Competitiveness in South East Europe 2021 A Policy Outlook

Description

Preface Acknowledgements Table of contents Abbreviations and acronyms Executive summary Key achievements Key priorities 1 Economic context Key economic features Sustainable development Structural economic challenges Weak knowledge and skills hinder economic diversification and upgrading A challenging business climate undermines investment and private sector development Infrastructure deficiencies undermine investment, trade and GVC integration Poor access to finance hinders SME investment, innovation and technology adoption Cross-cutting and sector-specific constraints undermine the growth of key sectors Weak management of public finances holds back long-term development Environmental degradation threatens long-term development and well-being Inequality remains an important challenge Covid-19 has exacerbated structural challenges EU accession process EU financial and development support References Notes 2 Assessment methodology and process Introduction Scope Methodology The overall assessment approach Qualitative indicators Quantitative indicators The assessment process The participatory nature of the Competitiveness Outlook 2021 assessment process The strengths and limitations of the Competitiveness Outlook 2021 References 3 Overview of key findings Key findings by dimension Dimension 1: Investment policy and promotion Dimension 2: Trade policy Dimension 3: Access to finance Dimension 4: Tax policy Dimension 5: Competition policy Dimension 6: State-owned enterprises Dimension 7: Education policy Dimension 8: Employment policy Dimension 9: Science, technology and innovation Dimension 10: Digital society Dimension 11: Transport policy Dimension 12: Energy policy Dimension 13: Environment policy Dimension 14: Agriculture policy Dimension 15: Tourism policy Dimension 16: Anti-corruption policy Notes Part I Assessment findings by policy dimension Part I. Assessmentfindings by policydimension 4 Investment policy and promotion (Dimension 1) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Investment policy and promotion performance and context in the WB6 Investment policy (Sub-dimension 1.1) Frameworks for investment are sound; legislation could be more transparent and predictable Exceptions to national treatment remain low in the WB6 Investor protection against expropriation has been bolstered Enforcing contracts and settling disputes remain challenging Alternative dispute mechanisms should be further reinforced Intellectual property rights laws are in place, but enforcement is a challenge The way forward for investment policy Investment promotion and facilitation (Sub-dimension 1.2) Institutional frameworks and strategies for investment promotion and facilitation are solid Investment facilitation could benefit from more IPA involvement Proactive investor targeting is progressively being adopted Investor incentives in WB6 economies are driving a “race to the bottom” Aftercare services are more focused on policy advocacy The way forward for investment promotion and facilitation Investment for green growth (Sub-dimension 1.3) Green investment frameworks and initiatives are generally in the early stages Frameworks for public and private partnerships for green growth are improving The way forward for green investment Conclusion References Notes 5 Trade policy (Dimension 2) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Trade policy dimension performance and context in the WB6 Trade policy framework (Sub-dimension 2.1) Institutional co-ordination has been strengthened Public-private consultations are required in all economies, but implementation varies The network of free trade agreements integrates the WB6 with their main trade partners but less into global trade Trade facilitation has seen significant progress The way forward for the trade policy framework Services trade restrictiveness (Sub-dimension 2.2) The WB6 economies continue to lower regulatory restrictiveness in their service sectors General business regulations and barriers to the movement of people undermine openness Specific services sectors still have restrictions affecting trade Transport and distribution supply chain Market bridging and supporting services Physical infrastructure services Digital network The way forward for services trade restrictiveness E-commerce and digitally enabled services (Sub-dimension 2.3) E-commerce policy frameworks are in place in all of the WB6 economies Digital STRI scores reveal low levels of restrictiveness The way forward for e-commerce and digitally enabled services Conclusion References Notes 6 Access to finance (Dimension 3) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Access to finance performance and context in the WB6 Access to bank finance (Sub-dimension 3.1) The WB6 are aligning banking industry regulatory frameworks with Basel III requirements There has been progress in increasing public accessibility to asset registers There has been progress in increasing public and/or private credit information coverage Collateral requirements remain high, and few firms use movable assets as collateral WB6 economies enhanced their credit guarantee schemes in response to COVID-19 The way forward for access to bank finance Access to alternative financing sources (Sub-dimension 3.2) Despite legislative improvements, factoring and leasing services remain underused Most WB6 economies lack dedicated regulatory frameworks for private equity and venture capital Business angel networks are increasingly being used in WB6 economies Several WB6 economies are developing laws and programmes to regulate crowdfunding Initial coin offerings are nascent, with few economies regulating crypto-assets The way forward for access to alternative financing sources Mobilisation of long-term financing (Sub-dimension 3.3) There are legal frameworks for public-private partnerships, but they are rarely used Dedicated legal frameworks covering institutional investors exist, but the investment base is underdeveloped Open active stock markets, when in place, make limited contributions to the economy Initial public offerings are underused as a way of raising capital for the private sector WB6 economies have markets of bonds, but they are shallow and illiquid The way forward for the mobilisation of long-term financing Conclusion References Notes 7 Tax policy (Dimension 4) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Tax policy performance and context in the WB6 Tax policy framework (Sub-dimension 4.1) WB6 economies provide an investment friendly environment with low CIT rates and generous investment incentives, which come at a certain revenue cost Tax revenues are based on social security contributions and taxes on goods and services The WB6 economies have strengthened their use of micro-simulation models to assess the distributive effects of tax reforms on their economy Tax expenditures are not reported in a regular and systematic way across the region The way forward for the tax policy framework Tax administration (Sub-dimension 4.2) Functions and organisation of the tax administration have changed little overall Tax compliance assessments follow a risk-based approach Tax administrations are increasingly transparent but still lack independence WB6 economies have improved their taxpayer services since the last report The way forward for tax administration International co-operation (Sub-dimension 4.3) Involvement with international tax initiatives and alignment with international tax trends are increasing Digital taxation is improving but can still be strengthened Regional co-operation and co-ordination are modest The way forward for international co-operation Conclusion References Notes 8 Competition policy (Dimension 5) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Competition policy performance and context in the WB6 Scope of action (Policy area 5.1) Powers to investigate and sanction are adequate, but professional and financial resources are limited The way forward for scope of action Anti-competitive behaviour and implementation (Policy areas 5.2 and 5.5) Enforcement and sanctions for horizontal and vertical agreements and exclusionary conduct are limited The effectiveness of leniency programmes and the use of unannounced inspections should be enhanced There has been little activity regarding merger reviews across the region The way forward for anti-competitive behaviour and implementation Probity of investigation (Policy area 5.3) WB6 competition authorities are independent, but can be subject to political influence WB6 competition authorities are accountable before parliament Procedural fairness performance is generally good across the region The way forward for probity of investigation Advocacy (Policy area 5.4) WB6 competition authorities are engaged in promoting competition The way forward for advocacy Conclusion References Annex 8.A. Competition Questionnaire 9 State-owned enterprises (Dimension 6) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework State-owned enterprise performance and context in the WB6 External assessments point to the frequent underperformance of SOEs The efficient operation of SOEs is vital for economic competitiveness in the WB region Efficiency and performance through improved governance (Sub-dimension 6.1) Ownership policies and rationales are still unclear Efforts to professionalise state ownership are similarly limited in the region Despite progress on board nomination frameworks, the process is seen as lacking transparency There has been limited progress in promoting independent and professional boards The way forward for efficiency and performance through improved governance Transparency and accountability practices (Sub-dimension 6.2) Financial reporting standards are sound, but non-financial reporting could be strengthened Financial auditing practices are mostly supported by sound basic legislation Protection of SOEs’ minority shareholders could be improved Accountability to the general public could be significantly strengthened The way forward for transparency and accountability practices Ensuring a level playing field (Sub-dimension 6.3) Most SOEs in WB6 economies are incorporated under company law Most SOEs access at least some financing on the commercial marketplace The way forward for ensuring a level playing field Reforming and privatising state-owned enterprises (Sub-dimension 6.4) SOE reforms have been limited in the region Small-scale privatisation efforts are continuing in some WB6 economies The way forward for reforming and privatising SOEs Conclusion References Notes 10 Education policy (Dimension 7) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Education performance and context in the WB6 Early childhood and school education (Sub-dimension 7.1) The WB6 economies have strengthened their early childhood education policies Policies and measures to improve instructional systems vary widely across the region Early school leaving rates have fallen across the region The way forward for early childhood and school education Teachers (Sub-dimension 7.2) Entry and accreditation standards for initial teacher education could be strengthened Almost all the WB6 economies have made strong progress in improving professional development opportunities for teachers The way forward for teachers Vocational education and training (Sub-dimension 7.3) The WB6 economies have strengthened their VET policy frameworks but inequalities with general education remain high All of the WB6 economies are developing work-based learning policies The way forward for vocational education and training Tertiary education (Sub-dimension 7.4) Access to higher education remains highly inequitable in the WB6 economies All the WB6 economies have taken steps to improve the market relevance of their tertiary education systems The way forward for tertiary education System governance (cross-cutting sub-dimension) The way forward for system governance Conclusion References Notes 11 Employment policy (Dimension 8) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Employment performance and context in the WB6 Labour market governance (Sub-dimension 8.1) Regulatory frameworks have improved but full implementation is challenging Little progress has been made in reducing informal employment Labour inspectorates lack the resources needed to regulate effectively Employment policy frameworks are becoming more comprehensive The frameworks are in place for tripartism and social dialogue but partners lack capacity The way forward for labour market governance Skills (Sub-dimension 8.2) Skills gaps and mismatches are being identified but more efforts are needed to resolve them Adult learning will be key to closing skills gaps and increasing competitiveness The way forward for skills Job quality (Sub-dimension 8.3) Despite mechanisms to set minimum wages, average wages and low labour productivity remain key challenges Women’s economic activity has increased substantially, but the gender employment gap remains wide The way forward for quality jobs Activation policies (Sub-dimension 8.4) The governance and service delivery of public employment services have improved, but they remain under-resourced Jobseekers have mutual obligations for receiving benefits although monitoring is limited Active labour market programmes are very under-resourced The way forward for activation policies Conclusion References Notes 12 Science, technology and innovation (Dimension 9) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Science, technology and innovation performance and context in the WB6 STI system (Sub-dimension 9.1) STI policy frameworks are comprehensive and strategic in most economies, but implementation varies The institutional framework for STI policy implementation varies significantly across the region Legal and regulatory frameworks are mostly in place, but could be better enforced The region is well connected with international networks, and regional integration is gaining momentum Alignment with EU STI policies remains a priority for all six economies The way forward for the STI system Public research system (Sub-dimension 9.2) Institutional structures are moving towards public research quality assurance Public research remains chronically underfunded Human resources in R&D are increasingly lost through brain drain The way forward for the public research system Business-academia collaboration (Sub-dimension 9.3) The collaboration framework is weak, and academic research is rarely linked to business needs Financial incentives for collaboration are mostly limited in scope, size and predictability Non-financial incentives for collaboration remain scattered An institutional support structure is emerging, but focuses on start-ups The way forward for business-academia collaboration Conclusion References Notes 13 Digital society (Dimension 10) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Digital society performance and context in the WB6 Access (Sub-dimension 10.1) Broadband infrastructure development is supported by plans to invest in rural area networks The ICT regulatory policy framework is coming into line with the EU Electronic Communications Code Implementation of data accessibility frameworks is in the initial phase The way forward for access Use (Sub-dimension 10.2) Digital government is transforming public sector services in the region Private sector adoption is not well supported in the majority of WB6 economies The way forward for use Jobs (Sub-dimension 10.3) Students’ digital skills are hindered by insufficient connectivity and equipment The adult digital skills gap persists, constraining the rise of the digital economy ICT sector support is not effective The way forward for jobs Society (Sub-dimension 10.4) Digital inclusion is not systematically reviewed The way forward for society Trust (Sub-dimension 10.5) Privacy and data protection frameworks are not sufficiently enforced Consumers have limited opportunities to learn about their rights in e-commerce Digital security risk management is slowly coming into line with the EU cybersecurity framework The way forward for trust Conclusion References Notes 14 Transport policy (Dimension 11) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Transport policy performance and context in the WB6 Planning (Sub-dimension 11.1) Transport visions could be updated and monitored more systematically Transport project selection could be more transparent Implementation and procurement lack a systematic approach Transport infrastructure asset management is in the early stages of development The way forward for planning Governance and regulation (Sub-dimension 11.2) Rail regulation is gradually opening markets Aviation regulatory reforms could be accelerated to match growth in the sector Road market regulation continues to be harmonised IWW and maritime market regulation is in the early stages The way forward for governance and regulation Sustainability (Sub-dimension 11.3) Road safety strategy updates are held back by resource constraints Environmental strategies for transport are underdeveloped Combined transport is still not prioritised The way forward for sustainability Conclusion References Notes 15 Energy policy (Dimension 12) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Energy performance and context in the WB6 Governance and regulation (Sub-dimension 12.1) Energy policy and legislative frameworks are progressing well and should now be fully implemented Energy regulators could be more independent financially and politically Infrastructure management is outdated The way forward for governance and regulation Security of energy supply (Sub-dimension 12.2) The natural gas supply framework exposes the WB6 to single-supplier and supply-route risks The electricity supply framework is well-advanced but over-reliant on coal Renewable energy policy has scope to move beyond hydro generation Energy efficiency is still in its early stages in the WB6 The way forward for security of energy supply Energy markets (Sub-dimension 12.3) Energy markets are moving towards international good practice Unbundling and third-party access are also approaching international good practice Regional market integration is making slower progress The way forward for energy markets Energy incentives and subsidies (cross-cutting sub-dimension) Significant levels of subsidisation across the WB6 are distorting the market The way forward for energy incentives Conclusion References Notes 16 Environment policy (Dimension 13) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Environment policy performance and context in the WB6 Resource productivity (Sub-dimension 13.1) Climate change adaptation legal and policy frameworks are gradually being introduced Circular economy frameworks remain underdeveloped in the region Municipal solid waste strategies are in place and starting to be implemented The way forward for resource productivity Natural asset base (Sub-dimension 13.2) Freshwater management frameworks are hampered by poor co-ordination Biodiversity and forestry frameworks are in place but laws are not properly enforced and inventories are mostly lacking Land-use frameworks could be more coherent and better developed The way forward for the natural asset base Environmental quality of life (Sub-dimension 13.3) Air pollution levels remain high, but action is being taken Water supply and sanitation strategies are in place but need sustainable funding Industrial waste management frameworks could be strengthened further The way forward for environmental quality of life Conclusion References Notes 17 Agriculture policy (Dimension 14) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Agricultural policy performance and context in the WB6 Agro-food system capacity (Sub-dimension 14.1) A rural infrastructure policy framework is in place in all six economies Investment in irrigation is increasing but policy progress is limited Agricultural education systems are not providing the skills the sector needs The way forward for agro-food system capacity Agro-food system regulation (Sub-dimension 14.2) Natural resource regulations are hampered by limited land information systems Product regulations are harmonised with the EU, but better management of fertilisers and pesticides is needed The way forward for agro-food system regulation Agricultural support system (Sub-dimension 14.3) Agriculture policy frameworks are fairly well harmonised with EU policies Domestic producer support instruments are in line with IPARD, but the criteria are not harmonised Trade policies follow EU principles, but tariff and non-tariff barriers remain significant in some economies Farmers enjoy a highly preferential agricultural tax regime Sanitary and phytosanitary frameworks partly comply with EU and international standards The way forward for the agricultural support system Agricultural innovation system (Sub-dimension 14.4) Research and innovation policy is underfinanced and limited in all economies Agriculture extension services lack human and financial resources The way forward for the agricultural innovation system Conclusion References Notes 18 Tourism policy (Dimension 15) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Tourism policy performance and context in the WB6 Governance and co-operation (Sub-dimension 15.1) Tourism governance still needs improving to implement policy measures effectively Public-private co-operation and dialogue is formally established, but not monitored or evaluated Municipalities need systematic government support to develop tourism effectively Data collection has improved, but data need to be more reliable The way forward for governance and co-operation Destination accessibility and tourism infrastructure (Sub-dimension 15.2) Easing border crossings is a key challenge for improving destination connectivity Accommodation quality has improved, but there is insufficient monitoring and control Tourism information systems require better management and co-ordination, and regular monitoring and evaluation The way forward for destination accessibility and tourist infrastructure Availability of a qualified workforce (Sub-dimension 15.3) Skills supply frameworks need improving to meet the needs of the tourism industry Most economies have made good progress in developing a VET tourism framework The higher education framework for tourism still needs considerable improvement The way forward for a qualified workforce Sustainable and competitive tourism (Sub-dimension 15.4) Natural and cultural enhancement frameworks need further development Comprehensive policy frameworks to promote sustainable tourism development need strengthening Most economies have developed a tourism investment policy framework, but not an innovation framework The way forward for sustainable and competitive tourism Tourism branding and marketing (Sub-dimension 15.5) Despite significant progress, tourism marketing and branding remain a challenge Digital tourism marketing frameworks are in the early stages of development The way forward for tourism branding and marketing Conclusion References Notes 19 Anti-corruption policy (Dimension 16) Comparison with the 2018 assessment Implementation of the Competitiveness Outlook 2018 recommendations Introduction Assessment framework Structure Key methodological changes to the assessment framework Anti-corruption policy performance and context in the WB6 Anti-corruption policy framework (Sub-dimension 16.1) Corruption risk assessments are carried out in most economies but their quality and impact are disputed Systematic and comprehensive corruption proofing of all relevant legislation has not been established in any WB6 economy All the economies have anti-corruption policies, drawn up in consultation with civil society The way forward for anti-corruption policy framework Prevention of corruption (Sub-dimension 16.2) All the WB6 economies conduct awareness-raising activities Corruption prevention bodies enjoy varying degrees of independence and resources across the WB6 economies The legal frameworks and oversight bodies needed to manage conflicts of interest are mostly in place Asset and interest disclosure requirements apply to most high/mid-level public officials, but verification remains a problem Protection of whistle-blowers has been strengthened but still does not meet international standards The way forward for prevention of corruption Independence of the judiciary (Sub-dimension 16.3) Despite recent progress, none of the WB6 economies have yet achieved firm and sustainable judicial independence The way forward for independence of the judiciary Business integrity and corporate liability (Sub-dimension 16.4) There are few business integrity requirements on companies but disclosure of beneficial owners is being introduced The main elements of liability of legal persons are in place but evidence of enforcement is scarce The way forward for business integrity and corporate liability Investigation and prosecution (Sub-dimension 16.5) The WB6 economies have specialised anti-corruption investigative and prosecutorial units and bodies with varying degrees of independence and capacity Several WB6 economies have intensified the investigation and prosecution of high-level corruption, but the numbers of final convictions are generally low The way forward for investigation and prosecution Conclusion References Part II Competitiveness Outlook assessment: Western Balkan profiles Part II. Competitiveness Outlook assessment: Western Balkan profiles 20 Albania profile Economic context Key economic features Sustainable development Structural economic challenges Weak knowledge and skills hinder economic diversification and upgrading A challenging business climate undermines investment and private sector development Infrastructure deficiencies undermine investment, trade and GVC integration Poor access to finance hinders SME investment, innovation and technology adoption Cross-cutting and sector-specific constraints undermine the growth of key sectors Weak management of public finances holds back long-term development Environmental degradation threatens long-term development and well-being Inequality remains an important challenge COVID-19 has exacerbated structural challenges EU accession process EU financial and development support Scope and methods Process Scoring approach Exceptions Investment policy and promotion (Dimension 1) Introduction State of play and key developments Sub-dimension 1.1: Investment policy framework Sub-dimension 1.2: Investment promotion and facilitation Sub-dimension 1.3: Investment for green growth The way forward for investment policy and promotion Trade policy (Dimension 2) Introduction State of play and key developments Sub-dimension 2.1: Trade policy framework Sub-dimension 2.2: Services trade restrictiveness Cumbersome horizontal measures affect firms’ ability to operate How restrictive are individual services sectors? Sub-dimension 2.3: E-commerce and digitally enabled services The way forward for trade policy Access to finance (Dimension 3) Introduction State of play and key developments Sub-dimension 3.1: Access to bank finance Sub-dimension 3.2: Access to alternative financing sources Sub-dimension 3.3: Mobilisation of long-term financing The way forward for access to finance Tax policy (Dimension 4) Introduction State of play and key developments Sub-dimension 4.1: Tax policy framework Sub-dimension 4.2: Tax administration Sub-dimension 4.3: International co-operation The way forward for tax policy Competition policy (Dimension 5) Introduction State of play and key developments Sub-dimension 5.1: Scope of action Sub-dimensions 5.2 and 5.5: Anti-competitive behaviour and implementation Sub-dimension 5.3: Probity of investigation Sub-dimension 5.4: Advocacy The way forward for competition policy State-owned enterprises (Dimension 6) Introduction State of play and key developments Sub-dimension 6.1: Efficiency and performance through improved governance Sub-dimension 6.2: Transparency and accountability practices Sub-dimension 6.3: Ensuring a level playing field Sub-dimension 6.4: Reforming and privatising state-owned enterprises The way forward for state-owned enterprises Education policy (Dimension 7) Introduction State of play and key developments Sub-dimension 7.1: Early childhood and school education Sub-dimension 7.2: Teachers Sub-dimension 7.3: Vocational education and training Sub-dimension 7.4: Tertiary education Cross-cutting dimension: System governance The way forward for education policy Employment policy (Dimension 8) Introduction State of play and key developments Sub-dimension 8.1: Labour market governance Sub-dimension 8.2: Skills Sub-dimension 8.3: Job quality Sub-dimension 8.4: Activation policies Cross-cutting sub-dimension: Informality Cross-cutting sub-dimension: Brain drain The way forward for employment policy Science, technology and innovation (Dimension 9) Introduction State of play and key developments Sub-dimension 9.1: STI system Sub-dimension 9.2: Public research system Sub-dimension 9.3: Business-academia collaboration The way forward for science, technology and innovation Digital society (Dimension 10) Introduction State of play and key developments Sub-dimension 10.1: Access Sub-dimension 10.2: Use Sub-dimension 10.3: Jobs Sub-dimension 10.4: Society Sub-dimension 10.5: Trust The way forward for digital society Transport policy (Dimension 11) Introduction State of play and key developments Sub-dimension 11.1: Planning Sub-dimension 11.2: Governance and regulation Sub-dimension 11.3: Sustainability The way forward for transport policy Energy policy (Dimension 12) Introduction State of play and key developments Sub-dimension 12.1: Governance and regulation Sub-dimension 12.2: Security of energy supply Sub-dimension 12.3: Energy markets Cross-cutting dimension: Energy incentives – direct and indirect subsidies in the energy sector The way forward for energy policy Environment policy (Dimension 13) Introduction State of play and key developments Sub-dimension 13.1: Resource productivity Sub-dimension 13.2: Natural asset base Sub-dimension 13.3: Environmental quality of life The way forward for environment policy Agriculture policy (Dimension 14) Introduction State of play and key developments Sub-dimension 14.1: Agro-food system capacity Sub-dimension 14.2: Agro-food system regulation Sub-dimension 14.3: Agricultural support system Sub-dimension 14.4: Agricultural innovation system The way forward for agriculture policy Tourism policy (Dimension 15) Introduction State of play and key developments Sub-dimension 15.1: Governance and co-operation Sub-dimension 15.2: Destination accessibility and tourism infrastructure Sub-dimension 15.3: Availability of a qualified workforce Sub-dimension 15.4: Sustainable and competitive tourism Sub-dimension 15.5: Tourism branding and marketing The way forward for tourism policy Anti-corruption policy (Dimension 16) Introduction State of play and key developments Sub-dimension 16.1: Anti-corruption policy framework Sub-dimension 16.2: Prevention of corruption Sub-dimension 16.3: Independence of the judiciary Sub-dimension 16.4: Business integrity and corporate liability Sub-dimension 16.5: Investigation and prosecution The way forward for anti-corruption policy References Notes 21 Bosnia and Herzegovina profile Economic context Key economic features Sustainable development Structural economic challenges Better skills are needed to foster economic upgrading and a competitive export-oriented economy The fragmented market and complex business environment undermine investment and increase the costs of doing business Transport infrastructure deficiencies undermine investment, trade and GVC integration Cross-cutting and sector-specific constraints undermine the growth of key sectors The well-being of current and future generations is strongly impacted by environmental factors More inclusive growth is needed to improve the well-being of all citizens COVID-19 has exacerbated structural challenges EU accession process EU financial and development support Scope and methods Process Scoring approach Exceptions Investment policy and promotion (Dimension 1) Introduction State of play and key developments Sub-dimension 1.1: Investment policy framework Sub-dimension 1.2: Investment promotion and facilitation Sub-dimension 1.3: Investment for green growth The way forward for investment policy and promotion Trade policy (Dimension 2) Introduction State of play and key developments Sub-dimension 2.1: Trade policy framework Sub-dimension 2.2: Services trade restrictiveness General business regulations affect firms’ ability to operate in Bosnia and Herzegovina There are several restrictions in specific services sectors Sub-dimension 2.3: E-commerce and digitally enabled services The way forward for trade policy Access to finance (Dimension 3) Introduction State of play and key developments Sub-dimension 3.1: Access to bank finance Sub-dimension 3.2: Access to alternative financing sources Sub-dimension 3.3: Mobilisation of long-term financing The way forward for access to finance Tax policy (Dimension 4) Introduction State of play and key developments Sub-dimension 4.1: Tax policy framework Sub-dimension 4.2 Tax administration Sub-dimension 4.3: International co-operation The way forward for tax policy Competition policy (Dimension 5) Introduction State of play and key developments Sub-dimension 5.1: Scope of action Sub-dimensions 5.2 and 5.5: Anti-competitive behaviour and implementation Sub-dimension 5.3: Probity of investigation Sub-dimension 5.4: Advocacy The way forward for competition policy State-owned enterprises (Dimension 6) Introduction State of play and key developments Sub-dimension 6.1: Efficiency and performance through improved governance Sub-dimension 6.2: Transparency and accountability practices Sub-dimension 6.3: Ensuring a level playing field Sub-dimension 6.4: Reforming and privatising state-owned enterprises The way forward for state-owned enterprises Education policy (Dimension 7) Introduction State of play and key developments Sub-dimension 7.1: Early childhood and school education Sub-dimension 7.2: Teachers Sub-dimension 7.3: Vocational education and training Sub-dimension 7.4: Tertiary education Cross-cutting dimension: System governance The way forward for education policy Employment policy (Dimension 8) Introduction State of play and key developments Sub-dimension 8.1: Labour market governance Sub-dimension 8.2: Skills Sub-dimension 8.3: Job quality Sub-dimension 8.4: Activation policies Cross-cutting policy areas: Informality Cross-cutting policy areas: Brain drain The way forward for employment policy Science, technology and innovation (Dimension 9) Introduction State of play and key developments Sub-dimension 9.1: STI system Sub-dimension 9.2: Public research system Sub-dimension 9.3: Business-academia collaboration The way forward for science, technology and innovation Digital society (Dimension 10) Introduction State of play and key developments Sub-dimension 10.1: Access Sub-dimension 10.2: Use Sub-dimension 10.3: Jobs Sub-dimension 10.4: Society Sub-dimension 10.5: Trust The way forward for digital society Transport policy (Dimension 11) Introduction State of play and key developments Sub-dimension 11.1: Planning Sub-dimension 11.2: Governance and regulation Sub-dimension 11.3: Sustainability The way forward for transport policy Energy policy (Dimension 12) Introduction State of play and key developments Sub-dimension 12.1: Governance and regulation Sub-dimension 12.2: Security of energy supply Sub-dimension 12.3: Energy markets Cross-cutting policy area: Energy incentives – direct and indirect subsidies in the energy sector The way forward for energy policy Environment policy (Dimension 13) Introduction State of play and key developments Sub-dimension 13.1: Resource productivity Sub-dimension 13.2: Natural asset base Sub-dimension 13.3: Environmental quality of life The way forward for environment policy Agriculture policy (Dimension 14) Introduction State of play and key developments Sub-dimension 14.1: Agro-food system capacity Sub-Dimension 14.2: Agro-food system regulation Sub-dimension 14.3: Agricultural support system Sub-dimension 14.4: Agricultural innovation system The way forward for agriculture policy Tourism policy (Dimension 15) Introduction State of play and key developments Sub-dimension 15.1: Governance and co-operation Sub-dimension 15.2: Destination accessibility and tourism infrastructure Sub-dimension 15.3: Availability of a qualified workforce Sub-dimension 15.4: Sustainable and competitive tourism Sub-dimension 15.5: Tourism branding and marketing The way forward for tourism policy Anti-corruption policy (Dimension 16) Introduction State of play and key developments Sub-dimension 16.1: Anti-corruption policy framework Sub-dimension 16.2: Prevention of corruption Sub-dimension 16.3: Independence of the judiciary Sub-dimension 16.4: Business integrity and corporate liability Sub-dimension 16.5: Investigation and prosecution The way forward for anti-corruption policy References Notes 22 Kosovo profile Economic context Key economic features Sustainable development Structural economic challenges Weak human capital reduces the scope for profiting from the demographic dividend A poor business environment hampers private sector development and investment Infrastructure deficiencies undermine investment, trade and GVC integration Cross-cutting and sector-specific constraints undermine the growth of key sectors Poor public finance management undermines long-term development Environmental degradation could affect the well-being of current and future generations Regional inequalities are undermining inclusive growth and well-being COVID-19 has exacerbated structural challenges EU accession process EU financial and development support Scope and methods Process Scoring approach Exceptions Investment policy and promotion (Dimension 1) Introduction State of play and key developments Sub-dimension 1.1: Investment policy framework Sub-dimension 1.2: Investment promotion and facilitation The way forward for investment policy and promotion Trade policy (Dimension 2) Introduction State of play and key developments Sub-dimension 2.1: Trade policy framework Sub-dimension 2.2: Services trade restrictiveness Sub-dimension 2.3: E-commerce and digitally enabled services The way forward for trade policy Access to finance (Dimension 3) Introduction State of play and key developments Sub-dimension 3.1: Access to bank finance Sub-dimension 3.2: Access to alternative financing sources Sub-dimension 3.3: Mobilisation of long-term financing The way forward for access to finance Tax policy (Dimension 4) Introduction State of play and key developments Sub-dimension 4.1: Tax policy framework Sub-dimension 4.2: Tax administration Sub-dimension 4.3: International tax co-operation The way forward for tax policy Competition policy (Dimension 5) Introduction State of play and key developments Sub-dimension 5.1: Scope of action Sub-dimensions 5.2 and 5.5: Anti-competitive behaviour and implementation Sub-dimension 5.3: Probity of investigation Sub-dimension 5.4: Advocacy The way forward for competition policy State-owned enterprises (Dimension 6) Introduction State of play and key developments Sub-dimension 6.1: Efficiency and performance through improved governance Sub-dimension 6.2: Transparency and accountability practices Sub-dimension 6.3: Ensuring a level playing field Sub-dimension 6.4: Reforming and privatising state-owned enterprises The way forward for state-owned enterprises Education policy (Dimension 7) Introduction State of play and key developments Sub-dimension 7.1: Early childhood and school education Sub-dimension 7.2: Teachers Sub-dimension 7.3: Vocational education and training Sub-dimension 7.4: Tertiary education Cross-cutting dimension: System governance The way forward for education policy Employment policy (Dimension 8) Introduction State of play and key developments Sub-dimension 8.1: Labour market governance Sub-dimension 8.2: Skills Sub-dimension 8.3: Job quality Sub-dimension 8.4: Activation policies Cross-cutting policy areas: Informality Cross-cutting policy areas: Brain drain The way forward for employment policy Science, technology and innovation (Dimension 9) Introduction State of play and key developments Sub-dimension 9.1: STI system Sub-dimension 9.2: Public research system Sub-dimension 9.3: Business-academia collaboration The way forward for science, technology and innovation Digital society (Dimension 10) Introduction State of play and key developments Sub-dimension 10.1: Access Sub-dimension 10.2: Use Sub-dimension 10.3: Jobs Sub-dimension 10.4: Society Sub-dimension 10.5: Trust The way forward for digital society Transport policy (Dimension 11) Introduction State of play and key developments Sub-dimension 11.1: Planning Sub-dimension 11.2: Governance and regulation Sub-dimension 11.3: Sustainability The way forward for transport policy Energy policy (Dimension 12) Introduction State of play and key developments Sub-dimension 12.1: Governance and regulation Sub-dimension 12.2: Security of energy supply Sub-dimension 12.3: Energy markets Cross-cutting sub-dimension: Energy incentives – direct and indirect subsidies in the energy sector The way forward for energy policy Environment policy (Dimension 13) Introduction State of play and key developments Sub-dimension 13.1: Resource productivity Sub-dimension 13.2: Natural asset base Sub-dimension 13.3: Environmental quality of life The way forward for environment policy Agriculture policy (Dimension 14) Introduction State of play and key developments Sub-dimension 14.1: Agro-food system capacity Sub-dimension 14.2: Agro-food system regulation Sub-dimension 14.3: Agricultural support system Sub-dimension 14.4: Agricultural innovation system The way forward for agriculture policy Tourism policy (Dimension 15) Introduction State of play and key developments Sub-dimension 15.1: Governance and co-operation Sub-dimension 15.2: Destination accessibility and tourism infrastructure Sub-dimension 15.3: Availability of a qualified workforce Sub-dimension 15.4: Sustainable and competitive tourism Sub-dimension 15.5: Tourism branding and marketing The way forward for tourism policy Anti-corruption policy (Dimension 16) Introduction State of play and key developments Sub-dimension 16.1: Anti-corruption policy framework Sub-dimension 16.2: Prevention of corruption Sub-dimension 16.3: Independence of the judiciary Sub-dimension 16.4: Business integrity and corporate liability Sub-dimension 16.5: Investigation and prosecution The way forward for anti-corruption policy References Notes 23 Montenegro profile Economic context Key economic features Sustainable development Structural economic challenges Skills gaps are a key obstacle to employment The business and investment climate faces persistent challenges Key sectors are being held back A greener growth model would improve well-being COVID-19 has exacerbated structural challenges EU accession process EU financial and development support Scope and methods Process Scoring approach Exceptions Investment policy and promotion (Dimension 1) Introduction State of play and key developments Sub-dimension 1.1: Investment policy framework Sub-dimension 1.2: Investment promotion and facilitation Sub-dimension 1.3: Investment for green growth The way forward for investment policy Trade policy (Dimension 2) Introduction State of play and key developments Sub-dimension 2.1: Trade policy framework Sub-dimension 2.2: Services trade restrictiveness Cumbersome horizontal business regulations affect firms’ ability to operate How restrictive are individual services sectors? Sub-dimension 2.3: E-commerce and digitally enabled services The way forward for trade policy Access to finance (Dimension 3) Introduction State of play and key developments Sub-dimension 3.1: Access to bank finance Sub-dimension 3.2: Access to alternative financing sources Sub-dimension 3.3: Mobilisation of long-term financing The way forward for access to finance Tax policy (Dimension 4) Introduction State of play and key developments Sub-dimension 4.1: Tax policy framework Sub-dimension 4.2: Tax administration Sub-dimension 4.3: International tax co-operation The way forward for tax policy Competition policy (Dimension 5) Introduction State of play and key developments Sub-dimension 5.1: Scope of action Sub-dimensions 5.2 and 5.5: Anti-competitive behaviour and implementation Sub-dimension 5.3 Probity of investigation Sub-dimension 5.4: Advocacy The way forward for competition policy State-owned enterprises (Dimension 6) Introduction State of play and key developments Sub-dimension 6.1: Efficiency and performance through improved governance Sub-dimension 6.2: Transparency and accountability practices Sub-dimension 6.3: Ensuring a level playing field Sub-dimension 6.4: Reforming and privatising state-owned enterprises The way forward for state-owned enterprises Education policy (Dimension 7) Introduction State of play and key developments Sub-dimension 7.1: Early childhood and school education Sub-dimension 7.2: Teachers Sub-dimension 7.3: Vocational education and training Sub-dimension 7.4: Tertiary education Cross-cutting dimension: System governance The way forward for education policy Employment policy (Dimension 8) Introduction State of play and key developments Sub-dimension 8.1: Labour market governance Sub-dimension 8.2: Skills Sub-dimension 8.3: Job quality Sub-dimension 8.4: Activation policies Cross-cutting policy areas: Informality Cross-cutting policy areas: Brain drain The way forward for employment policy Science, technology and innovation (Dimension 9) Introduction State of play and key developments Sub-dimension 9.1: STI system Sub-dimension 9.2: Public research system Sub-dimension 9.3: Business-academia collaboration The way forward for science, technology and innovation Digital society (Dimension 10) Introduction State of play and key developments Sub-dimension 10.1: Access Sub-dimension 10.2: Use Sub-dimension 10.3: Jobs Sub-dimension 10.4: Society Sub-dimension 10.5: Trust The way forward for digital society Transport policy (Dimension 11) Introduction State of play and key developments Sub-dimension 11.1: Planning Sub-dimension 11.2: Governance and regulation Sub-dimension 11.3: Sustainability The way forward for transport policy Energy policy (Dimension 12) Introduction State of play and key developments Sub-dimension 12.1: Governance and regulation Sub-dimension 12.2: Security of energy supply Sub-dimension 12.3: Energy markets Cross-cutting policy area: Energy incentives - direct and indirect subsidies in the energy sector The way forward for energy policy Environment policy (Dimension 13) Introduction State of play and key developments Sub-dimension 13.1: Resource productivity Sub-dimension 13.2: Natural asset base Sub-dimension 13.3: Environmental quality of life The way forward for environment policy Agriculture policy (Dimension 14) Introduction State of play and key developments Sub-dimension 14.1: Agro-food system capacity Sub-dimension 14.2: Agro-food system regulation Sub-dimension 14.3: Agricultural support system Sub-dimension 14.4: Agricultural innovation system The way forward for agriculture policy Tourism policy (Dimension 15) Introduction State of play and key developments Sub-dimension 15.1: Governance and co-operation Sub-dimension 15.2: Destination accessibility and tourism infrastructure Sub-dimension 15.3: Availability of a qualified workforce Sub-dimension 15.4: Sustainable and competitive tourism Sub-dimension 15.5: Tourism branding and marketing The way forward for tourism policy Anti-corruption policy (Dimension 16) Introduction State of play and key developments Sub-dimension 16.1: Anti-corruption policy framework Sub-dimension 16.2: Prevention of corruption Sub-dimension 16.3: Independence of the judiciary Sub-dimension 16.4: Business integrity and corporate liability Sub-dimension 16.5: Investigation and prosecution The way forward for anti-corruption policy References Notes 24 North Macedonia profile Economic context Key economic features Sustainable development Structural economic challenges Lack of skills is undermining economic growth and the development of a knowledge economy The economy underuses its human capital A challenging business environment stifles enterprises, particularly SMEs Firms’ capacities to innovate and adopt technology are still relatively limited Cross-cutting and sector-specific constraints undermine the growth of key sectors Weak revenue performance and high and rising current expenditure limit the government’s fiscal space A greener growth model would improve well-being More inclusive growth is also needed to improve well-being COVID-19 has exacerbated structural challenges EU accession process EU financial and development support Scope and methods Process Scoring approach Exceptions Investment policy and promotion (Dimension 1) Introduction State of play and key developments Sub-dimension 1.1: Investment policy framework Sub-dimension 1.2: Investment promotion and facilitation Sub-dimension 1.3: Investment for green growth The way forward for investment policy and promotion Trade policy (Dimension 2) Introduction State of play and key developments Sub-dimension 2.1: Trade policy framework Sub-dimension 2.2: Services trade restrictiveness General business regulations affect firms’ ability to operate in North Macedonia How restrictive are individual service sectors? Sub-dimension 2.3: E-commerce and digitally enabled services The way forward for trade policy Access to finance (Dimension 3) Introduction State of play and key developments Sub-dimension 3.1: Access to bank finance Sub-dimension 3.2: Access to alternative financing sources Sub-dimension 3.3: Mobilisation of long-term financing The way forward for access to finance Tax policy (Dimension 4) Introduction State of play and key developments Sub-dimension 4.1: Tax policy framework Sub-dimension 4.2: Tax administration Sub-dimension 4.3: International co-operation The way forward for tax policy Competition policy (Dimension 5) Introduction State of play and key developments Sub-dimension 5.1: Scope of action Sub-dimensions 5.2 and 5.5: Anti-competitive behaviour and implementation Sub-dimension 5.3: Probity of investigation Sub-dimension 5.4: Advocacy The way forward for competition policy State-owned enterprises (Dimension 6) Introduction State of play and key developments Sub-dimension 6.1: Efficiency and performance through improved governance Sub-dimension 6.2: Transparency and accountability practices Sub-dimension 6.3: Ensuring a level playing field Sub-dimension 6.4: Reforming and privatising state-owned enterprises The way forward for the state-owned enterprises Education policy (Dimension 7) Introduction State of play and key developments Sub-dimension 7.1: Early childhood and school education Sub-dimension 7.2: Teachers Sub-dimension 7.3: Vocational education and training Sub-dimension 7.4: Tertiary education Cross-cutting sub-dimension: System governance The way forward for education policy Employment policy (Dimension 8) Introduction State of play and key developments Sub-dimension 8.1: Labour market governance Sub-dimension 8.2: Skills Sub-dimension 8.3: Job quality Sub-dimension 8.4: Activation policies Cross-cutting sub-dimension: Informality Cross-cutting sub-dimension: Brain drain The way forward for employment policy Science, technology and innovation (Dimension 9) Introduction State of play and key developments Sub-dimension 9.1: STI system Sub-dimension 9.2: Public research system Sub-dimension 9.3: Business-academia collaboration The way forward for science, technology and innovation Digital society (Dimension 10) Introduction State of play and key developments Sub-dimension 10.1: Access Sub-dimension 10.2: Use Sub-dimension 10.3: Jobs Sub-dimension 10.4: Society Sub-dimension 10.5: Trust The way forward for digital society Transport policy (Dimension 11) Introduction State of play and key developments Sub-dimension 11.1: Planning Sub-dimension 11.2: Governance and regulation Sub-dimension 11.3: Sustainability The way forward for transport policy Energy policy (Dimension 12) Introduction State of play and key developments Sub-dimension 12.1: Governance and regulation Sub-dimension 12.2: Security of energy supply Sub-dimension 12.3: Energy markets Cross-cutting sub-dimension: Energy incentives – direct and indirect subsidies in the energy sector The way forward for energy policy Environment policy (Dimension 13) Introduction State of play and key developments Sub-dimension 13.1: Resource productivity Sub-dimension 13.2: Natural asset base Sub-dimension 13.3: Environmental quality of life The way forward for environment policy Agriculture policy (Dimension 14) Introduction State of play and key developments Sub-dimension 14.1: Agro-food system capacity Sub-dimension 14.2: Agro-food system regulation Sub-dimension 14.3: Agricultural support system Sub-dimension 14.4: Agricultural innovation system The way forward for agriculture policy Tourism policy (Dimension 15) Introduction State of play and key developments Sub-dimension 15.1: Governance and co-operation Sub-dimension 15.2: Destination accessibility and tourism infrastructure Sub-dimension 15.3: Availability of a qualified workforce Sub-dimension 15.4: Sustainable and competitive tourism Sub-dimension 15.5: Tourism branding and marketing The way forward for tourism policy Anti-corruption policy (Dimension 16) Introduction State of play and key developments Sub-dimension 16.1: Anti-corruption policy framework Sub-dimension 16.2: Prevention of corruption Sub-dimension 16.3: Independence of the judiciary Sub-dimension 16.4: Business integrity and corporate liability Sub-dimension 16.5: Investigation and prosecution The way forward for anti-corruption policy References Notes 25 Serbia profile Economic context Key economic features Sustainable development Structural economic challenges Strengthening education and skills is key to upgrading and building a knowledge economy Strengthening the institutional and business environment is critical for boosting domestic and foreign investment Access to finance could be further improved, particularly for micro and small enterprises and start-ups Cross-cutting and sector-specific constraints undermine the growth of key sectors Better management of public finances is needed to support the long-term development of the economy Stronger environmental protection will be critical for long-term development and well-being More inclusive growth is needed to improve the incomes and well-being outcomes for all citizens. COVID-19 has exacerbated structural challenges EU accession process EU financial and development support Scope and methods Process Scoring approach Exceptions Investment policy and promotion (Dimension 1) Introduction State of play and key developments Sub-dimension 1.1: Investment policy framework Sub-dimension 1.2: Investment promotion and facilitation Sub-dimension 1.3: Investment for green growth The way forward for investment policy and promotion Trade policy (Dimension 2) Introduction State of play and key developments Sub-dimension 2.1: Trade policy framework Sub-dimension 2.2: Services trade restrictiveness Cumbersome horizontal business regulations affect firms’ ability to operate Restrictions in specific services sectors Sub-dimension 2.3: E-commerce and digitally enabled services The way forward for trade policy Access to finance (Dimension 3) Introduction State of play and key developments Sub-dimension 3.1: Access to bank finance Sub-dimension 3.2: Access to alternative financing sources Sub-dimension 3.3: Mobilisation of long-term financing The way forward for access to finance Tax policy (Dimension 4) Introduction State of play and key developments Sub-dimension 4.1: Tax policy framework Sub-dimension 4.2: Tax administration Sub-dimension 4.3: International co-operation The way forward for tax policy Competition policy (Dimension 5) Introduction State of play and key developments Sub-dimension 5.1: Scope of action Sub-dimensions 5.2 and 5.5: Anti-competitive behaviour and implementation Sub-dimension 5.3: Probity of investigation Sub-dimension 5.4: Advocacy The way forward for competition policy State-owned enterprises (Dimension 6) Introduction State of play and key developments Sub-dimension 6.1: Efficiency and performance through improved governance Sub-dimension 6.2: Transparency and accountability practices Sub-dimension 6.3: Ensuring a level playing field Sub-dimension 6.4: Reforming and privatising state-owned enterprises The way forward for state-owned enterprises Education policy (Dimension 7) Introduction State of play and key developments Sub-dimension 7.1: Early childhood and school education Sub-dimension 7.2: Teachers Sub-dimension 7.3: Vocational education and training Sub-dimension 7.4: Tertiary education Cross-cutting sub-dimension: System governance The way forward for education policy Employment policy (Dimension 8) Introduction State of play and key developments Sub-dimension 8.1: Labour market governance Sub-dimension 8.2: Skills Sub-dimension 8.3: Job quality Sub-dimension 8.4: Activation policies Cross-cutting sub-dimension: Informality Cross-cutting sub-dimension: Brain drain The way forward for employment policy Science, technology and innovation (Dimension 9) Introduction State of play and key developments Sub-dimension 9.1: STI system Sub-dimension 9.2: Public research system Sub-dimension 9.3: Business-academia collaboration The way forward for science, technology and innovation Digital society (Dimension 10) Introduction State of play and key developments Sub-dimension 10.1: Access Sub-dimension 10.2: Use Sub-dimension 10.3: Jobs Sub-dimension 10.4: Society Sub-dimension 10.5: Trust The way forward for digital society Transport policy (Dimension 11) Introduction State of play and key developments Sub-dimension 11.1: Planning Sub-dimension 11.2: Governance and regulation Sub-dimension 11.3: Sustainability The way forward for transport policy Energy policy (Dimension 12) Introduction State of play and key developments Sub-dimension 12.1: Governance and regulation Sub-dimension 12.2: Security of energy supply Sub-dimension 12.3: Energy markets Cross-cutting sub-dimension: Energy incentives – direct and indirect subsidies in the energy sector The way forward for energy policy Environment policy (Dimension 13) Introduction State of play and key developments Sub-dimension 13.1: Resource productivity Sub-dimension 13.2: Natural asset base Sub-dimension 13.3: Environmental quality of life The way forward for environment policy Agriculture policy (Dimension 14) Introduction State of play and key developments Sub-dimension 14.1: Agro-food system capacity Sub-dimension 14.2: Agro-food system regulation Sub-dimension 14.3: Agricultural support system Sub-dimension 14.4: Agricultural innovation system The way forward for agriculture policy Tourism policy (Dimension 15) Introduction State of play and key developments Sub-dimension 15.1: Governance and co-operation Sub-dimension 15.2: Destination accessibility and tourism infrastructure Sub-dimension 15.3: Availability of a qualified workforce Sub-dimension 15.4: Sustainable and competitive tourism Sub-dimension 15.5: Tourism branding and marketing The way forward for tourism policy Anti-corruption policy (Dimension 16) Introduction State of play and key developments Sub-dimension 16.1: Anti-corruption policy framework Sub-dimension 16.2: Prevention of corruption Sub-dimension 16.3: Independence of the judiciary Sub-dimension 16.4: Business integrity and corporate liability Sub-dimension 16.5: Investigation and prosecution The way forward for anti-corruption policy References Notes Annex A. The Competitiveness Outlook 2021 scoring model for Bosnia and Herzegovina Annex A. The Competitiveness Outlook 2021 scoring model for Bosnia and Herzegovina