Serbia's trade shift: Declining ties with Russia amid new markets
3 July 2024 15:53
Despite the bilateral free trade agreement, Serbia and Russia have never utilised its full potential. Since the beginning of 2024, trade has significantly declined, notes the weekly "Vreme". Some analysts see this as a sign of Belgrade politically distancing itself from Moscow.
Serbia saw an increase in the value of imports from Russia in 2022, reaching £2.5 billion, which can be attributed to the signing of a new contract for Russian gas supplies and an increase in raw material prices. In subsequent years, imports have seen regular declines.
An ally turns away
Economic experts emphasise that the weakening trade between the countries demonstrates the underutilisation of the opportunities provided by free trade agreements and the gradual distancing of Serbia from Russia.
Economist Sasza Dziogović pointed out that apples were significant in exports to Russia. Still, these goods have been redirected to other destinations, indicating that Serbia has found alternative markets, "debunking the thesis of the dependence of this important export sector on Russia."
The expert explained that fruits have started to reach markets in the United Kingdom, Portugal, and Saudi Arabia, and the anticipated signing of a free trade agreement with Egypt will open another market for Serbia's goods.
The agreement with Russia was also utilised by foreign investors, who began opening their companies in Serbia, taking advantage of the preferential export conditions to the Russian market, recalled economist Ivan Nikolić.
Nine of the top ten exporters from Serbia to Russia in recent years were foreign investors, with eight originating from the European Union.
The analyst also pointed out restrictions on Russian imports. "Energy raw materials and defence sector goods overwhelmingly dominate these imports. This raises the question, does Russia have nothing to offer Serbia beyond weapons, oil, and gas?" said Nikolić.
