“The shadow economy in Serbia has a 27% share in the national GDP, which helps some criminal actors to legalize money they earned through illegal dealings. Serbia and Albania have been recording unusually strong growth in the construction sector, where there has been a big increase in real estate prices lately, especially in Zemun, Subotica and Niš,” it was said at the conference ‘Shadow economies: organised crime and corruption in the Western Balkans’.
“In recent years, new types of money laundering have emerged and criminal groups in the Western Balkans do not limit their operations only to the Western Balkans, so it is assumed that a large percentage of earnings is laundered outside this area,” said Sasa Djordjevic, of the Global Initiative to Combat Transnational Organised Crime.
According to data from the Spanish police, there are about 100 criminal groups from the Western Balkans in Spain alone, and it is believed that criminals from Serbia and Russia are “very good at money laundering”.
Djordjevic also says that although there is a functioning banking sector in the entire region, a large number of transactions are carried out in cash. “There is this kind of culture where cash is used much more in umore through cash, which makes it easier for criminal groups and individuals themselves to launder money.”
He adds that Western European estimates show that the shadow economy in Serbia has a close to 27% share in the GDP. “The whole environment helps criminal actors transfer the money they earn from illegal markets to the formal economy,” Djordjevic says.
Out of all Western Balkan countries, Albania and Serbia are known for their strong construction sector that have seen a significant increase in real estate prices recently. “A square metre of an apartment in Novi Beograd used to cost between 1,200 and 1,300 euros, and now the prices have doubled,” says Djordjevic. He also says that that is especially evident in Zemun, Subotica and Niš.
The real estate turnover in Serbia has seen an unusually high increase between 2018 and 2020, although many new buildings are still empty. The construction sector growth continued during the pandemic despite the overall decline in the Serbian economy, according to the report “Current prices: analysis of the flow of people, drugs and money in the Western Balkans” published by the Initiative Fighting Transnational Organised Crime.
One example mentioned in the report relates to the procurement of building materials for the Belgrade Waterfront project. Experts say that the increase in real estate turnover is most likely a consequence of the injection of a significant amount of illicit funds into the market and point out that the Serbian real estate market has become a regional hub for money laundering.
Also, according to the report, municipalities throughout the region are issuing building permits, but do not have the resources to monitor what is happening. Moreover, for historical reasons, land books and records of building permits are incomplete and poorly archived. The report identifies Belgrade, Novi Sad, Kragujevac, Vrnjačka Banja, Niš and Čajetina as money laundering hotspots.
(Nova Ekonomija, 07.11.2021)
https://novaekonomija.rs/vesti-iz-zemlje/kako-se-pere-novac-u-srbiji-%C5%A1ampinjoni-i-stanovi
This post is also available in: Italiano