Even in the third quarter of this year, Serbia achieved a negative growth rate compared to the previous quarter, and that is when the influence of the season is excluded. If this happens again in the fourth quarter, our country would formally be in a “shallow” recession, like the one expected in many European countries, Milojko Arsić, a professor at the Faculty of Economics in Belgrade, told Biznis.rs.
Speaking to our portal at the promotion of the “Quarterly Monitor” (QM) of the Foundation for the Development of Economic Science, he pointed out that a short-term recession is predicted for Germany as well, and that it is about economic growth hovering around zero, which means that such a recession will not to be “deep”.
“When it comes to Serbia, there are a lot of factors (that affect economic growth) that vary. For example, the situation in the energy sector in Serbia has improved due to good hydrology, the presence of wind and gas imports, so electricity production was better than usual,” added Arsić.
The interlocutor of Biznis.rs expects that Serbia will end this year with GDP growth of 2.5 percent, while the most important trends in 2022 are identified as a strong slowdown in economic activity and acceleration of inflation.
“In the next year, economic growth of two percent is expected, slightly lower inflation than this year, stagnation in the labor market and a similar deficit in the current balance as this year,” he said during the presentation of the new issue of QM, of which he is the editor.
He emphasized, however, that all forecasts are of an indicative nature, and revisions are likely, given the great uncertainties regarding the course of the war in Ukraine, the economic war between Russia and the West, and other unfavorable global trends.
” When it comes to the expectation that Serbia’s GDP will grow by two percent in 2023, which is somewhat slower than the 2.5 percent calculated by the Government of Serbia and some international institutions, we believe that the reasons lie in the fact that our country will enter the new year with a minimal or negative growth rate, while at the same time restrictive monetary policy will continue in Serbia and in Europe, so high interest rates are expected to bring down investments and consumption. Also, high inflation is still expected in the first half of the year, and there is also the risk of rising energy prices and their shortage,” Arsić explained the growth forecast for the next year, Biznis writes.
