AGP Executive Report

Danube Drought Hits Serbia-Romania Trade: Serbia’s FM Marko Đurić spoke with Romania’s Oana Țoiu about record-low Danube levels, focusing on keeping navigation safe and traffic running, plus the idea of restoring the cross-border railway link to boost connectivity and economic cooperation. Energy & Transport Pressure: Europe’s heat and drought are cutting river flows, disrupting shipping and forcing power plants toward shutdown risk; Hungary’s Paks and Romania’s Cernavodă have been pushed to emergency measures, while governments urge electricity saving. WWII Wrecks Exposed Near Prahovo: As water drops, dozens of German WWII warships and other relics are reappearing near Prahovo, with access and removal efforts complicated by possible unexploded ordnance. Tourism Shifts in the Region: An OECD review shows Serbia among European destinations with visitor growth from 2019-2025, even as some major markets fell sharply. Business Tech Hiring: Talentuch says it’s expanding recruitment for SAP S/4HANA projects as companies migrate from ECC and scale digital transformation. EU Politics Spillover: Serbia’s EU-reform dialogue continues with talks between Brnabic and the Irish ambassador, with Ireland’s EU Council presidency highlighted.

Danube Drought Shock: Record-low Danube levels are exposing dozens of WWII German warships near Prahovo, with some still carrying weapons, while the same drought is squeezing river transport and raising energy risks across the region. Energy & Power Strain: Hungary’s Paks nuclear plant came within millimetres of a shutdown as cooling water levels fell; Romania has already shut reactors and is diverting river water, pushing governments to conserve electricity. EU Heatwave Impact: Europe’s heat and drought are disrupting drinking water, agriculture, shipping and power generation, with the Rhine and Danube both at historic lows and freight and electricity costs under pressure. Serbia Diplomacy for Reforms: Ana Brnabić met Ireland’s ambassador to discuss Serbia’s EU-path reforms and expanding bilateral economic cooperation, including the role of Ireland’s EU Council presidency. NIS Sanctions Focus: Serbia’s energy minister said the NIS issue is both geopolitical and national, with authorities working toward a sustainable solution while protecting relations with partners; OFAC extended NIS’s licence to Aug. 28. Trade Ties: Serbia and Zimbabwe agreed to deepen trade cooperation via Serbia Export and ZimTrade, aiming to open doors for Serbian firms in African markets. Football Governance Fallout: Serbia’s football association joined a growing list of federations withdrawing support from FIFA chief Gianni Infantino after FIFA abandoned a plan to sell stakes in World Cup commercial rights.

Serbia-Zimbabwe Ties: Serbia’s FM Marko Đurić says talks with Zimbabwe’s Amon Murwira mark a “new phase” for deeper cooperation, with steps discussed across trade, investment and Expo 2027. FIFA Governance Shock: Serbia has withdrawn support for Gianni Infantino’s 2027 re-election after his failed plan to sell World Cup stakes to private investors, adding to a growing list of challengers and uncertainty ahead of the March 18 vote in Morocco. Danube Drought & Energy Risk: Record-low Danube levels are forcing emergency electricity measures across Central Europe; Serbia’s hydropower output is hit, while the wider crisis threatens navigation and water management in Vojvodina. Student Movement Registers: Serbia’s student protest group “Student Ticket” has been registered with the Business Registers Agency, signaling a more formal push for democracy and fair elections. Carpathian Initiative: Ukraine’s planned Carpathian Initiative for autumn recovery and logistics includes Serbia among eight countries, aiming to link economic cooperation with security and future tourism. Minimum Wage Watch: Eurostat data for 2H 2026 shows real pay pressure in parts of Europe as inflation outpaces minimum wage rises.

Energy & Water Crisis: Record-low Danube levels are forcing power cuts and emergency measures across the region, with Hungary’s Paks nuclear plant operating at reduced output and Romania shutting down Cernavodă’s reactor after drought-driven cooling-water problems; Romania even used explosives to redirect water flow, while Serbia’s hydro output is hit and authorities urge citizens to use electricity rationally amid heatwave demand. Business & Trade Impact: The drought is also disrupting river transport and raising costs for industry, with the Danube-Tisza-Danube canal network facing drying risk that threatens water supply and agriculture in Vojvodina. Politics & Governance: Serbia’s no-confidence vote survived, but the debate sharpened divisions ahead of expected snap elections. Civic/Business Registers: Student protesters registered the “Student Ticket” association with Serbia’s Business Registers Agency, signaling a more formal push after earlier campus blockades. Diplomacy & Partnerships: Serbia deepened ties with Zimbabwe via MoUs and with Uzbekistan via a push toward a strategic partnership and a labour mobility agreement. Markets: The dinar held around 117.39 per euro, while the euro-dollar reference moved slightly.

NIS & Sanctions: Serbia’s NIS got an OFAC operating-license extension until August 28, letting it keep processing crude oil while talks continue around MOL’s bid to resume negotiations with Gazprom Neft and JANAF’s delivery requests. Energy Shock from Drought: Record-low Danube levels are forcing power stress across the region, with Hungary preparing possible mandatory electricity curbs as Paks NPP shuts down; Kozloduy NPP in Bulgaria says both units are still running on schedule. Danube Shipping & Relics: The same drought is disrupting river navigation and has exposed WWII-era Nazi wrecks and other sunken vessels near Serbia’s Prahovo, raising new risks for transport. Hospitality Expansion: Wyndham is pushing faster in EMEA, signing 25 hotels and opening 13 in H1 2026, with momentum tied to Türkiye, India and CIS. Visa Rules Watch: Finland confirmed visa-free access for citizens of about 60 countries, with only Mauritius and Seychelles among African nations. Local Business/Infrastructure: Coventry is considering a wider parking zone for Foleshill after residents’ permit petitions, aiming to stop spillover into neighboring streets.

Energy & Water Crisis: Hungary warns of a “critical” week as record-low Danube levels force its Paks nuclear plant to shut down, with possible mandatory electricity limits for large companies and calls for peak-hour cuts; Bulgaria’s Kozloduy NPP says it’s still running on schedule but is coordinating with Serbian and Romanian authorities as the river keeps dropping. Danube Disruptions: The same drought has nearly halted river navigation across the region and is exposing WWII wrecks, including Nazi-era vessels resurfacing near Serbia’s Prahovo. Serbia’s Energy Deal Update: The US OFAC extended NIS’s operating licence until August 28, keeping Serbia’s only oil refinery running while negotiations over the Russian stake continue with MOL and the Serbian government. Hospitality Expansion: Wyndham says it signed 25 hotels and opened 13 in EMEA in H1 2026, pointing to demand for new destinations—relevant for regional investors watching tourism growth. Labour & Cost Pressures (Region): Eurostat data shows Albania’s households struggle most to afford a one-week holiday and that Albania still has the lowest minimum wage in Europe, while Serbia’s minimum wage ranks higher. Media Freedom Watch: RSF says the sale of Adria News Network in Serbia must not lead to political capture of independent outlets. Sports & Business Crossover: UFC Belgrade delivered major Serbian wins (Uros Medic, plus Navajo Stirling’s upset), underscoring how sport events keep drawing commercial attention to Belgrade.

Energy & Sanctions: Serbia’s NIS gets an OFAC operating licence extension until August 28, letting the oil refiner keep running and continue talks tied to MOL’s planned takeover of the Russian stake. Climate Impact on Business: Record-low Danube levels from Europe’s heatwave are disrupting shipping, tourism and even nuclear cooling—Hungary and Romania have had to cut reactor output. Infrastructure & Trade Disruption: A Nazi-era warship has resurfaced near Prahovo as drought exposes wrecks; EIB says about 200 vessels remain underwater and clearing them is a costly, ongoing drag on navigation. Media Freedom: RSF warns the planned sale of Adria News Network must not turn into political capture of independent outlets in Serbia and Montenegro. Labour & Costs: Eurostat data show Albania still has the lowest minimum wage in Europe and that 53% of Albanian households can’t afford a one-week holiday; Serbia’s figure is lower but still high. Diplomacy & Business Ties: Serbia’s deepening defence ties with Israel are highlighted amid wider regional scrutiny. Hospitality Expansion: Wyndham reports strong EMEA momentum—25 hotel signings and 13 openings in H1 2026—pointing to continued demand for experience-led travel.

NIS Sanctions Relief: The US extended a temporary OFAC sanctions waiver for Serbia’s NIS, letting it keep importing crude and run the refinery until Aug. 28 as talks with Hungary’s MOL continue over the Russian stake. Regional Connectivity: Serbia’s PM Djuro Macut met North Macedonia’s Hristijan Mickoski in Ohrid, stressing growth in transport, rail upgrades toward Greece, energy links and cross-border checkpoints. Press Freedom Watch: RSF says the sale of Adria News Network must not turn into political capture, after KRIK exposed a draft contract and the deal’s governance claims were questioned. Media & Business Risk: Serbia’s RSF ranking context is highlighted as the country sits low in the 2026 World Press Freedom Index. Energy Stress From Drought: Record-low Danube levels are disrupting shipping and power; Hungary and Romania have had to cut nuclear output, underlining how climate shocks hit Serbia’s wider supply chains. UFC Belgrade Spotlight: UFC’s first Serbia event in Belgrade puts local fighter Uros Medić center stage, while NIS’s energy story and the Danube drought set the economic backdrop.

Energy & Sanctions: Serbia secured another US sanctions waiver for NIS, extending the temporary licence to import crude and run its Pancevo refinery until August 28, as talks continue over MOL’s planned purchase of the Russian majority stake. Regional Economy & Infrastructure: PM Djuro Macut met North Macedonia’s Hristijan Mickoski in Ohrid, stressing growth potential in transport, energy connectivity, agriculture and tourism, with a focus on upgrading the Serbia–Greece rail link. Macroeconomy: Aleksandar Vučić said Serbia recorded the highest GDP growth rate in Europe in Q2 2026 (3.6% y/y), aiming for over 4% growth next year if the pace holds. Climate Impact on Business: Record-low Danube water levels are disrupting shipping and power generation across Europe, with Serbia’s hydropower and fuel logistics under pressure. Legal/Competition Watch: The Paramount–Warner Bros Discovery antitrust fight is moving toward a trial schedule battle, with Paramount pushing for November 2026 and states seeking April 2027. Markets & Risk: UFC Belgrade betting coverage is driving attention to the weekend card, but the bigger business angle remains Serbia’s growing visibility as an event destination.

Serbia-EU Business Impact of Drought: Record-low Danube levels are hitting hydropower and nuclear cooling, cutting output and disrupting shipping and tourism—Reuters flags knock-on effects for company earnings across Europe, with Serbia’s hydropower among the affected. Energy & Sanctions Watch: Serbia’s energy minister says there are indications NIS may get a new US operating licence, expected to be formalised by letter, crucial for crude purchases and refinery planning amid OFAC extensions. Local Growth Claim: Vučić says Serbia logged the highest GDP growth rate in Europe in Q2 2026 (3.6% y/y), aiming for 4%+ next year if the pace holds. Regional Infrastructure Push: PM Macut says Serbia-North Macedonia cooperation should surge, focusing on transport links, rail upgrades toward a modernised Serbia-Greece line, and gas interconnector plans. Mining & Markets: DPM Metals reports record Q2 free cash flow and earnings, declares a dividend, and reiterates production guidance—relevant for Serbia-linked metals exposure. Currency: NBS sets the dinar’s official median at 117.3963 per euro. Governance & Elections: ODIHR recommends a full-capacity election observation mission for Serbia, citing media issues, unequal campaign conditions and polarization.

UAE–Serbia Deal Push: UAE President Sheikh Mohamed bin Zayed met Serbian President Aleksandar Vučić in Belgrade to reaffirm the Comprehensive Strategic Partnership, with talks focused on investment, trade, renewable energy and scholarships for Serbian students in science, tech and AI. Heat & Water Shock: Record-low Danube levels are hitting Serbia and the region—boats stranded, shipping disrupted, and heatwave warnings issued as drought strains power and transport. Energy Impact: Austria’s Verbund said drought cut first-half earnings by €370m as hydropower output fell, underscoring how Central Europe’s electricity mix is getting stressed. Mining & Cash Returns: DPM Metals reported record Q2 free cash flow of $227m and earnings, plus progress at Vareš toward full production by year-end 2026, alongside new copper-gold drilling at Chelopech. Logistics Automation: LPP Logistics deployed hundreds of HAI Robotics robots at a new e-commerce fulfillment center in Romania serving Serbia and the wider region, boosting capacity for millions of garments. Aviation Connectivity: Air Serbia plans year-round Belgrade–Dubrovnik flights in winter, adding business and leisure links beyond the summer season.

Danube Drought Shock: Record-low Danube levels are disrupting shipping and cooling for power plants, with Hungary cutting output at Paks and Romania shutting Cernavoda reactors, while Serbia braces for a second heatwave that could hit transport, tourism and energy. Energy Earnings Hit: Austrian utility Verbund says drought cut first-half earnings by €370m as hydropower output falls, underscoring how regional water stress is reshaping generation plans. Air Serbia Expansion: Air Serbia moves further into year-round regional connectivity, upgrading Belgrade–Dubrovnik to winter service and launching direct Belgrade–Toronto flights after decades. EXPO 2027 Diplomacy: Serbia’s EXPO 2027 pitch gets a UAE boost as President Vučić meets Sheikh Mohamed bin Zayed, with cooperation and investment themes front and center. FX Watch: The dinar is steady around RSD 117.41 per euro, according to the National Bank of Serbia. Public Health Measures: Belgrade’s Get Going for Change urges heatwave protection plans—work-hour shifts, water stations and street cooling—triggered by extreme heat warnings. Corporate/Tech Signals: e& reports revenue growth in Q2, citing Serbia consolidation, while Meta expands AI training using far-right media sources.

Heatwave Shock to Serbia’s Economy: Record-low Danube levels are already disrupting shipping, tourism and power generation, while Serbia braces for a second heatwave with temperatures near 40C—raising wildfire risk and tightening hydropower and cooling capacity. Energy & Infrastructure: Serbia’s drought pressure is also pushing emergency steps to protect the Danube-Tisa-Danube hydrosystem and keep fuel supply stable, with authorities drawing on state oil reserves. Corporate & Investment Moves: NIS has started trial operations of two gas-fired power plants, while Telekom Srbija is modernizing customer engagement with an SAS AI-driven marketing platform. Renewables Push: Serbia added 61 MW of solar in H1, signaling continued expansion of clean capacity. Mining & Metals Watch: Zijin Copper says it sold 17 tons of gold to the National Bank of Serbia since 2019, keeping attention on the country’s resource-driven finance flows. Business Diplomacy: Slovakia is set to use Expo 2027 in Belgrade to attract investors and partnerships via SARIO support. Transport & Tourism: TUI Luzia has been floated out at Kladovo Shipyard in Serbia, a milestone toward a June 2027 delivery and new river-cruise demand.

Energy & Industry: NIS has started trial operations of two small gas-fired power plants in Vojvodina (Banatsko Miloševo and Srpska Crnja), adding 5 MW and using previously unused field gas to generate electricity for both external buyers and internal needs. Renewables: Serbia added about 61 MW of solar in H1 2026, with RES Serbia citing faster growth in the prosumer segment but warning grid connection and permitting delays remain a bottleneck. Finance & FX: The dinar’s official median rate against the euro was 117.4119 RSD/EUR, while the indicative USD rate edged up to 103.2102 RSD. Mining & Central Banking: Serbia Zijin Copper delivered 17 tonnes of gold to the National Bank of Serbia since 2019, with 2,057 kg delivered in H1 2026. Tech & Business Services: Telekom Srbija is modernizing customer engagement with an SAS AI-driven marketing platform. Shipping & Tourism: TUI River Cruises floated out its first purpose-built ship, TUI Luzia, at Kladovo Shipyard in Serbia, ahead of a June 2027 delivery for Douro itineraries. Sports Governance: FIFA’s plan to create a $20bn subsidiary for the World Cup is drawing sharp pushback from UEFA and others over governance and transparency.

Telecom & AI: Telekom Srbija is rolling out SAS Customer Intelligence 360, SAS Intelligent Decisioning and SAS Viya to unify campaign management and deliver more personalized, real-time marketing for its 8+ million customers. Mining & FX: Chinese-owned Zijin Copper says it sold 17 tons of gold to Serbia’s central bank (NBS) since 2019, with 164 bars delivered in H1 2026, under the NBS right of first refusal. Labor & Health Budget Pressure: Apoteka Beograd union leaders say President Vučić promised payment of 16 months of unpaid salaries within 30–45 days, with total arrears around RSD 900 million, while discussing a possible concession if losses continue. Energy & Geopolitics: US lawmaker Joe Wilson urges Serbia to cut Russian energy purchases and distance itself from Moscow, Beijing and Tehran to ease Western integration, citing NIS and broader influence concerns. Diplomacy: Serbia’s foreign policy calendar includes new ambassador appointments and fresh parliamentary talks, including Serbia–Azerbaijan cooperation discussions in Belgrade.

Serbia’s Gold Push: Chinese-owned Zijin Copper says it sold 17.005 tons of gold to the National Bank of Serbia since 2019, with 164 bars delivered in H1 2026—gold stays in Serbia’s reserves unless the NBS passes on its first-refusal right. Wage Arrears Pressure: President Vučić promised employees of state pharmacy network Apoteka Beograd all 16 unpaid salaries within a month or 45 days, after arrears of about RSD 900 million; talks also point to a possible concession if the firm runs losses. FX Watch: The dinar’s official median rate is 117.4261 RSD per euro, while the indicative dollar rate is 102.8231 RSD. EXPO 2027 Branding: Badminton legend Lin Dan joins EXPO 2027 Belgrade brand ambassadors alongside Jackie Chan and Usain Bolt, as the event targets 4+ million visitors. Tech & Diplomacy: Serbian deputy parliament speaker Marina Ragus met Azerbaijan’s deputy FM Fariz Rzayev, highlighting cooperation potential in IT, AI and energy, and Azerbaijan’s planned EXPO 2027 participation. Global AI Governance: A new World AI Cooperation Organization (WAICO) was launched in Shanghai with Serbia among signatories, aiming to shape AI governance and capacity-building beyond Western-led frameworks.