Investments In Serbia Research Articles

Economic growth and foreign direct investment in Balkans

Foreign direct investment (FDI) has become a key source of economic growth for the Balkan countries, offering vital funding for development initiatives. Therefore, the purpose of this study was to examine the dynamics of FDI in Serbia, North Macedonia and Montenegro from 2000 to 2023. An econometric model was used to conduct the research, namely, the relationship between FDI and economic growth in the region was analysed. A multiple regression model was developed that includes gross domestic product growth as the dependent variable. It was established that significant fluctuations in the rates of economic growth are characteristic of all three countries during this period. Serbia has shown particular resilience, with positive growth rates prevailing in most years. Key sectors attracting FDI were also identified, including services, manufacturing, automotive, IT, agriculture, energy and tourism. The obtained results emphasised the importance of reforms aimed at business development, infrastructure development and regional integration, especially with the EU, as critical factors in attracting FDI. In addition, diversification of FDI sources was emphasised with increased investments from China, Turkey and the United Arab Emirates, which complement traditional investors from the EU. More than 60% of foreign investment in Serbia has been found to be concentrated in the services sector, while North Macedonia has successfully attracted investment in high value-added industries such as information technology and engineering. These findings are consistent with established economic theories about the impact of FDI on growth, while providing specific insights into the Balkan context. It found that a 1% increase in FDI was associated with a 0.3-0.5% increase in gross domestic product in the Balkan countries studied. The obtained results can become the basis for future political decisions and investment strategies in the region

Neophodan nivo investicija za ubrzani privredni rast - stilizovane činjenice i politike

To close the gap in economic development relative to the EU average, Serbian economy has to achieve significantly higher growth rates in comparison to other European countries over the longer period. Theoretical and empirical literature indicates that the level of investment in physical capital is one of the key determinants of the dynamics of economic growth. In this paper, based on data on investments and savings in Serbia and in 37 countries that in the previous three decades achieved an average GDP growth rate of over 5% per year (so-called fast-growing economies - FGE), we present and analyze relevant stylized facts. In the observed period, FGE had average total investments of 25.6% of GDP, of which 69% was private and 31% public investments, whereby private investments were predominantly domestic, which is associated with a high rate of gross domestic savings (of 27.4% of GDP). On the other hand, total investments in Serbia were 9.7% of GDP lower than the FGE average, which was a consequence of significantly lower public and domestic private investments, which was, among other things, a consequence of significantly lower domestic savings (by over 20% of GDP). As in the recent period there has been a noticeable increase in public investments in Serbia, in order to accelerate economic growth, it is necessary, in addition to maintaining them at a high level, to encourage a considerable increase in domestic private investments through economic measures policy and wider reforms of the general institutional environment, with the aim of having the total level of investments of over 25% of GDP over the next few decades.

Političko okruženje kao faktor privlačenja stranih investicija u Srbiju

The purpose of the paper is to research the influence of political environment factors on the inflow of foreign investments in Serbia. Keeping in mind that many countries in Southeast Europe find themselves in a situation where foreign investments are a necessity and a need for whole economic development, this research focused on Serbia owing to its results in foreign investment attraction during a transition period. Primary data collected using a survey technique on 88 foreign companies that invested in Serbia from 2001 to 2019 were analysed using a quantitative methodology (ANOVA and t-test). The results indicate that the stability of the government and the rule of law are the most important conditions for foreign investors in Serbia. This research's originality is reflected in the primary data and research results obtained.

Uloga bilateralnih investicionih sporazuma u podsticanju internacionalizacije preduzeća u Srbiji

Bilateral investment treaties are traditionally considered to be an instrument for attracting foreign direct investment in Serbia. However, their provisions may also support the internationalization of its enterprises. In this paper, we explore how effective bilateral investment treaties are in promoting the most challenging aspect of the internationalization of enterprises in Serbia -foreign direct investment outflows. Additionally, we investigate the role of other main motivations for the investment outflows. We conduct our analysis by estimating a gravity model using the panel data on Serbia and its 147 partner economies, observed in the period between 2011 and 2019. The gravity model was estimated using the Poisson pseudo-maximum likelihood estimator. We find that bilateral investment treaties have a statistically significant positive effect on bilateral foreign direct investment outflows. Furthermore, the outflows are particularly affected by the treaties containing higher anti-discrimination standards and providing a more liberal investment regime. Unilateral liberalization of the host countries' investment regime is also found to be positively associated with the investment outflows, whereas both the geographic and psychic distances have negative effects. Market-seeking motives of the internationalizing enterprises in Serbia are revealed to be the dominant driver of the investment. The results provide useful implications for the policymakers aiming to support the internationalizing efforts of the enterprises and the consequent improvement of the international competitiveness of Serbian economy.

Razvoj inicijative "Pojas i put" u Srbiji

The paper presents a general overview of the projects, observed according to the sectors of the Serbian economy, which were implemented in Serbia through the Belt and Road Initiative or are in the phase of implementation, planning or signed memoranda between China and Serbia. This initiative to strengthen trade, infrastructure and investment links between China and the countries of Asia, Africa and Europe, through a network of land and waterways, has affected the landscape of global trade, investment and financing, thereby expanding China's influence in the world. As a European country which is not a member of the European Union, Serbia found itself in a specific situation and was able to independently manage its relations with China and conclude contracts directly. In addition to the European Union as the main economic partner, Serbia is also turning to China, so this cooperation has a growing trend in the form of Chinese investments in Serbia, which are being investigated here, in contrast to the almost non-existent implementation of Serbian projects in China. Chinese companies in Serbia are actively building infrastructure, investing in the energy sector as well as the privatization and renewal of production of the former metallurgical giants of Serbia, and more. So, despite the large trade deficit with China, this initiative brings tangible economic and social benefits at the local level, creating new opportunities for employment and income generation in the community. That is why it can be said that the Belt and Road Initiative contributed to the development of cooperation between Serbia and China.

Belt and road investments in Serbia: Is China a new saviour or a new threat?

Versatile political and institutional cooperation between Serbia and China recently spurred the dynamic development of economic relations between the two countries. Those progressed quickly, especially due to Serbia?s participation in the format China-Central and Eastern European countries and the Belt and Road initiative. It caused changes in economic relations between China and Serbia in three directions: changes in trade patterns, the volume of loans, and the inflow of Chinese investments. This article focuses on the Chinese Belt and Road investments (foreign direct investments, acquisitions, and joint ventures) in Serbia while using qualitative along with descriptive statistical analysis. The authors analysed the type of companies, value of investments, and industries in which Chinese companies invested capital in the period 2014-2022. Research findings indicate an increase in bilateral trade, especially in export, after the Chinese investments have been made. The value of Chinese investment has grown over time, with a relatively high concentration in the automotive industry and a presence in rather few industries. The first investments were realized by state-owned enterprises and, in recent times, by private-owned companies. The authors indicate that while China?s role in Serbian economic development is increasing, it should not be categorized either as a saviour or a threat, but as a rather important economic partner of Serbia whose influence in Serbia is increasing. However, the interplay between China and Serbia, determined by the interests of both sides as well as the capabilities of Serbia to design appropriate institutional and policy frameworks will determine the contribution of Chinese investments to Serbian economic development in the future.

The (Un)Certain Future of Tax Sparing Credit in International Tax Treaty Law

all treaties, with Serbia having this clause in 46% of its double taxation agreements. It is the authors’ view that this provision represents a confirmation of the right to introduce tax incentives as a part of a country’s right to tax, while pointing out the necessity of preventing abuses of the provision. After conducting an analysis of the effects of tax sparing on foreign direct investments in Serbia and outgoing investments of Serbia’s residents, the remaining portion of the paper is dedicated to exploration of the interaction between GloBE Income Inclusion Rule and tax sparing. Their incompatibility, which implies that tax sparing would be annulled under BEPS 2.0, may be overcome via a specific carve-out, but at present such initiative is not endorsed by Inclusive Framework on BEPS.

Serbia and France: the special relationship?

What is the relationship between the European Union and the Western Balkans, and Serbia in particular? The author reviews the process of accession of the Western Balkan countries (with a focus on Serbia) to the European Union, but also the geopolitical stakes in this region, which is sought after by external actors such as China and Russia, and which the European Union should pay more attention in order to strengthen its strategic autonomy. The EU needs to take a bold stance in the Western Balkans and France wants to be at the forefront. European actors must show future member states that the door to full membership is indeed open, but only if they can truly embrace democratic values. In his analysis, the author writes about Serbia's path towards EU integration through an increasingly close relationship with France. The current situation in Serbia is rather complex. Will it continue with its "hamster in the wheel" approach, where the result is always expected to be the same, or should Serbia adopt a different approach for the future? As concerns Serbia, France will certainly continue to insist on economic cooperation and the improvement of French investments in Serbia. They will also take a stand against damaging foreign influences which they believe could potentially destabilize the region and are fundamentally at cross purposes with the policy favored by the European Union.

Social Environment as a Factor of Capital Investment in Serbia

ABSTRACT The main purpose of this paper is to investigate the impact of the social environment on foreign investment inflows in Serbia. It surveyed the largest 300 foreign investors over the period 2001–2019 and achieved a response rate of 29.3%. The obtained results show that the crime rate, skilled labor, and attitude toward foreigners are the most important for foreign investors in Serbia. The main contribution of this paper is that it represents a rare attempt to provide an empirical research on the attitudes of foreign investors, in the context of the transition economy in the region of Southeast Europe.

Illiberal capitalist development: Chinese state-owned capital investment in Serbia

ABSTRACT State-owned capital investment into so-called illiberal democracies in Central and Eastern Europe (CEE) has risen to become a more significant feature of CEE political economies, although knowledge of the impact of such transnational flows on illiberal capitalist development remains limited. This article analyses this form of capitalist relation by contributing to and consequently fusing two strands of burgeoning academic literature: (1) the political economy of illiberalism and (2) state capitalism. The result is an expansion of the purview of each: the former by focusing on CEE illiberalism’s external (state) capitalist dimensions; the latter via an upgrading of the rigour of the term ‘state capitalism’ through analysis of ‘new territorialities’. Empirically, I use a Case Study Analysis of Chinese state-owned capital investment into Serbia with focus on two Sino-Serbian agreements and identify two issues that may come to characterise the broader relationship between CEE illiberalism and Chinese state-owned capital investment.

STRANE DIREKTNE INVESTICIJE U SRBIJI

In the process of globalization, the importance of foreign direct investment has changed significantly, because today they represent one of the most important factors of competitiveness, development and application of new technology, education, innovation and economic development. As a significant form of financing national economies, foreign direct investment is a form of investment that is realized outside the home country, where one of the most important goals of both developed and especially developing countries is to attract as much foreign direct investment. A large number of developing countries, including Serbia, have liberalized restrictions on foreign investment and free trade in the last two decades, liberalized national financial markets and begun privatization processes. Due to numerous problems and consequences of economic crises they have faced, many developing countries, as well as Serbia, view foreign direct investment as one of the most important factors for stimulating trade, employment growth, openness of national economies, and establishing overall macroeconomic stability. The aim of this paper is to point out the importance and dynamics of foreign direct investments in Serbia, as well as the key incentives for their attraction. Also, in addition to the theoretical review of foreign direct investments, the effects of foreign direct investments are presented in the paper.

УТИЦАЈ ПОРЕСКИХ ОЛАКШИЦА НА ПОСЛОВАЊЕ СТРАНИХ ИНВЕСТИТОРА У СРБИЈИ

Tax incentives granted to foreign investors play the leading role in the process of attracting foreign investments. The aim of this paper is to determine how individual tax exemptions affect the operations of foreign investors in Serbia. In order to determine this, we conducted a survey through which the views of foreign investors, expressed through their opinions, perceptions and expectations when it comes to their investment in Serbia, were collected. The main focus of the work is on tax incentives in certain areas, intended for the operation of foreign investors in Serbia, and depending on the amount of investment. The methodology of empirical research, based on the quantitative approach, enabled the collection of numerical data, their mutual comparison, as well as the exploration of connections between them. Based on the results obtained it is possible to conclude that tax incentives are very important to foreign investors when choosing Serbia as an investment destination. The results that have been achieved through the research may be of relevance to the fiscal policy makers in Serbia, since it is of the utmost importance that even more favorable conditions for foreign investors are ensured in the forthcoming period.

National Culture Values: reflections on formation process of future leaders in international economic cooperation

The trend towards foreign investments in Serbia has been in rapid progress in recent years. The biggest and most valuable numbers of investments are coming from Italy. The authors’ expectation is that the trend of Italian investments in future will continue; therefore it is of high importance for the representatives of both countries’ business sectors to under-stand and accept differences and similarities to the other country’s business culture. Research of cultural differences between two nations , which are considered like a frame of business culture, helps avoiding possible misunderstandings and improving business cooperation be-tween two countries. Having in mind students of economics and management, on one hand like future leaders of Italian and Serbian business and on other like representatives of the cur-rent education value system in the field of economics and management, this study consists of an application of the 7-D Hofstede Model. The application of the model takes place through the administration of two surveys done by students of Serbian Megatrend University, in Bel-grade, and Italian Università degli Studi Gabriele d’Annunzio, in Pescara

Politika javnih investicija u Srbiji usmerena na podsticanje rasta - više i efikasnije

In the last few years Serbia has restored its macroeconomic stability, primarily due to successful fiscal consolidation, but economic growth remained insufficient for faster convergence with other European countries. One of the reasons for sluggish growth is related to low domestic private and public investment. From 2001 to 2018 public investment in Serbia amounted to 2.6% of GDP on average, which was the lowest in Central and Eastern Europe (CEE) and the Western Balkans (WB). Although its public investment has risen in the last few years, Serbia is still lagging behind the CEE and WB countries in that respect, especially in terms of the local self-government investment. In that period, cumulative public investment in Serbia was lower than the CEE average and WB average by 33% of GDP and by more than 40% of GDP, respectively, although total government expenditures in Serbia were rather large. Due to many years of severe underinvestment, the total public capital stock (per capita) in Serbia is the lowest in CEE and the WB region, which is why Serbia is among the three lowest ranked countries in terms of the overall quality of infrastructure in CEE and the WB. The public investment policy may yield significant positive impact on future growth in Serbia, provided that the following two conditions are met: i) public investment increases to 4-5% of GDP and remains at that level in a fiscally sustainable manner for at least a decade, ii) the efficiency of investment projects, in terms of selection, contracting, implementation and supervision, is significantly improved.

Značaj unaprjeđenja slobodne trgovine u zemljama u razvoju

The subject of this research is a scientific contribution to the promotion of free trade in underdeveloped countries and developing countries, both in theoretical and practical terms. Bearing in mind that the world trade is a young scientific area that has evolved from skill through the methodology of dealing with people in organizations to forms as professions and scientific discipline. Experience shows that developing countries that have understood this and started using scientific achievements in the field of international trade business and free trade, have in practice achieved far faster development than other underdeveloped countries. The promotion of free trade in developing countries is more decades in the circles of interest for numerous economic theorists and practitioners, bearing in mind the fact that free trade is the first-rate factors of the economic development of each country. This paper presents a contribution to the analysis of the competitiveness of free trade in developing countries and persistent analysis compared to developed countries. The paper points to the importance of membership in the World Trade Organization, which entails access to the market, benefits, relief and exemption from customs duties. The starting assumption is that the competitiveness of the economy of countries that are underdeveloped or in development is at a very low level. Therefore, an increase in competition between undeveloped countries would be conditional on an increase in exports and thus developed a more favorable environment for attracting foreign direct investments. This is why the basic message of this scientific research paper is that, with cooperation with international monetary, financial and trade institutions, allow developing countries to open their markets and seize the benefits of engaging in international trade flows . Therefore, on the work of the paper a special emphasis is placed on cooperation with the World Trade Organization, the WTO. The theoretical and empirical foundation of this scientific and research work stems from the realization that investments in the development of free trade are an increasingly significant factor of growth and development of each economy. The experience shows that countries that save on these activities are the ones who are working too little for their present and not for their future. The lack of investment in the promotion of free trade is reduced in the final instance to poverty in the quality of economic development. And the quality of planting and future economic growth is based on programmed production, redistribution and allocation of quality scientific programs with calculated effects on labour productivity, savings and prosperity. Investing in improvement and cooperation with international trade institutions of the current and future leaders of undeveloped countries provides answers to evolving challenges. Improving foreign trade is one of the most cost-effective investments of an underdeveloped state. Knowledge and expertise in the field of foreign trade are the fundamental determiners of the development of the most solemn, the vreiority and the quality of human life in these countries. The entire future of one country is based on science, education and knowledge that liberate the social, economic and cultural difference.Chinese foreign direct investment in the world has long and successful tradition. Over the past decade, China has become one of the largest exporters of foreign investment in the world, including European countries. China's investment in Europe brings a number of benefits in terms of technology, know-how, improving the reputation of existing brands, establishing a logistical market in the European market. Looking from the viewpoint of the host countries, the inflow of Chinese investments brought new economic opportunities, especially in those European countries that had poor economic growth, faced with high unemployment after the Euro crisis. This paper presents global trends of Chinese foreign direct investment, the motives that have prompted Chinese investors to invest in European countries, the needs of the EU for Chinese investment, and good example of attracting Chinese investments in Serbia.

FOREIGN DIRECT INVESTMENTS IN THE REPUBLIC OF SERBIA WITH A SPECIAL FOUNDATION ON BROWNFIELD INVESTMENTS

Foreign direct investment (FDI) in developing countries is a significant development factor. The Republic of Serbia, as a country in the transition phase, considers FDI as one of the most important factors for economic development. FDIs from the aspect of investors are also of great importance, especially in the sphere of building confidence of other countries and a favorable economic climate in our country, and in connection with future profitable investments. The benefits of increasing foreign direct investment in Serbia include: initiating technological transfers and spilling into the domestic economy, helping human resources development and management capabilities, contributing to inclusion in international trade and increasing exports, helping to create a more competitive environment, developing a culture of entrepreneurship, for the purpose of economic progress.

Kineske strane direktne investicije u evropskim zemljama

Chinese foreign direct investment in the world has long and successful tradition. Over the past decade, China has become one of the largest exporters of foreign investment in the world, including European countries. China's investment in Europe brings a number of benefits in terms of technology, know-how, improving the reputation of existing brands, establishing a logistical market in the European market. Looking from the viewpoint of the host countries, the inflow of Chinese investments brought new economic opportunities, especially in those European countries that had poor economic growth, faced with high unemployment after the Euro crisis. This paper presents global trends of Chinese foreign direct investment, the motives that have prompted Chinese investors to invest in European countries, the needs of the EU for Chinese investment, and good example of attracting Chinese investments in Serbia.

The impact of calculation of resources and reserves on mining activity in Serbia

The appearance of interest of the world's most important mining companies i for investment in Serbia imposes the problem of harmonization of domestic legislation with foreign ones. In this paper, specific categorization and classification of mineral raw materials, which do not match in domestic and foreign practice, are treated. The existence of such a conflict of criteria in use for categorization and classification can lead to misunderstanding and create certain complications in business. The following sections outline some of the disagreements that are present in comparing our regulations with the world ones.

Competitiveness of the Serbian Economy Through the Prism of Tax Incentives for Foreign Investors

In order to make Serbia the most attractive investment destination in relation to countries in the region, special attention should be paid to the current tax incentives granted to foreign investors. Hence, the aim of this paper is to find the opinion and attitudes of foreign investors in the relevant research and analysis regarding the importance of tax relief for their investment in Serbia. Tax incentives are one of the most important tax instruments that can play a decisive role on foreign investors when choosing an investment location, and therefore to increase the competitiveness of the Serbian economy. In this paper, special attention will be given to tax incentives in certain areas for the business of foreign investors, depending on the way foreign investors enter the Serbian market. The methodology of empirical research in this paper is based on a quantitative approach to the collection of primary data through the survey of relevant subjects, the comparison of collected data, and the analysis of the causality of the investigated phenomena. On the basis of the obtained results it can be concluded that the greatest influence on the investor when making a decision on investing in Serbia is tax incentives in corporate income tax.

Chinese Investments in Serbia—A Joint Pledge for the Future of the New Silk Road

Abstract Following the political changes in 2000, Serbia has rapidly started to catch up with the countries of Central and Eastern Europe in various aspects of the transition process. One of these very important aspects were foreign investments, both ‘direct’ and ‘portfolio’ ones, that had a significant impact on the development of Serbian economy by recovering economic structure and raising competitiveness in world markets, followed by improving the balance of payments and technological, scientific and managerial base. Foreign investments as an “economic engine” enable accelerated realization of national economic goals which include re-industrialization and renewal of industrial capacity. The openness of the Serbian market and the lack of financial resources allow China and other states concerned under favourable conditions invest in the development of Serbian economy. In this way, Chinese investments have become a driving force for the promotion of economic and other relations between the two countries. On the other hand, however, Chinese investments have proven to be an ideal test for the realization of the objectives of the development strategy of the ‘New Silk Road’ which among other things include the improvement of China’s position on world markets, including the EU market. For the proper understanding of Sino-Serbian relations, this study first gives a short explanation of the Chinese strategy of the New Silk Road. Then, it includes an analysis of Serbia’s position towards China. Analysis of the development of Serbian-Chinese economic relations, especially in the field of foreign investment and within the framework of multilateral cooperation mechanism ‘16+1’, occupies the central part of the study. The study concludes with an evaluation of comparative advantages and certain disadvantages for the Chinese foreign investment in Serbian economy, which in itself has certain significance for the realization of the New Silk Road strategy.