Serbia: GDP growth moderates in final quarter of 2016 but stays solid
February 28, 2017
Revised data published by the statistics office (SORS) on 28 February showed that GDP expanded 2.5% year-on-year in Q4, confirming the preliminary estimate published on 31 January. The result represented only a mild deceleration compared to the 2.8% expansion in Q3 and led the economy to expand 2.5% in 2016 as a whole, the strongest expansion since 2013. Sequential data confirmed the softening suggested by the annual data as GDP increased a seasonally-adjusted 0.2% in Q4, which came in below the 0.5% rise in Q3.
A more comprehensive data set showed that private consumption picked up momentum in Q4 and accelerated to a 1.0% expansion (Q3: +0.5% year-on-year). Furthermore, government spending increased a notable 2.3% in Q4, which was up from the 0.8% rise in Q3. That said, gross fixed capital formation lost impetus in the final quarter, increasing 2.6%. This was a deceleration from the substantial 6.2% expansion in Q3 and the slowest pace since Q1 2015.
On the external front, exports of goods and services continued showing double-digit growth in the fourth quarter (Q4: +13.8% yoy; Q3: +10.7 yoy), while imports, although still in good shape, increased just 5.9% in Q4 (Q3: +5.7% yoy). As a result, the contribution from net exports to overall economic growth increased from 1.7 percentage points in Q3 to 2.8 percentage points in Q4.
Author: Ricardo Aceves, Senior Economist