EBRD keeps forecasts for Serbia: 3.3% growth this year

The European Bank for Reconstruction and Development (EBRD) has kept Serbia’s 2022 economic growth forecast at 3.3% in a new, autumn report on regional economic prospects, as it predicted in May.

Serbia will have the same gross domestic product (GDP) growth rate of 3.3 percent in 2023, according to the international financial institution, which is 0.7 percent lower than its May projection.

In the section of the report dedicatedto Serbia, the EBRD notes that the economic recovery of Serbia in 2021 continued in the first half of this year, albeit at a slower pace, pointing out that production in the first two quarters increased by 4.3 percent, i.e. by 3.9 percent on an annual basis, respectively.

Household consumption continued to lead economic growth, but the rate of consumption growth slowed to 4 percent in real terms in the second quarter after a 7.0 percent rise in the first quarter, as prices rose and monetary policy tightened, the document notes.

While investments remained subdued in the second quarter, export continued strong growth of 20 percent year-on-year, led by goods export, as industrial production rose by 4.6 percent, it is added.

The EBRD also notes that globally rising energy prices have been reflected in the growth of the import bills and the increase in the current account deficit in the first half of the year.

The global rise in food and oil prices, it is stressed, contributed to Serbia’s annual inflation rate rising to 13.2% in August. In response, the central bank raised the key policy rate six times in 2022, from 1% in March to 3.5% in September.

Finally, the Bank states that it forecasts a 3.3 percent increase in Serbia’s GDP in 2022 and 2023 and warns of short-term risks reflected in increased inflation, its impact on the available income of residents and the deterioration of external demand due to the expected slowdown on EU markets.

Izvor: RTS, Tanjug

Foto: BIZLife