Serbia’s industrial production increased by 0.3% in May 2026 compared with the same month a year earlier, leaving total output marginally above its 2025 level as manufacturing and mining gains were offset by a contraction in energy supply. Industrial production during the first five months of 2026 was 0.6% higher than in the corresponding period of 2025. May output, however, remained 0.9% below the 2025 average.
The May result followed a 3.4% year-on-year increase in April, indicating a slower pace of industrial growth in the latest monthly data. Production fell sharply in January, improved during February and March, increased more visibly in April and then moderated in May.
Manufacturing and Mining Record Increases
Manufacturing output rose 1.4% year on year in May, while mining production increased by 3.2%. The two sectors supported the overall industrial index during the month.
Manufacturing plants continued to operate above their May 2025 production levels amid weak external demand and higher input costs. Industrial activity included export orders and production in automotive-related industries, food processing, machinery and electrical equipment, while other branches faced slower demand, margin pressure and energy-related constraints.
Mining remained a contributor to industrial output through its role in metals, energy supply, raw materials and industrial exports. Mining activity can be affected by maintenance schedules, ore quality, weather conditions, investment timing and commodity-specific developments.
Energy Supply Reduces Overall Industrial Growth
Output in electricity, gas, steam and air-conditioning supply declined by 8.6% in May compared with the same month in 2025. The reduction in energy-sector production limited the contribution of manufacturing and mining to total industrial growth.
Electricity production affects household prices, industrial operating costs, trade balances, inflation, import requirements and export competitiveness. Energy-system performance also influences thermal generation reliability, hydropower conditions, grid capacity, renewable-energy integration, balancing systems and distribution-network upgrades.
For exporters serving the European Union, electricity sourcing, embedded emissions and related documentation are increasingly relevant to market access, buyer due diligence and contract requirements. These factors apply to sectors including metals, cement, fertilisers, chemicals, aluminium processing, machinery and other carbon-sensitive industries.
Export Demand and European Market Conditions
Germany, Serbia’s largest export market and a central link in its manufacturing supply chains, is facing weak growth expectations. Serbian exporters connected to automotive components, electrical equipment, machinery, rubber, plastics, metals and intermediate goods are exposed to demand conditions in Germany and other European markets.
Exports grew faster than imports during the first five months of 2026, narrowing Serbia’s goods deficit. Continued export growth depends on industrial output, domestic value added, the use of domestic inputs and production of more complex goods.
Serbia’s location, industrial zones, transport corridors and established supplier base are relevant to production-location decisions by European manufacturers. Investment decisions also depend on energy reliability, labour availability, workforce skills, rule-of-law stability, logistics quality and the ability of domestic suppliers to meet EU standards.
Infrastructure and Investment Links
Roads, railways, bypasses, logistics platforms and power infrastructure can affect costs for exporters and regional integration. Infrastructure connected with industrial zones, energy assets, ports, rail corridors and export clusters is linked to private-sector production and logistics activity.
Manufacturing and mining contribute export earnings, supplier development, investment demand, logistics activity and higher-productivity employment. Serbia’s GDP growth can also be supported by services, consumption, public infrastructure, agriculture and construction.
The May industrial data showed positive year-on-year growth in manufacturing and mining, alongside a decline in electricity, gas, steam and air-conditioning supply. The first five months of 2026 recorded 0.6% industrial production growth, while May’s 0.3% increase kept the annual industrial index above zero.
