Dun & Bradstreet projects a quicker than expected recovery of Serbian economy

The credit rating company Dun & Bradstreet placed Serbia among the moderate risk countries in its July report and estimated that its economic growth in 2016 and 2017 would be higher than previously projected.

A country's rating indicates the risk of doing business in that country and gives information on the payment performance and the cost-effectiveness of potential investments. Croatia, Bulgaria, Hungary, Macedonia and Albania are together with Serbia in the moderate risk group. Of the countries in the region, Slovenia and Romania have ranked better and were characterized as low risk countries, whereas Bosnia and Herzegovina has a lower rating and is characterized as a high risk country.

– The data for the first quarter of the current year show that the gross domestic product (GDP) of Serbia is larger by 3.5% relative to the same period last year, and the biggest driving force of the growth was the net export, supported by investments in the export-oriented production sector and lowered costs of the import of energy – the D&B report says.

It adds that the investments were financed by the inflow of foreign direct investments and loans thanks to the improved credit environment in the country, which contributed to the growth of industrial production by 10.5% relative to the first quarter of 2015.

As it was pointed out, D&B reviewed the projection of the growth of Serbia's GDP for 2016 and 2017 and increased it from 1.7% and 2.2% to 2.3% and 2.8%, while also noting that there were potential risks, mostly external ones, which could slow down the economic recovery of the country, such as the stability of the banking sector in the eurozone, Brexit, a potential Grexit and the possibility of a cyclical recession in developed countries.

Dun & Bradstreet is the largest, oldest credit rating company in the world. It has existed for over 175 years, and its representative in Serbia in the company Bisnode.

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