April 6 (SeeNews) - Fitch Solutions, an intelligence solutions affiliate of Fitch Ratings, expects Serbia's real household spending to contract by 2.4% in 2020 due to the impact of the coronavirus outbreak, before growing by 2.7% next year, it said.
"We have revised downward our 2020 forecast for real household spending in Serbia to contract by 2.4% from a pre-coronavirus projection for 2020 of y-o-y growth of 4.0%. In 2019 we estimate that real household spending expanded by 3.4% y-o-y," Fitch Solutions said in a commentary on the impact of the novel coronavirus (COVID-19) on Serbia's consumer sector last week.
Consumers will increase their purchases of food and drink from groceries and supermarkets as the curfew and lockdown imposed by the government means they will need to cook at home, but non-essential retail and shopping malls stand to lose almost a months sales revenue, Fitch Solutions said.
"We predict that positive growth will return in 2021 as consumer spending increases once more the restrictions on the retail sector are removed, but this outlook remains under pressure to the downside. Our 2021 forecast is now 2.7% y-o-y for real household spending, from our pre-coronavirus projection for 2021 of 4.4%," Fitch Solutions added.
The Serbian government declared a nationwide state of emergency on March 15, which led to travel bans being imposed, closed schools and universities and led to restrictions on operations and the movement of consumers. The country has confirmed 1,908 cases of the coronavirus infection and 51 deaths related to the virus so far.