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The Government of the Republic of Serbia

In the service of citizens

Foreign trade inreases in first two months of 2006

Belgrade, 31 March 2006

The Serbian Statistical Office stated today that Serbia's overall foreign trade for the first two months of 2006 totalled $2,172.4 million, up 26.4% compared to the same period in 2005. Expressed in euros, foreign trade reached €1,805.6 million, which is an increase of 37.1%.

Exports stood at $682.2 million, up 14.8% compared to the same period last year, while imports totalled $1,490.2 million, a 32.5% increase in relation to the same period in 2005.

Expressed in euros, exports jumped 24.8% to €566.9 million, while imports went up 43.6% to €1,238.7 million in relation to the same period previous year.

Increased imports in January were a result of the import of electricity, which was almost seven times higher compared to the same period in 2005, copper and iron ores import ($31 million) used in production of copper, iron and other metals, since at this moment the prices of these ores are favourable, and an increase in demand (public and personal spending).

The import of gas was 50% bigger than in the same period last year. Due to the problems with gas delivery from Russia, there was no gas import in December 2005 and no import of oil. This considerably encumbered January and February 2006 with additional import of energy sources. The import of oil, electricity, coke, butane and diesel in these two months amounted to $272 million, or 18.3% of the total import.

The increased availability of loans resulted in the increase of demand, which in turn affected the import. This is confirmed by the fact that the import of road vehicles in January and February was $101 million, which is 6.8% of the total import.

Increased exports were driven by the initial effects of privatisation and the restructuring of companies, by signed and ratified free trade agreements with signatory countries of the Stability Pact, by food and ready-made textile goods trade surplus, thanks to the agreement signed with the EU and a preferential status of Serbian goods, as well as by an increase in world prices of basic metals and general economic activity.

The trade deficit for the period January-February 2006 stood at $808 million, up by 52.3% against the same period last year. Expressed in euros, the deficit stood at €671.8 million, up by 64.6%.

Exports-to-imports ratio was 45.8%, showing a fall against the same period last year, when it stood at 52.8%. Expressed in euros, the ratio was 45.8%, whereas last year it was 52.7%.

The most exported items in the period January-February 2006 were intermediate goods accounting for 70.7% ($482.5 million), followed by consumer goods, which made up 25% ($170.7 million) and equipment, making up 4.3% ($29.1 million) of total exports.

Imports were dominated by intermediate goods accounting for 63.7% ($949.5 million), followed by consumer goods, 22.9% ($341.1 million) and equipment, 13.4% ($199.5 million dollars).

Major importers of Serbian goods were Italy ($122.3 million), Germany ($77.9 million), and Bosnia-Herzegovina ($70.2 million). The largest exporters to Serbia were Russia ($246.5 million), Germany ($132.7 million) and Italy ($114.6 million).

The greatest foreign trade was recorded in commerce with the EU, which accounted for more than half of total trade. Foreign trade surpluses realised in commerce with Bosnia-Herzegovina and Italy were $36 million and $8 million respectively.

Thanks to the free trade agreement, as well as the competitiveness of Serbian products, a surplus was also achieved in commerce with Macedonia, but the largest deficit remained in commerce with Russia, due to energy imports, mainly oil and natural gas.