Serbia has set a new record for attracting foreign direct investments (FDI) this year. President Aleksandar Vučić recently shared this achievement on Instagram, although the news was first announced a week earlier by the Governor of the National Bank of Serbia (NBS), Jorgovanka Tabaković. “Record foreign direct investments continue, and as of October 30, they have reached 4.47 billion euros,” said Tabaković, adding that President Vučić, who is abroad, deserves recognition for this achievement.
FDI inflows for the first half of 2023 amounted to 2.3 billion euros, with foreign investments almost doubling in just four months. President Vučić also announced that more investments are expected in the next 20 days.
China, Netherlands and Luxembourg Lead Investment Inflows
The NBS, which is the sole authority publishing official FDI data by country and sector, reports that China, the Netherlands, and Luxembourg are the largest investors in Serbia.
In the first half of this year, Chinese companies invested 697.9 million euros, followed by companies from the Netherlands with 527.8 million euros, and Luxembourg with 312.3 million euros. The UK also made a significant contribution, with investments worth 284.9 million euros.
The European Union remains Serbia’s largest investor, with total investments from EU member states exceeding one billion euros in the first half of the year.
German investments decline for the first time
Interestingly, German investments have shown a decline for the first time since 2010. This year, German investments in Serbia recorded a negative figure of 60.8 million euros. In contrast, German investments reached 223 million euros last year, 282 million euros the year before, and a peak of 410 million euros in 2021.
The decline in German investments can be attributed to the weakening German economy and challenges within the automotive industry, including the closure of factories by Volkswagen and job cuts at Ford in Germany.
Despite this, Germany remains Serbia’s largest foreign trade partner in terms of imports and exports.
New manufacturing investments in Serbia
The Serbian Development Agency (RAS) reported several significant manufacturing projects this year, including investments by companies such as Nestlé, Schiebel, CE Industries, Spintec, Linglong, Lianbo, Mattoni 1873, OCSial and Puratos.
RAS only records investments related to production activities and services, excluding infrastructure investments.
Some of the most notable new projects underway or expanding in Serbia include JFE Shoji, PWO SEE, Muehlabauer, Ariston, Continental, Minth, Kromber & Schubert, Stada/Hemofarm and Knjaz Miloš, which opened a new plant in October with an investment of 28.5 million euros.
Large-scale investments by Chinese and Italian companies
One of the largest greenfield investments in Serbia is from the Chinese company Linglong, which began serial production of tires in September 2023. The tire production facility in Zrenjanin, which started construction in 2019, represents an investment of over one billion dollars.
In July, the Italian company Ariston began the construction of a factory to produce household electrical appliances, with a total investment of 75 million euros.
In Preljina, near Čačak, the German company PWO Group broke ground in May on a new factory for manufacturing parts and equipment for motor vehicles, with an investment of 89 million euros.
In April, Lianbo Precision Technology, a Chinese company, opened its first European factory for producing metal parts for automotive engines, investing over 57.4 million euros.
Additionally, the American company Modine opened a new factory for refrigeration equipment in May, with an investment of over 27 million euros.
These investments highlight Serbia’s growing appeal as a destination for foreign direct investments, contributing to the country’s economic growth and job creation.
