Economic instruments for environmental protection

Due to sustained robust growth, the overall economic context for the conduct of environmental policy has improved over the past years (see the Introduction). As regards structural reforms, a major challenge remains the privatization of large State-owned enterprises, an area where progress has been slower than expected. Although there has been progress in price liberalization, the share of administered and regulated prices in the consumer price index (CPI) is still quite high. These include notably prices for heating and electricity, coal and gas, and oil derivatives. In 2005, the central government also decided to take control of tariff-setting in the water and wastewater sector (see section 4.4). Despite improving living standards, there are still a large proportion of people with very low incomes, which is reflected in the widespread use of firewood and the high and rising levels of illegal logging.

Related Subject(s): Environment and Climate Change

Countries: Serbia