The average salary at the end of 2025 will be 900 euros and the average pension between 430 and 440 euros, announced the President of Serbia, Aleksandar Vucic, at the presentation of the program “Serbia 2025”.
Economic experts believe that this development plan is very ambitious in the next five years, but not impossible, while some believe that it would be positive and at least part of the announced projects would be realized. Still, most agree that it is hardly likely that the announced level of earnings will be reached in such a short period of 5-6 years.
Economists cite higher growth of the domestic economy, improvement of business environment and greater security of capital, lower tax burdens, but also further development of infrastructure and prevention of increasing emigration of labor as some of the main factors needed for further growth of salaries and pensions. All this should ensure greater growth of gross domestic product.
Professor Ljubodrag Savic, professor at the Faculty of Economics in Belgrade, cites support to the local economy as a key factor in achieving the announced goals.
“Serbia needs to turn to domestic forces. Foreign investors are welcome, but there is no serious long-term development without domestic investment and without industrial production in which our investors will be the main carriers. This is a domestic task for this or a subsequent government”, said the Blic Business source, adding that domestic investors should be more supported and given the same working conditions as foreigners.
Professor Milojko Arsic also believes that announced investments in infrastructure will not be sufficient for such a rise in salaries and pensions. He thinks that the figures, which are in the rank of current wages in Poland, could only be reached in 10 years.
“Production in the private sector needs to grow 80-90 percent. Higher production, above all in industry, is a prerequisite for wage growth because wages can grow about as much as productivity, maybe 2 percent more if our inflation is higher than European inflation”, Blic source explains, adding that to reach a salary of 900 euros, Serbia should have economic growth like the Chinese.
Dragoljub Rajic from the Business Support Network says that it is necessary to work on improving the business environment in the country, that is, above all, on the predictability of business and legal certainty of capital.
“More efficient judiciary, security of business contracts, work to improve competitiveness should be ensured…”, explains the source and adds that this should be followed by greater support for small and medium-sized enterprises, lower tax burdens for the domestic economy and the cessation of subsidizing foreign investors.
The economist Aleksandar Stevanovic is of a similar opinion, who, with the advancement of the rule of law, states as a condition for reaching a salary of 900 euros in 2025 a reduction in the burden on salaries, which must be at least 1.5 percent every year, and parafiscal “must be cut”. He also stresses that macroeconomic stability must be maintained, subsidies to investors abolished and government investment in infrastructure continued.
The state’s plan to invest around ten billion euros in infrastructure over the next five years will significantly increase the country’s overall economic activity and enable attracting not only foreign but also domestic private investment, Serbian Economy Association President Aleksandar Vlahovic said in a statement.
“It is good that the government plans to invest some ten billion euros in infrastructure, road, rail, agricultural, tourism in the future, because certainly this increase in capital investments will significantly increase the overall economic activity directly, and on the other hand it will enable attracting not only foreign but also domestic private investment on a larger scale than has been the case so far”, Vlahovic said, adding that it would allow investments to be above 25 percent of GDP, which is the level of investment that provides to plan more ambitious growth rates, from five to seven percent.
Serbia is facing, and will only be facing in the coming years, the fact that Western European countries, especially Germany and Austria, have an increased need for manpower, Dragoljub Rajic points out.
“The working conditions are better there, the health system is better, the salaries are higher, and if we look at the mood of the young generations and the statistics of the abroad, so far this is not promising”, Rajic said, noting that Serbia should think of ways to stop the outflow of labor.
