Thanks to the Government of Serbia’s Economic Support Programme, the Serbian economy preserved its exports, investments and employment despite the COVID-19 Pandemic and aggravated conditions for doing business, while in 2021 these indicators are expected to experience a growth trend. The Serbian Export Credit and Insurance Agency of the Republic of Serbia participated actively in the implementation of this programme during the pandemic.
The world found itself confronted by the severe economic consequences of the global health crisis caused by the coronavirus pandemic in 2020. The Republic of Serbia responded in a timely fashion to the challenges posed on the economy, and above all on fiscal policy, by the health crisis. The basic objectives set by the Programme of Economic Measures to Support the Serbian Economy have been met. Economic capacities have been preserved and support has been provided for maintaining the economy’s liquidity for the duration of the extraordinary circumstances.
“The Serbian Export Credit and Insurance Agency (AOFI) participated actively in the implementation of this programme during the pandemic,” says AOFI CEO Dejan Vukotić, who agreed to summarise, exclusively for our publication, the consequences of the COVID- 19 Pandemic and the Serbian economy’s prospects in 2021. “In cooperation with the Government and relevant ministries, the Agency focused its activities, both during and after the pandemic, on the credit insurance of the receivables of Serbian exporters and, by taking on the risk of non-payment, helped a large number of export-orientated entrepreneurs to continue their operations.”
As such, during the course of 2020, the AOFI insured 2,820 customers in 75 countries in a total amount of 765,326,609 euros, which represents year-on-year growth of 13%.
The activity of drafting general and special conditions and a new insurance policy that aims to initiate cooperation with the banking sector was completed during 2021
In your opinion, what were the biggest challenges and to what extent did the Serbian economy show its readiness to respond to them?
The Serbian economy preserved its exports, investments and employment despite the COVID-19 Pandemic and aggravated conditions for doing business, while in 2021 these indicators are expected to experience a growth trend. Macroeconomic and financial stability, accompanied by a growth trend in exports, FDI and consumption, along with a timely and comprehensive package of measures, enabled the consequences of COVID-19 and the global slowdown to have less of an impact on the economy of the Republic of Serbia compared to most other European countries.
During 2020, the Republic of Serbia’s exports showed high resilience against the global negative consequences of the pandemic, which halted supply chains, by achieving only a slight fall of 2.0%. The largest decline was recorded in the processing industry, which was caused by a drop in external demand and disruptions to global supply chains.
Foreign trade nonetheless endured great pressure and many works could not be implemented?
The pandemic has impacted on our economy both in terms of placement opportunities and in terms of supplying our producers. The consequences of the market circumstances that emerged were expected, and in credit insurance they are manifested through an increased number of reports of non-payments and company bankruptcies. Thus, the insurance sector paid out 1.6 million euros in 2020, which is the most damages paid since its establishment. On the other hand, in the recourse procedure, 903,000 euros were collected from debtors.
Exports are expected to return to their previous growth path in 2021, despite the global recession, which is also shown by the data of the National Bank of Serbia for the first quarter of 2021.