Foreign direct investments in Serbia: what has been done so far and what can we expect

Zubović, Jovan and Domazet, Ivana and Kovačević, Milena (2009) Foreign direct investments in Serbia: what has been done so far and what can we expect. In: Business Opportunities in Serbia : the case of Italian business sector and the role of management education. Belgrade Banking Academy and Institute of Economic Sciences, Belgrade, pp. 219-231. ISBN 978-86-9852-025-9

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Abstract

Strategic approach to foreign investments in Serbia has changed significantly at the beginning of XXI century. Before 2000 Serbia was a country that used high level of custom and non-custom barriers to protect its economy. During the period of nine transitional years Serbia shifted to completely liberal approach of an open market economy. A starting impulse to foreign investments in Serbia was given by the new approach to privatization process of state companies, which attracted over 3 billion euros of investments. Stable and transparent political model that was created made significant impact to an increase of foreign investments into the country and growth of foreign capital share in the market as a whole, with over € 13 billion of inflow. Since transition in Serbia in its full scale begun with ten years delay compared to other eastern and southeastern European countries, so was the first stage of the transition process completed with significant delay. For that reason it is important to understand in which way Serbia will approach second stage of transition, which is critical for sustainable development in the next period. Past experience of other countries should be used to understand what should and what should not be done in order to achieve so called “Virtual Circle of Foreign Investments”. Clear strategy and vision of Serbia in the future is required in order to attract not only those FDI which are seeking for fast turnover and use of natural resources, but rather those which are able to provide high level of added value and able to transfer technology and skills to economy as a whole.

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