In recent years, Serbia has pursued a strategy of diversifying its foreign investments, particularly through significant greenfield investments. According to Ivan Nikolić, an economist and editor of the publication Macroeconomic Analysis and Trends (MAT), this strategy has proven beneficial for the country’s industry and broader economy, especially amidst geopolitical uncertainties and the eurozone crisis.
Nikolić’s analysis, featured in the May edition of MAT, comes ahead of Chinese President Xi Jinping’s visit to Belgrade. He examines the hypothesis that Chinese investments have played a decisive role in maintaining Serbia’s dynamic industrial production growth. Despite external challenges and geopolitical restrictions, Serbia’s industry has shown resilience, attributed in part to fundamental transformations since 2015, including technological upgrades and improved quality standards.
The analysis focuses on 28 companies representing a significant share of Serbia’s gross value added (GVA) and included in the monthly industry survey for calculating the industrial production index. These companies, operating across all industrial sectors, accounted for 9.4% of the country’s GDP in 2022, with 46.9% contributed to the overall industry GDP.
In 2023, Serbia’s economy saw a real growth in gross value added (GVA) of 2.9%, with the analyzed companies contributing 8.5% to this growth. Notably, Chinese-owned companies, such as Serbia Zijin Bor Copper and YURA Corporation Rača, led the growth, with production increases of 55.5% and 11.9%, respectively. Other subsets of companies either stagnated or experienced reductions, particularly Russian-owned firms.
The results for the first quarter of 2024 further support the hypothesis, with the analyzed companies contributing 6.2% to the country’s 4.6% real growth in economic activity. Chinese companies continued to dominate, with significant production increases recorded. However, some sectors, like the Oil Industry of Serbia (NIS), faced challenges due to planned maintenance and investment works.
Nikolić concludes that Serbia’s policy of diversifying investments from various countries and regions has been successful, particularly in attracting Chinese investments, which have positively impacted the country’s industrial growth trajectory.
