What is the most balanced budget for 2025 in the Western Balkans?

In the Balkans, the assessment of the most balanced national budget for 2025 in terms of sustainability, equity and efficiency includes examining how effectively each government addresses key challenges such as social inclusion, environmental sustainability and economic growth.

Based on recent developments, EU-supported initiatives play a critical role in shaping the budgets of several countries.
For example, EU financial support, including the Western Balkans Investment Framework and the Economic and Investment Plan, emphasizes the importance of the green transition, digital infrastructure and economic growth.
These plans, which aim to mobilise significant investments, include a focus on creating sustainable job opportunities and improving competitiveness.
Countries such as Albania and Serbia, according to these plans, are expected to invest in infrastructure, digital connectivity and innovation while also addressing social inequalities and youth employment.

However, these investments are often balanced by the challenge of maintaining fiscal stability. For example, Serbia’s 2025 budget includes strong allocations for infrastructure and energy, but its overall sustainability depends on effective governance and reducing fiscal deficits. Similarly, Kosovo’s focus remains on public sector growth and sustainable development, although it faces challenges in balancing efforts for social inclusion with fiscal constraints.

The most balanced budget is likely to be one that aligns investments in green technologies and economic growth with strong measures to address inequality, including targeted support for vulnerable populations. The EU’s investment plans, which encourage these aspects, are a good indicator of how governments are aligning their budgets for sustainable long-term growth. The balance, however, is delicate, requiring careful integration of these investment priorities with the need for sound fiscal governance.

In summary, while many Balkan countries are focusing on improving infrastructure, addressing environmental challenges, and increasing social equity, the success of these efforts will depend largely on their ability to effectively implement reforms. The European Union’s framework for supporting green growth and sustainable development in the region provides a key guide in assessing the strength of these budgets.

In the context of wealth distribution, sustainability, and efficiency for the 2025 budgets in the Balkans, Albania and Serbia appear to be making notable progress, although their approaches differ.

1. Albania: Albania’s 2025 budget prioritizes vulnerable groups, with a focus on welfare programs, but it also includes large investments in infrastructure and foreign direct investment to foster long-term economic sustainability. While the budget prioritizes green growth and EU alignment (with significant investments in infrastructure), challenges remain in effectively addressing wealth and poverty inequality. The budget includes environmental sustainability through initiatives such as green energy and digital infrastructure, but fiscal constraints may hinder the full realization of these goals.

2. Serbia: Serbia’s 2025 budget is more fiscally prudent, with a strong emphasis on economic stability and infrastructure development. It also aims to improve social services such as healthcare and education. The Serbian government is addressing sustainability through environmental policies and investments in green technologies, although there are concerns about the extent to which the government can ensure broad wealth distribution given higher levels of public sector spending and the slower pace of reforming social protection systems.

3. Kosovo: Kosovo’s budget, while aiming to foster sustainable growth with an emphasis on green energy and digital transformation, struggles with budgetary efficiency due to limited implementation capacity and political instability. Kosovo’s budget emphasizes poverty reduction, strengthening public services, and improving human capital through increased investment in health, education, and social protection. However, challenges remain in implementing a comprehensive social protection system that can fully support the most vulnerable populations. In addition, Kosovo’s plans align with the broader United Nations Sustainable Development Cooperation Framework, focusing on gender equality, economic growth, and sustainable energy, but its capacity to address these goals in a sustainable manner is still developing.

4. North Macedonia is working towards fiscal improvements as part of its 2025 budget planning. The government aims to reduce the budget deficit to around 3% of GDP, in line with its updated fiscal rules. This is a gradual reduction from the 2023 deficit, which stood at around 4.9% of GDP. Efforts include implementing tax policy reforms, curbing subsidies, and increasing revenue collection.

Despite these measures, challenges remain. Public debt is expected to be above 50% of GDP, driven by infrastructure investment and borrowing needs for projects such as Road Corridors VIII and X. Risks include potential cost overruns on public projects and rising borrowing costs, particularly with the payment of the Eurobond obligation due in 2025.

Efforts to distribute welfare are present, but may not adequately reach the most vulnerable, limiting the effectiveness of its social programs.

In conclusion, Albania appears to offer the most balanced approach, with a stronger focus on inclusive development and green sustainability—although its ability to fully meet these ambitions depends on the efficiency of its implementation and fiscal resources.
The success of these budgets will ultimately depend on their implementation and the ability to attract sufficient investment to meet the ambitious sustainability objectives.