International Information Centre for Balkan Studies

Wages in Serbia rise, GDP falls

June 25, 2020

An average net wage in Serbia in April was 501.18 Euro, or eight percent nominally higher than at the same period last year, according to the Republic's Statistic Bureau (RSZ), the news agencies reported on Thursday.

The gross salary rose 8.2 percent nominally at the same time, while medium wage, 375.31 Euro, meaning that was the monthly amount half of the employees in Serbia received.

However, the GDP was estimated to drop three percent in 2020, due to the coronavirus epidemic, Milojko Arsic, an Economy Faculty professor, said.

He added that the economic Quarterly Magazine analysis presented on Thursday predicted that such a fall would cause the loss of dozens thousand jobs and an unemployment increase of 13 to 14 percent by the end of the year.

"Fiscal policy will also be heavily influenced by the crisis. We expect the fiscal deficit to be record high, between seven and eight percent of the GDP coupled with the public debt rise to some 28 billion Euro at the end of 2020," Arsic said.

He added that meant the public debt would rise from 52 to 60 percent of the GDP.

The analysis also predicts the drop in foreign direct investments which won't be enough to cover the deficit the current account balance of payments, nor will they contribute to economic growth as it has been the case before.

Arsic said that at the starts of the crisis, Serbia had smaller GDP fall compared to other European countries due to the less vulnerable local economy, and not because of "superior economic policy."

Serbia's economy is mostly based on the production of food, home chemicals and construction, which for the demand has not substantially fallen.

"Serbia's recovery will mostly depend on the improvement of the European Union member states' economies since their recover will enable higher export and possibly more investments.  

Source:  http://rs.n1info.com/English/NEWS/a613558/Wages-in-Serbia-rise-GDP-falls.html        

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