COMPETITIVENESS OF THE AGRICULTURAL SECTOR OF SOUTHEAST EUROPE: THE WESTERN BALKANS VS. EUROPEAN UNION

Despite its importance, the state of the agricultural sector in Southeast Europe is not at a satisfactory level. The goal of the paper was to examine the impact of agricultural competitiveness on economic development and to identify the parameters that contribute to its improvement. The Revealed Comparative Advantage index was employed to assess the comparative advantage, while the Unit Values index was used to examine the quality of important agricultural products. Ordinary Least Squares regression was applied to examine the impact of agricultural competitiveness on economic development. Kruskall Wallis test was used to compare important factors that affect this competitiveness. The results indicate that Southeast Europe generally has a competitive agricultural sector. Republic of Serbia stands out in terms of competitiveness, but it is primarily driven by low productivity, prices and yields. Enhancing the value-added of agricultural products is crucial for boosting trade, strengthening agricultural competitiveness and fostering economic development.