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BELGRADE (Serbia), September 2 (SeeNews) - Austria's Erste banking group expects Serbia to post flattish industrial production growth figures for 2019, due to a drop in the output of the car factory of FCA Srbija in Kragujevac, it said.
Despite the surprisingly positive data for July, Serbia's industrial output is expected to remain close to neutral on average, Erste analysts said in a comment on Serbia's most recent industrial output data on Friday.
Headline industrial production will pick-up in the coming months, due to base effects, but contrary to retail trends, industry confidence surveys depict an overall negative sentiment, Erste said.
"The drop in production in FCA due to diminished demand and tariffs introduced by Kosovo in November last year stand out as key negative risks."
Serbia's industrial production rose 3.7% year-on-year in July, after declining by 6.1% in June, the statistical office said on Friday. In the first seven months of 2019, Serbia's industrial output declined by 1.3% on the year.
On November 21, Kosovo government increased import tariffs on all goods produced in Serbia to 100% from 10% set earlier that month, saying the move aimed to protect Kosovo’s sovereignty and interests.