The economy of Serbia and Montenegro entered a prolonged decline in 1989. Exacerbated by the economic embargo imposed during the Bosnian war, the Federal Republic of Yugoslavia (FRY) economy's downward spiral showed no real sign of recovery until 1995. GDP was nowhere near its 1991 level, but the NATO bombing in 1999 of the basic infrastructure of the country and many factories, as well as a renewed embargo caused a further huge drop in GDP in relation to the 1991 level. The first sign of an economic recovery occurred in 2001 after the removal of Milošević on 5 October 2000. A vigorous team of economic reformers has worked to tame inflation (non-energy inflation is less than 9% in 2002, down from over 120% two years earlier) and rationalize the SCG economy. GDP, although only half of its 1997 level, is projected to increase steadily in the near future. As of January 2005 GDP has recovered to 55-60% of its 1990 level, due to GDP growth of 8.5% in 2004.
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