After a significant slowdown in 2022, Serbia’s Economic Reform Program (ERP) predicts that economic growth will gradually accelerate in the period from 2023 to 2025, the European Commission stated in its report.
According to a document published by the European Commission on April 19, under the influence of the economic consequences of the war in Ukraine, especially due to inflation that grew thanks to higher energy and food prices, Serbia’s real GDP slowed to 2.3 percent in 2022, with private consumption and accumulation of stocks as the main drivers of growth.
The programme projects that economic growth will continue at a moderate 2.5 percent in 2023 and gradually accelerate to 3.5 percent in 2024 and 4.0 percent in 2025, broadly returning to pre-pandemic growth rates, the EC stated, reports Blic.
Consumer inflation continued to rise gradually in 2022, reaching 16.2 percent in March this year but is expected to decline in the first half of 2023 and return to the target range (three percent-1.5 percentage points) towards the end of 2024.
The high price of imported energy and production interruptions in the domestic electricity industry caused a sharp increase in the current account deficit in 2022. The Economic Reform Programme predicts it will remain above six percent of GDP from 2023 to 2025.
Against a backdrop of continued high uncertainty, the growth outlook is, as elsewhere, subject to a range of risks related to the war in Ukraine and geopolitical tensions, such as further fluctuations in energy prices and global trade restrictions, as well as supply chain disruptions, persistently high inflation and further tightening of financial conditions.
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