Serbian town in the winter

Serbia Economic Forecast

Serbia Economic Outlook

GDP expanded by 0.4% year on year in Q4, down from 1.0% growth in the preceding quarter. Household consumption and export growth weakened relative to Q3, while public spending and investment contracted. Looking at the first quarter of this year, economic activity is likely to be moderate due to high inflation, tighter financial conditions and weak external demand. That said, available data is fairly positive; tourist arrivals, retail trade turnover and industrial output all expanded in January compared with the same month in 2022. In other news, March’s EU-brokered meeting with Kosovo did not lead to clear results, with the next round of talks set for 18 March. Resolving the dispute with Kosovo will likely be key for Serbia’s EU accession process.

Serbia Inflation

Inflation came in at 15.8% in January (December: 15.1%). Double-digit inflation is expected to continue in H1 amid the pass-through of previous high costs. Inflation should return to single digits in H2 due to monetary tightening and the reduction of imported inflation. Commodity price swings are a risk.

Serbia Economic Data

2017 2018 2019 2020 2021
Population (million) 7.0 7.0 7.0 6.9 6.9
GDP (USD bn) 44 51 52 53 63
GDP per capita (USD) 6 7 7 7 9
GDP (EUR bn) 39 43 46 47 53
GDP per capita (EUR) 5 6 6 6 7
GDP (RSD bn) 4 5 5 5 6
Economic Growth (Nominal GDP, ann. var. %) 5.1 6.6 6.9 1.5 13.9
Economic Growth (GDP, ann. var. %) 2.1 4.5 4.3 -0.9 7.5
Domestic Demand (ann. var. %) 3.9 6.5 6.3 -0.9 7.7
Private Consumption (ann. var. %) 2.2 3.1 3.7 -1.9 7.8
Government Consumption (ann. var. %) 2.9 3.7 1.9 2.8 4.1
Fixed Investment (ann. var. %) 6.6 17.5 17.2 -1.9 15.9
Exports (G&S, ann. var. %) 8.2 7.5 7.7 -4.2 19.5
Imports (G&S, ann. var. %) 11.1 10.8 10.7 -3.6 17.7
Industrial Production (ann. var. %) 3.4 1.5 0.2 0.4 6.1
Retail Sales (ann. var. %) 3.8 4.1 9.7 4.9 10.8
Unemployment (% of active population, aop) 13.5 12.7 10.4 9.0 11.1
Fiscal Balance (% of GDP) 1.1 0.6 -0.2 -8.0 -4.1
Public Debt (% of GDP) 57.8 53.6 51.9 57.0 56.5
Money (ann. var. of M2 %) 7.9 16.7 16.6 30.9 13.8
Inflation (CPI, ann. var. %, eop) 3.0 2.0 1.8 1.3 7.9
Inflation (CPI, ann. var. %, aop) 3.1 2.0 1.8 1.6 4.1
Inflation (Core, ann. var. %, aop) 1.7 1.0 1.3 1.6 2.3
Key Policy Rate (%, eop) 3.50 3.00 2.25 1.00 1.00
3-Month BELIBOR (%, eop) 3.12 3.03 1.64 0.90 0.94
Exchange Rate (RSD per USD, eop) 98.48 103.49 104.75 96.08 103.39
Exchange Rate (RSD per USD, aop) 107.70 100.21 105.27 103.14 99.46
Exchange Rate (RSD per EUR, eop) 118.25 118.30 117.58 117.56 117.58
Exchange Rate (RSD per EUR, aop) 121.44 118.24 117.83 117.58 117.58
Current Account Balance (EUR bn) -2.0 -2.1 -3.2 -1.9 -2.2
Current Account Balance (% of GDP) -5.2 -4.9 -6.9 -4.1 -4.2
Merchandise Trade Balance (EUR bn) -4.0 -5.1 -5.6 -5.2 -6.0
Merchandise Exports (EUR bn) 14.1 15.1 16.4 16.1 21.0
Merchandise Imports (EUR bn) 18.1 20.2 22.0 21.3 27.0
Merchandise Exports (ann. var. %) 9.8 7.4 8.5 -1.8 30.3
Merchandise Imports (ann. var. %) 13.5 11.6 9.1 -3.2 26.7
Foreign Direct Investment (EUR bn) 3 4 4 3 4
International Reserves (EUR bn) 10.0 11.3 13.4 13.5 16.5
International Reserves (months of imports) 6.6 6.7 7.3 7.6 7.3
External Debt (EUR bn) 25.5 26.7 28.3 30.8 36.5
External Debt (% of GDP) 65.1 62.1 61.4 65.8 68.4

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