Serbia’s GDP to rise by more than 6% in 2021, central bank says

Serbia’s GDP to rise by more than 6% in 2021, central bank says

By bne IntelliNews May 23, 2021

Serbia’s economy could rise by more than 6% in 2021, and possibly close to 7%, central bank governor Jorgovanka Tabakovic said during a presentation of macroeconomic expectations.

Serbia was the country least affected by the coronavirus (COVID-19) pandemic in the region, with GDP contracting by just 1% in 2020 and expected to grow significantly in 2021.

"Based on the faster than expected recovery in the first quarter, higher planned capital investments by the state and the adopted third package of fiscal measures, we estimate that the growth of gross domestic product this year would amount to 6%, which is above our previous projections,” Tabakovic said.

She added that, should Serbia continue with its implementation of infrastructure projects and keep attracting foreign direct investment, the growth rate might be even higher, reaching nearly 7%. This would be backed by further successful vaccination process and recovery in service activities.

The continued investment will lead to a further rise in the share of goods and services exports in GDP, which should go up from last year’s 48% to more than 56% by 2023.

Tabakovic also noted that the regulation of public finances has created space for a strong fiscal policy response during the coronacrisis, which has been utilised efficiently, without threatening the sustainability of public finances.

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