The International Monetary Fund (IMF) has revised Serbia’s economic growth forecast for this year from 4.2% down to 3.5%. While both the Serbian government and opposition have interpreted this in ways that suit their agendas, Serbia is not an outlier—global growth projections have also been downgraded. The IMF reduced its worldwide forecast from 3.3% to 2.8% for this year, and from 3.3% to 3.0% for the next.
Experts point out that the IMF’s global pessimism stems mainly from the ongoing trade war initiated by the administration of former U.S. President Donald Trump. This conflict, particularly with China, has led to reciprocal tariffs, market instability, and weakened global trade—effects that have reached Serbia. In addition, Serbia’s economy has been impacted by a crisis in Germany’s auto industry, to which many Serbian companies supply parts, and by ongoing domestic protests and blockades, some led by student groups.
It’s important to note that the IMF’s forecasts were made using data up to April 4 and do not reflect subsequent delays or adjustments in U.S. tariff policy, such as reductions on electronics imported from China.
Despite the slowdown, Serbia has performed better than many European economies, signaling a degree of resilience. For instance, Germany—the continent’s largest economy—is now projected to shrink by 0.2% this year, compared to earlier expectations of 0.8% growth. The Eurozone forecast was also trimmed from 1.7% to 1.4%, with Hungary expected to slow the most, from 2.9% to 1.4%. Poland’s growth was revised from 3.5% to 3.2%, and the Czech Republic’s from 2.3% to 2.0%. Spain was an exception, with an upgraded projection from 2.1% to 2.5%.
Serbian Finance Minister Siniša Mali blamed domestic unrest for the downgraded forecast, citing the economic consequences of prolonged protests and blockades. He emphasized that lower private consumption, investor caution, and slowing foreign trade are symptoms of both global tensions and local political instability. Public spending, however, is on the rise.
Dragoljub Rajić of the Business Support Network agrees that the trade war and the slump in Germany’s auto industry—exacerbated by rising sales of Chinese electric vehicles—are key reasons for Serbia’s slower growth. Many Serbian companies that produce automotive components for German manufacturers have seen a drop in orders.
He warned of another potential threat: the withdrawal of American IT firms from markets like Serbia as the U.S. pushes to repatriate operations. If engineering offices abroad are deemed to be creating taxable intellectual property, their services could become too costly, prompting closures.
Economist Aleksandar Stevanović supports the IMF’s revised forecast, attributing the downturn to the realignment of global trade structures. While Serbia isn’t directly targeted by tariffs, its strong economic ties to the European Union—an indirect victim of U.S. trade policy—make it vulnerable. He also noted that political unrest has dented business and tourism, particularly in Belgrade.
Branimir Jovanović of the Vienna Institute for International Economic Studies echoes these views, attributing the slowdown mainly to stagnation in Germany and broader EU economies. He acknowledged that domestic protests have played a role, but that industrial declines—such as February’s 1.8% drop in production—are largely due to external economic pressures.
Jovanović confirmed that his institute will revise Serbia’s growth projection from 3.7% down to 3.0%, though he anticipates a rebound to around 4.0% starting next year.
Professor Ljubodrag Savić of the University of Belgrade highlighted three key factors behind Serbia’s slowdown: the global trade war, the German auto industry crisis, and domestic unrest. While Serbia’s direct trade with the U.S. is limited, its dependence on the EU makes it indirectly vulnerable to American tariffs. Germany remains Serbia’s largest trading partner, and the downturn in automotive demand is hitting Serbian suppliers hard.
In conclusion, despite facing external economic shocks and internal political turbulence, Serbia’s economy remains relatively stable compared to some of its European peers, suggesting a degree of underlying resilience.
