Reuters Reports on Economy Measures in Serbia: Recovery Program to Cause Increase in Deficit, Serbian Economy to Also Face Recession

The British agency Reuters has reported about the set of measures aiming to recover the Serbian economy, announced by Serbian President Aleksandar Vucic.

The agency reports that Serbia plans to offer about 5 billion euros in loans and subsidies to businesses to help them cope with the economic impact of the coronavirus and that the state will also make a one-off payment of 100 euros to every Serbian citizen older than 18, or around 5 million people, the entire electorate.

Reuters estimates that the recovery program, which the president announced late on Sunday, would lead to an increase in the deficit this year that would be covered from financial reserves and borrowing.

Without specifying the source, the agency says that Serbia’s currency reserves in February stood at 13.458 billion euros, down from 13.694 billion euros a month earlier.

Reuters also points out that, last week, Fitch Ratings maintained Serbia’s long-term ratings at BB+, and affirmed its medium-term outlook despite the crisis caused by the coronavirus outbreak.

It is also estimated that the country’s economy will miss its 4% growth target for 2020 and face a recession, but Vucic said Serbia should rebound to growth in 2021.

The agency writes that, to aid recovery, local banks are expected to “throw in” around 2 billion euros in a fund for which the state would secure an additional 1.25 billion euros in guarantees. Serbia’s development fund would add another 200 million euros.

Reuters also reminds that, so far, 13 people in Serbia, out of a population of 7 million, have died from the coronavirus and 741 have been infected. They add that, to counter the outbreak, Serbia introduced stringent measures, including a state of emergency and an overnight lockdown for all.

Vlada Republike Srbije

Narodna banka Srbije Beograd

Fond za razvoj Republike Srbije Niš

Fitch Ratings New York

measures for recovery of Serbian economy

Aleksandar Vucic

recession

coronavirus

incentives for SMEs