Page 72 - SE Outlook Regions 2023

2.10.2 External environment
Serbia’s foreign trade deficit widened by an annual 66.7% to over
€7.9bn in the first nine months of the year, data from by the statistics
office shows.

In euro terms, Serbia’s exports increased by an annual 27.7% to nearly
€20bn in the first nine months of the year, while imports jumped by
36.8% y/y to €27.9bn.

The coverage of imports by exports was 71.4%, down from 76.6%
through the same period in 2021.

In September, the trade deficit totalled €681.1mn as exports rose by
25% y/y to nearly €2bn and imports increased by 26.6% to over €3.1bn.

Foreign trade exchange was the largest with countries with which
Serbia has signed free trade agreements (FTAs). EU member states
accounted for 58.7% of the total trade exchange.

Plans to sign a FTA between Serbia and China were discussed by the
presidents of the two countries back in February, but it is unclear how
soon the deal will be signed. It is expected to significantly expand trade
between Serbia and China.

According to the European Commission, net exports will make a
negative contribution to GDP growth in 2022. However, it added that
looking ahead, “the contribution of net exports to growth is expected to
improve due to decelerating imports and increased export capacity
supported by recent foreign direct investment in the tradable sector”.

“A deeper than expected slowdown in main trading partners, particularly
in the EU, could dampen net exports as compared to the baseline. On
the other hand, increased nearshoring of production could have

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