Serbia seeks to maintain its leading position in the region in attracting foreign investments and this year the investment volume is expected to exceed 1.5 billion euros. Along with attracting foreign capital, Serbian businessmen also plan to expand exports, especially focusing on food, which is increasingly in demand on the world market. More in our regular feature ECONOMIC REVIEW prepared by Jelena Milenkovic.
This year, foreign investors will continue to focus on car and electronic industries, as well as the sector of information and communication technologies. The Serbian Government has identified these sectors as promising and provided its support through a program encouraging foreign direct investment. According to Director of Serbia Investment and Export Promotion Agency (SIEPA), Bozidar Laganin, the Agency seeks to adequately respond to the economic situation and stimulate exports and investment inflows. In 2011, inflows of foreign investment in Serbia were greater than in all other countries in the region. Serbia’s results are even better than Romania, which is an EU member state with the market three times larger. Last year was proof that continuous work yields good results even in difficult circumstances, because the global economic crisis affected the operations of foreign companies. Laganin says that the companies still decided to invest in Serbia because of lower operating costs, favorable conditions and trade liberalization agreements that Serbia signed with many countries. In 2011, foreign companies launched some 90 investment projects, and the largest capital inflows came from the EU member states - Germany, Austria, Italy, and Greece.
When it comes to exports, food has an important place already, and there is potential for increased exports, especially to countries that have liberalized trade with Serbia. There is good potential to substantially increase sales in the Russian market, as well as to realize joint projects with this country in agriculture, says Minister of Agriculture and Trade Dusan Petrovic. During the first three months of the year, the foreign trade between Serbia and Russia has amounted to nearly 850 million dollars. Tariffs have been removed on almost all merchandise trade between the two countries. Exports in value of about 180 million dollars has been increased by 12 %, while imports, amounting to approximately 660 million dollars, decreased by about 8%. By increasing exports, Serbia has gradually managed to reduce the deficit in trade with Russia, which is a result of substantial energy imports. Russia is the fifth largest export and a primary imports partner of Serbia and the export-import coverage ratio is about 27%. Serbian food products hold a significant position among the products exported to Russia. Fruits and vegetables top this list of products. Exports of fresh and processed apples have increased by 10% in the first quarter of the year. Being a large country, Russia is in demand for large amounts of food and it is also willing to make invests to increase the Serbian production capacity so that Serbia can increase quotas for export of food to this market.