Advancing Social Protection in the Western Balkans:Opportunities for Reform*April 2023Reforming social protection systems has become more important recently due to various global crises, drawing attention to this unfin-ished agenda in the Western Balkans.1 The six Western Balkan countries, Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Mac-edonia, and Serbia, need social protection2 more than ever. Millions of people in the region remain vulnerable to a range of well-known risks, with shocks and new sources of vulnerability exacerbating the urgency of reform. These countries are taking steps to improve their social pro-tection systems to make them fairer, more sustainable, more effective and better able to respond to people’s needs. However, progress is slow and uneven.Social protection systems across the Western Balkans are comprehen-sive and complex, spanning multiple objectives. To reduce poverty and vulnerability, reforms are necessary, and governments should focus on four main areas: (i) establishing strong foundations for social protection systems to better respond to crises; (ii) expanding coverage and effec-tiveness of poverty-targeted programs to improve inclusion and support for vulnerable populations; (iii) facilitating access to better employment opportunities and promoting labor market inclusion; and (iv) ensuring the financial sustainability of social protection programs for long-term effectiveness.Social Protection needed more than ever across the Western BalkansSocio-economic outcomes are still poor across the Western Balkan countries. The six Western Balkan countries face high levels of poverty and struggle with poor labor market outcomes. The share of the popula-tion living on less than $6.85 a day (2017 PPP), the international poverty line for Upper Middle Income countries, ranged from 12 percent in Serbia to 34 percent in Kosovo, compared to 4 percent in the seven small tran-sition countries of Eastern Europe that are already part of the EU (7STEE countries) and 2 percent in the EU as a whole (Figure 1).3 Only about one in two people of working-age are employed in the Western Balkans, ranging from a low of 31 percent in Kosovo to slightly above 60 per-cent in Serbia and Albania (Figure 1). The share of working-age women in employment averages 46 percent, reaching a dismal 16 percent among i* Please cite the work as follows: Brodmann, S., Coll-Black S., and von Lenthe, C. (2023). AdvancingSocial Protection in the Western Balkans: Opportunities for Reform. Washington DC: World Bank.1 This summary of the key issues on social protection are based on detailed social protection situational analyses for Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia, and Serbia.2 Social protection in this note includes social assistance, social services, social insurance, and employ-ment and labor market services and progra...
