WIIW The Vienna Institute for International Economic Studies - Wiener Institut für Internationale Wirtschaftsvergleiche

Serbia has been among the best-performing European countries during the COVID-19 pandemic. GDP fell by just 0.8% in the first half of the year, and data for Q3 suggest a solid recovery. We are thus upgrading our forecast for 2020, from -4% to -2%. The good results are mainly due to the massive fiscal support by the government, which has borrowed abroad and used the money to support the economy during the crisis. This cannot continue indefinitely, and prospects for the future depend on the viability of its current economic model, based on attracting FDI, in the post-coronavirus world.