February 13 (SeeNews) - Serbia's central bank expects the country's economy will grow by 3.5% in 2019, driven by domestic demand, the bank's vice governor Zeljko Jovic said on Wednesday.
"In the following years, we expect growth to pick up further to around 4%, resting on sustainable grounds," Jovic said in remarks at the presentation of the National Bank of Serbia's (NBS) February inflation report published on NBS' website.
The central bank expects net exports to provide a mildly negative contribution to GDP in 2019, due to the slower-than-expected growth in the euro area, Savo Jakovljevic, acting general manager of the Economic Research and Statistics Department of the central bank, said in his speech at the presentation. "On the other hand, greater contribution to economic growth is expected from domestic factors, as indicated primarily by the significantly higher than expected net inflow of FDI and a faster rise in government capital investment which have already approached the level of 4% of GDP. "
Serbia's GDP grew by 4.4% in 2018, backed by the improvement of the business climate, favourable financial conditions, positive labour market trends, as well as the accelerated implementation of infrastructure projects, Jovic noted.
"This is an environment conducive to further growth in investment and competitiveness, and hence, further rise in living standards on sustainable grounds," Jovic added.
In its January 2019 Global Economic Prospects, the World Bank affirmed its 2019 economic growth forecast for Serbia at 3.5%.