[Biznis.rs] Economy grew nearly six times faster in years without elections

Between 2012 and 2022, Serbia had six years with national (parliamentary and/or presidential) and local elections and five years without elections. Data show that the average rate of economic growth in years without elections was almost six times higher than in those when there were elections - 4.21% versus 0.75% of GDP, Dušan Vasiljević, Competitiveness and Investments Director in NALED.

When asked how much the possible announcement of elections in the fall would spoil the plans of businesses, as well as estimates of economic growth for the current year, Dušan says that he does not expect that the potential elections would have a greater impact on the plans of business entities, since they are generally not made in relation to election cycles, which are relatively unpredictable in our country anyway.

- The easily predictable effects of calling elections are the suspension of the adoption of laws for about six months, a decrease in the intensity of the activities of the state administration in performing daily tasks and a short-term increase in public expenditures in order to win over different segments of the electorate, which can have the effect of a mild stimulus for economic activity in the short term, and potentially a challenge in the long term, when it will be necessary to compensate the funds that were directed to non-productive purposes in support of the campaign. All in all, I expect that the eventual announcement of elections will not have a major impact on business performance, but to the extent it exists, it will be slightly negative - assesses Vasiljević.

He claims that, according to direct testimonies of representatives of multinational companies operating in Serbia, political stability and predictability are among the most significant positive characteristics of our business environment.

- Personally, when I first heard such testimonies several years ago, they were confusing to me, because I expected investors to seek much more from the state than stability and a predictable business environment. In the meantime, I have heard the same thing so many times, especially in the context of business problems in some economies in the environment where there is no such stability and predictability. I don't see the expectation among businessmen that the elections, if they happen, will neither resolve the key uncertainties of the business environment nor call into question the basic directions of economic policy - concludes Dušan Vasiljević, who believes that businessmen are not in anticipation of whether the elections will take place .

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