Balkan regional economic and fiscal trends

The Balkan region continues to experience varied economic and fiscal developments. In Bosnia and Herzegovina, public revenues in the Federation reached 6.61 billion KM through September 2026, despite rising costs for staples and mixed tourism results. Employment trends remain divergent; while unemployment decreased in Republika Srpska and Brčko District, it rose in the Federation of BiH, bringing the total registered unemployed to 311,107 by the end of August.

In the banking sector, credit to domestic sectors rose to 31.43 billion KM, a trend driven largely by increased borrowing from citizens. However, efforts to join the Single Euro Payments Area (SEPA) face hurdles due to the country’s status on the FATF grey list.

In Serbia, the economy recorded a real GDP growth of approximately 3.6 percent during the first eight months of the year, supported by services, trade, and net taxes, even as industrial production saw a slight decline or stagnation. Serbia continues to face significant fiscal challenges, with a budget deficit reaching approximately 903 million euros in September and a total deficit of roughly 1.74 billion euros by the end of that month.

In Croatia, exports increased by 9.5 percent during the first eight months of 2026, reaching 17.85 billion euros and helping to reduce the trade deficit to 13.3 billion euros. The government has announced a budget rebalance to increase spending on education, healthcare, and pensions, while maintaining a deficit of 2.9 percent of GDP.

In Montenegro, tax revenues rose by 9.7 percent in the first nine months of 2026. Additionally, Mastercard announced that starting in 2027, it will introduce offline card payment support in Montenegro and across Europe, allowing transactions up to 200 euros during network outages.