Serbia’s consolidated fiscal deficit reached RSD 109.3 billion (€931 million) in the first eight months of 2026, more than doubling from RSD 53.5 billion recorded in the same period a year earlier.
The wider deficit coincided with an acceleration in public investment covering roads, railways, energy infrastructure and projects linked to Expo 2027. Despite the increase, the republican budget remained significantly ahead of its planned position, while the government sector recorded a RSD 6 billion primary surplus.
Central budget remains below planned deficit
The republican budget posted a deficit of RSD 98.4 billion (€838 million) through August, approximately RSD 78 billion (€665 million) below the amount planned for the period. The budget had envisaged a January-August deficit of RSD 176.4 billion, meaning the actual shortfall was substantially smaller than projected.
August alone produced a deficit of RSD 600 million, with revenues reaching RSD 195.8 billion against expenditure of RSD 196.4 billion. At the broader government level, the RSD 6 billion primary surplus indicates that revenues exceeded expenditure before interest costs.
Capital spending rises as major projects advance
Public investment has become a major component of Serbia’s fiscal expenditure. Capital spending reached RSD 33.9 billion in August, representing a 28.6% year-on-year increase, or approximately 25% after accounting for inflation. The revised 2026 budget provides for RSD 779.9 billion in general-government capital investment, equivalent to around 7% of GDP.
The investment programme includes infrastructure associated with Expo 2027, the Belgrade metro, the National Stadium, the Morava and Fruška Gora corridors, the Danube corridor, as well as multiple motorway and railway projects. Energy infrastructure is also included in the broader investment cycle.
Public debt reaches €41.93 billion
The increased investment expenditure has coincided with higher nominal public debt. Serbia’s public debt stood at €41.93 billion at the end of August, compared with €39.34 billion at the end of 2025, representing an increase of approximately €2.6 billion over eight months. Despite the higher debt stock, public debt amounted to 43.3% of GDP, slightly below the 43.7% recorded at the end of the previous year. The revised budget assumes 3.3% real economic growth in 2026 and projects central-government debt at approximately 43.8% of GDP at year-end.
Fiscal spending remains ahead of budget targets
The difference between planned and actual expenditure has left the central budget in a stronger position than originally projected for the period. The government has simultaneously maintained higher capital expenditure while keeping the republican deficit below its planned level.
The fiscal figures therefore combine a larger consolidated deficit with a central budget position that remains significantly better than the adopted plan. The investment programme continues to include major transport, energy and Expo-related projects, while public debt remains below the levels implied by the increase in nominal borrowing when measured against GDP.
