jorgovanka tabakovic : overcoming the pandemic and enabling sustainable recovery address by dr jorgovanka tabakovic, governor of the national bank of serbia, at the swiss constituency seminar " overcoming the pandemic and enabling sustainable recovery ", 3th june 2021. * * * dear colleagues, good afternoon or morning to everyone. first, i want to emphasize that human capital, knowledge and trust are the preconditions and conditions for existence, for lasting and for having development perspectives. isn ’ t it that human capital, knowledge and trust are the most important in everyday life too - in our families and interpersonal relationships? for it is people who make institutions, companies, states. they both make and represent them. i will present to you, as to my chosen family, how serbia has fought the pandemic. i will talk about : 1. why covid - 19 had a less severe impact on serbia 2. responses by both the nbs and the government 3. and our medium - term agenda. i will start with the outcome. serbia has recorded only a mild contraction of gdp last year, of just 1 %. already in q1 this year our gdp exceeded pre - crisis levels. we often get the how question – what are the key factors behind such a good outcome? 1. first, serbia entered the crisis in an excellent shape – a lot has been done during the last nine years, and here i want to give the deserved credit to our president aleksandar vucic for his vision and dedicated work for a stronger serbia. 2. second, we implemented large and comprehensive packages of both monetary and fiscal policies, but we stayed prudent and kept public debt to gdp ratio well under control. we also increased our fx reserves since the pandemic. 3. third, it is also the timeliness of these packages that kept business and consumer confidence. 4. fourth is the product and geographical diversification of industrial production and exports. 5. fifth is the continuation of all government infrastructure projects. 6. and, on top of that, it is about the successful vaccination process. also, part of the better result is related to a better than initially expected outcome in our main trading partners. during the curtain raiser, managing director madam georgieva said that without synchronized measures, the global contraction last year would have been at least three times worse and this could have been another great depression. fortunately, due to our extraordinary joint

and judgment, and the pursuit of the congressionally mandated goals that guide the work of the board. in some cases, this approach has led me to depart from the views of my colleagues. at its september meeting, the fomc voted to lower the target range for the federal funds rate, for the first time since we began tightening to combat inflation, by 1 / 2 percentage point to 4 - 3 / 4 to 5 percent. i dissented from that decision, preferring instead to lower the target range by 1 / 4 percentage point. in my statement published after the meeting, i 1 / 9 bis - central bankers'speeches agreed with the committee's assessment that, given the progress we have seen since the middle of 2023 on both lowering inflation and cooling the labor market, it was appropriate to reflect this progress by beginning the process of recalibrating the policy stance toward a more neutral setting. as my statement noted, i preferred a smaller initial cut in the policy rate. with inflation continuing to hover well above our 2 percent goal, i saw the risk that the committee's large policy action might be interpreted as a premature declaration of victory on our price - stability mandate. in addition, with the u. s. economy remaining strong, moving the policy rate down too quickly, in my view, would carry the risk of stoking demand unnecessarily and potentially reigniting inflationary pressures. my dissent was notable in that the last dissenting vote from a fed board member on an fomc vote occurred nearly 20 years ago. my dissent was guided by my view and interpretation of the available data and my understanding of the fed's dual mandate of maximum employment and stable prices, which i will discuss more in a moment. everyone in this room knows that experience is important. my experiences have shaped and reinforced my views on how policymakers can best serve the publicnarrowly, including in monetary policy decisionmaking and the regulation of the banking industry, but also more broadly in thinking about policymaking in support of an agency's mission balanced with its extensive impact on the affected industry and the u. s. economy. a pragmatic approach to policymaking a goal - oriented approach in the past, i have discussed the role of policymaking from the perspective of a federal reserve board member. but taking a step back, there are some broader themes relevant to agency policymaking more generally, themes that are useful beyond the context of the federal reserve. at a