Global Location Trends Report: Serbia most attractive FDI country

Serbia ranks first in the world by the number of jobs created as a result of foreign direct investments (FDI), relative to the size of the country’s population – the Global Location Trends report, published by IBM Institute of Business Value, says.

Three other countries on the list of top-ranking destination countries by estimated jobs per million inhabitants — Bosnia & Herzegovina, Slovenia and Macedonia — were also from the former Yugoslavia, which (with the exception of Slovenia) has lagged behind its peers from Central Europe economically, indicating that efforts by governments in the region to attract investors are paying off. The low costs in countries like Bosnia, Macedonia and Serbia have also proved attractive to investors as the labour market squeeze drives up costs in CEE. 

Serbia “continues to receive significant inward investment in key sectors such as textiles, transport equipment, chemicals and electronics. Not surprisingly, manufacturing activities account for almost 80% of all jobs created from FDI,” the report said. 

“The continued strong performance by Serbia and the wider Western Balkans on this measure testifies to the region’s growing success in attracting foreign investment and cementing its position in global value chains. While the performance of individual countries varies from year to year, the region as a whole is experiencing a sustained high level of interest from foreign investors,” according to IBM’s study. 

However, while it remains within the top 10 destinations, the jobs created per million inhabitants in Macedonia dropped considerably in 2017 compared to in 2012-2016, indicating that the political unrest that culminated with a violent invasion of the parliament in 2017 has deterred some investors. 

Other countries from CEE that scored highly in terms of estimated jobs created per million inhabitants were Lithuania (2nd), Hungary (7th), Slovakia (8th) and Latvia (11th). 

Like the Western Balkans, “the Baltic countries are experiencing continued high levels of inward investment, with Lithuania ranking second overall and Estonia and Latvia featuring among the global top 20. The region has been particularly successful in attracting ICT investment, and this sector is the most significant source of inward investment measured by both number of projects and jobs created.”

Meanwhile, Hungary has become an attractive destination to investors as the personal income tax rate and the corporate tax rate is one of the lowest in Europe and the social contribution tax rate is also getting lower, said the Foreign Affairs and Trade Ministry, which oversees foreign investments. 

The US ranks first, China second and Mexico third on the list.

(B92, 05.10.2018)

This post is also available in: Italiano

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