AGP Executive Report

Energy and Mining: Serbia extended fuel price caps, an export ban and reduced excise duties through October 25, with diesel at 236 dinars a litre and petrol at 207. The government says reserves can protect supply amid market pressure. Mining and geology dean Aleksandar Cvjetić backed a time-limited moratorium on lithium extraction in the Jadar valley, with clear conditions for ending it. Industry: Industrial turnover rose 14.8% year on year in August, while FCA Serbia reported a 3.71 billion-dinar profit after a loss the previous year. ENGEL is also expanding its production network with a site in Serbia. Agriculture: Regional development incentives rose 7.4% in the first half to 116.3 billion dinars; agriculture received 65.5 billion. Serbia also agreed with Indonesia to deepen cooperation in trade, food and energy. Infrastructure and Workforce: The Hungary–Serbia oil pipeline received environmental approval for construction. Germany’s employment agency warned that cutting the Western Balkans work quota could worsen labour shortages, noting more than half a million workers from the region are employed there.

Industrial Output: Serbia’s industrial turnover rose 14.8% year on year in August, led by a 46.2% jump in mining and 13% growth in manufacturing. Agriculture Funding: The state disbursed 116.3 billion dinars in regional incentives in the first half of 2026, up 7.4%; agriculture received 65.5 billion dinars. Automotive: FCA Serbia swung to a 3.71 billion-dinar profit in 2025 as mass production of the Fiat Grande Panda lifted revenue. Energy: The Hungary–Serbia oil pipeline received environmental approval, clearing a step toward construction. Power Supply: EPS has lost 17 engineers as electricity and coal production fell, raising concerns about staffing and output. Construction: Serbia issued 3.9% fewer building permits in August than a year earlier. Economic Outlook: The IMF raised its 2026 growth forecast for Serbia to 3.3%, while warning inflation could return in 2027.

Industrial Output: Serbia’s industrial turnover rose 14.8% year on year in August, led by a 46.2% jump in mining and 13% growth in manufacturing. Automotive: FCA Serbia swung to a 3.71 billion-dinar profit in 2025 as production of new models, including the Fiat Grande Panda, lifted revenue nearly tenfold. Construction: August building permits fell 3.9% from a year earlier, with 3,771 homes planned. Transport: Direct Belgrade–Vienna trains are planned for 2027, with two services daily in each direction and a journey time of about six and a half hours, subject to route approval in Hungary. Belgrade and Air Serbia will host IATA’s Wings of Change Europe conference in October 2027. Investment and Trade: Machinery maker ENGEL is expanding its production network with a Serbia site, while the Hungary–Serbia oil pipeline has received environmental approval for construction. Nearly 2,000 Slovenian companies are expected at EXPO 2027 in Belgrade. Energy and Outlook: Reports say 17 engineers have left EPS as electricity and coal production declined. The IMF forecasts Serbia’s economy will grow 3.3% in 2026 and 4% in 2027.

EXPO 2027: Nearly 2,000 Slovenian companies are expected at the Belgrade event, after EXPO organisers signed a cooperation deal with Slovenia’s Chamber of Craft and Small Business to help firms take part. Agriculture and Food Exports: Serbia and the FAO plan to deepen cooperation, with a focus on food systems, companies and distribution centres to help Serbian producers reach markets such as China. Transport Links: Austria’s ÖBB plans two daily Vienna–Belgrade train services, potentially restoring direct rail travel suspended since 2019; Hungarian approval is still pending. Energy Infrastructure: The Hungary–Serbia oil pipeline has received environmental approval for construction. Economic Outlook: The IMF raised its 2026 growth forecast for Serbia to 3.3%, while projecting 4% growth in 2027.

Agriculture: Serbia will work with the UN Food and Agriculture Organization to strengthen food systems, including companies and distribution centres that can help send more exports to markets such as China. Economic Outlook: The IMF raised Serbia’s 2026 growth forecast to 3.3%, citing a stronger recovery; it expects growth to reach 4% in 2027. Water Infrastructure: Nearly $100 million in concessional financing is upgrading irrigation across five regions. More than 108,000 hectares are already irrigated, with another 14,000 hectares under construction. Manufacturing and Energy: Injection-moulding group ENGEL is expanding its production network with a Serbia site, while the Hungary–Serbia oil pipeline has received environmental approval for construction. Oil Sector: Aleksandar Vučić has floated a possible US investor purchase of Russian-controlled NIS, adding uncertainty to the delayed MOL takeover.

Oil and Gas: Vučić has floated a possible US investor takeover of Russia’s stake in NIS, adding uncertainty to MOL’s delayed acquisition. The deal still hinges on sanctions approval and negotiations with Gazprom. Energy Infrastructure: The Hungary–Serbia oil pipeline has received environmental approval, clearing a step toward construction. Agriculture: Nearly $100 million in Abu Dhabi financing is upgrading irrigation across five Serbian regions; more than 108,000 hectares are already served, with another 14,000 under construction. Transport: A tunnel-boring machine for Belgrade’s first metro line is waiting at the Romanian border, with delivery to Pančevo dependent on Danube water levels. Power Generation: Reports say 17 EPS engineers have left as electricity and coal production fell, raising concerns about staffing at the state utility. Trade and Investment: Indonesia and Serbia have agreed to deepen cooperation in food, energy and industrial processing, including mineral exploration and electric-vehicle supply chains. EXPO 2027: A Belgrade business and tourism promotion in Zagreb highlighted plans for more than 250 bilateral events and 50,000 business meetings.

Metro Construction: A Chinese tunnel-boring machine for Belgrade’s first metro line is waiting at the Romanian border; officials say the line is due to be built by the end of 2029. Energy Security: Serbia approved the environmental study for a 113-kilometre oil pipeline from Hungary to Novi Sad, designed to carry up to 5.5 million tonnes a year. Power Sector: EPS reported a first-half profit above plan, but coverage also points to engineer departures and falling electricity and coal production. Trade and Industry: Indonesia and Serbia agreed to deepen cooperation in industrial processing, food and energy; Indonesian investment in Serbia already includes instant-noodle and processed-mushroom production. Economic Outlook: The IMF raised its 2026 growth forecast for Serbia to 3.3%, projecting 4% growth in 2027. Manufacturing: ENGEL is expanding its production network with a site in Serbia.

Economic Outlook: The IMF expects Serbia’s growth to accelerate to 3.3% in 2026 and 4% in 2027. Foreign Reserves: The National Bank’s gross FX reserves fell €946 million in September to €29.86 billion, still covering 6.7 months of imports; higher energy-import demand contributed to pressure. Manufacturing: Austrian plastics machinery group ENGEL is opening a plant in Kikinda to make machined components, planning to recruit 150 people over three years and strengthen European supply chains. Energy Infrastructure: A green permit has cleared the Hungary–Serbia oil pipeline for construction, with its route crossing Vojvodina. Household Energy: Serbian pellet prices have climbed sharply, reaching as much as 52,000 dinars a tonne as early-season demand rises.

Manufacturing: Austrian plastics machinery maker ENGEL will open a production site in Kikinda, making machined components and recruiting 150 employees over three years. The plant is expected to strengthen European supply chains and shorten delivery times. Energy Infrastructure: The Hungary–Serbia oil pipeline has received a green light for construction, while Serbia is due to start laying pipes for its gas link with North Macedonia. Household Finances: New borrowing rose sharply in the second quarter, with cash loans accounting for 87% of newly approved dinar loans to households—pointing to mounting pressure on everyday budgets. Heating Costs: Pellet prices have climbed to as much as 52,000 dinars, up from 26,000–35,000 dinars last year, as households buy fuel early and demand rises.

Energy: Serbia will join a new regional oil coordination group to share supply data and respond to shortages as global prices rise. District heating systems began warm tests ahead of the official Oct. 15 season; Vrbas still had an unresolved gas contract. Infrastructure: Serbia plans to start laying pipes for its gas interconnector with North Macedonia next week. Belgrade also opened a 365-million-dinar tender for an 80-metre mast and park works at Ušće. Industry and jobs: Employment in Serbian industry fell 3.3% year on year, while wages are rising faster than productivity, raising concerns about competitiveness. Agriculture: Belgium flagged cadmium in frozen raspberries from Serbia; a recent Swiss alert also found levels above the permitted limit, putting export quality controls in focus. Trade and investment: A Serbia–North Macedonia business event in Skopje explored partnerships tied to EXPO 2027, including tourism and other commercial opportunities.

Food Exports: Belgium flagged cadmium in frozen raspberries from Serbia, following Switzerland’s earlier finding of levels above the permitted limit and withdrawal of the product. EXPO Business: Serbian and North Macedonian firms are exploring trade and tourism partnerships ahead of EXPO 2027, after a Skopje networking event drew more than 50 business representatives. Food Standards: Serbia will raise minimum fruit content in jam from 350 to 450 grams per kilogram from 2028, with clearer fruit-content labelling. Industry and Jobs: Industry employment fell 3.3% year on year, while wages are rising faster than productivity, adding pressure on employers’ competitiveness. Energy and Logistics: Serbia plans to start laying pipes for its gas link with North Macedonia, while the Hungarian section of the Budapest–Belgrade railway has passed European safety testing.

Food Manufacturing: Serbia has raised the minimum fruit content in standard jam from 350 to 450 grams per kilogram, with stricter rules taking effect in 2028. Manufacturing Investment: Serbian firm Mercury.AI plans to open a 17,000-square-metre security-camera factory in 2027, with annual capacity of 7.2 million devices. Energy Infrastructure: Work on the gas interconnector with North Macedonia is set to begin, expanding Serbia’s regional supply links. Trade: Serbia-Italy trade reached about €3 billion in the first half of 2026, up 32% year on year; full-year trade topped €5 billion in 2025. Economic Outlook: The National Bank of Serbia held its key rate at 5.75%, while MAT reported GDP growth of 3.6% in the first eight months of the year.

Technology Manufacturing: Serbian security company Mercury.AI won an industry award for its Belgrade surveillance project and plans to open a 17,000-square-metre camera factory in 2027, with annual capacity of 7.2 million devices. Energy Links: Work is set to begin on the first 5 kilometres of the Serbia–North Macedonia gas interconnector. The 145-kilometre link is designed to carry 1.5 billion cubic metres a year, with construction expected to continue into 2028. Trade: Serbia-Italy trade topped €5 billion in 2025 and reached about €3 billion in the first half of 2026, up 32% year on year, figures highlighted at the Italian Trade Agency’s centenary event in Belgrade. Agriculture: Serbia and China discussed joint projects in farm digitalisation and AI, aiming to raise productivity and cut costs through cooperation between companies, universities and research institutes. Business Conditions: The National Bank of Serbia held its key rate at 5.75%; annual inflation was 2.2% in August, with the bank watching price pressures and international risks.

Trade: Serbia-Italy trade exceeded €5 billion in 2025 and reached about €3 billion in the first half of 2026, up 32% year on year. Belgrade marked the Italian Trade Agency’s centenary as both countries look to deepen business ties. Manufacturing: Belgrade security technology firm The Mercury.AI won a regional award for its city surveillance system and plans to open a 17,000-square-metre camera factory in Serbia in 2027, with annual capacity of 7.2 million devices. Energy: Work on the first five kilometres of Serbia’s gas link with North Macedonia is due to begin next week; the 145-kilometre connection is planned to carry 1.5 billion cubic metres of gas a year. Agriculture: Serbia and China are exploring joint projects in farm digitalisation and AI, aiming to raise productivity and cut costs for local producers. Finance: The National Bank of Serbia kept its benchmark rate at 5.75%, citing inflation risks, and expects growth of at least 3.2% this year.

Energy: Serbia will begin laying the first five kilometres of its gas link to North Macedonia next week. The 145-kilometre pipeline is planned to carry 1.5 billion cubic metres of gas a year. Energy Minister Dubravka Đedović Handanović also said hydropower could help store energy as renewable capacity expands. Business and Finance: The National Bank of Serbia held its key rate at 5.75%, citing inflation and international risks; it expects growth of at least 3.2% this year. Manufacturing: Belgrade-based Mercury.AI won a regional security award for its smart surveillance system and plans to open a 17,000-square-metre camera factory in Serbia in 2027. Agriculture: Serbia and China are exploring cooperation on farm digitalisation and AI, while local producer Zeleni Hit is scaling up pesticide-residue-free fruit and vegetable deliveries to Lidl. Trade: Twelve Bulgarian wineries are showcasing their products in Belgrade ahead of the Wine Vision by Open Balkan fair, which runs October 10–12. Transport: Hungary’s section of the Budapest–Belgrade railway has completed European safety testing, bringing the route closer to passenger service.

Security Manufacturing: Belgrade firm Mercury.AI won an industry award for its smart-surveillance system and plans to open a 17,000-square-metre camera factory in Serbia in 2027, with annual capacity of 7.2 million devices. Energy Infrastructure: Work on the first five kilometres of Serbia’s 145-kilometre gas link with North Macedonia is due to begin next week; the pipeline is designed to carry 1.5 billion cubic metres a year. Serbia’s energy minister also highlighted hydropower’s potential to store renewable energy. Agriculture: Serbia and China plan to deepen cooperation on digital tools and AI for farming, while local supplier Zeleni Hit expects to deliver nearly 250,000 kilos and pieces of pesticide-residue-free produce to Lidl by season’s end. Economic Outlook: The central bank held its key rate at 5.75%, citing inflation and global risks. It expects growth of at least 3.2% this year, supported by domestic demand and infrastructure investment.