National Bank of Serbia : Economic and external trade activity in 2020

29/01/2021

Economic and external trade activity in 2020

According to SORS, total industrial production increased by 0.4% in 2020, reflecting growth in all three sectors - manufacturing, mining and energy. Within manufacturing, growth at the annual level was recorded, despite the pandemic, in 11 areas, which together with mining and energy make up more than two thirds of total industrial production. This confirms the resilience of industrial production to external shocks - resilience achieved by boosting investment and increasing the diversification of exports and production in the prior period.

In December 2020, industrial production rose 4.1% y-o-y, led primarily by manufacturing (5.5% y-o-y) and, to a lesser degree, energy (0.5% y-o-y), while mining recorded a decline in activity by 1.4% y-o-y.

Real retail trade turnover went up by 4.3% in 2020. Looking at tourism at the year level, due to the pandemic, the total number of tourist arrivals was lower by 50.7% and the number of overnight stays by 38.4%. On the other hand, owing to a pick-up in activity during the summer months, the slump in domestic tourism was considerably softer, which eased the lack of foreign tourists. The number of domestic tourists at the annual level was down by 25.4% and the number of their overnight stays by 18.6%.

As for foreign trade movements, Serbia's deficit in the goods trade narrowed during 2020, despite decreased external demand and a significant increase in the necessary import procurements of medical equipment. According to SORS, the goods export decreased by a mere 2.8% in 2020, while import for the whole year is lower by 3.8%.

Looking at overall goods export, manufacturing industry saw a fall by 5.0% due to the subdued external demand and disrupted global value chains, while on the other hand, export of agricultural products rose 19.8% after an excellent agricultural season. Additionally, in December 2020 alone, export posted two-digit growth of 16.6% y-o-y, driven by the rise in the manufacturing and agricultural exports. Import-wise, the decrease at the level of the whole year was mainly driven by the lower import of energy due to the fall in the global oil prices, while import of equipment continued up despite the pandemic.

Governor's Office