State Aid in the European Union and Serbia
State Aid in the European Union and Serbia

Author(s): Miroslav Prokopijević
Subject(s): Economy, Governance, Government/Political systems, Public Finances, Fiscal Politics / Budgeting
Published by: Evropski Pokret u Srbiji
Keywords: state aid; EU; Serbia; state aid limits; state aid objectives; state aid transformation
Summary/Abstract: he paper deals with the issue of state aid to the economy in EU countries and in Serbia. High amounts of state aid are economically inefficient and undermine the common market which is one of the main results of European integration, so that is why such high amounts are undesirable. State aid which is provided in Serbia differs in amount, structure and objectives from state aid in the EU. The amount of state aid in the EU is 0.6% of GDP on average, while it amounts to 2–3% of GDP in Serbia. State aid in the EU is 80% horizontal by structure, while it is about 20% horizontal by structure in Serbia and the rest of it is either sectoral or vertical. Objectives of state aid in the EU are moving towards activities which help development, research, employment and environment protection, while in Serbia they are still related to activities which cause losses. What follows from that is that state aid in Serbia will have to be changed fundamentally if the process of accession to the EU continues, or if we want to have better solutions than the existing ones.

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