Improving private-public cooperation
Following the opening of the market in the 1990s, the Serbian economy entered a boom period. But growth was unstable, as became evident when the economy ground to a halt during the economic crisis of 2007-08. The Serbian economy has yet to recover from this blow, and rural regions and young people have been the hardest hit by the stagnating economy.
In 2017, 40% of young people in Serbia were jobless – a youth unemployment rate considerably above the estimated global average (12.6%). The reason for this high unemployment rate is not only a lack of jobs, but also the fact that young people are leaving school with qualifications that do not meet the needs of the economy.
Serbian employers, for their part, cannot find the qualified workers they need in their own country and are therefore unable to contribute to economic growth.
The main reason for this catch-22 situation is the education system, which has proven incapable of providing young people with the skills demanded by the private sector. But the problem also has deeper roots: as long as the private and public sectors fail to work together, an economic turnaround will not be possible.
The SDC's 'South Serbia Private Sector Development' project is taking an integrative approach to tackle the problem: it aims on the one hand to bring about positive change in a promising economic sector – the timber and furniture – and on the other to solve the underlying problem by establishing a foundation of trust between the private and public sectors. Because under the socialist command economy the government dictated what companies could and could not do, there has never been any trust between the private and private sectors in Serbia. The private sector that emerged in the 1990s has been unable to establish a relationship of trust with the public sector.