Economic Outlook

What can we expect from 2026?

Europe is expected to see modest economic growth in 2026, with Eurozone GDP rising around 1.0%, slower than in 2025. Tariffs continue to weigh on activity, affecting countries unevenly. Inflation has eased significantly - Eurozone inflation is forecast at 1.5% - supporting real incomes, though no further ECB rate cuts are anticipated. Meanwhile, accelerating AI adoption is reshaping labour needs, reducing some jobs even as unemployment is expected to decline.

Serbia

Serbia’s economy remains on a subdued but positive growth path. GDP for 2025 has been revised upward to 1.9%, supported by rising real incomes. Inflation eased to 2.7% in December. Consumption remains the main driver, while investment and trade face uncertainty due to weak external demand and global trade tensions. Industrial production has contracted, but labour‑market reforms aim to support resilience.

Bulgaria

Bulgaria recorded 3.2% GDP growth in Q3 2025, driven by strong domestic demand and rising investment. EU integration milestones - including Schengen entry and upcoming euro adoption in January 2026 - are expected to strengthen investor confidence and economic stability. Major cities such as Sofia, Plovdiv, Varna and Burgas will continue to drive growth through expanding services, industry and talent attraction.

Slovenia

As one of the EU’s most open economies, Slovenia remains vulnerable to external headwinds. GDP growth is projected to slow to about 2.3% in 2026, though domestic demand should remain supportive. Inflation has stabilised around 2.3%. Labour shortages—among the highest in the EU—pose structural challenges, while policy uncertainty may restrain investment and consumer spending.

Croatia

Croatia remains one of the EU’s stronger performers, though growth is expected to moderate to below 3% in 2026. Consumption and investment remain resilient, helped by strong employment and record tourism. Inflation should average around 2.9%, though the removal of energy price caps and tight labour markets may keep price pressures elevated. Tourism continues to benefit from euro adoption, Schengen entry and efforts to reduce seasonality through long‑term sustainability strategies.