IJERD – International Journal of Environmental and Rural Development (2015) 6-2

Research article
erd

Problems in Rural Areas of Bosnia, Montenegro and Serbia:
A Comparative Analysis
SINISA BERJAN*
University of East Sarajevo, East Sarajevo, Bosnia and Herzegovina
Email: sinisaberjan@yahoo.com

HAMID EL BILALI
Mediterranean Agronomic Institute of Bari (CIHEAM-IAMB), Valenzano, Bari, Italy

ALEKSANDRA DESPOTOVIC
University of Podgorica, Podgorica, Montenegro

SNEZANA JANKOVIC
Institute for Science Application in Agriculture, Belgrade, Serbia

ADRIANA RADOSAVAC
Faculty of Agriculture, University of Novi Sad, Novi Sad, Serbia

NOUREDDIN DRIOUECH
Mediterranean Agronomic Institute of Bari (CIHEAM-IAMB), Valenzano, Bari, Italy
Received 13 February 2015

Accepted 30 April 2015(*Corresponding Author)

Abstract: Bosnia, Montenegro, and Serbia (BMS) are in a phase of consolidation, which
implies rising of economic growth, agricultural productivity, and fostering ruraldevelopment. Therefore, it is crucial to have a clear idea about problems faced by rural
population in order to design effective rural development policies. The paper aims at
highlighting the main problems in rural areas of BMS with a particular focus on those
hampering good governance and increased diversification of their rural economies. For
each country, significance of the problems was identified; and a critical analysis was
performed to highlight causes, implications in terms of rural governance and policy, andpotential solutions. Problems were identified in the framework of surveys dealing with
agricultural and rural development governance that involved representatives of public, civilsociety, and international organizations: 120 in Bosnia (winter 2011), 50 in Montenegro(winter 2012), and 120 in Serbia (summer 2013). Economic problems include difficultaccess to financial resources, low level of investments, rural economy diversification,
limited employment opportunities, small and uncompetitive farms, and rural enterprises.
Remoteness and isolation, bad local natural resources management, and increased
pollutions were the main environmental and geographic problems mentioned by theinterviewees. Socio-cultural and demographic problems encompass rural poverty, low
quality of life, gender inequity, low human capital of the rural population, unpopularity ofagriculture and alarming negative demographic trends. Focus of local development
strategies mainly on agriculture and lack of local spatial plans are some of the political andregulatory problems. There are also problems related to the poor physical infrastructure andservices, and lack of processing facilities and local markets. For smooth accession to theEuropean Union (EU), BMS should address these problems urgently in a systemic andholistic way to unlock the growth potential of rural areas, taking stock of the current EU’s
rural development policy.
Keywords rural areas, agriculture, problems, Bosnia, Montenegro, SerbiaⒸ ISERD

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IJERD – International Journal of Environmental and Rural Development (2015) 6-2

INTRODUCTION
The three countries of the Western Balkan (WB), namely Bosnia, Montenegro and Serbia (BMS),
are in a phase of consolidation, which implies rising of economic growth, agricultural productivity, andfostering rural development. Therefore, it is crucial to have a clear idea about problems faced byrural population in order to design effective rural development policies.
Around 61% of the Bosnian population can be classified as rural (UNDP, 2013). The share ofMontenegrin population living in the countryside accounts for 38% of the total population(Arcotrass-consortium, 2006). Approximately 43% of the Serbian population lives in rural areas(RDNS, 2010). The rural areas of BMS lag behind in terms of socio-economic development andstill face many problems such as low quality of life and limited employment opportunities. In suchcontext, agriculture plays an important socio-economic role for employment and poverty reduction.
Moreover, since a large share of population lives in rural areas, there can be no balanced
development of BMS without devoting more attention to rural population and combating rural
poverty. For the development of agriculture and rural areas, evidence from other countries such as
those of the EU, show that agriculture is not sufficient to ensure the sustainable development ofrural areas. It is the core reason why rural economy should be diversified (OECD, 2006).
Participation of local actors in rural development processes is particularly important; especiallythere is a transition to adopt people-centred approaches and policies. It is clear nowadays that
achieving sustainable and inclusive development of rural areas means long-term effective andefficient policy measures. It is important that these policy measures and instruments have real
impact on rural population livelihood and quality of life. Hereinafter, they should create an enable
environment for investments, improve household assets, and service delivery in rural areas.
The paper aims at highlighting the main problems in rural areas of BMS with a particularfocus on those hampering good governance and increased diversification of the rural economy.
METHODOLOGY
The applied methodology comprised both primary and secondary sources of information. Many
literature sources were consulted and primary data were collected by a questionnaire survey thatwas sent via email to different key stakeholders in BMS.
BMS share similar traditional, cultural, and historical background as ex-republics of theformer Yugoslavia. The spoken language is the same, which made easier communication for online
questionnaire dissemination and the overall survey. Problems were identified in the framework ofsurveys dealing with agricultural and rural development (ARD) governance that involved
representatives of public, civil society, and international organizations; 120 in Bosnia (winter 2011),
50 in Montenegro (winter 2012) and 120 in Serbia (summer 2013). Unit of data collection was
individuals, one representative per eligible organisation, while unit of data analysis wasorganizations. Only institutions that are involved in ARD were considered in the surveys. The
selection of eligible institutions was mainly based on internet search and literature review as well
as authors’ personal and professional networks. Questions were open ended to say that no list of
problems was previously prepared and respondents were left at their own to identify problems. The
questionnaire was pre-tested in all target countries with representatives of public, civil society, andprivate sector. Feedback gained was useful for making improvements, especially in terms of usedterminology and question wordings. For each country, the significance of each identified problem
was identified and a critical analysis was performed to highlight causes, implications in terms ofrural governance and policy, and potential solutions.
RESULTS AND DISCUSSION
Problems in rural areas mentioned by the respondents can be divided in several categories:
economic problems; environmental and geographic problems; institutional, political and regulatoryⒸ ISERD36

LEM

mic problemssabour market
opmentIJERD – International Journal of Environmental and Rural Development (2015) 6-2

problems; social, demographic and cultural problems; and infrastructure- and service-related
problems (Table 1).
Table 1 Major problems in rural areas of Bosnia, Montenegro and Serbia
INDENTIFIED PROBLEM
Economic problems
Lack of financial resources and of investments
Lack of labour force and undeveloped rural labour market
Low level of SMEs and new businesses development
Limited use of machinery
Extensive agriculture
Difficult access to credit due to lack of collateral
Limited employment opportunities
Low prices of agricultural products
Difficult procurement of agricultural inputs and high costs
Low productivity and low remuneration for workers
Undeveloped rural tourism
No added value to agricultural products
Low level of rural economy diversification and high dependence on the
agricultural sector
Obsolete farm machinery and equipment
Small and uncompetitive farms
Environmental and geographic problems
Long distance to urban areas
Bad management of local resources and increased pollution due touncontrolled use of chemicals
Insufficient development of organic production
Unused natural resources
Mined agricultural land from the war
Limited arable landInstitutional, political and regulatory problems
Non-stimulating tax policy and existence of “grey economy”
Local strategies mainly focus on agriculture activities
Small and irregular economic incentives
Lack of spatial plans at the local level

BO
A
C
B

nd high dependence on the

A
C
C

B

eral

nd high costs
workers

COUNTRY
MO
SE

A
B
C
C
C
C

A
C
B
B

C
A

A
C

C
C
C

C

C

B
A

B

B
B

C

A

d geographic problems

ased pollution due toConl and regulatory problems
grey economy”
ctivities

C
C

C
C
C

C
A
C
B

C
B
C
B

A
C
B

INDENTIFIED PROBLEM
Social, demographic and cultural problems
Rural poverty
Low quality of life
Lack of qualified human resources
Lack of knowledge and information
Low educational level and use of ICT
Lack of vision, initiatives and willingness
Lack of training activities for farmers
Use of traditional methods and technologies
Poor social and cultural life
Disorganization of farmers
Gender inequity
Lack of cooperation between producers and scientists
Disappearance of common interest and emerging individualistic
mentality of rural population
Unpopularity of agriculture
Obsolete educational and cultural facilities
Territorial dispersion of rural settlements and low density
Prejudices of youngsters about staying in the countryside
Negative demographic trends (low birth rate, depopulation,
migration, ageing, single men, etc.)
Infrastructure- and service-related problems
Difficult access to rural areas (i.e. bad roads)
Poor physical infrastructure and communal services(e.g. sewage, garbage, ambulance, transport, etc.)
Lack of processing capacities, equipment and resources
Lack of tourist accommodation facilities and services
Instability of electrical power supply
Lack of collection centres for rural products
Lack of local markets

BO
A
C
B

COUNTRY
MO
SE
A
C
C

B
A
B
C
C
C
C

A
C
B
B

C
A

A
C

C
C
C

C

C

B
A

B

C

A

B
B

C
C
C

C
C
C

C
A
C
B

C
B
C
B

BO

COUNTRY
MO
SE

A
A
A
A
A

A
A
A
A
A

A
C
B

INDENTIFIED PROB

Social, demograph
Rural poverty
Low quality of life
Lack of qualified human resources
Lack of knowledge and information
Low educational level and use of ICT
Lack of vision, initiatives and willingness
Lack of training activities for farmers
Use of traditional methods and technologies
Poor social and cultural life
Disorganization of farmers
Gender inequity
Lack of cooperation between producers andDisappearance of common interest and eme
mentality of rural population
Unpopularity of agriculture
Obsolete educational and cultural facilities
Territorial dispersion of rural settlements an
Prejudices of youngsters about staying in th
Negative demographic trends (low birth ratemigration, ageing, single men, etc.)
Infrastructure- andDifficult access to rural areas (i.e. bad roads
Poor physical infrastructure and communal(e.g. sewage, garbage, ambulance, transport
Lack of processing capacities, equipment an
Lack of tourist accommodation facilities an
Instability of electrical power supply
Lack of collection centres for rural products
Lack of local markets

A
A
A
A
A
C

C
B
C
B
C
C

C
C

B
C
C
C
C

A
C
C
A

B
C
B

B

A

A

A

B
A
B
A
B
A

B

C
A
A
C
C

A
B
A
C
C

Source Authors’ elaboration based on survey results. Legend: BO=Bosnia; MO=Montenegro; SE=Serbia;
A=Significant (problems mentioned by >50% of respondents); B=Average (25-50%); C=Poor (>25%).

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IJERD – International Journal of Environmental and Rural Development (2015) 6-2

Economic Problems
Lack of financial resources is one of the main indicators used for assessing poverty. This problem
is more expressed in those rural areas in which employment opportunities are limited and where
many people suffered due to loss of jobs. This is particularly true in the Bosnian case where many
companies were totally devastated or partially during the civil war. However, overall unstable
political and economic situation in whole WB also negatively affected the quality of life in the rural
areas of Montenegro and Serbia. In addition, the lack of financial resources is connected to difficultaccess to credits due to lack of collaterals. Therefore, rural population hardly has access to credits
and does not have savings that allow to live with dignity and to make investments for future.
Financing agriculture and agribusiness has always been difficult due to the risky nature of thebusiness. Traditional forms of collateral are often not available, and not acceptable when they areavailable. Thus, limiting access needs funding for the sector (Winn et al., 2009).
Rural economy diversification is still a challenge in many rural areas of BMS, both in terms ofoff-farm and non-farm income-generating activities. Despite its declining gross value added,
agriculture continues to have an important influence on the rural economies of these countries.
Farm activities diversification in BMS is hampered by the lack of financial resources, willingness,initiatives, and knowledge and skills of rural households to start new endeavours. Diversification
endeavours can allow, among others, to add value to products through some on-farm processing
and packaging activities, as well as to make products widely recognized by developing productswith geographic indications and regional quality labels. Rural economy is still highly dependent on
agricultural sector, not only because of reluctance and resistance of rural households to start new
activities in the non-farm sector but also the focus of national rural development strategies andlocal development plans on agriculture.
As for small fragmented uncompetitive farms, there is lack of farmers’ organization, which is
coupled with the dispersed farm settlements, hinders the participation of farmers in ARD. Thishinders also the supply of extension services, farm credit, and other vital inputs to farmers andinfrastructure. All these factors negatively impact competitiveness of single farms but also theoverall agricultural sector of whole countries.
Environmental and Geographic Problems
Long distance to urban areas is often mentioned especially in Montenegro. This is related touneven regional development and lack of urban nuclei that aggregate economic activities near torural areas. This problem is further aggravated by poor road infrastructure, which makes mobility
more difficult. Another problem is bad management of local resources and increased pollution due
to uncontrolled use of chemicals. The excessive exploitation of forests and the irrational use of landcaused a change in land use structure (Nyssen et al., 2014), and the quality of vegetation cover. In
these cases, it is necessary to adopt conservation agriculture techniques and practices. Bosnian
agriculture is rather traditional and the use of chemicals is low (Stanojcic-Eminagic, 2010).
Fertilizers and chemicals application should be under control especially in Serbia (cf. Vojvodina).
Although many scholars and practitioners highlight the potential of organic agriculture as asustainable development opportunity for the developing and transition countries, it is still at theearly developmental stage in BMS. In fact, less than 0.01% of the products consumed in Serbia isorganic (GAIN, 2009), while in Bosnia organic area represents less than 0.1% of the total
agricultural area (Driouech et al., 2013). The main obstacles for organic production development in
BMS region are the lack of adequate government support (Vittuari, 2011), the undeveloped market,
the small range of organic products, and the underdeveloped processing infrastructure.
Unused natural resources and mined agricultural land is mainly a legacy of the civil war in
Bosnia that compelled many people to migrate from rural areas. Limited arable land in Montenegro
is predominantly due to geomorphology as quite a large part of the country is mountainous andkarst.

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Institutional, Political and Regulatory Problems
The main problem is lack of a stable ARD policy. ARD policy-making in the WB region in generaland in BMS in particular has often been dictated by ad-hoc considerations. Agricultural policy is
still mostly implemented based on annual programs of budget allocation, which are not stable interms of funds, support measures, and eligibility criteria. Rural development policy is generally
subordinate to production support. Funds aimed at supporting rural development are much lower(Volk, 2010). One characteristic specific to Bosnia is state administration complexity, which
complicates the implementation of its agricultural policy. Montenegro has already undergone majorchanges in the process of reforming agricultural policy but many challenges remain (Marković andMarković, 2010). In Serbia, the implementation of agricultural policy has been permanently
changing. Programs and regulations were changed and/or abolished several times during the year.
The agricultural policy in Serbia is only partly designed on a strategic basis. In recent years, it has
been characterized by the increasing estrangement from the EU model of support. Frequentchanges in administrative structures bring radical changes in the support system (Bogdanov andBozić, 2010).
Social, Demographic and Cultural Problems
Rural poverty is a serious problem faced in many rural areas in BMS. Poverty is a complicatedissue that is influenced by endowments and capital of rural households; and also by general social
environment, especially in terms of presence or absence of social programs and safety nets.
Gender inequity is still an issue in the rural areas in BMS. This should be broadly understood
not only in terms of equity between men and women but also in terms of different socio-economicand ethnic groups. Female rural population has very limited participation in the decision-making
processes (FAO-Bosnia, 2012). The truth is also regarding their share in the most important
positions within ministries and other public institutions. Rural youth are also among the mostdisadvantage groups. They sometimes have limited access to educational programmes. Very often,
rural young women are not given the same opportunities comparing with young men. Youngpeople are not enough involved in rural policy cycle. Unfavourable environment “push” youngsters
to migrate and rural areas remain without human capital and cannot achieve development. Youth’s
knowledge and skills are of vital importance for the implementation of sustainable ARD
programmes (FAO, 1991).
Prejudices of youngsters about staying in the countryside and unpopularity of agriculture are
related to their mind-sets. The education that they receive in rural areas is very often urban oriented
and makes them believe that their future perspectives will be better in the urban areas. Living incities is perceived as prestigious and fashionable especially in rural mentality; and it can happen
that rural people, especially the young, prefer to move even when they find less paid jobs incomparison with the ones they can get in rural areas. Bad services quality influences negative
demographic trends in rural areas because it fosters out-migration. In addition, poor services areamong the consequences for intensified urban drift.
As for the use of traditional technologies, despite effort made for modernizing the agricultural
sector in the three countries, agriculture is still mainly traditional except in some fertile areas such
as Vojvodina (Serbia) and Semberija (Bosnia). In fact, the use of traditional methods andtechniques calls into question about the efficiency of agricultural extension services. Most of farmmanagers are old and not open to modern technologies. Difficult access to plots makes
mechanization difficult. Agricultural production is predominantly in the hands of a multitude ofsmall-scale and unorganized farmers. State level interventions are needed to address the issue ofland fragmentation through land consolidation.

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Infrastructure and Service Problems
Dispersion of rural settlements is a big problem as it influences the availability and quality of arange of services. Adequate access of all rural people to services and structures (including
infrastructure) necessary to engage in diversification endeavours is far from optimal. It has to belinked to costs related to service provision in rural areas especially in times of financial andeconomic crisis. Low population density in rural areas exponentially increases the cost of services
delivery per rural citizen. Even when some services exist in small rural communities, they are very
often of lower quality with respect to urban centres. However, the quality of rural services and theperformance of service delivery structures are a problem in most of rural areas in BMS, especiallyin remote rural areas.
What is alarming is the general observation that the situation is getting worse regarding
human capital in the rural areas of BMS because of the out-migration of its well-educated youth.
This undermines one of the most important endogenous assets and resources that can speed up thediversification journey. In fact, it is well-known that non-farm activities require a range of new
managerial and soft skills. This highlights the importance of the role of extension and advisory
services as well as of other institutions and international development agencies dealing withcapacity building, business skills development, and human capital strengthening in rural areas.
These actors should work together and coordinate their activities in order to address this challenge.
CONCLUSION
It is essential to analyse the problems in the rural areas as these not only influence the impact ofpolicies but also the different phases of the policy cycle. Appropriate diagnosis of problems is
crucial for designing effective ARD strategies and policies. One of the common problems faced inrural areas of BMS is related to low human capital. This has implications in terms of policy
implementation as well as policy monitoring and evaluation. For implementation phase, it isnecessary to have at disposal competent and endogenous human capital with high education level.
Furthermore, skills and education level influences quality of data that are collected on the field
which directly impacts evaluation. Sustainable development of rural areas cannot be based only on
agriculture, as rural economies should also be diversified. In general, rural regions face many
problems that reduce the critical mass needed for effective public services, infrastructure, andbusiness development. Rural enterprises face many disadvantages compared to urban-based
counterparts due to small size of local markets, sparse distribution of potential customers in rural
areas, and more difficult access to credits. Better coordination and governance of ARD can help
solving most of the identified problems.
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