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The Government of the Republic of Serbia

In the service of citizens

January-November foreign trade jumps 11.4 percent year-on-year

Belgrade, 29 December 2005

Serbia’s foreign trade in the period January- November 2005 amounted to $13.63 billion, an 11.4 percent jump on a year earlier, according to the Serbian Statistical Office.

Expressed in euros, the volume of foreign trade stood at €10.93 billion, marking an increase of 10.2 percent against the same period in 2004.

Exports stood at $4.08 billion, up 31.1 percent from a year earlier, while imports totalled $9.54 billion, a 4.7 percent jump against the same period of 2004.

Expressed in euros, exports jumped 29.5 percent to €3.27 billion, while imports went up 3.6 percent to €7.66 billion against the same period in 2004.

The increase in imports in the first eleven months of the current year was due to decreased aggregate spending mainly because of a decline in real wages, as well as stemming from monetary and credit policy measures and the newly introduced value added tax (VAT).

Import of many goods planned for the beginning of the year was made in December 2004, ahead of the launch of the new tax in order to avoid VAT payments by importers for the first couple of months of 2005. VAT also affected export results, because exporters are now declaring real values of their shipments in order to claim VAT refunds.

Surging exports were also driven by the initial effects of privatisation and the restructuring of companies, by signed and ratified free trade agreements with countries who are signatories of the Stability Pact for South Eastern Europe, and by food and ready-made textile goods trade surplus, thanks to the agreement signed with the EU.

The trade deficit in the January to November period was $5.45 billion, down by 9 percent against the same period in 2004. Expressed in euros, the gap narrowed by 9.8 percent to €4.39 billion.

Exports-to-imports ratio was 42.8 percent, up from 34.2 percent from a year earlier. Expressed in euros the ratio is 42.7 percent, up from last year’s 34.1 percent.

The most exported items were intermediate goods, accounting for 67.1 percent ($2.74 billion) of overall exports, followed by consumer goods, which made up 27.5 percent ($1.12 billion) and equipment, making up 5.4 percent ($220.4 million) of total exports.

Imports were also dominated by intermediate goods, 62.5 percent ($5.96 billion), consumer goods, 21.1 percent ($2.02 billion), and equipment, 16.4 percent ($1.56 billion) of overall imports. Major importers of Serbian goods were Bosnia and Herzegovina ($651.2 million), Italy ($608.8 million), and Germany ($411.5 million), while the largest exporters to Serbia were Russia ($1.55 billion), Germany ($992.9 million), and Italy ($816.6 million).

The greatest portion of foreign trade in the first 11 months of 2005 was recorded in commerce with the EU, which accounted for more than a half of total trade. Serbia has increased imports from Italy in the last two months due to a loan for equipment import, but the overall trade ratio is more favourable than in 2004.

The biggest surplus was recorded in trade with Bosnia-Herzegovina, $391 million. Thanks to the free trade agreement, as well as the competitiveness of Serbian products, a surplus has also been achieved in commerce with Macedonia, while deficit remained wide in commerce with Russia, due to energy imports, mainly oil and natural gas.