Sitemap

Emil Sovilj CEO, Energotehna d.o.o.

Building the Energy of the Future

“I believe that by consolidating the capital of domestic, smaller yet reputable companies, we could once again establish a strong reputation as reliable builders,...

Stanislava Petković, General Director of Vista Rica

A Pioneer in Opening New Investment Opportunities for the Economy

The investment market in Serbia is undergoing a transformation, with alternative investment funds attracting increasing attention from domestic investors In this interview for CorD, Stanislava...

Miloš Jauković, CEO, Dr. Max Serbia

Making Healthcare Accessible to All

Dr. Max Group and Dr. Max Serbia are leaders in providing comprehensive and timely services to patients, with highly ambitious plans for the company’s...

Milorad Stojanović and Darko Šehović, Data Cloud Technology (DCT)

Comprehensive Solutions for Digital Transformation

In today’s dynamic digital landscape, companies face increasing challenges related to IT infrastructure, data security, and business continuity. Data Cloud Technology (DCT) has positioned...

Goran Medić, Director, INOVA-Geoinformatika

INNOVAtion is a Key Part of Our Identity

The advanced and innovative solutions of INOVA, best known for its TeleCAD-GIS and INOVA GIS platform, are applied not only in telecommunications but also...

Slaviša Tasić, Professor Of Economics, Researcher

Sobering Up Comes Next

Sobering-up will follow during this year, through a more restrictive monetary policy that will also be transferred to Serbia. That means reduced liquidity, a slower economy, fewer new jobs and rising interest rates. Rising inflation is no longer the main risk – we are awaited by more unpleasantness through the extinguishing of inflation that will follow

We’re accustomed to inflation. The only periods without inflation in the living memory of today’s Serbian citizens were three short periods when the dinar had a fixed exchange rate: the period of the fixed exchange rate of Ante Marković, the period of the fixed exchange rate of Dragoslav Avramović and the last few years, which were again marked by a de facto fixed exchange rate.

We were to blame for all the inflation experienced to date. Prior to 2001, the inflation and hyperinflation that we experienced were created by the state financing itself through the printing of money. In more recent times, inflation was generated by the NBS whenever it lacked the ear to maintain the exchange rate, as this country’s only successful anchor of monetary policy.

However, this current inflation is something we didn’t create ourselves. The dinar is stable against the euro, but that’s no help given that prices are now also rising in the eurozone. The European Central Bank, as well as other key central banks around the world, reacted to the pandemic by turning on the taps and allowing the money to flow. They increased liquidity in order to prevent the economic crisis triggered by the pandemic from deepening.

They succeeded in preventing an even greater crisis, but it seems that they overexaggerated. Monetary policy works with a delay of unknown duration. You print money today, and inflation comes later – but you don’t know precisely when it will come and to what extent. The inflation that we now see in the eurozone – and in zones of dollars, pounds, roubles, Turkish lira and other currencies – is a consequence of the excessive monetary expansion of the previous two years. Serbia, which previously imported price stability through a fixed exchange rate, has now imported inflation through just such an exchange rate against the euro.

Prior to 2001, the inflation and hyperinflation that we experienced were created by the state financing itself through the printing of money. In more recent times, inflation was generated by the NBS whenever it lacked an ear to maintain the exchange rate, as this country’s only successful anchor of monetary policy

The European Central Bank will not allow things to spin out of control. It currently has inflation of close to 5% and its task is to return to the targeted level of 2% annually. If the NBS continues to peg the dinar to the euro, it will continue to import the policy of the European Central Bank. That’s why further inflation flare-ups are unlikely.

However, the problem hasn’t dissipated. On average, companies and countries fared a little better than they’d expected last year. They had higher revenues. That is the early effect of inflation. Like an alcoholic beverage, it initially makes things better.

This year, the sobering-up will follow through a more restrictive monetary policy, which will be transferred to Serbia as well. That means less liquidity, a slower economy, fewer new jobs and rising interest rates. The main risk is no longer rising inflation – more trouble awaits us through the quenching of inflation that follows.

Sobering-up will follow during this year, through a more restrictive monetary policy that will also be transferred to Serbia. That means reduced liquidity, a slower economy, fewer new jobs and rising interest rates. Rising inflation is no longer the main risk – we are awaited by more unpleasantness through the extinguishing of inflation that will follow.

Comment By Zoran Panović

Students & Vučić

The largest mass gathering in the history of Belgrade demystified the myth of the so-called critical mass, because it doesn’t have to mean anything...

Aleksandar Vlahović, President of the Serbian Association of Economists

A Lack of Quality Institutions Reaches Boiling Point

The resignation of Prime Minister Vučević represents a precedent in Serbia’s political life, marking the consequences of a deep political crisis, the resolution of...

Goran Radosavljević, Ph.D. Vice-Dean for Research and Director of the FEFA Institute

Bad and Good News

Although the political crisis threatens the economy over the short term, meeting protestors’ demands for stronger institutions and the fight against corruption could stimulate...

Pavle Petrović, economist, former president of the Fiscal Council and a member of the Serbian Academy of Sciences and Arts (SANU)

Time for a U-turn in Serbia?

The prime minister’s resignation, prompted by mass protests, may open a window for Serbia to shift from state-led cronyism to an entrepreneurial model grounded...

Serbian Economy Slows Sharply Amid EU Stagnation, Warns wiiw Economist

Serbia’s economy is experiencing a marked slowdown, primarily driven by the stagnation of Germany and other European Union economies,...

World Book and Copyright Day

Each year, on April 23rd, UNESCO celebrates World Book and Copyright Day to highlight the power of books to bring together...

Air Serbia Reaches One Million Passengers

In a landmark moment for regional aviation, Air Serbia has transported its one-millionth passenger of 2025 — a full...

EC Welcomes Serbia’s New Government, Emphasizes Commitment to EU Path

The European Commission has welcomed the appointment of Serbia's new government under Prime Minister Đuro Macut, highlighting the importance...

Serbia’s Living Pavilion Blooms in Osaka

At the official opening of Serbia’s pavilion at EXPO 2025 Osaka, Commissioner Žarko Malinović stated that Serbia was proud...

Serbian Economy Slows Sharply Amid EU Stagnation, Warns wiiw Economist

Serbia’s economy is experiencing a marked slowdown, primarily driven by the stagnation of Germany and other European Union economies,...

World Book and Copyright Day

Each year, on April 23rd, UNESCO celebrates World Book and Copyright Day to highlight the power of books to bring together...

Air Serbia Reaches One Million Passengers

In a landmark moment for regional aviation, Air Serbia has transported its one-millionth passenger of 2025 — a full...

Serbia’s Living Pavilion Blooms in Osaka

At the official opening of Serbia’s pavilion at EXPO 2025 Osaka, Commissioner Žarko Malinović stated that Serbia was proud...

Automation, Migration and Labour Shortages – A European Perspective

As Europe grapples with persistent labour shortages across key sectors, new research underscores how both automation and migration have...

Serbian Economy Slows Sharply Amid EU Stagnation, Warns wiiw Economist

Serbia’s economy is experiencing a marked slowdown, primarily driven by the stagnation of Germany and other European Union economies,...

World Book and Copyright Day

Each year, on April 23rd, UNESCO celebrates World Book and Copyright Day to highlight the power of books to bring together...

Air Serbia Reaches One Million Passengers

In a landmark moment for regional aviation, Air Serbia has transported its one-millionth passenger of 2025 — a full...

Serbia’s Living Pavilion Blooms in Osaka

At the official opening of Serbia’s pavilion at EXPO 2025 Osaka, Commissioner Žarko Malinović stated that Serbia was proud...

Automation, Migration and Labour Shortages – A European Perspective

As Europe grapples with persistent labour shortages across key sectors, new research underscores how both automation and migration have...
spot_img