The International Monetary Fund (IMF) has upgraded its 2016 GDP growth forecast for Serbia to 2.5 percent from the 1.8 percent forecast in April this year.
The international financial institution also expects inflation to reach 1.3 percent, Tanjug reported.
The GDP growth forecast has now been revised upwards for the second time in just two months, as the April forecast had been raised from 0.05 percent.
“We now expect real GDP growth of 2.5 percent in 2016, and inflation of 1.3 percent,” IMF Mission Chief for Serbia James Roaf told a press conference after the conclusion of the Mission’s visit to Belgrade for discussions on the fourth and fifth reviews under Serbia’s precautionary stand-by arrangement with the IMF.
“Strong performance under Serbia’s economic program continues. Economic growth is strengthening, supported by robust investment and rising net exports. Inflation has remained low and stable but below target, on account of lower-than-expected imported prices and food prices,” Roaf said.
“The external current account deficit is declining amid robust exports,” he also said.
The IMF mission, led by Roaf, started talks with the Serbian government representatives on June 9, focusing on the budget and reforms of the public sector and public companies, the fulfillment of obligations envisaged under the 2016 first quarter program, and economic policy measures for the upcoming period.
During the stay in Serbia, Roaf said that arrangement with Serbia was successfully being implemented and that the country was achieving excellent results regarding the set goals, underlining the importance of investments in the private sector, which had been propped up by positive trends and the recovery due to the fiscal part of Serbia’s arrangement with the IMF.
In February 2015, the IMF and Serbia signed a three-year precautionary stand-by arrangement, worth EUR 1.2 billion.
The previous three arrangement revisions were positive, while the fourth was carried out in February 2016, ahead of a snap parliamentary election, with the IMF mission deciding to finalize it after the formation of a new cabinet.
Source; B92
