Serbia is a priority country of Switzerland’s transition cooperation with Eastern Europe. The EU accession is a priority on Serbia’s agenda, however, capacities to implement the necessary reforms are still lacking. Under Switzerland’s cooperation with Serbia, SECO improves the macroeconomic environment, the competitive business environment and the supply of renewable energies as well as energy efficiency.
In recent years, Serbia has made significant progress in terms of political reforms. Nevertheless, the global financial crisis hit the country’s economy hard and revealed its structural weaknesses. Consequently and following a path to EU accession, Serbia implemented strong fiscal consolidation measures in order to reduce its government debt and the macroeconomic situation improved. However, with the outbreak of the COVID-19 pandemic and the ensuing slowdown of economic activities, the Serbian economy is now at risk of another recession.
Further need for reforms
The challenges to further privatise large state-owned enterprises and reduce the number of employees in the public sector remain. Serbian businesses are in a weak competitive position and unemployment rates – especially among young people - remain high. In addition, Serbia ranks low in terms of energy efficiency among European countries and makes too little use of renewable energy sources.
What are SECO’s objectives?
SECO and the Swiss Agency for Development and Cooperation (SDC) jointly define and implement the Swiss Cooperation Strategy 2018 - 2021 in Serbia, which covers the following domains of intervention: governance, economic development and employment, and sustainable energy and resilient cities. Furthermore, Switzerland has a migration partnership with Serbia. SECO’s focus is on:
- Investment climate and job creation
SECO supports measures to improve the investment climate in Serbia. This strengthens the competitive position of Serbian SMEs and ultimately creates more jobs.
- Public financial management
SECO supports Serbia’s efforts to make the management of public funds more efficient. This includes improving tax administration and making accounting more transparent. SECO also works with municipalities to strengthen their control procedures.
- Energy efficiency and strong cities
SECO’s activities in municipalities aim at reducing energy consumption. Another goal is replacing fossil fuels with renewable energy sources. With SECO’s support, cities can better manage and plan their public infrastructure.
From 2018 to 2021, a total of some CHF 105 million is foreseen for Swiss transition cooperation with Serbia, of which around CHF 38 million is from SECO.