Serbia maintains rating, recovery slower

BELGRADE -- In its July report, the Dun&Bradstreet (D&B) rating agency maintained Serbia's rating at DB4d, Beta news agency reports.

It places Serbia among the countries with moderate risk to business, and assessed that the growth of Serbia's economy was slower than expected.

"Business risk in Serbia is still elevated, as a consequence of lowered credit capabilities, an increased number of bankrupt companies and poor economic prospects. The high credit debt and the presence of a large number of foreign banks increase the risk of instability in the banking sector," it was said in the statement of the Rating Company from Belgrade, which represents the interests of D&B in Serbia and Montenegro.

"The Serbian economy is slowly coming out of the recession, but economic growth is slower than D&B expected and it indicates a slower global economic recovery and long-term credit progress," it was said in the statement.

D&B expects a further growth of business activities in Serbia during the year, which will be based on the increase of exports, prompted by increased global demand, but also by private investments.

It was added that private investments will be initiated by a more favorable situation on the financial market, cheap labor and the envisaged increase of investments of the Serbian government.

What will also support the economic growth, according to D&B, will be a restrictive monetary policy, lower required reserves and measures of the National Bank of Serbia for encouraging credits in dinars, as well as state subsidies for loans to businesses.

In the region, Slovenia still has the highest rating (DB2c). Croatia is next with DB3d, Bulgaria, Romania, Hungary and Albania are at DB4a, Macedonia and Greece at DB4b and Serbia at DB4d. Bosnia-Herzegovina has lower rating than Serbia's - DB6a.