In the first eleven months of 2025, Serbia reported a current account deficit of €3.48 billion, marking a 13.1% increase compared to the same period in the previous year. This figure highlights ongoing challenges within the country’s macroeconomic framework, characterized by robust export growth alongside significant reliance on imports and external financing.
The widening deficit is primarily attributed to the merchandise trade balance, which recorded a goods deficit of €5.706 billion during the same timeframe. Despite this figure representing a 2.6% decrease from the previous year, it was not the sole contributor to the overall deterioration in the current account. Goods exports rose by 8.4%, while imports increased by 6.5%, indicating that trade performance remains relatively stable.
However, the decline in Serbia’s services surplus significantly impacted the current account balance. The services surplus fell to €1.923 billion, down €511.5 million or 21% year-on-year, reflecting reduced stability in this sector, which has traditionally supported external accounts through information and communication technology (ICT) exports and business services.
Another critical factor influencing the current account was the primary income balance, which showed a substantial deficit of €4.432 billion for the same period. This component encompasses various investment-related flows such as profit repatriation and interest payments, with direct investment income outflows amounting to €3.767 billion, consisting of dividends and reinvested earnings.
This dynamic underscores a structural dependence where foreign direct investment (FDI) has bolstered Serbia’s manufacturing capabilities but also results in significant income outflows as these firms mature and generate profits. While export growth is evident, it does not automatically lead to an improved external balance due to these ongoing capital transfers.
Despite these challenges, Serbia benefitted from a strong secondary income surplus of €4.735 billion during the first eleven months of 2025, largely driven by worker remittances totaling €3.317 billion. These inflows have provided crucial support against trade deficits and income outflows, sustaining consumption and reducing external financing needs.
Nonetheless, reliance on remittances raises concerns about long-term economic stability, emphasizing the necessity for a more resilient domestic export structure capable of generating value without depending heavily on foreign capital or goods.
The monthly data for November 2025 indicated a current account deficit of €555.6 million, significantly higher than €213.2 million in November 2024, driven by an expanding goods deficit and reduced services surplus.
On the financing side, net inflows on the financial account reached €3.684 billion in the first eleven months of 2025, primarily sourced from foreign direct investment and corporate borrowing. However, FDI inflows decreased by 52.5% from the previous year to €1.944 billion, raising concerns about sustainability as Serbia traditionally relies on FDI to cover external imbalances.
The overall macroeconomic landscape illustrates that while Serbia’s external gap is manageable, its financing structure has become less favorable in 2025. Although goods exports are improving, services surpluses are declining, and profit outflows remain substantial.
In terms of trade dynamics, total exports reached €33.068 billion in 2025, with manufacturing comprising 87.6% of this total. This indicates progress in building an export base; however, significant reliance on imported inputs persists alongside capital outflows from foreign-owned entities.
Addressing Serbia’s current account deficit requires not only numerical reduction but also structural changes to enhance local supplier networks and increase domestic value added within export sectors. The challenge lies in transforming an economy that has successfully developed an export machine into one that retains more value domestically while reducing external dependence.
