Serbia / Lebanon

Serbia flag

Capital: Belgrade
Area: 77,474 sq km
Population: 7,111,024 (2017 est.)
Median age: 42.6 years
Major language: Serbian
GDP (PPP): $106.6 billion (2017 est.)
GDP – per capita: $15,200 (2017 est.)
Currency: Dinar (RSD)

Source: The World Factbook

WHY INVEST IN SERBIA © Development Agency of Serbia

With a population of 7.1 million, Serbia is a parliamentary republic. It is a member of the UN, CoE (Council of Europe), OSCE (Organization for Security and Co-operation in Europe), PfP (Partnership for Peace), BSEC (Organization of the Black Sea Economic Cooperation), EFTA (European Free Trade Association), CEFTA (Central European Free Trade Agreement) and is acceding to the WTO (World Trade Organization). Since 2014 the country has been negotiating its EU accession with the perspective of full membership by 2025.

Serbia has an emerging market economy in the upper-middle income range. According to the IMF World Economic Outlook, Serbia’s nominal GDP in 2017 is officially estimated at $39.366 billion or $5,599 per capita, while purchasing power parity GDP is $106.602 billion or $15,163 per capita. The economy is dominated by services which accounts for 60.8% of the GDP, followed by industry with 31.3%, and agriculture at 7.9%.

Since 2000, Serbia has attracted close to $30 billion in foreign direct investment (FDI). Blue-chip corporations making investments include: Fiat Chrysler Automobiles, Siemens, Bosch, Philip Morris, Michelin, Coca-Cola, Carlsberg and others. In the energy sector, Russian energy giants, Gazprom and Lukoil have made large investments. Between 2010 and 2018, Chinese investments in the Serbian economy have reached the $3 billion mark, and include acquisitions of the Smederevo steel manufacturing and RTB Bor copper mining complexes, greenfield investments in tire and automotive component plants in Zrenjanin, an IT park near Belgrade and several capital infrastructure development projects. Most recently, US private equity firm KKR announced plans to invest further $340 million through United Group which controls Serbia’s largest cable provider, taking its total media investments to over $1.5 billion.

Serbia has an unfavorable trade balance: imports exceed exports by 23%. Serbia’s exports, however, recorded a steady growth in the last couple of years reaching $17 billion in 2017. The country has free trade agreements with the EFTA and CEFTA, a preferential trade regime with the European Union, a Generalized System of Preferences with the United States, and individual free trade agreements with Russia, Belarus, Kazakhstan, and Turkey.

Structure of the Serbian Economy

Food and Agriculture

“The land in this country is so remarkably fertile that I still believe you can take a stick and you can put it in the ground and watch it grow.”
Remer Lane, International agribusiness consultant

With over 6.12 million hectares of agricultural land (of which 60% is arable) and perfect climate conditions, Serbia is able to produce a diversity of fruits and vegetables. The lowest usage of fertilizers and pesticides in Europe, fertile soil, a favorable yearly balance of sun and rain, a tradition of growing plants, and care and expertise in developing food products make Serbian food simply tastier.

Agricultural land in Serbia

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Technology, Hardware & Software

According to a recent ICT Cluster report, Serbia has advantages over its neighbors when it comes to the ICT industry. The report argues that considering global and German offshore outsourcing market trends, the potential for Serbian companies is clearly visible and is built on several factors: proximity in geographic and cultural issues, positive cost-benefit ratio of relatively lower-cost but skilled labor, solid language skills, and rising wages in some markets (such as India).

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Automotive Components

In recent years, the automotive industry in Serbia has been reborn, this time based more on foreign investments and entrepreneurship in the SME sector. Tradition and know-how in the industry attracted a significant number of foreign investors to the sector, which in turn stimulated local suppliers to improve and grow. Most significantly, 2008 saw the takeover of the struggling Zastava factory by FIAT with an unprecedented investment project worth €940 million. The factory was completely overhauled with new machinery being introduced for the production of the brand-new FIAT 500L mini MPV. Tier 1 suppliers came along with FIAT—Johnson Controls, Magneti Marelli, Gruppo Proma, and Sigit—and built factories in the specially designated supplier park in Kragujevac.

The FIAT manufacturing plant in Kragujevac

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Wood Industry

Wood pellet production in Serbia started in 2006–07. Development was gradual with few developed factories per year until 2010, when a real boom started by 2014, with over 60 manufacturers. The total capacity exceeded half a million tons per year. The demand for wood pellets is rising, and total consumption in 2014 in the European Union reached 18.8 million tons.

Wood pellets

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Textile Industry

Textile and apparel production in Serbia has a long-standing tradition and has been one of the main export industries for many years. Nowadays, around 1,800 companies employing more than 43,000 are operating in the Serbian textile industry, which includes garment, textile, leather, and footwear production.

Serbian textile industry

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Serbia is not a mass-tourism destination but nevertheless has a diverse range of touristic products. In 2017, over 3 million tourists were recorded in accommodations, of which some 1.5 million were foreign. Foreign exchange earnings from tourism were estimated at $1.44 billion.

Tara National Park

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Capital: Beirut
Area: 10,452 sq km
Population: 6,229,794 (2017 est.)
Median age: 29.9 years
Major language: Arabic
GDP (PPP): $87.89 billion (2017 est.)
GDP – per capita: $19,500 (2017 est.)
Currency: Lebanese Pound (LBP)

Source: The World Factbook

Aerial view of Beirut with the Pigeon Rocks © Piotr Chrobot/Unsplash

Lebanon is a sovereign state in Western Asia. It’s location at the crossroads of the Mediterranean Basin and the Arabian hinterland facilitated its rich history and shaped a cultural identity of religious and ethnic diversity. At just 10,452 km2, it is the smallest recognized country on the entire mainland Asian continent.

With a population of 6.2 million, Lebanon is a parliamentary democracy. It is a member of the UN.

Lebanon concluded negotiations on an association agreement with the European Union and is included in the European Union’s European Neighbourhood Policy (ENP), which aims at bringing the EU and its neighbours closer. Lebanon also has bilateral trade agreements with several Arab states and is working toward accession to the World Trade Organization.

Lebanon’s economy follows a laissez-faire model. Most of the economy is dollarized, and the country has no restrictions on the movement of capital across its borders.

The Lebanese government’s intervention in foreign trade is minimal. The economy is service-oriented; main growth sectors include banking and tourism. The Lebanese economy grew 8.5% in 2008 and a revised 9% in 2009 despite a global recession, however, the political and security instability in the Arab world, especially in Syria, have had a negative impact on the domestic business and economic environment, slowing down economic growth to the 1-2% range in 2011-17.

In early 2018, the Lebanese government signed long-awaited contract agreements with an international consortium for petroleum exploration and production as part of the country’s first offshore licensing round.

Exploration is expected to begin in 2019.