The recent transition of Elektroprivreda Srbije (EPS) from a public enterprise to a joint-stock company has had profound implications for Serbia’s economic landscape, reshaping long-standing achievements within certain sectors.
According to the latest “Annual Report on Business Operations in 2023” released by the Agency for Economic Registers, the financial dynamics of public companies have undergone significant changes. The shift in EPS’s legal status has resulted in a reduction of their business assets to 1,950 billion dinars, with capital standing at 1,124 billion dinars—a decrease of one-third from previous figures.
“This change has also led to a slight decrease in the overall indebtedness ratio of public companies, from 0.86 to 0.84,” the report highlights.
Additionally, the report notes that public companies now operate with significantly reduced negative net working capital, amounting to 148.4 billion dinars. However, they still face a shortfall of 276.3 billion dinars in long-term funding required to fully finance fixed assets and inventories.
The restructuring of EPS has also influenced broader economic metrics. In 2023, the total losses of public companies decreased notably, from 579.5 billion dinars in 2022 to 291.9 billion dinars. Specifically, the electricity, gas, steam, and air conditioning supply sector saw its losses decrease from 362.3 billion to 63.9 billion dinars, alongside a reduction in workforce from 110,157 to 89,651 employees.
Conversely, the overall losses across all companies in 2023 increased marginally to 4,037 billion dinars, up by 1.7%. However, losses exceeding capital decreased by 2.3%, totaling 1,605 billion dinars.
The processing industry continues to dominate in financial terms, boasting 5,024 billion dinars in business assets and 2,314 billion dinars in capital. This sector leads in both total liabilities, amounting to 3,175 billion dinars, and in own financing sources, totaling 1,815 billion dinars—representing over a fifth of the economy’s total debt.
The report also highlights notable growth in the information and communications sector, which saw a 20.2% increase in business assets and an 18.2% rise in capital in 2023.
Overall, while challenges persist, Serbia’s economy exhibits positive indicators with a 6.7-fold increase in positive net working capital, amounting to 503 billion dinars. The general liquidity ratio improved from 1.01 to 1.05, and the current liquidity ratio increased from 0.65 to 0.69, reflecting modest improvements in liquidity trends.
Despite these advancements, micro-enterprises continue to face financial vulnerabilities, operating with losses exceeding their capital and relying heavily on borrowed funds for sustenance.
In conclusion, while the transformation of EPS marks a significant structural shift, Serbia’s economy navigates a path of evolving financial dynamics amidst sector-specific challenges and opportunities for growth.
