Serbia’s revised fiscal strategy presents a confident growth story, but the external accounts reveal the cost of that ambition. The country is expected to run current-account deficits of roughly €5–6 billion a year through the projection period, reflecting the import-heavy nature of its infrastructure, energy and industrial investment cycle.
The deficit is projected at approximately €4.7 billion in 2025, widening to about €5.7 billion in 2026, before remaining close to €5–6 billion in 2027 and 2028. For a country moving toward a €100 billion-plus economy, these figures are not automatically alarming. But they underline a structural feature of Serbia’s growth model: expansion still depends heavily on external financing.
The main driver is investment. Roads, railways, energy projects, industrial facilities and EXPO-related construction require imported machinery, equipment, technology, vehicles, construction inputs and energy-related components. Even when projects are built domestically, the capital goods behind them often come from abroad.
That is why infrastructure-led growth can widen the trade gap before it improves competitiveness.
In theory, this is acceptable if imported capital goods raise future export capacity. A railway that lowers freight costs, an energy project that improves security of supply, or an industrial facility that expands manufacturing exports can all justify temporary external deficits. The problem arises if imports support projects with weak productivity returns or if export growth fails to catch up.
Serbia’s export base remains stronger than in previous decades. Automotive production, tyre manufacturing, basic metals, ICT services, agricultural exports and machinery-related sectors all provide support. Digital services are particularly important because they generate foreign-currency income without the same import intensity as heavy industry.
Yet the current-account forecasts show that these strengths are not enough to eliminate the external gap.
That makes foreign direct investment crucial. Serbia has historically covered much of its current-account deficit through FDI inflows, particularly from European, Chinese and other international investors. If FDI slows, the external position becomes more exposed to borrowing, portfolio flows or reserve use.
The fiscal strategy therefore points to a delicate balance. Serbia can sustain higher current-account deficits if investors continue financing productive projects. But if global uncertainty, political tensions or weaker confidence reduce capital inflows, the same deficit becomes a more serious vulnerability.
For banks and investors, the external account is one of the most important indicators to watch. It will show whether Serbia’s investment cycle is being financed comfortably or whether external pressure is building beneath the surface of headline growth.
The country is not facing a balance-of-payments crisis. But its economic strategy depends on a steady inflow of capital. The more Serbia invests, the more important it becomes that those investments generate exports, productivity and foreign-currency earnings after the construction phase ends.
