About two million inhabitants of Serbia live on the doorstep of poverty and social exclusion, and Serbia belongs to the countries with the greatest inequalities in income distribution in Europe, said prof. Dr. Ognjen Radonjić, full professor of economics at the Faculty of Philosophy of the University of Belgrade and a member of the Scientific Society of Serbian Economists.
He emphasizes that Serbia is one of the "most corrupt countries in the world" and that, behind Russia and Ukraine, it is the third on the European list of countries in terms of the strength of organized crime.
"Then we wonder why about 40.000 of its citizens leave Serbia every year, the negative natural increase is at the level of about 40-50.000 a year, while the population is persistently aging and rural areas are rapidly emptying," Radonjić told N1.
Higher GDP does not necessarily mean betterment for citizens
He warns that the weakness of the Serbian economy is its economic growth, which "leaves future generations without a future."
"Economic growth does not contain the elements of economic development, because it is not sustainable and does not carry within it the germs of climbing the ladder of technological progress. I remind you that in October 2024, the American agency S&P awarded Serbia an investment credit rating of BBB- for the first time. However, they clearly pointed out that economic growth in Serbia is driven by strong demand, behind which are public infrastructure investments and Expo 2027, but also that Serbia has a very weak institutional environment - read: high corruption, low the rule of law, low GDP per capita, high net foreign debt and a high share of the euro in the economy," says Radonjić.
He points out that higher GDP does not necessarily mean betterment for citizens because it does not speak about the level of political repression, corruption, and crime in a society.
"Also, GDP ignores environmental degradation, air, water and forest pollution. A scenario of GDP growth is quite possible, but with ruthless exploitation of the workforce, massive endangerment of people's health, unsustainable extraction of natural resources, destruction of the living environment and the use of dirty technology," warns Radonjić.
GDP growth can increase poverty
He notes that with the growth of GDP, it is quite possible that there will be an increase in poverty at the same time, and that, for example, 80 percent of the newly created income will be appropriated by the richest 10 percent or that the richest 50 percent will appropriate XNUMX percent of the newly created wealth.
"Consequently, economic growth, i.e. GDP growth, can be harmful. According to the definition of the United Nations, one of the several harmful types of economic growth, which in my opinion applies to Serbia, is economic growth that leaves future generations without a future - futureless growth, and it boils down to meeting the needs of a privileged layer of society at the expense of the rest of society and those yet to come," says Radonjić.
When asked how he explains the statement by the Minister of Finance that the share of public debt in GDP in Serbia is 44,3 percent, which is significantly better than the European average, and whether this means that Serbia is a stable country, Radonjić emphasizes that I explain it largely by "inflating" the GDP, through its audit conducted in October last year.
"As the Fiscal Council itself noted, nominal GDP was increased by about five percent through this revision, which automatically decreases the share of public debt in GDP. On the other hand, since the middle of 2012, when this government took over, the absolute level of debt has increased from 15,5 billion euros to today's around 40 billion euros, which is a dramatic increase of 160 percent," says Radonjić.
"The narrative of the economic tiger is a wild story"
He also states that interest costs on the public debt jumped from 63 billion dinars in 2012 to 185 billion dinars in 2024.
"The economic tiger narrative is a wild story when you take a look at the real data. Before the 2024 GDP revision, Serbian real GDP per capita at 2010 prices was 2023 euros in 6.500 and was lower than Montenegrin, which was 6.900 euros. After the revision, and inflation of Serbian GDP, the same and 2023 Serbian real GDP per capita, at 2020 prices In 8.520, it amounted to 8.460 euros and was above the Montenegrin one, which is XNUMX euros. So, we can see how the data is manipulated in action," says Radonjić.
He adds that despite this, Serbia lags significantly behind the countries of the European Union. Specifically, according to the latest available data, in 2024, the real GDP per inhabitant of Serbia, I note after the problematic revision, amounted to 8.900 euros, while the average for the European Union was 33.530 euros and, for example, Slovenia 25.389 euros, Croatia 16.690 euros, Romania 13.130 euros and Bulgaria 11.300 euros.
Source: H1
