Automotive suppliers, electrical machinery and industrial subcontractors are becoming the strongest part of Serbia’s mid-year business story, but margins remain vulnerable to energy, wages and working-capital costs.
Serbia’s exporters are carrying more of the economy’s momentum than usual.
In the first four months of 2026, exports rose 8.2 per cent in euro terms to €11.78bn, while imports edged up only 0.5 per cent to €14.11bn. The trade deficit narrowed 26.1 per cent and the export-import coverage ratio improved to 83.5 per cent from 77.5 per cent a year earlier. European Union countries accounted for 59 per cent of total external trade.
For a country often analysed through consumption, public investment and foreign direct investment, the trade data are notable. They suggest that Serbia’s industrial base is benefiting from proximity to European supply chains, regional free-trade access and a maturing network of automotive, machinery and electrical-equipment producers.
The central bank has also acknowledged the shift. The National Bank of Serbia said GDP growth since the beginning of the year had been supported by both domestic demand and net exports, while April indicators pointed to positive developments in industry, retail and tourism. Industrial production in April was 3.4 per cent higher than a year earlier.
The second-half forecast is that export manufacturing will remain Serbia’s clearest outperformer. Automotive suppliers, electrical machinery producers, specialised components, rubber and plastics, selected metals, industrial packaging and logistics services should all benefit if EU demand remains stable.
The base case is high-single-digit export growth for H2 2026, broadly consistent with the January-April trend. Stronger companies in automotive and electrical machinery could reach low-double-digit growth, especially where they already have repeat orders from EU customers.
But this is not a simple boom story. Exporters can grow sales and still lose margin. Labour costs are rising, energy remains volatile, freight is exposed to the NIS situation and interest rates are still restrictive. The NBS kept its key policy rate at 5.75 per cent in June, meaning companies financing inventories, inputs and receivables are still operating in a relatively expensive credit environment.
This is why the best-positioned companies are not merely exporters. They are exporters with short cash-conversion cycles. A Serbian component maker that ships quickly, invoices in euros, collects on time and manages inventory tightly will be better placed than a larger producer with long production cycles and slow receivables.
Serbia’s operational integration with Europe should help. SEPA payments became operational in Serbia on May 5, with 18 domestic banks handling SEPA payments for citizens and businesses. The European Commission said the change would make euro transactions with EU counterparties faster, cheaper and more reliable, potentially saving individuals and businesses up to €400mn.
For large manufacturers, SEPA is a useful efficiency gain. For smaller exporters, it can be more material. Faster euro payments reduce friction in invoicing, collections, supplier payments and cash-flow planning. In a high-rate environment, every day saved in receivables matters.
The biggest external risk is Europe itself. Serbia’s exporters are tied to EU industrial demand, particularly Germany, Italy and central European supply chains. A downturn in European manufacturing would quickly soften order books. The second risk is energy. Export plants that rely on fuel-intensive logistics or imported inputs face higher cost uncertainty. The third is wage competition, especially for skilled technicians, engineers and production managers.
The sector’s second-half winners are likely to be mid-sized suppliers that are already embedded in EU supply chains but still flexible enough to adapt pricing and production. Logistics firms, certification advisers, packaging producers and warehouse operators should benefit from the same trend.
Serbia’s export story is no longer just about foreign investors using the country as a production platform. Increasingly, it is about whether domestic and foreign-owned suppliers can move up the value chain while maintaining cost discipline.
The opportunity is real. The constraint is execution.
