Serbia is approaching a symbolic economic milestone that would have seemed ambitious only a decade ago. According to the government’s revised fiscal strategy, the country is expected to expand from an economy worth approximately €89 billion in 2025 to nearly €109 billion by 2028, crossing the psychologically important €100 billion GDP thresholdduring 2027.
The forecast reflects more than simple inflation and exchange-rate effects. It is built upon an economic model that combines infrastructure construction, manufacturing exports, energy investment, digital services and one of the largest public investment programmes in Southeast Europe.
The significance of a €100 billion economy extends beyond headlines. For investors, sovereign lenders and multinational companies, it marks the point at which Serbia increasingly begins to resemble a mid-sized European market rather than a small emerging economy. Economic scale influences everything from bond-market liquidity and banking-sector development to infrastructure financing and foreign direct investment decisions.
The challenge is that reaching €100 billion and sustaining growth beyond that level are two different objectives.
For most of the past decade Serbia benefited from a combination of relatively low labour costs, strong foreign direct investment and significant public infrastructure spending. The next phase will require greater productivity gains. Labour shortages are becoming more visible, demographics are becoming less favourable and competition for industrial investment is intensifying across Central and Eastern Europe.
The government’s projections assume growth of 3.0% in 2026, accelerating to 5.0% in 2027 before moderating to 3.5% in 2028. Much of that acceleration depends on infrastructure projects linked to EXPO 2027, transport corridors, rail modernisation and large-scale state-supported investments.
Manufacturing remains critical. Automotive production continues to evolve toward electric mobility, while sectors such as tyres, metals, machinery and industrial components remain major export earners. At the same time, information technology services are becoming an increasingly important contributor to export revenues.
The transition toward a larger economy also requires stronger capital markets. Serbia’s banking sector remains highly liquid and well-capitalised, but long-term growth increasingly requires deeper domestic financing channels capable of supporting corporate expansion, energy projects and infrastructure assets.
Another challenge lies in the external balance. The fiscal strategy anticipates annual current-account deficits of approximately €5-6 billion through much of the projection period. Such deficits are manageable when foreign investment remains strong, but they highlight Serbia’s continued reliance on external capital.
The most interesting aspect of the forecast is that Serbia’s path toward €109 billion GDP is not driven primarily by consumption. Instead, it is being built through physical capital formation. Roads, railways, industrial facilities, logistics centres, digital infrastructure and energy projects account for a growing share of economic activity.
That makes the forecast highly sensitive to project execution. Delays in major investments, slower absorption of capital expenditure or weaker foreign investment flows would quickly affect growth expectations.
The ambition itself is significant. A decade ago Serbia was viewed primarily as a low-cost manufacturing destination. By the end of this decade, policymakers hope to position the country as a regional logistics, industrial and energy hub supported by an economy approaching €110 billion in size. Whether that transition succeeds will depend less on the pace of spending and more on whether investment translates into productivity, competitiveness and export capacity.
