IMF Concludes Second Review of Serbia's Economic Program, Praises Fiscal Discipline and Reforms

IMF Affirms Serbia's Economic Stability Amidst Global Headwinds

The Executive Board of the International Monetary Fund (IMF) successfully concluded its Second Review under the Policy Coordination Instrument (PCI) for Serbia on December 17, 2025. The review highlighted Serbia's continued commitment to fiscal discipline and the advancement of structural reforms, even as the country navigates a period of slowed economic growth.

The PCI, an advisory and non-financial instrument approved for Serbia on December 9, 2024, for a period of 36 months, is designed to support countries implementing credible economic policies through regular semi-annual assessments.

Economic Performance and Outlook

The IMF noted that Serbia's economic activity has experienced a slowdown due to both domestic and external challenges. Real GDP growth is estimated at approximately 2% in 2025, with projections indicating a recovery to 3% in 2026 and further acceleration to 4.6% in 2027.

Despite these challenges, Serbia has maintained strict fiscal discipline, with the fiscal deficit expected to remain below the agreed limit of 3% of GDP. This achievement is attributed to controlled current spending, adherence to fiscal rules governing public-sector wages and pensions, and careful prioritization of investments. Furthermore, the National Bank of Serbia (NBS) has maintained a cautious and appropriate monetary policy, contributing to headline inflation easing to below its target of 3%.

The IMF also recognized Serbia's robust macroeconomic buffers, including:

• High foreign exchange reserves
• Sizable government deposits
• A resilient and well-capitalized banking sector

These buffers are crucial in helping Serbia manage current economic challenges.

Advancing Structural Reforms and Addressing Risks

Under the PCI, Serbian authorities are actively pursuing key structural reforms, particularly in areas such as public financial and investment management and the energy sector. These reforms are considered vital for strengthening fiscal transparency and accountability.

While the outlook is positive, the IMF highlighted elevated downside risks. However, these are mitigated by the country's prudent macroeconomic policies and substantial buffers. The resolution of sanctions on the oil company NIS was specifically mentioned as a factor that would further reduce uncertainty.

Official Statements and Future Commitment

Serbian Finance Minister Siniša Mali affirmed that the IMF's positive assessment confirms the stability of the Serbian economy and the successful implementation of reforms. Similarly, NBS Governor Jorgovanka Tabaković stated that the review underscores Serbia's sound economic policy and strong management capabilities in the face of shocks.

The successful completion of this second review follows the first review, which was concluded on June 30, 2025, further solidifying Serbia's commitment to its economic reform agenda.