Serbia is modern, democratic European country, located at the Balkan Peninsula, on the way to its European Union membership. Serbia has a population of around 7.5 million people. Major cities are, the capital city Belgrade (population around 1.6 million), Novi Sad, Niš, Kragujevac and Subotica.
Due to Serbia’s geographically important position many world-renowned companies have recognized Serbia’s potential and decided to locate their business in the country. Exports to the European Union market are free-of-customs according to the Stabilization and Association Agreement. The Free Trade Agreement with Russian Federation stipulates that goods produced in Serbia can be exported to Russian Federation customs free. The Central European Free Trade Agreement (CEFTA) is the trade agreement between Albania, Bosnia and Herzegovina, FYR Macedonia, Moldova, Montenegro, Serbia, and the United Nations Interim Administration Mission (UNMIK) in Kosovo which enables companies in Serbia to export goods to 22 million people market also customs free. Besides that, with 7.5 million people, the Serbian market is the second largest in Southeast Europe.
Many companies are attracted by Serbia’s highly-skilled, easily-trained, English proficient, wide available labor force. Serbia is country of growing number of engineers and managers sufficient to meet the needs of new investors, proven by each year of approximately 43,000 university and 2-year college graduates and 75,000 high school graduates who enrich already existing working population of about 3 million people. There is also whole range of incentives for investors, including financial and tax incentives. Along with highly educated labor force and number of valuable incentives Serbia has become attractive investment location in Southeast Europe.
Serbia is country of modern infrastructure with well-developed road connections and railway network and has great potential for river transportation as well. Serbia is one of the countries through which the Danube River flows and features 12 ports in Serbia (Novi Sad, Belgrade, Pančevo, Šabac, Smederevo, Sremska Mitrovica, etc). This makes Serbia one of the transit countries which connect central Europe and the Black Sea. Serbia has two international airports: Nikola Tesla Airport in Belgrade and Constantine the Great Airport in Niš.
Since 2000 Serbia has attracted EUR 25.2 billion of foreign direct investments becoming one of the most attractive countries for investments in the Southeast Europe. Key sectors with prospects and potential include the following: Automotive Industry, Agribusiness, Real Estate, ICT, Shared Business Services and Renewable Energy.
Serbia has a tradition in automotive industry of more than 70 years. Serbian automotive center is the city of Kragujevac. The most important and the largest investment in this sector was the Fiat project, which launched number of other investments and projects in the sector enabling Serbia’s automotive industry to develop, modernize and to supply all major car manufacturers from Europe to Asia.
Serbia’s ideal natural conditions for growing crops, fruit and vegetables and strong regional brands with long lasting tradition were main reasons for a lot of investors from agribusiness sector to come and invest in Serbia. With Serbia’s tradition and new tehnologies that came with investitions in previous years, Made-in-Serbia food became well known brand worldwide.
Regarding real-estate sector in Serbia, situation is quite encouraging when we look past few years and considering many international companies that have chosen Serbia to locate their business instead some other country in Souteast Europe. Section with the most promising potential is the retail market offering great opportunities for investors and retailers. Serbian government launched reforms which will facilitate administrative procedures before the authorities and unburden it from of unnecessary formalities.
In ICT sector Serbia has much to offer. As geographically well located country and with approximately 35% of university graduates coming from technical schools Serbia is more than capable to persuade new investors to locate and expand their business in the country.
By setting operations in Serbia, some of the global magnates in Shared Business Services sector placed Serbia on the map as new hot spot and suitable location for shared services center in Southeast Europe.
Serbia is country rich with renewable energy sources which are insufficiently exploited and in its initial phases of development. Serbian government a few years ago adopted the 2020 strategy on development of renewable energy sector with aim to significantly enhance the use of renewable energy sources providing to investors new legal base and great export possibilities.
Investors that decide to set up operations or conduct trade in Serbia will find it to be a reliable and dynamic country, with vibrant labor market and business-friendly environment that affords them many business opportunities.
Written by: Ivan Milosevic, attorney-at-law in Serbia, who collaborates with Soutullo & Asociadas.