Serbian economy recovery in the post COVID-19 era: Cluster approach

Abstract

The COVID-19 crisis differs from previous ones. It disrupts global value chains, redirects business toward regional cooperation in a highly globalized world, and forces new business model development toward digitalization. This crisis affected both supplyand demand-side and all countries worldwide, regardless of their economic strength. To support economic recovery, while at the same time fighting for health system endurance through lockdowns and prevention measures, economic decision-makers all around the globe have been using expansive macroeconomic policies. One of the first measures was loosening monetary policy. Such measure was taken in 80% of the countries globally and in all emerging markets. Fiscal policy was significant in supporting demand in the short-term, simultaneously resulting in higher public debt, which is becoming one of the constraints for future development. While economists of today are discussing which letter visualizes the best the character of this crisis - V, U, L, W, we got the letter K, which indicates that recovery among countries will differ in growth rates and duration. Accordingly, we are going to live in a world where change is the only constant. To survive within these conditions, digitalization and key clusters' development are crucial for long-term competitiveness. In this paper, we analyzed the competitiveness of the Serbian economy by using the Country Competitiveness Index, emphasizing the importance of microeconomic indicators that represent a powerful tool in analyzing crucial segments for the economy's recovery. We also focused on three clusters' potential: tech, agribusiness and organic food, and tourism.

A Markov regime-switching (MS) approach to modeling the effects of fiscal policies and COVID-19 pandemic on tourism destination competitiveness in Kenya

“…Further, Millaku et al (2021) confirmed that the prioritization of fiscal reforms had an effect on tourism recovery measures in Kosovo during the post COVID era. Savić et al (2021) noted that fiscal policy was important in recovering tourism demand in the short-run. However, according to AZMI et al (2021) in order to stabilize the effects of the fiscal impacts in the long-run, there is need to sustain the income generating potential of the nation.…”

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“…In terms of inflation, the NBS was much more prepared in 2020 than in 2008 when inflation was around 14%. In line with other world economies, the NBS has begun to implement an expansionary monetary policy in terms of the inherent lowering of interest rates in the initial periods of the pandemic (Savić et al, 2021). The transition from disciplined monetary policy to a regime of strict expansion is shown in the context of three sets of monetary measures: (i) liquidity control measures; (ii) direct aid measures; (iii) reactions to supply and demand shocks (Narodna Banka Srbije, 2021).…”

Competitiveness of agri-food exports of the Republic of Serbia in the Covid-19 conditions

“…As the link between exports and economic growth is two-way (Syamni, 2021), countries with a high share of tourism, as well as some industrialized countries, have faced negative growth rates. On the other hand, the Republic of Serbia in 2020 achieved a decline in gross domestic product of only 1.1%, which is one of the better results given the European countries (Savić et al, 2021). This is the result of a well-conducted macroeconomic policy, timely and effective measures to overcome the consequences of the crisis, but also above-average results in certain sectors of the economy.…”