Serbia’s gross domestic product (GDP) has grown at a rate 2.5 times faster than that of the European Union since 2018, according to a study by the Institute for Politics and Economy of Southeast Europe (IPESE) published on September 8.

The report, based on data from the International Monetary Fund (IMF), reveals that Serbia’s GDP increased by a total of 26.5% over the past seven years, while the EU’s economy grew by only 10.2% during the same period. This gap is expected to widen further in 2024.

According to the Republic Institute of Statistics (RZS), Serbia’s GDP rose by 4.7% in the first quarter and by 4.2% in the second quarter of 2024 compared to the same periods in 2023. In contrast, Eurostat data shows that the EU and Eurozone grew by only 0.8% and 0.6%, respectively, during the second quarter of 2024.

According to IPESE’s analysis, one of the primary factors behind Serbia’s rapid growth is the robust expansion of the construction sector. The industry has generated between 5.5% and 6.4% of GDP in recent years, with gross added value rising by 14.2% in the first quarter of 2024. Large infrastructure projects, housing development and foreign investments have played a crucial role in fuelling this growth.

Serbia has become an attractive destination for foreign investors, benefiting from its strategic location, relatively low labour costs, and government incentives. The influx of FDI, particularly in manufacturing and services, has bolstered economic activity and job creation.

Looking ahead, Serbia is expected to maintain its faster growth rate compared to the EU, with a new investment cycle projected to boost its economy. The “Leap into the Future – Serbia 2027” programme outlines more than €17bn in investments over the next three years, a key factor expected to sustain economic growth.