Prices of goods and services in Serbia in 2019 were at the level of 57 percent of the European Union average, ie goods were cheaper by 43 percent of the European average, according to data from the European statistical agency Eurostat.
That would be good news if our gross domestic product per capita was not even 59 percent lower than the EU average. At first glance, it could be noticed that we are approaching the European Union much faster in terms of prices than in terms of revenue, ie economic activity. For example, compared to 2012, the price level in relation to the EU increased by 4.5 percentage points, and GDP per capita by only one point.
It looks even more interesting how we stand in some product categories. Namely, according to Eurostat data, electronic devices such as computers, televisions, printers and scanners, audio systems, and even software were 13 percent more expensive than the EU average last year, with the exception of Iceland, the most expensive in Europe.
For example, Germany finished below us with 15 percent cheaper devices, the United Kingdom 18 percent, while these devices were more expensive in our country than in Norway by one percentage point.
Clothing prices were only six percent below the EU average, which is 15 percent more expensive than in Bulgaria, 13 percent more expensive than in Hungary and 12 percent more than in Romania. On the other hand, clothes in Denmark are by far the most expensive in the EU because they are 32 percent more expensive than the average.
When we look at the most important part of the consumer basket, which is food and non-alcoholic beverages, in Serbia it was cheaper by 22 percent than the European Union average, while alcohol and tobacco are cheaper by 38 percent. However, we were not cheaper than all EU member states because food in Poland is as much as 30 percent cheaper than the average. When compared to the most expensive Denmark, food in Poland in 2019 was as much as 60 percent cheaper.
When it comes to the prices of vehicles, ie means of transport, such as passenger cars, motorcycles, bicycles, together with the Czech Republic, Estonia, Romania, Hungary, we are among the cheapest countries in Europe to buy, with prices 14 percent below average. On the other side are Denmark, the Netherlands and Ireland where it is very expensive to buy a car. In the end, compared to the EU, we are convincingly the cheapest when it comes to prices in restaurants and hotels, which are half as low. Of the member states, only Bulgaria has 55% cheaper catering services, below the EU average.
Veroljub Dugalic, a professor at the Faculty of Economics in Kragujevac, concludes that if we were to measure consumer power and income, life in the EU is cheaper.
“That means that it is not enough to say that strawberries are 2.5 euros here, and three euros there, and that it is cheaper here. EU salaries should also be taken into account. But the European Union is a colorful society. Bulgaria and Luxembourg are also there, so it is better to measure in relation to comparable countries, the level of prices and salaries,” Dugalic notes.
According to him, as a measure of purchasing power, the average salary is a better indicator than GDP. And if we look at the average salaries of certain countries, we see that the difference in relation to Serbia is far greater than the difference in prices.
For example, the average salary in Croatia is 900 euros, which is 77 percent more than our 508 euros, while prices are higher by 24.5 percent, or almost three times less than the difference in salaries, Kamatica reports.
