During a recent visit, the International Monetary Fund mission maintained its forecast that the Serbian GDP will decline 3% this year.
After the first quarter of 2020, during which economic activity increased by about 5%, there has been a sharp decline. However, official statistics with quarterly GDP estimates will be available only at the end of August and the economists’ forecasts, based on incomplete information, are quite different this time around.
The authors of the quarterly monitoring estimate that the decline in GDP in the second quarter will be between 8 and 10%. The biggest drop in economic activity occurred in April, leading to the annual decline of almost 17%. In May, the decline was almost halved to 9.3%.
Economist Dragovan Milicevic is even more pessimistic and estimates that the decline will exceed 10% in the second quarter.
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“I still believe that, at the end of the year, the decline will not be less than 4.9%, Milicevic notes.
The editor of Macroeconomic Analysis and Trends trends, Ivan Nikolić, is somewhat more optimistic.
“After 5% growth in the first quarter, the decline in April was 11-12%. The recovery began in May and the decline was halved compared to April. A double-digit decline was recorded in three sectors: transport and telecommunications by about 11-12% and tourism and catering by more than 80%. The construction sector also suffered a double-digit decline. Other sectors’ decline was in single digits compared to the same month last year, while retail trade grew. In June, according to the research, we have indications that the recovery has continued and in the first half of the year, I expect GDP to be at the same level as in the same period last year,” Nikolić estimates, which translates into a 5% decline in the second quarter.
Food and drink producers expect a rise in their production. This is particularly pronounced in ice cream, alcohol, beer, soft drinks, sparkling and other bottled water production, considering warmer weather.
On the other hand, the automotive industry, which has been severely affected by the pandemic, has not fully stabilized as yet. This applies in particular to the production of motor vehicles and trailers, while the production of other parts and accessories for motor vehicles has increased.
This post is also available in: Italiano