European Stability Initiative - ESI - 21 October 2017, 10:34
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Shopping centre Novi Vek in Leskovac, Serbia. Photo: ESI

Shopping centre Novi Vek in Leskovac, Serbia. Photo: ESI

The cost of Non-Europe

January 2007

ESI has often written about the positive effects of enlargement and European integration but what happens if there is no stabilization process, let alone accession process and no credible perspective of joining the EU any time soon? In January 2007, ESI published a paper analysing the reasons for and the consequences of such a scenario in Serbia.

It is a story about the economic decline and social crisis of a formerly proud textile town well-placed on the edge of the largest market for clothes and textiles in the world (the EU), but unable to take advantage of it. It is also a story about the costs of non-Europe in the Balkans. The town is Leskovac; and the key policy question we ask is how it is possible that all of Serbia's neighbours are winners in the global restructuring of the textile and clothing industry, while Serbia is a looser.

At the heart of this short paper is also a comparion betweeen Leskovac and a similar town in the Maceonia, Stip. This comparison shows how much Serbia's isolation from the EU in the 1990s, followed by slow progress in European integration and delays in completing its transition, have cost in terms of employment. Comparing Leskovac with the city of Stip suggests that there could easily be 10,000 jobs more in Leskovac today than there are. This in turn would have improved the economic position of households and would have helped close the prosperity gap with other regions of Serbia. If Serbia would have followed Bulgaria in the period since 1997 it would have today 100,000 additional jobs in the textile and clothing sector alone.

The last decade was lost. One cannot change the past. The challenge now is to take a look at the success of others in the region, and to translate this in practical policy.

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21 October 2017, 10:34