Strike in Fiat could disrupt Serbia’s economic growth

The current economic data is very good and the projected economic growth of 3% in 2017 is almost certain. However, the unwanted events like the strike in Fiat pose the biggest risk to the dynamic economic growth in the next few months – economy experts say.

Ivan Nikolic from the Institute of Economics says that the May data is very good primarily in the segment of industrial which makes the projected economic growth quite certain. Stojan Stamenkovic from Macroeconomic Trends and Analyses magazine reminded that the experts have been pointed out to the problems in our automobile industry for months, because both sides in the project did not meet all of their obligations.

“Furthermore, I think that Fiat 500L is too expensive for what it offers. On top of that, there is a general strike at the factory which is becoming more serious by the day and causes a lot of problems to the factory’s suppliers too”, Stamenkovic points out. He also says that he doesn’t really know how is this problem going to be solved and mentioned some media speculations that Fiat was willing to leave Serbia all together.

“Something is not right there and that poses a problem. Public enterprises are an even bigger problem as the IMF pointed out”, Stamenkovic adds.

He reminds that Fiat has between 2% and 2.5% of share in the Serbian processing industry, and if the production stops in this company, the entire industry suffers.

Other economy experts disagree with Stamenkovic and say there is no danger of Fiat leaving Serbia. President of the Serbian Chamber of Commerce, Marko Cadez says that he has no information of Fiat planning anything like that, and reminds that the company is a member of the Chamber.

“I am not too fond of a fatalistic approach especially that this kind of speculation has been circling around for four years now. Strikes happen everywhere in the world, including Germany and Italy. They do pose a problem, but there is no indication that Fiat plans on leaving Serbia”, Cadez says and adds that a solution simply has to be found.

Economy expert, Miladin Kovacevic says there are three very good reasons why Fiat will not withdraw from Serbia: “Firstly, Fiat has invested a lot of money in production equipment and infrastructure in our country, secondly, a lot of money was also invested in training workers, and thirdly, Serbia is one of those countries with cheap labour”.

(Blic, 06.07.2017)


This post is also available in: Italiano

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