In July, the leaders of Albania, North Macedonia and Serbia announcement that they would abolish border controls between their countries by 2023. This news could be a game-changer for businesses across the Balkans and would be particularly important for startups.
THE Open Balkans Initiative initially nicknamed the “mini-Schengen», aims to reproduce the Schengen area by making the movement of people, goods and capital free as in other European countries. Their plan is to eventually extend this initiative to the rest of the Balkans.
Of course, some criticize the initiative, warning that it could replace EU membership. This fear is not without reason, given that these three countries have been on the waiting list to join the EU for years. However, companies with limited access to the European market would greatly benefit from such an arrangement.
The co-founder of the Macedonia startup, Nina Nikolovich, shared for BalkanInsight that while individual markets in the Balkans have been good for testing services or products, Startup Macedonia has always encouraged its clients “to think globally and focus on other markets as well.”
“An initiative like Open Balkan is something that will accelerate the process of faster market validation in these countries. » Nikolich commented. “This will support collaboration between founders, organizations, investors and institutions.”
Before joining the EU
A unified Balkan market is nothing new. The idea dates back to 2019. However, for various reasons, the conquest of Kosovo, Montenegro and Bosnia and Herzegovina proved problematic. This is mainly because they want to join the EU, just like North Macedonia, Serbia and Albania.
People like Aleksandar Klashninovski, CEO of Brainster Next, consider Open Balkan an invaluable experience before joining the EU.
“This will give us access to a larger talent pool and greater sources of fundingwe can become an attractive investment zone for large foreign companies, etc. he said. “Even if the end goal remains the same – joining the EU and the European Economic Area – opening the Balkans would be very useful to all three countries on their path to the EU, as it would bring together the resources of three similar economies , with similar levels of economic development. development and similar challenges.
The vice president of the Bitcoin Association of Serbia, Arvin Kamberi, agrees and sees the benefits of the initiative.
“This agreement will introduce a common market of more than 10 million people, which will provide growth opportunities for the company.” Kamberi told BIRN in an email. “Later, large regional companies could be more competitive in global markets and better prepare for the 40 times larger open EU market. Regardless, companies should still invest more in personalized local content given that, even geographically close, the three regional markets remain quite different,” he said, citing language differences in particular.
Innovation Center
The initiative is supported by South Central Ventures, which primarily invests in technology startups in the region.
“First, it can increase interconnectivity and cooperation between teams and individuals (including the free movement of capital and labor) across these countries,” the company commented, citing Labbox as an example , based in Pristina, which supplies science, technology, engineering and mathematics games for children. »
“Recent developments in Croatia, such as the two unicorn companies Infobip and (Croatian carmaker) Rimac have had a ripple effect on Serbia with venture capital funds such as Accel Partners (based in the US), Earlybird (based in Berlin) and Point Nine (based in Berlin) investing directly in the preliminary stages. The Open Balkan initiative can help speed up the process and also put North Macedonia and Albania on the radar for these funds,” » said South Central Ventures.
Even though the initiative is in its early stages, they seek to make innovation in the region a top priority, said Kosta Petrov, general director of the North Macedonia State Fund for Innovation and technology development, FITD.
“The issues facing startups in the region are pretty much the same, and it is therefore better to work together to find the right solutions. » » said Petrov. “The idea is to engage and be able to use our instruments in a regional context, because for most startups the first markets are the national market and the regional market.”
Lack of confidence in initiative
Some remain skeptical about the potential benefits this initiative could bring to the region. Albanian entrepreneur Gerion Treska, commercial director of Almotech, says that due to corruption and lack of competitionthe only thing that will happen is that international companies will be reluctant to do business in the region.
“I do not believe that Open Balkan will have a major influence on the startup and business ecosystems of these countries,” Treska said. “Culturally speaking, when it comes to doing business, the focus is rarely on customer needs. We want to build things in the Balkans “for them”, because our people cannot use what we do and there are too many bureaucracies. This must change in order to prosper and grow as a market.
Treska says he has more faith in area entrepreneurs.
“I believe in the entrepreneurial future of the region, not because of politics but because one day, brilliant entrepreneurs will start to elevate the Balkans as an ecosystem made up of puzzle pieces that work together for a richer society and healthier”, he said.
Startup expert Ergest Nako shares Treska’s opinion.
He said “Better Initiatives from respective governments and donors should be implemented so that startups can better explore this new unified market. These initiatives must be coordinated, with the primary objective of helping the region, not individual countries,” Nako added. “If we opt for local initiatives, we will start to have countries that will benefit from advantages over others.”
And what about EU membership, with some countries – at least on paper – being closer than others?
“We also need to take into consideration what will happen if Serbia enters the EU before other countries? Will this agreement still be in force?» » asked Nako. “We are aware that not all Western Balkan countries are on the same path when it comes to European integration.”
