Serbia recorded a real GDP growth of 3 percent in the first half of 2011, but that rate is expected to drop in the second half and bring the annual growth to 2 percent, the Ministry of Finance has announced.
Industrial production will achieve a modest increase this year, while trade will fall significantly, according to the ministry’s website.
Economic activity grew slower in the second and third quarter, mostly because of lower production in the processing industry and a drop in trade.
The financial crisis in the euro zone and a drop in domestic and foreign demand slowed down the economic activity significantly in 2011 and will also affect the results in 2012.
The increase in unemployment has slowed down this year compared to the previous two.
The overall drop in the number of employees is expected to be at 2.8 percent this year. It was at 4.9 percent in 2010 and 5.5 in 2009.
The situation with the balance of payments should deteriorate in the fourth quarter because of lower revenue from credits and investments.
The inflation will continue to drop, which is a trend started in May this year, but will be above the upper limit of the target figure at the end of 2011.
The projected inflation for 2011 is 4.5 plus or minus 1.5 percent.
It is expected to return within the projected range during the first quarter of next year. A careful monetary and fiscal policy, lower pressure on food prices, slower growth of controlled prices, low agregate demand and dinar appreciation will help that.
The monetary policy will be loosened at the same time, in view of the expected drop in inflation and projections of macroeconomic trends.
Source emg.rs
