EC: Serbia’s economy slows, growth at risk amid political instability

In its autumn economic outlook, the Commission warned that Serbia’s economy slowed markedly in the first half of the year, with GDP growth of around two percent compared to roughly four percent the previous year. For 2025, the Commission projects Serbia’s GDP growth at 2.2 percent, down from 3.9 percent in 2024. A sharp jump in imports of 10.5 percent, compared to export growth of 6.5 percent, also had a strong negative effect on growth.

The Commission’s analysts predict a growth recovery to 3.3 percent in 2026 and then 4.2 percent in 2027, as domestic demand benefits from rising household incomes and public investments under the “Leap into the Future – Serbia 2027” program and the EXPO 2027 specialized exhibition.

As for the general outlook, the Commission says that downside risks prevail, as political instability has reduced foreign direct investment in Serbia, with economic uncertainties rising. The report also points to a government intervention in the retail market, relying on margin caps, as well as US sanctions against the Serbian Oil Industry (NIS).

Among European Union (EU) candidate countries in the Western Balkans, only Bosnia and Herzegovina is expected to post a lower GDP growth rate, projected at around 1.8 percent.