Ana Ivković, Vice-Governor of the National Bank of Serbia (NBS), has warned that a shift in Serbia’s current economic policy could negatively impact citizens’ budgets. Speaking on TV Prva, she emphasized that macroeconomic and fiscal stability are directly tied to political stability, noting that months-long protests and institutional blockades are already affecting the economy, particularly in the service sector.
Ivković cautioned that continued political instability could slow or even reduce investments this year, harming personal earnings, employment, the dinar’s exchange rate, and potentially jeopardizing Serbia’s credit rating. Despite these concerns, she highlighted Serbia’s positive economic growth, with a 3.9% GDP growth last year and an average of 4.6% growth from 2021 to 2024, even amid economic slowdowns in key trade partners.
She also mentioned that representatives from S&P credit rating agency recently visited Serbia and confirmed the country’s strong growth outlook, despite the protests affecting investor sentiment. Ivković stressed the importance of maintaining political stability to sustain Serbia’s potential for continued economic growth, which she believes could reach 4% annually.
The service sector is already showing the first signs of decline, with reduced consumer spending and a downturn in tourism, especially in congress tourism. Ivković noted that every protest and roadblock comes at a significant economic cost.
In terms of foreign exchange reserves, the NBS has accumulated 29.3 billion euros, more than double pre-pandemic levels, which has led to lower borrowing costs for Serbia. However, due to reduced FDI inflows and tourism revenue, the NBS has recently become a net seller of foreign currency.
Despite the challenges, Ivković expressed confidence that Serbia can still benefit from global economic shifts, particularly under the leadership of President Aleksandar Vučić. She also mentioned that investors are optimistic about Serbia’s long-awaited investment credit rating, with positive assessments expected from Fitch in July.
