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WB links rise in salaries and pensions to GDP
Salaries and pensions in Serbia in the next year or two should not exceed a nominal GDP growth, World Bank expert said on Wednesay (April 11).
“That should be Serbia’s government medium and long term economic policy,” Lazar Sestanovic, WB senior economist for the Western Balkans, told Istinomer web page.
He said that a rise in both public sectors salaries and pensions was recorded in the first two months of 2018, noting that “that will influence the economic >> Pročitaj celu vest na sajtu N1 televizija << growth because the state’s participation in total population spending is pretty high”.
He also pointed out that the current transactions deficit rose to 5,7 percent of the last year’s GDP from 3,1 percent in 2016, showing faster import growth, adding that was one of the major challenges to Serbia because of its foreign debt level.
Sestanovic also warned that Serbia’s government continued to subsidise big state companies, contrary to its proclaimed policy, and that during the first two months of 2018 that expense increased.
The latest WB report says the government has an ownership share in 600 companies and that some of them cost the state up to one percent of the GDP. At the same time, Sestanovic added, slower economy growth did not reflect on employment which actually rose, according to respected local institutions’ data.
At the same time, Sestanovic added, slower economy growth did not reflect on employment which actually rose, according to respected local institutions’ data.
Meanwhile, the WB reported that Serbia’s GDP in 2018 would be three percent, while the estimate for 2019 was 3,5 percent, while at the same time, the GDP in the region would reach 3,2 percent in 2018 and 3,5 percent the next year.
The WB experts noted that after “disappointing” 1,9 percent GDP growth in Serbia in 2017, medium term economic recovery would be a result of rising spending not higher export.
