In the third quarter of 2023, real GDP growth was 3.6% compared to the same quarter of the previous year, and 1.3% compared to the previous quarter. The gross value added in the fields of construction, agriculture, forestry and fishing, and industry and water supply, sewerage, waste management and remediation activities saw significant real growth. Exports increased by 3.7% compared to 2022, while imports decreased by 5.5% compared to the same period in the previous year. The export-import ratio equaled 77.7% and was higher than in the same period of the previous year. The largest share in Serbia’s exports was recorded in the Vojvodina region (33.4%), followed by the Belgrade region (24.2%), Šumadija and Western Serbia (20.8), and Southern and Eastern Serbia (19.4). The biggest share in Serbia’s imports was recorded in the Belgrade region (43.3), followed by Vojvodina (33.1), Šumadija and Western Serbia (13.3), and Southern and Eastern Serbia (8.3).

"The employment rate in Serbia is 49.6% and the unemployment rate is 10.1% in the first quarter of 2023. The number of employed persons aged 15 and over rose by 31,500 in the first quarter of 2023, which was an increase of 1.1% compared to the first quarter of 2022. In the same period, the number of the unemployed decreased by 25,000, which was a 0.8% fall. At the regional level, a significant increase in the employment rate was recorded in the Belgrade region (2.7%) and in Vojvodina (1.6%). The increase in the number of employed persons was the most noticeable in the manufacturing sector, while in the agriculture, forestry and fishing sectors there was a decrease in the number of employed persons.

Inflation in Serbia has been on a declining path since April and returned to a single-digit level in October 2023, while in December it slowed further to 7.6% y/y. Inflation is expected to continue falling through the projection horizon, with the return to the target tolerance band expected in middle 2024 and approaching the central point of the target by the end of 2024. Real GDP growth in Q3 2023 stood at 3.6% y/y (1.0% s.a.), and in Q4 it is expected to accelerate to around 3.8% y/y. The current account deficit (CAD) in 2023 amounted to EUR 1.1 bn, while at the year level it is projected to be lower than projected EUR 1.7 billion (2.5% of GDP). For 2024, the CAD is projected to be EUR 2.9 bn (3.8% of GDP) due to an expected acceleration of the investment cycle."

In summary, Serbia's economy is a service-based upper-middle income economy with a strong focus on the tertiary sector. The country has faced economic challenges in the past, but has made significant progress in recent years, with fast economic growth, increasing employment, and a declining unemployment rate. The country's exports have increased significantly, and the current account deficit is projected to remain broadly stable in the coming years. Inflation is expected to continue falling, and real GDP growth is projected to accelerate in the coming years.

The Serbian real estate market is expected to reach a projected value by the end of 2024, with the residential segment dominating the market. The market experienced a surge in sales volume and prices in 2023, but the latter half of the year witnessed a slowdown and stagnation across most cities. Belgrade has the highest average prices per square meter in Serbia, with Novi Beograd being one of the most expensive locations. Opinions in the real estate sector are divided, with some believing that prices will stagnate, while others anticipate a decline. However, the majority of investors forecast price stability. Economic instability, both domestically and globally, is identified as the primary challenge in the real estate business. Factors such as credit conditions, inflation, and labor shortages in the construction sector are also considered risk elements. The majority of respondents believe their incomes will either remain steady compared to 2023 or see an increase. Investors identify unfavorable loan conditions, rising construction material prices, geopolitical instability, and reduced demand for 'first sale' apartments as the most impactful factors on their business. The upcoming period is assessed as the bottom of the market cycle, presenting an advantageous time for real estate purchases with ample room for negotiation with sellers. However, a significant price drop is not anticipated, and there might be a reduction in trading volume. Only in 2025 is an upsurge in demand and transactions expected, with the potential for further price hikes hinging on supply dynamics

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