That the progress is merited and that the business and investment environment in Serbia is favourable is evidenced also by the continuing high inflow of foreign direct investment, which this year again will more than suffice to cover the current account deficit.
The labour force is not being fully utilised owing mainly to labour market rigidities. But now we should not overlook the fact that initiatives have been taken to reform the German labour market. There can be no doubt that the labour market has recently become more flexible both with respect to its institutional framework and as regards collective wage bargaining and working hours.