Serbia's growth is slowing fast — from 3.9% to 2% — while foreign money leaves

Serbia cut its fiscal deficit in half and reduced public debt, but its economy is decelerating sharply and foreign currency reserves are starting to shrink. This means the country's ability to weather external shocks or fund new borrowing is getting tighter even as the macroeconomic fixes that looked successful just 12 months ago are beginning to unwind.

The numbers look good on paper — debt down, deficit controlled, inflation cooling. But the deceleration is real and rapid: growth fell from nearly 4% to 2% in one year, which is the speed at which a stabilization story turns into a stagnation story. The current account deficit widened as foreign companies moved money out, and reserves are shrinking from their 2024 peak. For a small open economy like Serbia, this shift matters because it narrows the window for policy mistakes or external shocks. The World Bank is publishing this because the obvious question has changed from 'can they stabilize' to 'can they sustain it.'