Termination of the A-H empire and the non-existence of Yugoslavia would be the first things necessary to better the Balkans. Those states have to be able to develop their own economic systems, the type of which will benefit the various south slavic ethnicities individually - not a consensus between them, as that would always be seen as "going on a comprimise with those iffy other, for the purpose of keeping a state we don't particularly like together". There is no point why Croatia should experience high tarrifs in trading with Austria, just to satisfy the Serbs in Belgrade. There is also no point for Serbia to keep spending money on trying to develop Muslim Bosnia. These comprimises just instill tensions, not lower them. So for stability, a peaceful balkanization is necessary, preferably after WWI. Have Serbia annex the Serbian parts of Bosnia and Vojwodina, Croatia go independent with Dalmatia, Slovenia with access to the Adriatic, Bosnia from whatever isleft. Croatia and Slovenia would be able to be fairly prosperous if they furtherly avoid WW2. The Serbs would be in a slightly weaker spot due to no access to sea, but could still probably establish it with Germany through the balkans and France through Montenegro and the Mediterranean. Food prices were quite high in the 30's, so if the money they made from agricultural products could be invested into their own domestic industries, of the type that would be competetive with the west, they have high chances for prosperity. Croatia with Dalmatia could try and compete in naval works, constructing specialized transport ships - globalization after the 50's did require special ships for special types of trnasported good - tankers, car carriers, etc. That is a niche it could try to get.
