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GDP growth of seven percent when Germans live in Serbia – economy

"If the people of Serbia were replaced by the Germans and all of our German institutions, then we will have a growth rate of seven percent."

Photo: FoNet Serbian Association of Managers

Nicola Altiparamakov, a member of the Fiscal Council, said this at a traditional meeting of representatives of the Serbian Managers' Association (SAM) and this independent regulator, commenting on a recent statement by World Bank officials that we can have a decade of annual economic growth of seven percent.

"We can not reach seven percent for ten years. This has not happened in any country from Eastern Europe or Serbia. When such a powerful institution, such as the World Bank, gives unrealistic promises, it has consequences. When imposing unrealistic goals that can not be fulfilled, tensions are created unnecessarily, "said Altyparmakov, recalling that the chairman of the fiscal council Pavle Petrovich presented such an econometric model, according to which we have the potential for an annual growth of five percent that will be first class . economic and social achievements.

Recipes for achieving this result, according to Altyparmakov, are quality institutions and the rule of law.

"The reform of the tax administration and the tax administration, which has been talked about for a long time, but does not do much work. The state must pay taxes. Another thing is the cadastral reform. People need to know what their man is. The third thing is the rule of law, which means the work of the courts. Economic growth is no longer an economic problem, but an institutional one. There is no problem with the law. We have laws, we just do not have enough capacity to implement them, "Altiparamakov said.

But the past and present part of this year are characterized by a few good, one bad and one potentially bad news. Vladimir Vuckovic, a member of the Fiscal Council, estimates that even if this year, if there are no shocks, a slight budget surplus can still be achieved, but he pointed to poor economic growth as bad news.

"Our economy is growing at a rate of three per cent and is now banned because we have macroeconomic stability, low interest rates, a favorable international environment, and again we have little growth. Other neighboring countries have four or five percent. Now that should improve, "Vuckovic said, adding that the growing current account deficit and the faster growth of export imports are also worrying.

Altiparamakov also noted that, for unexplained reasons, the tax administration reform process was halted after the state borrowed $ 50 million from the World Bank.

"For many years IMF experts have worked out a technical plan for tax administration reform and we have paid them for donations from other countries. Finance Minister Lazar Krstic started implementing the plan so he stopped, and now something started again. Now we are borrowing from the World Bank so they do the same work instead of IMF people. According to the biographies of the World Bank people, we have not come to the conclusion that they are better experts, on the contrary. Now, only for the administration, what has the World Bank lost for two years in the reform of the tax administration. The question arises as to how hard the tax administration is to improve, "Altyparmakov asks. The Fiscal Council members, as well as representatives of the economy, have urged the state to use the space in the budget to reduce the burden on wages in support of economic growth.


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