Serbian President Aleksandar Vučić has unveiled a new economic package aimed at supporting pensioners and vulnerable citizens, while capping retail profit margins.
The measures include discounts on electricity bills for pensioners earning up to 28,000 dinars and additional relief for energy-vulnerable households. The electricity discount will be split into two parts: 5% for timely payment and an extra 5% for energy-vulnerable customers. The package also covers lower prices for firewood and protections for the most at-risk citizens.
Trade Minister Jagoda Lazarević explained that the package limits retail margins to 20% on around 3,000 products across 23 categories, rather than directly adjusting prices. Authorities expect prices to drop by approximately 15%, with the regulation coming into effect on September 1. Vučić also announced changes to enforcement laws, which will protect debtors from losing their only property up to 60 square meters and reduce interest rates on loans, all aimed at improving citizens’ living standards.
Experts, however, warn that a blanket cap on margins could produce unintended consequences, including distorted pricing and potential harm to domestic companies in favor of foreign chains. Skepticism remains about the long-term effectiveness of the measures due to possible adjustments by retailers. Some bakery representatives have noted that traders may find ways to bypass the rules, such as introducing new billable services, and highlight that bakery product margins have previously reached as high as 144%.
