Serbia is in a position to pursue long-term sustainable ‘green growth’ strategies. Society in Serbia can be mobilized around this goal since green growth strategies are able to simultaneously deliver on GDP growth, impairment of regional disparities and employment creation, generating numerous, yet dispersed winners. Such development can be achieved only as a path that genuinely responds to the needs of Serbian citizens. Public participation in policymaking, implementation, monitoring and evaluation are essential if such a policy is to be pursued.

The development path that Serbia followed during the transition has not yielded outcomes that match the expectations of Serbian citizens. Employment growth, freedom of entrepreneurship, effective social protection and export growth were promised at the beginning of the transition. The financial crisis may have exacerbated the problems, but many authors indicated long before the onset of the crisis that the development model focusing on stringent macroeconomic policies together with liberalized capital flows accompanied by high inflation rates do not provide a framework for the emergence of the rule of law that facilitates sustainable development. The model lacked the support of any sustainable development components.

Efficiency in the energy sector critically determines overall economic competitiveness. The Energy Sector in Serbia constitutes a large part of its national economy in all aspects. Energy the supply comprises imported fuels that constitute a large share of overall imports along with locally produced energy, based on low-quality domestic lignite with its inherent inefficiency in extraction, relatively large hydro facilities and fuelwood. Such a supply, characterized by high direct and indirect costs are inefficiently converted and transported to sectors with low purchasing power or industry to which it is provided at a price not allowing for full cost recovery.

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