Safeguarding macroeconomic and financial stability remains a precondition for sustainable growth. But more is needed to secure a strong economy and better prospects for the workforce.
Serbia needs to accelerate the implementation of structural and institutional reforms in order to complete its transformation into a dynamic, private sector-driven market economy that’s able to compete successfully on the Single Market when it joins the EU, including the single labour market. Achieving this goal is critical to limiting the risk of skilled workers leaving the country to pursue better prospects elsewhere in the EU.
The Policy Coordination Instrument that expired in January 2021, as well as the new one that Serbia is currently discussing with the IMF, aim to maintain macroeconomic and financial stability, while supporting the implementation of structural and institutional reforms in these areas
Reaching this goal requires efforts in several areas. Safeguarding macroeconomic and financial stability remains a precondition for sustainable growth. Further addressing Serbia’s infrastructure gaps would help to support competitiveness, foreign investment and integration into regional and global value chains. Well-designed investments in environmental protection would not only support economic recovery from the COVID-19 crisis, but also foster greener and more resilient growth over the medium term. Fighting informality would both facilitate doing business and generate fiscal revenues.
Improving the quality of institutions and governance, which includes having well-governed and managed SOEs, is a priority. In this context, a credible commitment to fight corruption, enhance rule of law and strengthen regional cooperation would be important both in terms of the EU accession process and for accelerating the country’s convergence towards EU-income levels.