Meagan-177-002 -

: Growth previously driven by labor and capital accumulation is reaching its limit, necessitating a shift toward productivity-led growth.

The paper identifies structural deficiencies in Serbia's economy and suggests reforms to enhance productivity and boost total factor productivity. Below is a draft summary and analysis based on the key themes of that report. meagan-177-002

This paper examines the historical and future drivers of economic growth in the Republic of Serbia. While Serbia has maintained growth rates comparable to regional peers, a significant income gap with the European Union (EU) persists. As traditional contributions from labor and capital are projected to decline, this report argues for urgent structural reforms to boost total factor productivity and ensure sustainable long-term development. 1. Economic Context and Growth Drivers : Growth previously driven by labor and capital

: Reforming educational and vocational training programs to align with market needs. This paper examines the historical and future drivers

: Low levels of research and development (R&D) compared to EU standards.

: A persistent gap between available skills and those demanded by modern industries.

: Reducing state influence and improving the regulatory environment to foster a more competitive market.