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After the deluge, the contraction. Serbia’s economy shrank by 1.1 per cent year-on-year in the second quarter after the country was hit by serious flooding that may have caused €1.7bn of damage.

May’s floods came just when the economy seemed to be picking up again and a new government was installed with a big majority and mandate for sweeping reform. The impact of the disaster has been felt across the economy and will weigh on full-year growth, now expected to be negligible. The shrinkage in the second quarter, reported in a flash GDP estimate from Serbia’s statistical office, followed a 0.1 per cent y-o-y rise in Q1. Continue reading »

Vucic spreads his message of doom

Could Serbia become the Greece of the Danube and go bankrupt within a year, just as other European countries are having some success in grappling with their debt problems? That was the recent warning from Aleksandar Vucic, the country’s new prime minister, should his government fail to implement a package of tough economic reforms, including extensive privatisation and labour liberalisation.

Vucic’s doom-mongering is partly a signal to his electorate that there are hard times ahead. Serbia is indeed on a dangerously unsustainable trajectory. But it is not quite at the buffers yet. Continue reading »

Serbia’s central bank cut its key policy rate by 50 basis points on June 13, twice the reduction expected and another bold monetary easing move. The National Bank of Serbia (NBS) has now lowered rates by a full 100 bp in two months. The NBS is taking advantage of low inflation and easing pressure on prices, and taking account of the recent radical policy action by the European Central Bank (ECB). But the cut should also be seen in the context of May’s devastating floods, which caused Serbia’s fragile recovery to grind to a halt and has shaken domestic and international confidence in the newly-elected government. Continue reading »

By Adam Ereli, US ambassador to the Kingdom of Bahrain

A political earthquake shook Serbia on March 16, 2014. The Serbian Progressive Party (SNS) of Alexander Vucic took 48.6 per cent of the popular vote in general elections and secured 63 per cent of the seats in Parliament. For the first time in the post-Milosevic era, Serbia’s Prime Minister will have a strong mandate to govern.

A number of factors contributed to this seismic shift. Chief among them was public disenchantment with the venality and malfeasance of the country’s ruling class, which historically has placed self-interest ahead of the public good. Vucic’s rivals self-destructed through internal divisions and rivalries. Continue reading »

By Aleksandar Vucic, Prime Minister of Serbia

A 19th Century American theologian and anti-slavery campaigner once wrote: “A politician thinks of the next election; a statesman of the next generation. A politician looks for the success of his party; a statesman for that of his country.”

James Freeman Clarke’s words are close to my heart, and he would doubtless have had stirring opinions on recent events in south eastern Europe. Continue reading »

A landslide win for the ruling party in Sunday’s Serbian election provides a mandate for sweeping reforms including privatisations, changes to labour legislation and fiscal tightening in the country running Europe’s highest budget deficit.

But, as ever, actually implementing unpopular measures is likely to prove difficult, even with a hefty parliamentary majority. Continue reading »

On January 15, 2000, 23-year-old Dobrosav Gavric strode into the lobby of Belgrade’s InterContinental hotel, pulled out a Heckler and Koch submachine gun and unloaded it into Arkan, one of the most notorious warlords and gangsters in the Balkans.

Arkan – real name Zeljko Raznatovic – died in the arms of Ceca, his “turbo-folk” singer wife, the other half of the First Couple of Serbian nationalism. The assassination seemed to typify Serbia in the wake of the Yugoslav wars: lawless, shamelessly violent and ruled by extremist kleptocrats. Continue reading »

Serbia could privatise up to 100 state-owned companies and enact wide-ranging reform of the business environment if the government is re-elected in next month’s general election, Ivica Dacic, prime minister (pictured), has told beyondbrics in exclusive comments.

But can he deliver? Continue reading »

Ivica Dacic (left) with José Manuel Barroso, EC president

By Harriet Salem of bne

Serbia may have opened its EU accession talks on January 21 but the bloc’s stringent restrictions on smoking have not yet permeated the Serbian Embassy on Boulevard du Regent in Brussels. Reclining in a large armchair, Ivica Dacic, Serbia’s prime minister and leader of the Socialist Party, puffs on a fat cigar to celebrate what he describes as “the most momentous and most important day for the country since the end of World War II.” EU officials reciprocated by lavishing praise on the Serbian government’s work over the last 18 months.

But on the home front the situation is less then ideal. Continue reading »

Recovering growth, a new settlement on Kosovo, real progress with the European Union, generous funding packages from the UAE and Russia and new trade and investment ties – last year was a pretty good one for Serbia. The government is already looking to cash in on the success with a snap election in the spring.

But has the positive news papered over real cracks in the economy? That is the view of Fitch, the ratings agency, which on Friday downgraded Serbia to B+, or “highly speculative junk” status. Continue reading »

Just over a decade ago, in the wake of the bloody Yugolsav Wars, Serbia was regarded as a pariah by many European countries. Next month, it will start negotiations for membership of the European Union.

A rogue state no more, the beginning of formal talks on a wide range of policy areas (“chapters”) indicates how far the country has come. But the way ahead is not an easy one, entailing many years of difficult reforms. Continue reading »

Serbia’s national bank has delivered an early Christmas present to borrowers with another interest rate cut, its third in succession.

The move comes as talk of a snap election next year intensifies, raising concerns about the short-term economic outlook and the future of the government’s promised austerity measures. Continue reading »

A CNN affiliate has launched a broadside against the Serbian government over a draft law that it says restricts media freedom, threatening to take the case to European level if Belgrade does not back down.

Brent Sadler, a veteran CNN reporter and now chief executive of N1, an affiliated local-language 24-hour news channel that would broadcast to Serbia, Croatia and Bosnia from their capital cities, told beyondbrics that the proposed electronic media law would “strangle the channel before it is born”. Continue reading »

A landmark deal with Kosovo, a $3bn loan package from a new Emirati ally, a high-profile anti-corruption drive: Serbia has been filled with a new boldness in recent times.

It continued on Friday as the National Bank of Serbia cut its policy interest rate by half a point to 10.5 per cent, more than the expected quarter-point cut. The bank had held steady for the previous three months following reductions totalling 75 bp in May and June, as inflation fell from double figures. Continue reading »

Hollywood, Bollywood, Nigeria’s Nollywood; France’s arthouse cinema scene, British romcoms, Italian and Russian film from the likes of Fellini and Tarkovsky; the Korean Wave. The cinema culture of south eastern Europe may be rather less celebrated outside the region than those of its more famous peers, but there is growing recognition both of a resurgent home-grown movie scene and the competitive advantages of SEE as a location for shoots. Continue reading »