1. Prospering Foreign Investments D.0.0.
Investing in Serbia
2. Key country data
Official name: Republic of
Area: 88,361 km2
Population: 9.5 million
Official Language: Serbian
State Form: Democratic
Capital: Belgrade (1.6
Currency: Serbian Dinar
3. Serbia’s priorities
Ensuring energy stability
Proactive trade diplomacy
Support to industries of national importance
(Automotive, Electronics & IT)
Support to underdeveloped regions and strategic regions
4. Integration processes
 The Stabilization and
Agreement (SAA) with the EU
signed in and ratified by
 Trade interim agreement with
 Visa liberalization for Serbian
 Serbia’s application for WTO
5. Investment in Transportation
Infrastructure – Corridor X
A major part of the Corridor X
highway already built, but some
towards FYR Macedonia and
International tenders to be
6. Unique export potential
Free Trade Agreements
7. Favorable tax regime
Corporate income tax is paid at the uniform rate of 10%. Non-residents
are taxed only based on their income generated in Serbia.
The personal income tax rate is 12% for salaries.
Corporate Income Tax:
Serbia: 10 %
Bulgaria: 10 %
Romania: 16 %
Hungary: 16 %
Czech Republic: 19 %
Poland: 19 %
Slovakia: 19 %
Croatia: 20 %
Personal Income Tax:
Serbia: 12 %
Croatia: 15 %
Czech Republic: 15 %
Hungary: 16 %
Romania: 16 %
Poland: 18 %
Slovakia: 19 %
Bulgaria: 20 %
8. Ensuring energy stability
The “South stream” gas pipeline with a total
capacity of more the 10 billion m3/year
High capacity underground gas storage in
Construction of additional thermal power plants;
Further expansion of existing capacity
Construction of an additional major hydro power
plant is being considered
Focus on renewable sources of energy –feed in
Tariff system put in place
9. Incentives in municipalities of
In the municipalities of special interest
for regional development:
Min. investment: 0.5 million EUR
Minimum new of jobs: 50
Incentives from 5,000 to 10,000 EUR
or every new job created
10. Free Zones in Serbia
Fiscal benefits (exemptions from any tax
burden for FDI, VAT, company profit
tax, property tax, income tax, etc.)
Free of customs duties for
goods, equipment, raw and construction
Efficient administration (one stop shop)
Simple and fast customs procedures
Local subsides for using the
Providing a set of services to users
under preferential terms
11. Free Zones Cities
There are seven free zones which are currently operating in Serbia:
12. Incentives for investing in
 In the municipalities that are
considered most underdeveloped
• Min. investment: 0.5 million EUR
• Min. creation of jobs: 50
• Incentives from 4,000 to 10,000
EUR/ every new job created
13. Incentives for for Large-Scale
In all municipalities in Serbia:
• For projects with investment
value of over 50 million EUR and
creating 300 new jobs the
Government will provide up to
20% of total investment
• For projects with investment
value of over 200 million EUR and
creating 1,000 new jobs the
Government will provide up to
25% of total investment
14. Most Improved Business Environment
Economist Intelligence Unit: "Serbia is forecast to make the largest
improvement in the business environment in the region of Eastern
Europe between 2009 and 2013. Out of 16 countries included in the
research, Serbia will be leading the region in terms of business
reforms by a wide margin".
PricewaterhouseCoopers ranked Serbia as the 3rd most attractive
manufacturing and 7th most attractive services FDI destination among
Ernst & Young recorded nearly 150 inward investment projects in
Serbia in 2007, 2008 and 2009 - the 2nd best performance in the
South East Europe region.
15. Foreign Direct Investments
Since year 2001, Serbia has attracted over $25 billion of inward foreign direct
Since the onset of economic reforms, Serbia has grown into one of the
premier investment locations in Central and Eastern Europe. A list of leading
foreign investors is topped by world-class companies and banks such as
FIAT, Telenor, Stada, Microsoft, Coca-Cola, Michelin, Gazprom, Siemens,
IntesaSanpaolo, Raiffeisen, and many others.
Investors from the European Union top the list. The leading spot on the
country list is held by Austria, followed by the Netherlands, Greece, Germany,
Luxembourg and Norway, while major investor countries also include Italy,
the Russian Federation, Slovenia, France and Switzerland.
The actual amount of U.S. investment is significantly higher than the official
figure due to their companies investing primarily through European affiliates.
This also holds for Belgium, Denmark, Israel, and a number of other
16. Foreign Direct Investments by Industries
17. Overhead Costs
Extremely competitive environment provides second lowest
corporate income tax in Europe, together with other favorable taxes
19. Liberalized Trade
Externally, Serbia can serve as a manufacturing hub for duty-free exports to a
market of 1 billion people. It includes the European Union, the United States of
America, the Russian Federation, Kazakhstan, Turkey, South East Europe, the
European Free Trade Agreement members, and Belarus.
This customs-free regime covers most key industrial products, with only a few
exceptions and annual quotas for a limited number of goods.
Upon the completion of negotiations with Egypt, the territory with duty-free
access for Serbia will be increased by the population of additional 77 million.
20. Belgrade - City of Future
Belgrade – City of Future
Belgrade, the capital, has been awarded as the City of the Future for
Southern Europe 2007 by the FDI Magazine.
Selection criteria - economic potential, cost effectiveness, human
resources, IT and telecommunications, transport, quality of life, and
In 2008 the municipality of Indjija was ranked among the Top 25
Most Attractive locations for foreign direct investment in Europe by
the FDI Magazine.
With a population of 1.6 millions, Belgrade is the administrative,
economic and cultural center of Serbia.
21. Duty-free Access to a Market of 1 Billion Consumers
Starting a business in Serbia means the opportunity of exporting to a
1 billion people market without paying any customs duties.
Serbia is a member of the Central European Free Trade Agreement
(CEFTA) comprising of a free trade area with 29 million people. This
region is also the one with the highest growth rate in Europe.
Serbia is the only country outside of the Commonwealth of
Independent States that enjoys a Free Trade Agreement with Russia.
Added to this are duty-free exports to the European Union and the
United States for most products and services.
Finally, with the population of 9.5 million people, Serbian market
itself is among the largest in the region.
22. Skilled and Competitive Workers
Serbia's labor force combines exceptional working efficiency with sizable labor supply.
With a unique combination of high-quality and low costs, it is one of the key factors in
reaching a strong business performance.
Technical education is particularly strong as high school students are among the best
performers at world contests in natural sciences, while Serbian engineers are wellknown for their expertise.
In addition, Serbia boasts the highest English speaking proficiency in Eastern Europe.
Management education has also been accelerated by the introduction of joint graduate
and post-graduate courses organized by local universities and renowned Western
23. Unique Selling Propositions
Independent privately held company with international roots
No governmental or financial services industry affiliation
No political affiliation
Hundred percent focused on client needs
Prepare client for Go or No Go for Investing in Serbia
Using or working with local resources - working with our people (no
Working privately - all work, information and investigations will be
done silently in the background (avoiding public noise)
Capable of negotiating with government or public institutions subventions
Support all industries
Experienced in Due Diligence and Compliance Assessments
24. Economic Information
GDP (2010): $40.28 billion.
GDP growth rate (2010): 1% (revised downward from 1.8%).
GDP per capita (2010): $5,370.
Inflation rate (2010): 10.3%.
Natural resources: Coal, petroleum, natural gas, antimony, copper, lead, zinc,
timber, bauxite, gold, silver, navigable rivers.
GDP by sector (2009 percentages, latest data available):
Agriculture 9.0%; mining and quarrying 1.2%; manufacturing 14.8%;
electricity, gas, and water 3.2%; construction 4.7%; wholesale and retail trade,
repair of vehicles 1.3%; hotels and restaurants 1%; transport, storage, and
communication 7.5%; financial intermediation 2.8%; real estate, renting
15.6%; public administration and defense, compulsory social security 3.4%;
education 4.2%; health and social work 5.4%; other community, social, and
personal services 2.3%; private households with employed persons 0.1%.
Trade (2010): Exports--$9.79 billion. Major markets--Bosnia and
Herzegovina, Montenegro, Germany, Italy. Imports--$16.73 billion. Major
suppliers--Russia, Germany, Italy, China.
Constitution: Adopted in an October 28-29, 2006 referendum.
Branches: Executive--President (chief of state) Boris TADIC (since July 11,
2004); Prime Minister (head of government) Mirko CVETKOVIC (since July 7,
2008), Council of Ministers (cabinet). Legislative--Parliament. Judicial-Supreme Court of Cassation and Constitutional Court.
The national legislature of Serbia is a unicameral assembly of 250 deputies
chosen in direct general elections for a period of four years.
The deputies in the National Assembly elect the Government of the Republic
of Serbia, which, together with the President of the Republic, represents the
country's executive authority. The judiciary is independent.
Area: Republic of Serbia (88,361 sq. Km), Central Serbia (55,968 sq. Km),
Vojvodina (21,506 sq. Km), Kosovo and Metohija (10,887 sq. Km).
Cities: Capital--Belgrade. Other cities--Novi Sad, Nis, Kragujevac, Subotica,
Zrenjamin, Pancevo, and Cacak.
Position: Serbia is located in the central part of the Balkan Peninsula, in the
south-eastern part of Europe.
Geographic coordinates: 44 00 N 21 00 S.
Land Boundaries: Total: 2,026 km. Border countries: Bosnia and Herzegovina
302 km, Bulgaria 318 km, Croatia 241 km, Hungary 151 km, Kosovo 352 km,
Macedonia 62 km, Montenegro 124 km, Romania 476 km.
Terrain: Varied; in the north, rich fertile plains; in the east, limestone ranges
and basins; in the southeast, mountains and hills.
27. Investment Potential
Serbia is positioned at the heart of the river that unites Europe – the
Passing through ten European countries – Germany, Austria,
Slovakia, Hungary, Croatia, Serbia, Bulgaria, Romania, Moldova and
Ukraine, the Danube River links the cultures and economies of
Western and Southeastern Europe.
With 588 navigable kilometers through Serbia, the beautiful
landscapes along the river are particularly interesting and offer a
high potential for tourism development.
As Corridor VII of the European Union, the Danube is an important
transport route. Since the opening of the Rhine – Main - Danube
Canal, the river connects the Port of Rotterdam and the industrial
centers of Western Union with the Black Sea and, also, through the
Danube - Black Sea Canal, with the Port of Constanta.
28. Territorial organization
 In terms of administrative and territorial division, the Republic of
Serbia is divided into provinces, regions, administrative areas, the City
of Belgrade, cities and municipalities.
 The territorial organization of Serbia includes five regions (Belgrade
region, Vojvodina region, Sumadija and western Serbia region, eastern
and southern Serbia region and Kosovo-Metohija region). They include
the City of Belgrade as a separate territorial unit established by the
Constitution and law, and 29 administrative areas, 23 cities, 28 urban
municipalities, 150 municipalities, 6,158 villages and 195 urban
 The Republic of Serbia has two territorial autonomies, AP
and AP Kosovo-Metohija.
29. Municipalities and Cities of Serbia
Serbia is divided into 150 municipalities (Serbian: opstine) and 24
cities (gradovi), which are the basic units of local self –
government. The city may and may not be divided into city
municipalities (gradske opštine).
Six cities, Belgrade, Novi Sad, Nis, Kragujevac, Pozarevac and
Vranje, comprise several city municipalities, divided into "urban"
(in the city proper) and "other" (suburban).
There are 33 city municipalities (17 in Belgrade, 5 in Niš, 5 in
Kragujevac, 2 in Novi Sad, 2 in Pozarevac and 2 in Vranje).