Serbia’s external trade has begun 2026 with a slight decrease in overall performance, yet there are signs of enhanced internal balance, indicating a shift in trade dynamics. According to the Statistical Office of the Republic of Serbia, total foreign trade for the first two months of the year reached approximately €11.52 billion, reflecting a 1.3% decline compared to the same period last year.
Despite this decline, underlying trends reveal a more positive outlook. Exports increased to €5.3 billion, representing a 1.6% rise, while imports saw a sharper decrease of 3.5%, dropping to €6.2 billion. This contrasting movement between growing exports and decreasing imports has led to a significant reduction in the trade deficit, which now stands at €936.3 million, down 24.9% year-on-year.
The improvement is also evident in the export-import coverage ratio, which has risen to 84.9%, up from 80.7% a year earlier. This pattern suggests that Serbia is experiencing a phase of trade normalization under tighter domestic demand conditions rather than facing a structural slowdown in exports.
Geographically, Serbia remains closely tied to the European market, with the European Union accounting for 59.9% of total trade, emphasizing Serbia’s role as an integral part of EU supply chains. Additionally, regional trade has provided stability, with trade among CEFTA partners yielding a surplus of €419.9 million, primarily driven by exports in agricultural products, pharmaceuticals, beverages, vehicles, and electrical equipment.
The current data should be viewed against the backdrop of January’s more pronounced contraction, where trade volumes fell by around 11%, largely due to weaker imports and currency fluctuations. The stabilization observed in February indicates a moderation of early-year shocks and a gradual rebalancing of trade flows.
This situation presents a dual-speed adjustment; while import compression reflects reduced domestic consumption and demand for industrial inputs—likely influenced by tighter financial conditions and adjustments in energy-intensive sectors—export resilience signals ongoing integration into European manufacturing chains, especially in automotive components and agri-food sectors.
The notable reduction in the trade deficit is significant from a macro-financial perspective. Lower external imbalances alleviate pressure on Serbia’s current account and its dependence on external financing, which tends to support currency stability and improve sovereign risk perceptions amid elevated global interest rates.
Sector-wise data aligns with broader industrial trends, showing that industrial production declined by 4.7% during January-February, particularly affected by weaknesses in mining and energy segments. This contraction directly impacts import demand for intermediate goods and reinforces the overall decline in trade volume.
However, the export composition—especially the sustained strength in processed goods and machinery—indicates that Serbia’s industrial base is not uniformly contracting but rather undergoing selective rebalancing. Higher-value-added segments continue to maintain competitiveness externally even as traditional or energy-intensive industries confront challenges.
Looking forward, several factors will influence Serbia’s external trade trajectory in 2026. The recovery pace of EU demand will be crucial given its nearly 60% share in Serbia’s trading structure. Concurrently, energy prices and trends in industrial output will dictate the extent of import recovery during the latter half of the year.
Early data suggests that Serbia’s trade performance is shifting from being volume-driven to more balance-oriented. While overall exchange experienced a modest contraction of 1.3%, this is overshadowed by an almost 25% reduction in the deficit, indicating a more sustainable external position even within a softer macroeconomic environment.
