Insight-ProCredit

On 21 November 2024, Albania officially joined the Single Euro Payments Area (SEPA).
• According to the European Payment Council calendar, financial institutions in Albania and Montenegro will be able to join the SEPA payment systems starting in April 2025.
• The operational readiness date (ORD) for payment service providers (PSPs) from these countries will be announced at a later date.

This is a significant step towards European integration and offers new opportunities and a number of advantages for companies.

• Impact of SEPA membership on Albania
- Lower costs for cross-border payments
- Simplified processes expected to improve the country’s competitiveness

• Advantages for businesses
- Payments are faster and much easier, improving interactions with the European market
- Lower transaction costs

ProCredit Bank Germany will support its clients in Albania as they adjust to this new environment, ensuring they are able to quickly benefit from the new possibilities.

In November, we partnered with the German Committee on Eastern European Economic Relations to host an online session entitled “Insight into cross-border banking in South-Eastern and Eastern Europe”. Klaus Keilmann, Head of Corporate Strategy & Development at ProCredit Bank Germany, hosted the event and presented insightful views on the region’s political, economic and regulatory landscape. The discussion centred on the challenges for foreign trade, but also the opportunities for companies.

The presentation addressed the economic and regulatory conditions in South Eastern and Eastern Europe and highlighted the special features associated with tax and wage cost developments. Klaus Keilmann also addressed the current geopolitical challenges, which have been further exacerbated by the ongoing conflict in Ukraine. Despite these challenges, the dynamic development of the private sector and the increasing foreign direct investment that is currently making the region attractive to investors were highlighted.

You can find more detailed information in the presentation.

The European Commission’s growth plan for the Western Balkans, launched in 2023, aims to integrate these countries into the EU's single market. With financial support of EUR 6 billion, the plan promotes regional cooperation and reforms until 2027.

As part of the growth plan, countries will gradually be given access to the SEPA zone to carry out cost-effective euro transactions. Montenegro and Albania will be the first Western Balkan countries to have access to SEPA in 2025.

In 2025, the World Bank forecasts an economic growth rate of 3.7% for the region, driven by rising consumption and investments. Investments are expected to grow by up to 6.5%, which underlines the importance of ongoing structural reforms for sustainable economic stability.

Do you need support for your activities in South Eastern Europe? Contact our team: South Eastern Europe Desk – ProCredit Bank Germany

Source:
European Commission Growth Plan
World Bank Western Balkans Economic Report

Serbia expects strong GDP growth of 4-5% in 2025, supported by the “Leap into the Future - Serbia Expo 2027” project. Further positive indicators include:

- Inflation: Stable at 3±1.5%
- Foreign investment: Steady inflows
- Labour market: Unemployment rate of 8.2%, employment rate of 51.4%
- Fiscal health: Budget surplus, national debt at 46.8% of GDP, credit rating BBB-
- Banking stability: NPL ratio of 2.7%

These robust economic conditions provide opportunities. One risk is the relevance of the German market for the Serbian economy. A deterioration of the German economy could have a negative impact on Serbia’s economic development. Together with our colleagues in Serbia, we are happy to support you with market expertise and local knowledge.

Link to our South Eastern Europe Desk: South Eastern Europe Desk – ProCredit Bank Germany

Sources:
National Bank of Serbia - Macroeconomic Developments in Serbia - January 2025
Germany Trade & Invest (GTAI) - December 2024