Economics expert: Purchasing power has significantly decreased

NEWS 26.07.2022 18:20

Serbian citizens’ purchasing power has significantly decreased in the past year and a drastic drop in the standard of living yet awaits them, economics expert Goran Radosavljevic said, Beta reported.

Radosavljevic told the Beta agency that statistics are not up to date with information on the living standard of the population in Serbia.

According latest information of the Statistical Office of the Republic of Serbia (RZS), the average net salary in May 2022 amounted to 74,168 Dinar (1 Euro – 118 Dinar), while the median net salary (50% of employees in Serbia) stood at 56, 582 Dinar.

Radosavljevic said that, when it comes to average salaries, Serbia has reached a relatively high level, “however, average prices are catching up with them, and not just average prices but also those of food staples.”

“The essential problem is that people in Serbia spend a greater part of their income on food, housing and energy and these are the three components that have become significantly more expensive in Serbia,” he said.

According to the latest available information of the Ministry of Trade, Tourism and Telecommunications, the average consumer basket in April 2022 cost 83,633 Dinar, or 1.15 the then average salary.

The analysis shows that, even though the average salary increased almost twofold compared to 2012, the people’s purchasing power did not increase as much and, compared to the median salary, the consumer basked is even more expensive. The average net salary in May 2012 was 40,442 Dinar, which is almost half less than today.

The price of food in Serbia has risen significantly more on the average than in the European Union, unlike energy prices because they are controlled by the state, but it is only a matter of time when this will happen. The price of housing drastically increased, and when we look at these three components we arrive at the conclusion that our inflation is not 11 per cent as the official statistics say, but that the inflation that most people are hit by is 15, 20 or more per cent, Radosavljevic explained.

He said the people’s standard of living has not significantly improved compared to that in 2012.

In Serbia we have a society of paradoxes in the economic sense, apartments are bought for cash, people live on loans, said Radosavljevic, adding that it is only a matter of time when this bubble will burst and when we will see what the quality of life in Serbia is really like.