High assessment of the US State Department on the investment climate in Serbia, News
The US State Department praised the investment climate in Serbia in the report for 2021, emphasizing the long-term implementation of macroeconomic reforms, fiscal discipline and financial stability as the main factors that contributed to the improvement of conditions for foreign investments.
In a new report on the global investment climate for 2021, the State Department states that the opinion of American investors in Serbia is generally positive due to the country’s strategic position, well-educated and available workforce, excellent English language skills, investment incentives and free trade arrangements with key markets, primarily with the European Union.
The document especially emphasizes that investors from the USA enjoy the same rights in market competition as their Serbian and other foreign competitors.
“Serbia’s investment climate has improved in recent years, driven by macroeconomic reforms, greater financial stability, fiscal discipline and the EU (EU) accession process, which encourages legislative changes that improve the business climate,” the report said.
It is noted that the Government has successfully completed a 30-month policy coordination instrument with the International Monetary Fund (IMF) in January 2021, to work on a new standby arrangement, and that Serbia has advanced four places on the World Bank’s Doing Business list in 2020 and to occupy the 44th position.
Attracting foreign investment remains an important priority of the Government, adds the State Department and reminds that in 2021, the United States and Serbia signed a new Agreement on Investment Promotion, which, as he says, can facilitate opportunities for investments in many different sectors.
It is also stated that the US Embassy in Belgrade often helps investors when they encounter a problem, but also that Serbian leaders react to investment difficulties.
The report cites slow bureaucracy, corruption, loss-making state-owned enterprises, a large informal economy and an inefficient judiciary as challenges facing the country. It adds that “the political influence on the decisions of nominally independent regulatory agencies is also worrying.”
The extensive analysis indicates that the Serbian government has set economic growth and job creation as top priorities and is committed to addressing some long-standing issues related to what is said to be “consolidation of market-driven capitalism” (private-based economy).
Furthermore, significant reforms in the legislation (labor law, building permits, inspections, public procurements…) are listed, as well as the implementation of digitalization of public administration, introduction of electronic signatures, privatizations that have helped improve the business environment.
The State Department states that the Government is slowly making progress in resolving problematic state-owned companies, that where possible this problem has been resolved through bankruptcy or privatization, and that another 78 companies are planned to be privatized.
If the government implements the promised reforms during the EU accession process, business opportunities will continue to grow in the coming years.
The sectors that will benefit most from the reforms are agriculture and processing of agricultural products, solid waste management, sewerage, environmental protection, information and communication technologies (ICT), renewable energy sources, health, mining and manufacturing, according to the State Department.
Women in Serbia generally enjoy the same treatment as men in business, and the government offers various programs to support women’s entrepreneurship, with the state providing approximately 1 million dollars a year in grants from the budget to support innovative women’s entrepreneurship, the State Department report concludes, RTS reports.