This paper examines the relationship between the real exchange rate and the foreign trade imbalance in both the Western Balkan (WB) and Central and Eastern European (CEE) countries. During the most recent global economic crisis, examining the impact of the exchange rate on the balance of trade took on a particular importance. Countries used a variety of monetary policy regimes and, depending on their choice, they had different economic instruments available to deal with the crisis. The aim of the research was whether exchange rate devaluation and/or depreciation are capable of effectively and fully eliminating the negative effects of the global economic crisis, as well as the consequent poor export performance and contracted economic activity. Our findings show that during an economic crisis those countries that use their own currency cannot substantially adjust their trade deficit by depreciating their currency. Moreover, it is suggested that during the global economic crisis, the balance of payments deficit is not impacted significantly by the exchange rate, any more. In such cases, other factors play a more significant role, like as government spending, followed by foreign demand and direct investments.

This paper explores the economic relations between China and new E.U. member states and Western Balkan countries. China is an important trade partner for these countries, but in recent years the cooperation has been extended to include Chinese foreign direct investments (F.D.I.) inward investment. Using the Poisson pseudomaximum likelihood (P.P.M.L.) method to estimate a gravity model of bilateral trade, this study analysed the export flows of these countries as a function of total inward F.D.I. and Chinese F.D.I. as well. The results imply that F.D.I. inflows from China significantly increase the bilateral exports of the investigated countries, where F.D.I. has a greater impact on the exports of new E.U. member states than on Western Balkan countries.

Observing the expanding and high share of export of travel services in both GDP and total export of services in Mediterranean countries, we focus our research on travel service export in twelve countries from 1998 to 2018. We investigated both short-term and long-term significance of export of travel services for GDP growth in Mediterranean countries using the VAR and VECM model and the fixed-effects panel OLS model. In our analysis of significance of export of travel services on current account balance, we applied an accounting approach. Our application of the fixed-effects OLS model on the panel data with GDP growth rate as the dependent variable has shown that, in the short run, export of travel services has a positive impact on GDP growth. In the long run, Granger causality based on block exogeneity Wald tests evidenced that export of travel services has a positive impact on GDP growth, but only at the 10% significance level. Following the accounting approach in our analysis of impact of export of travel services on overall current account balance, we evidenced a strong relevance of export of travel services in achieving current account balance equilibrium.

Tourism is the most important export sector in Montenegro, with a share of 22% of the total Gross Domestic Product (GDP) and a strong tendency toward growth. Tourism revenues contribute substantially to both the current account balance and employment. However, the current level of the tourist sector suffers from serious limitations. The switch from the current approach to tourism in Montenegro to a more sustainable tourism is only possible by becoming more innovative.Highlighting the importance of innovation in all its forms has been the motivation for our research. The application of the organizational, marketing, and design innovations of the Montenegrin tourism industry actors was examined in a survey, based on the Community Innovation Survey (CIS), with some necessary adaptations. The sample covered more than 70% of available tourism actors. The authors also analysed the experience from Slovenia, in particular the Slovenian example of the Bank of Tourism Potentials, finding this innovation potentially suitable for transfer to Montenegro. Based on the survey and analysis, the team designed certain recommendations for policy action that can be used as guidelines for policy makers.

The world economic crisis that paralyzed the world economy in 2008 and 2009 had a profound impact on all countries in the world. Due to the interconnectedness of national economies the crisis spread rapidly from its centre in the United States to the world. There were two main transmission channels for the spread of the crisis between countries - international trade and the exchange of private capital between states in the form of foreign direct investment (FDI). This economic downturn has greatly influenced the domestic economic stability of the Western Balkan economies. The Western Balkan countries have shaped their economic policy towards European Union (EU) membership, resulting in a high degree of liberalization in international economic relations accompanied by a commitment to free international capital movement. Since this region has close economic ties with the EU the crisis spread to the region very quickly, manifesting itself in decreasing regional exports to the EU market and a downward trend of FDI inflow to the region. This paper will focus on the impact of the world economic crisis on the Western Balkan economies and especially on their exports and FDI inflow. Our empirical analysis, based on panel data, uses a wider sample of Central and Eastern European Countries (CEEC) which includes the Western Balkans, since we wanted to analyze if the effects of the economic crisis in the Western Balkans are specific or are common to most countries in transition. The analysis shows that Western Balkan exports have suffered due to the crisis, but reveals some interesting results on the different dynamics of export flows which depend on regional trade integration for their destination