What happened to the promised average salary of 500 EUR?

Year-on-year, or rather from election to election, Aleksandar Vucic keeps giving the same promise – the average salary in Serbia will be 500 EUR. Well, we do hope that his promise will come true one day.

The first time that the then Prime Minister, Aleksandar Vucic mentioned the magic amount of 500 EUR was in January 2016 when he announced that, in 2017, that would be the average salary. Considering that, in the first 11 months of 2017, the average salary was 389 EUR, there is no chance that the promised average salary would materialize. So, just before the New Year’s, now President Vucic reiterated his promise given in September 2017, but has now ‘pushed’ the average salary of 500 EUR to the end of 2018.

This Holy Grail of the Serbian economy and politics, often desired but for now unattainable, has always been one of the shiniest promises of our politicians because average salary is one of economic indicators that is clear and visible, unlike the GDP, budget deficit, public debt and similar.

There is also a practical reason why the President has promised that the average salary would reach 500 EUR only in December this year. As a rule of thumb, December is the month when bonuses, 13th salary, awards and some January salaries are paid out which is why salaries paid out in December are around 20% higher than in other months of the year.

For instance, in December 2016, the average net salary was 53,456 dinars or 433 EUR, while the average for the past 11 months of the same year was 369 EUR. If the statistics shows that the average salary paid out in December 2017 is 451 EUR (an equivalent of 53,456 dinars), if the dinar continues to be as strong as it is as the moment, and if the average salary goes up by 10% by December this year, than we might reach the 500 EUR mark.

“Those 500 Euros are extremely uncertain and very unlikely. I am not holding my breath that this would happen because similar promises had already been given earlier,” says economist Mladjen Kovacevic.

For Bozo Drasković from the Institute for Economic Sciences the promise of the average salary of 500 EUR is just political propaganda.

“This is implausible since there is no real economic growth to support the increase in salaries”, Draskovic adds.

(Danas, 04.01.2018)


This post is also available in: Italiano

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