Bloomberg News

Serbian Economy Grew 0.5% in Third Quarter, Final Data Shows

December 29, 2011

(Updates with inflation estimate, performance by industry, from second paragraph.)

Dec. 29 (Bloomberg) -- The Serbian economy expanded 0.5 percent in the third quarter and may grow as much as 1.9 percent this year, the country’s Statistics Office said.

The energy, construction and mining industries contributed the most during the year to growth, while trade and services led declines, said Dragan Vukmirovic, head of the statistics office.

Serbia’s central bank revised its forecast for full-year growth in November to 2 percent from 2.5 percent on the effects of Europe’s sovereign-debt crisis and dwindling demand in the European Union, Serbia’s main export market. It also cut the outlook for 2012 to 1.5 percent from 3 percent previously, in line with the International Monetary Fund with whom the Balkan country has a 1.29 billion euro ($1.66 billion) precautionary loan arrangement.

“The slowdown was stronger in the third quarter than in the second, so it will probably be months before we seen an upturn,” Vukmirovic said at a press conference today in the capital Belgrade. Growth for the third quarter was revised from 0.7 percent in a flash estimate.

Trade and processing industries contributed the most to the slowdown during the quarter, contracting 7.7 percent and 1.6 percent respectively, while telecommunications and construction led growth, with 9.3 percent and 9.2 percent respectively.

Industrial Production

Industrial production grew 2.2 percent, its first positive quarter since mid-2010. Agriculture is seen growing 0.8 percent this year and retail trade may fall as much as 17.7 percent, even as wholesale probably avoided contraction, he said.

Inflation may end the year at 7 percent, slowing from a peak in April of 14.7 percent, according to the data.

The office also revised second-quarter growth to 2.5 percent from 2.4 percent previously. Seasonally adjusted numbers showed that the economy stagnated in the third quarter against the previous three months, the statistics office said.

--Editor: Douglas Lytle

To contact the reporters on this story: Gordana Filipovic in Belgrade at gfilipovic@bloomberg.net; Misha Savic in Belgrade at msavic2@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net


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