Associating the Balkans with "backwardness" is highly common in specialty literature. However, more recently - ten years after the Dayton Peace Agreement - a new paradigm is dominating discussions about the future of the Balkans: a possible EU membership for the countries of the region. This paper presents a detailed analysis of the current economic situation in the Balkans with emphasis on the EU's policy towards the region. The launch of the Stabilization and Association Process for the Western Balkans with its main instruments concerning trade liberalization and financial assistance reflects an obvious political will to reduce the "backlog" of the region. The accession of Bulgaria and Romania is a matter of "when" not a matter of "if". An extensive part of this paper is concerned with trade analysis, in view of the fact that external trade might be regarded as one of the most important sources of growth for the countries of the region.