Financial Times: Serbia first in world in greenfield FDIs

Serbia has the best global performance index for greenfield foreign direct investments in the world – the Financial Times claims.

Despite disappointing economic results, the newspaper says, Serbia still outranks other countries in terms of regulatory reform, low labour costs and access to the EU market.

The global performance index for greenfield FDIs measures the attractiveness of a certain country for greenfield investments relative to the size of their GDP. Serbia’s index is 12.02, followed by Cambodia with 11.24 and Macedonia with 9.18. The index shows that, in 2016, Serbia attracted over 12 times more foreign direct investments than expected for an economy of that size.

In 2016, foreign investors announced the implementation of 77 greenfield projects in Serbia compared to 57 in 2015. Close to 53% of these projects were in the manufacturing industry, mainly in the production of electronic and car parts, followed by real estate and textile industry.

Serbia is appealing to foreign investors because it is more of an export platform to them, rather than a full-fledged market. In 2015, the country’s GDP contracted by almost 16%, while its economic growth stood at 1.6% last year.

Despite this poor economic performance, Serbia jumped to the 44th place on the World Bank’s Doing Business report for 2017, seven places up from 2016 thanks to shorter procedures for registering property and expediting issuing of building permits.

Also, Serbia is known for its low labour costs. For instance, labour costs of a manufacturing plant in the automotive industry which employs 400 people are half of those in other regional countries like Hungary and Turkey according to the Financial Times.

(Blic, 03.08.2017)

This post is also available in: Italiano

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