At the inaugural session of the Alliance for Fair Competition (FCA) within the National Alliance for Local Economic Development (NALED) in Belgrade, significant progress in the fight against Serbia’s gray economy was highlighted, alongside key measures for continued improvement.
During the meeting, NALED members emphasized the importance of adopting and monitoring the implementation of the Government of Serbia’s program aimed at curbing the gray economy, with 56% of businesses identifying this as the top priority. Another key focus was improving cross-border trade procedures through regulatory amendments, a priority for 50% of respondents.
Other highlighted measures include amendments to the Labor Law (39%), changes to the Budget System Law (28%), and the creation of an action plan for hiring new inspectors. Additionally, addressing the fiscal burden on low salaries and improving the functionality of Serbia’s eInspector system were also ranked as important.
Progress in reducing the gray economy
Over the past decade, Serbia has made significant strides in reducing its shadow economy, which undermines state revenues and market fairness. Zoran Daljević, president of NALED’s Association for Fair Competition, pointed out that Serbia has successfully reduced the gray economy from 29.1% to 21.1% of GDP in the last ten years. This progress has been attributed to policies like e-fiscalization, electronic invoices, and cashless payments for services.
Daljević noted that the Ministry of Finance is currently drafting a new program to further reduce the gray economy and continue these positive trends. In 2023, the market inspection alone carried out over 6,000 inspections, with more than half targeting unregistered businesses that operate outside the legal framework. These inspections are crucial in identifying and penalizing entities that do not comply with tax and licensing regulations.
Partnerships for a fairer market
The meeting also emphasized the importance of partnerships between the government and responsible businesses. Stevan Nikčević, from the Ministry of Internal and Foreign Trade, spoke about the recent cooperation agreement between Minister Momirović and NALED, aimed at strengthening collaboration in combating the gray economy.
The cooperation agreement is seen as an important step in creating a fairer and more transparent business environment, where businesses comply with regulations, and employees enjoy stable, legal working conditions. Experts stress that ongoing efforts to modernize inspection procedures, digitize systems, and educate both the public and businesses are key to permanently reducing the gray economy.
Long-term goals and continued efforts
While progress has been made, the fight against the gray economy is far from over. NALED’s experts emphasize that long-term success will require continuous improvement in both the regulatory environment and enforcement mechanisms. The fight against illegal business practices is a shared responsibility between the state, businesses, and citizens alike.
Minister Nikčević concluded by highlighting the importance of reducing bureaucratic hurdles to boost the efficiency and competitiveness of Serbia’s economy, especially in the global market. As efforts to modernize inspection procedures and digitize systems continue, the goal is to ensure that legal businesses thrive and contribute to a fairer economic system.
This collaboration between NALED and the government represents a clear commitment to building a market where legal and fair competition prevails, ultimately benefiting the country’s economy and workers.
