Western Balkans countries need reforms and faster green transition
19/10/2025
On the final day of the visit to Washington, D. C., Governor Irena Radović participated in a working breakfast organised by the European Department of the International Monetary Fund (IMF) and led by its Director, Alfred Kammer. The Regional Economic Outlook (REO) report for Europe titled “Overcoming Europe’s Policy Drift: from Recognition to Action” was presented at the event.
The meeting featured the latest projections for global and European economic growth, indicating that countries in Central, Eastern, and Southeastern Europe (CESEE), including the Western Balkans, are expected to experience moderate growth in the medium term, with a gradual decline in inflation. However, persistent risks remain due to global trade tensions and geopolitical uncertainties.
It was emphasized that the region’s convergence toward the European Union calls for efficient implementation of structural reforms and investment in infrastructure, energy transition, and the digital economy. Special attention was given to the need to maintain fiscal discipline, strengthen financial buffers, and remove regulatory barriers to private sector growth.
During the discussion, it was particularly highlighted that preserving the independence of central banks is a key prerequisite for stability and trust in the financial system. Participants pointed out that lessons from the 1970s demonstrate how the loss of monetary discipline and interference with central banks can lead to prolonged macroeconomic instability. It was concluded that countries in the region should continue strengthening the institutional capacity and independence of their central banks in order to avoid similar mistakes and preserve the stability of financial flows.
The event also announced an upcoming IMF regional workshop for the Western Balkans, Moldova, and Ukraine, scheduled for late October in Vienna. The workshop will focus on improving financial regulation, supervision, and payment systems.
Later in the day, Governor Radović met with Ulrik Nødgaard, Governor of the National Bank of Denmark, the country that is currently holding the Presidency of the Council of the European Union. The conversation focused on strengthening bilateral cooperation between the two central banks, with a particular focus on sharing experience in payment system interoperability and technical solutions enabling the connection of different currencies and markets, including the Denmark`s National Bank`s experience in integrating the Swedish krona (SEK) into the T2 and TIPS platforms. Particular attention was given to the Central Bank of Montenegro’s plans for implementing the TIPS Clone project and potential future cooperation in the area of infrastructure for instant payments and cross-border interoperability.