Vienna Institute: Serbia Has Grown 2.4% a Year Since 2012
A wiiw analysis published six days before the election compares 2012-2025 with 2001-2011 and with eight regional economies.
Serbia’s economy grew by an average of 2.4 percent a year in 2012-2025, almost half as fast as in 2001-2011, when the average was 4.2 percent. That is the finding of an analysis by the Vienna Institute for International Economic Studies (wiiw), published on October 19, 2026, six days before the snap parliamentary elections scheduled for October 25. The author is economist Branimir Jovanovic, and the piece is titled “Serbian Economy Under Vucic: Far From a Miracle.”
Where does Serbia rank among nine regional economies?
Jovanovic compared Serbia’s growth with eight regional economies over the same period. Serbia grew faster only than North Macedonia, which recorded 2.3 percent. According to Biznis.rs, Bulgaria had the same 2.4 percent average, while N1 and Danas report that Serbia is marginally ahead of it. The other economies grew faster:
- Kosovo: 4.1 percent
- Albania: 3.0 percent
- Montenegro: 2.9 percent
- Romania: 2.8 percent
- Bosnia and Herzegovina: 2.6 percent
- Croatia: 2.5 percent
The author concedes that part of the gap with the earlier period comes from a pre-crisis boom that lifted the whole region. He also notes that the Serbian Progressive Party (SNS) inherited a weak economy: GDP fell by about 1.5 percent in total in 2009-2011, and in the first three years of the new government, 2012-2014, the economy shrank by almost two percent more. Sustained growth returned only in 2015.
Jovanovic sums up the analysis this way: “Serbia’s growth under SNS rule was moderate by every measure.” He adds that “the image of Serbia as a growth champion is simply not supported by the data.”
How did wages, employment and social protection move?
The author calls the labor market the strongest argument in the government’s favor. Unemployment fell from about 23 percent in 2011-2012 to below nine percent in 2024-2025, and most of that improvement came in the early years, during the recovery from the crisis. The number of people in work rose from 2.2 million in 2012 to 2.9 million in 2019, has stagnated since, and dipped slightly in 2025, to roughly the 2008 level. About 270,000 people are unemployed and 2.5 million are outside the labor force.
The average net wage rose by about 150 percent, from roughly 370 to 930 euros a month. Consumption per person rose from about 290 to about 700 euros, or around 140 percent. For a family of four with two average incomes, wages covered 63 percent of spending in 2012 and 67 percent in 2025. Such families still finance a third of their spending from other sources: remittances, pensions, savings, loans or informal work.
Inequality has grown. The poorest 20 percent of the population saw their share of after-tax income fall from 4.3 percent in 2011 to 4.1 percent in 2024, while the richest 10 percent increased theirs from 35.5 to 37.6 percent. Spending on social protection, excluding health care and pensions, was cut from about 4 percent of GDP in 2011 to 2.8 percent in 2023.
The analysis offers two explanations. The first is ideological: SNS, as a right-wing party, has little faith in social protection. The second Jovanovic describes in less charitable terms: “lasting poverty creates an electorate that can be mobilized before elections with one-off payments.” A well-functioning social safety net, the analysis adds, would make such handouts far less effective.
What do investment and infrastructure look like?
Foreign direct investment averaged 5.7 percent of GDP a year in 2012-2025, compared with 6.1 percent in 2001-2011. In 2025 the inflow dropped to 3.9 percent of GDP, and wiiw expects even less in 2026. According to Biznis.rs, the author attributes that decline more to global uncertainty than to domestic policy.
Income paid out to foreign investors rose from about 3 percent of GDP in 2011 to more than 5 percent in 2024 and 2025, and in 2025 it exceeded the inflow of new foreign investment. Serbia thus paid foreign investors more than it received from them in fresh capital.
Public investment was at 2-3 percent of GDP in 2013-2017 and has been around 7 percent since 2021. The problem lies in the structure: of six infrastructure indicators relative to the EU average, only motorway length improved, from 34 to 50 percent of the average. Road and rail length, installed electricity generation capacity, and access to sanitation and water supply lagged even further behind. Domestic private investment stayed at about 3 percent of GDP, roughly half the public figure.
What does the author say about the election?
According to Jovanovic, a great deal is at stake in the October 25 election, including the direction of economic policy. If SNS and Aleksandar Vucic win, the current model, built on foreign investment and motorway construction and indifferent to inequality and domestic entrepreneurship, will probably continue. A change of government, the analysis states, does not guarantee better outcomes, but it would open the door to rethinking economic policy.
