What impact does the conflict in Ukraine have on the Serbian economy?

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While the eyes of the world are on Eastern Europe, the events in Ukraine are being closely monitored in Serbia as well. Some of the analysts saw Moscow’s decision to launch a special military operation as forced after years of provocations by NATO and, on the other hand, the authorities in Kiev, which Russia considers neo-Nazi. We analyzed the geostrategic consequences of the current conflict, but also its impact on the Serbian economy.

Eight years after the annexation of Crimea, Russia will start a special military operation in Donbas. The offensive from several directions was preceded by the recognition of Donetsk and Lugansk. The escalation of tensions in the conflict on the territory of Ukraine was inflamed by the distrust of the Russian side towards NATO.

“NATO has brought this current situation to life with its constant provocations. What is terrible is that Russia has warned all the time and in fact has abstained all the time, saying that NATO must not bring its nuclear infrastructure 400 km from Moscow, yes, it completely upsets the balance of power and brings the world to the brink of disaster. What is happening now is to prevent a much bigger potential catastrophe, “said Dr. Stevan Gajic, Institute for European Studies.

While analysts see the only way out in the capitulation of Kiev, the West responds to Russia’s moves with condemnations and sanctions. The penal protocol is aimed at harming the Russian economy and the finances of individuals. In the political consequences of the events in Ukraine, many see the outlines of a new geostrategic era.

“The biggest losers will be France and Germany, and France and Germany, the main countries of the European Union. Macron’s idea of ​​creating a European army is now falling apart. The Americans got what the British wanted, we can see from their reactions, in fact, from impatience. “Russia should finally do this. I think that the American desire is for Europe to be divided again according to the Cold War divisions,” Gajic emphasized.

However, the consequences are not only political, but also economic. Although it is not endangered at the moment, the Serbian economy also sees them. Rising energy prices have pushed up inflation, they say for RTV in the Serbian Chamber of Commerce.

“So, prices continued to rise, especially energy, and what is especially important is that they are very important as a component within the cost of all products, and thus it pushes inflation up. We had data for January – 8.2 percent “Inflation in Serbia is expected to continue. We will see how much it will be possible to realize those projections of the National Bank of Serbia that the issue of inflation should be stabilized at the transition from the second to the third quarter of this year,” said Bojan Stanic, assistant director. Sector for Strategic Analysis, Analytics, Services, Services and Product Packages in the Serbian Chamber of Commerce.

While the export of about 250 domestic companies to Ukraine last year amounted to about 150 million euros, the current situation will also affect 750 Serbian companies that export about 850 million euros to Russia.

“Doing business with Ukraine is now practically impossible, and regarding the problems faced by businessmen who export to Russia, and certainly to Ukraine – such are the prospects, what to do with the already signed agreements – the Serbian Chamber of Commerce has formed an information center, with a call center available,”Stanic added.

Although Serbia is almost self-sufficient in terms of food, the stocks of commodity reserves are at a good level, they confirm in the Chamber of Commerce, and in case of the need for extraordinary imports, they note that it is possible to provide supplies from alternative markets, RTV reports.