Economic climate in Serbia

Published on 21. March 2023., News

The economic climate in Serbia is deteriorating, the economic climate index (ESI) in Serbia is lower in the fourth quarter of 2022 and was 91.4, which is a continuation of the downward trend.

Compared to the previous quarter, it is down 1.3 percentage points, which is an additional 1.1 percentage points below the average of 2020, which was marked by the pandemic, according to the publication Trends of the Republic Institute of Statistics (RZS).

Also, the economic climate index lags behind the average from the pre-pandemic year of 2019 by as much as 21.1 percentage points (112.5).

This trend of economic expectations is in line with the expected slowdown in economic activity due to geopolitical tensions.

“Storm” in the consumption sector

The index of economic opportunities, first of all, shows a sharp drop in expectations in the consumption sector, by 4.9 percentage points, followed by the manufacturing industry by 0.6 percentage points, while expectations in the service sector by two percentage points and construction by 4.6 percentage points increase.

There have been no changes in the retail trade sector for the third quarter in a row.

The economic climate index (Economic Sentiment Indicator – ESI) is an indicator of producer and consumer attitudes about economic trends and economic stability. This indicator, as written in the RZS publication, is often used to assess the economic situation, for short-term forecasts, for scientific and analytical purposes, as well as for international comparisons and the creation of economic policies.

“The sun is shining, the grass is smelling…”

The traffic light of the economic climate shows that only the consumption sector is in the recession phase, which indicates a negative trend of expectations among consumers.

When looking at other sectors, the “sun is shining” in the service sector, which is entering a phase of economic growth, with an improving climate.

The construction sector is in the recovery phase, while the retail trade sector and the manufacturing industry are stagnating, RZS announced.

The economic climate index, developed by the European Commission’s Directorate General for Economy and Finance (DG ECFIN), is obtained on the basis of five different surveys of producers and consumers, whose views provide reliable indications of economic trends, and based on which confidence indicators were created.

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