Vienna Institute expects change of power at the end of this year or beginning of next one, then growth of Serbia’s GDP

The expectations for the growth of the gross domestic product (GDP) this year in Serbia are being revised down by a range of financial institutions. The International Monetary Fund (IMF) recently said in an answer to us that, in April, it would most probably announce a review of GDP for Serbia, which would be slightly worse, whereas the Vienna Institute for International Economic Studies says that they don’t just expect a drop of the GDP, but also a change of power.

– We have not yet announced the latest projections, we are preparing them, but we will review down the projections for the growth of the GDP this year slightly, and increase them in the next two years. That is due to the protests and the political changes – it is apparent that the economic activity in the first quarter slowed down slightly, but we also expect that, either by the end of this year or the beginning of next one, there will be a change of power, so the growth will be slightly bigger. The global events around the trade war certainly have an impact on all this too – says Branimir Jovanovic, the economist for the Balkan countries at the Vienna Institute for International Economic Studies.

In the past two months, the National Bank of Serbia (NBS) has reduced the FX reserves with which the dinar is defended against the euro. From the beginning of 2025 until the end of February, NBS sold a net amount of EUR 745 million, of which EUR 420 million in January and EUR 325 million in February. Last year, it acted in the opposite direction, so the NBS bought a net amount of EUR 2.7 billion to maintain the exchange rate.

– The FX reserves lowered slightly in January and February, and the dinar weakened a bit, to 117.2 per euro. That is also due to the unfavorable economic situation, but we don’t expect any drastic changes. The reserves are nevertheless at a good level – around 7 months of imports, which is much higher than the rough rule that they need to be at least 3 months. The dinar will likely additionally weaken a bit, but no more than 117.5 – says Jovanovic.

Međunarodni monetarni fond-MMF Beograd

Narodna banka Srbije Beograd

Vienna Institute

International Monetary Fund

IMF

National Bank of Serbia

NBS

Branimir Jovanović

GDP of Serbia

gross domestic product of Serbia