The real growth of Serbia’s gross domestic product (GDP) for the first eight months of this year increased by approximately four percent year-on-year, while inflation rates remain among the highest in the EU, according to the latest issue of the journal Macroeconomic Analysis and Trends (MAT).
“In August, the growth of total industrial production slowed to 0.9 percent year-on-year. Within this context, the processing sector maintained a satisfactory growth rate of five percent. However, the energy sector experienced setbacks, primarily due to unfavorable hydrological conditions,” stated MAT experts.
The dry and hot summer has severely impacted primary agricultural production, which is projected to decline by approximately eight percent annually.
While foreign trade exchange showed growth in August, the value of goods imports significantly exceeded that of exports. Additionally, strong year-on-year growth in retail trade turnover and average wages continued.
Year-on-year inflation remained steady at 4.3 percent, consistent with July, primarily due to a one-time increase in certain regulated prices and rising costs of food and non-alcoholic beverages.
“The key risk to successfully combating inflation at this time is the potential escalation of the conflict in the Middle East, which could lead to a global energy crisis,” the magazine noted.
In July and August 2024, Serbia reported year-on-year inflation rates of 4.3 percent and 4.4 percent, respectively, while the EU recorded rates of 2.8 percent and 2.4 percent during the same period.
Among the 27 EU member states, only Belgium and Romania had higher year-on-year inflation rates than Serbia in both July and August 2024, with Romania exceeding Serbia’s rate in August this year.
In July 2024, year-on-year inflation in Belgium and Romania stood at 5.4 percent and 5.8 percent, respectively, while Romania’s inflation rate was 5.3 percent in August 2024.
