Serbia could achieve long-term growth of seven percent annually and double its per capita income in the next ten years if it implements a new ambitious reform program, it is said today at the Economic Memorandum for Serbia „New economic growth agenda” of the World Bank.
“Is it realistic for Serbia to grow by seven percent a year? Absolutely yes”, Western Balkans WB Director Linda Van Gelder said at the presentation of the report.
She said she understood skepticism if something was possible, but recalled that Serbia had already implemented a program of ambitious and complex reforms.
Van Gelder said that in the conditions of growth of the world economy for Serbia it would be a challenge to implement a program that would enable growth in the long run, aimed at increasing investment and productivity and a program that encourages access to better paid jobs.
According to her, Serbian President Aleksandar Vucic was also interested in the results of the report, who met with Prime Minister Ana Brnabic yesterday and requested that the WB team cooperate with the Serbian Government in drawing up an action plan for Serbia’s economic growth.
She added that Vucic had asked to meet with WB representatives by the end of December, for further information.
WB Global Practice Director Gallina Andronova Vincelette stated that a seven percent increase would allow any country to double its income.
“Maintaining seven percent growth is hard work, but not an impossible task for Serbia”, Andronova said.
If growth is five percent a year, per capita income would double, but in about 15 years.
Asked by a reporter if there had been a seven percent increase in Europe over the long term since World War II, she said there was no such example.
“We haven’t seen a seven percent growth every year for 10 years every year in Europe, but that doesn’t mean that Serbia can’t reach it”, Andronova pointed out.
The World Bank’s chief economist for Serbia, Lazar Sestovic, reminded that Serbia’s GDP is in real terms at pre-Yugoslav level.
“We are roughly on the 1990 mark this year, so our initial base is very low and in that sense we believe that significantly faster growth rates are possible”, Sestovic said. He believes that Serbia is just following a real recovery and an increase in economic activity compared to where it was 30 years ago.
“These growth rates we are talking about are kind of ambition and”, he said, emphasizing that they should be approached with ambition and optimism. Asked by reporters whether the WB experts were aware of the fact that next year’s regular elections were in Serbia, the head of the WB Office in Serbia, Stephen Ndegwa, stated that they partly took this into account.
He said that elections usually slow down economic activity, but also stressed that it was very important to adopt a new economic agenda.
“The elections provide an opportunity to discuss such major reforms”, Ndegwa said, adding that elections do not have to be a disruptive factor, but a type of mobilization and an opportunity to create a consensus in society that a new economic agenda should be implemented.
