Photo by Unsplash / Ljubomir Žarković
Serbia rebounded strongly from the impact of the global pandemic, with growth reaching 7.4 percent in 2021. After a strong recovery in 2021, however, several domestic and international factors have caused an economic slowdown. Growth in 2022 is forecasted at 3.2 percent, with risks tilted to the downside.
Challenges include the performance of the Serbian energy sector and availability of electricity and gas in the winter of 2022-23, as well as the rising cost of financing the fiscal deficit and debt obligations in light of higher interest rates. Inflation has also increased significantly, with adverse effects on incomes of the poor and vulnerable.
Over the medium term, the Serbian economy is expected to slow down and return to pre-pandemic growth levels after 2024 at the earliest. However, Serbia still faces challenges that limit its potential growth, both in the short and medium to long term. With limited space for future stimulus packages, structural reforms are needed to bring the economy back to sustained growth, boost jobs and incomes, and strengthen resilience to shocks – while gradually transitioning to a greener and more resilient development trajectory.
Source: World Bank, Serbia Country Overview
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