South-Eastern Europe Economic Outlook
The regional economy is forecast to accelerate next year, largely thanks to lower interest rates compared to 2025. Strong tourism arrivals and low energy prices will further support economic activity. GDP growth should pick up in Turkey, among EU members and in the Balkans next year. Economic developments in the EU—SEE’s key trading partner—are a key two-sided risk.
South-Eastern Europe Inflation
Inflation rose in September for the first time in over a year as Turkish disinflation stalled. Inflation in Turkey remains by far the highest in the region, followed by Romania. Inflation elsewhere is far lower. This three-speed dynamic—sky-high price pressures in Turkey, moderately high inflation in Romania and contained prices elsewhere—should persist in 2026.
This chart displays Economic Growth (Real GDP, ann. var. %) for South-Eastern Europe from 2018 to 2017.
| 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|
| Industrial Production (ann. var. %) | -1.6 | 13.0 | 3.7 | 0.5 | 0.3 |
| Fiscal Balance (% of GDP) | -5.8 | -4.2 | -2.2 | -4.2 | -4.3 |
| Investment (annual variation in %) | 3.4 | 7.8 | 6.5 | 8.9 | 2.2 |
| Unemployment (% of active population, aop) | 11.8 | 10.8 | 9.4 | 8.6 | 8.0 |
| Policy Interest Rate (%, eop) | 9.52 | 7.89 | 6.95 | 26.88 | 30.44 |
| Inflation (CPI, ann. var. %, aop) | 6.6 | 11.4 | 43.5 | 32.7 | 34.5 |
| Public Debt (% of GDP) | 66.2 | 64.4 | 54.5 | 50.4 | 45.8 |
| Economic Growth (Real GDP, ann. var. %) | -1.7 | 9.8 | 5.2 | 3.9 | 2.9 |
| Private Consumption (annual variation in %) | -0.3 | 11.3 | 13.1 | 3.4 | 4.3 |