Serbia, Raw material prices and production costs are the biggest challenge for the economy

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By the end of the year, the domestic economy expects an increase in turnover and exports, a stable business climate and employment, but the biggest challenges faced by companies are the higher costs of purchasing energy, raw materials and raw materials, as well as the increase in the prices of finished products, according to the latest survey of the PKS “Business Activity economic entities in the Republic of Serbia”.
Conducted on a sample of more than 1,800 companies, this PKS survey shows that around 80% of surveyed companies expect to end 2022 with the same or higher turnover, 84% of surveyed exporters expect stable export activities, mostly in agriculture, food industry and service activities, while 93% of respondents do not plan to reduce the number of workers in the fourth quarter.
As stated on the website of the Serbian Chamber of Commerce, what is worrying is that production costs are rising, which in the third quarter of 2022 were increased by 81% of respondents, while 51% of surveyed businessmen increased the prices of finished products or services. Respondents point out that lower resource prices are a key factor in more efficient operations and capacity utilization.
The threat to achieving the projected economic growth of GDP between 2 and 3% in the current year is also represented by disruptions on the supply and demand side when it comes to basic raw materials and raw materials that our companies use as inputs in the production process. Additional risks include: high inflation, tightening of monetary conditions, geopolitical risks, interruptions in global supply chains.
It is encouraging that 76% of surveyed companies have sufficient financial resources for optimal business financing, while two-thirds stated that they had sufficient funds for investments in the third quarter of 2022, according to the website of the Serbian Chamber of Commerce.
The companies that participated in the PKS survey, according to the financial reports for 2020, achieved a total business income of EUR 22.7 billion, and employed 287,000 workers in September 2022. In the third quarter of this year, they realized a total of EUR 8.6 billion in exports, 84% more than in the same quarter of 2021, and EUR 6 billion in imports, which is 29% more than in the same period last year, eKapija writes.