Yugoslavia’s potential

OECD Observer

The economy of the Federal Republic of Yugoslavia was devastated during the 1990s, but according to the latest OECD economic survey of the country, reform since the end of 2000 has marked a sea change in policy that has already had a number of positive effects.

Difficult decisions have been taken to implement some structural reforms, and the economy has been substantially liberalised and stabilised. Inevitably there are risks to the hitherto positive macroeconomic developments, especially in Montenegro that has relied heavily on foreign aid. Export-led growth may suffer from the economic slowdown in Europe, Yugoslavia’s largest market.

At the same time, the economy needs to attract inflows of capital. Hence the government needs to keep up the pressure of reform in order to reshape the domestic competitive environment. It takes time for structural reforms to become effective and new institutions to take root. In due course reforms will benefit domestic firms and industry, simultaneously providing fertile ground for the foreign investment that is needed both to support the balance of payments and to help seed a wider domestic recovery.

©OECD Observer No 235, December 2002

Economic data

GDP growth: -9.8% Q2/Q1 2020 2020
Consumer price inflation: 1.3% Sep 2020 annual
Trade (G20): -17.7% exp, -16.7% imp, Q2/Q1 2020
Unemployment: 7.3% Sep 2020
Last update: 10 Nov 2020

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