Unemployment rate to continue growing, experts predict

Serbia could end 2012 with record European unemployment figures - reaching a rate of 30 percent - a result of economic inactivity, economic analysts say.

Izvor: Tanjug

Friday, 20.07.2012.

21:00

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BELGRADE Serbia could end 2012 with record European unemployment figures - reaching a rate of 30 percent - a result of economic inactivity, economic analysts say. The new government's expected measures to raise employment are unlikely to have positive effects this year, and an improvement can only be expected in 2013, with a higher level of foreign investments, the analysts stated. Unemployment rate to continue growing, experts predict According to the Republic of Serbia Office of Statistics, unemployment in Serbia in April was 25.5 percent, and the Vienna Institute for International Economic Studies has predicted the unemployment rate to be at 27 percent by the end of the year. Belgrade Economic Faculty professor Ljubodrag Savic told Tanjug the institute's prediction might even be optimistic, adding he feared the unemployment rate could jump to 30 percent by the end of the year, together with a drop in GDP. "Everything connected to production, GDP drop and higher illiquidity must reflect on unemployment," Savic noted. The drastically lower agricultural production, bad situation in Zelezara Smederevo caused by U.S. Steel's pull out and difficulties in finding a strategic partner and lower than planned production in Fiat in Kragujevac will have the biggest effect on the GDP drop, he remarked. Production in Kragujevac was supposed to start in mid-2012 and be in the range of 30,000 cars every year, but only several thousand can be expected, Savic pointed out. Economist Miroslav Zdravkovic told Tanjug an improvement to the economic situation in the EU would result in lower unemployment, but added that such an improvement was not in sight. Another way to reduce unemployment would be to get more investments in Serbia, he said. Zdravkovic wants to wait for government measures that could help reduce unemployment, adding that a mild reduction in that negative trend was recorded in March and April, and that the number of unemployed went up by around 2,000 in May. With its high unemployment, according to the Vienna institute, Serbia holds "an ignominious record, beaten only by Bosnia-Herzegovina and Macedonia" - with 28 and 31 percent respectively. Tanjug

Unemployment rate to continue growing, experts predict

According to the Republic of Serbia Office of Statistics, unemployment in Serbia in April was 25.5 percent, and the Vienna Institute for International Economic Studies has predicted the unemployment rate to be at 27 percent by the end of the year.

Belgrade Economic Faculty professor Ljubodrag Savić told Tanjug the institute's prediction might even be optimistic, adding he feared the unemployment rate could jump to 30 percent by the end of the year, together with a drop in GDP.

"Everything connected to production, GDP drop and higher illiquidity must reflect on unemployment," Savić noted.

The drastically lower agricultural production, bad situation in Železara Smederevo caused by U.S. Steel's pull out and difficulties in finding a strategic partner and lower than planned production in Fiat in Kragujevac will have the biggest effect on the GDP drop, he remarked.

Production in Kragujevac was supposed to start in mid-2012 and be in the range of 30,000 cars every year, but only several thousand can be expected, Savić pointed out.

Economist Miroslav Zdravković told Tanjug an improvement to the economic situation in the EU would result in lower unemployment, but added that such an improvement was not in sight. Another way to reduce unemployment would be to get more investments in Serbia, he said.

Zdravković wants to wait for government measures that could help reduce unemployment, adding that a mild reduction in that negative trend was recorded in March and April, and that the number of unemployed went up by around 2,000 in May.

With its high unemployment, according to the Vienna institute, Serbia holds "an ignominious record, beaten only by Bosnia-Herzegovina and Macedonia" - with 28 and 31 percent respectively.

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