FLASH
Shkruar nga Klodian Tomorri
The Growth Plan for the Western Balkans has turned into a propaganda televsion, broadcasting precisely the same episode every time the Brussels bureaucrats and autocratic leaders of the region need it. That of 6 billion euros and the doubling of the economies of the Western Balkans.
"Through the new Growth Plan, the EU will provide 6 billion euros to the countries of the Western Balkans in the next 4 years. This plan will enable the doubling of the GDP of 6 countries in the region within a decade," repeated today in Tirana, Commissioner for Neighborhood and Enlargement, Olivér Várhelyi.
In fact, since it was announced in November last year by Ursula Von Der Leyen, the Growth Plan for the Western Balkans has turned into a propaganda televsion, broadcasting precisely the same episode whenever Brussels bureaucrats and autocratic leaders need it. of the region. That of 6 billion euros and the doubling of the economies of the Western Balkans.
This time, Várhelyi also explained to the citizens what this plan means specifically. "This means that the countries, which today have 30 percent of the level of development of the EU, after 10 years will have reached 60 percent, while those that currently have 50 percent of the development of the EU after In 10 years, they will have reached 100 percent of the EU's income," he clarified.
First absolute doubling and relative doubling are two very different concepts. For the Balkan countries to double their income level in relation to the EU average, their economies must double, while the economy of the EU countries remains stagnant for 10 years. But Várhely's mathematical blunders are not the biggest mockery of the Growth Plan. She is another.
In the last 12 years, Albania's income in relation to the European Union has converged by 5 percentage points. In 2010, Albania's average income was 29 percent of the European Union, while in 2022 the figure reached 34 percent. According to Várhely, the Growth Plan will make it possible for Albania's income to converge by 34 percentage points over the next 10 years, i.e. 7 times faster than the previous decade. This is thanks to reforms and 6 billion euros from the EU. Now let's look at the numbers.
The Gross Domestic Product of the 6 countries of the Western Balkans taken together is about 150 billion euros. The European Union says it will disburse 6 billion euros in the next 4 years, or an average of 1.5 billion euros per year for the six countries. In short, 1 percent of the Gross Domestic Product. The question is, can the much-hyped injection of 1.5 billion euros or 1 percent of GDP double the region's GDPs?
John Maynard Keynes, the man who invented stimulus theory, argued that at best the fiscal multiplier goes up to 4. So 1 percent government spending generates 4 percent economic growth. However, this is a much debated conclusion. Economists on the other side, those closer to the right line, think that the fiscal multiplier is even smaller than 1. But this is a long and ideological debate.
For the citizens of the Western Balkans, the essence is this. The convergence process of the region's economies has stalled. The main reason is corruption and mismanagement, which stifle competition, misallocate resources and strike at the heart of the mechanism that creates economic growth and prosperity.
This is the real problem, which cannot be solved either by contrived propaganda summits or by handouts trumpeted as gigantic financial packages. They just do the opposite. They nurture autocratic leaders and the mechanism by which they have made the rotation of power impossible.
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