Discusses key economic indicators and trade statistics, which countries are dominant in the market, and other issues that affect trade
Serbia is located in the heart of Southeast Europe (SEE), specifically the Western Balkans, the crossroads of Europe, Middle East, and Africa. The Western Balkans region is home to emerging markets of varying size, all of which have economic development plans focused on bringing their legal, labor and tax codes; educational and medical systems; energy, transportation, and telecommunications infrastructures; and security/defense frameworks up to European Union standards.
With a population of 6.8 million, Serbia is the largest and most prosperous economy in the Western Balkans, serving as a regional hub and springboard for companies to access the larger regional market.
Nominal GDP in 2022 is projected to reach $65.08 billion, which is $9,570 per capita. GDP based on purchasing power parity (PPP) is projected at $155.720 billion for 2022, which is $22,900 per capita. Serbia’s strongest sectors are energy, the automotive industry, machinery, mining, and agriculture. Primary industrial exports are automobiles, base metals, furniture, food processing, machinery, chemicals, sugar, tires, clothes, pharmaceuticals. Trade plays a major role in Serbia’s economic output. Serbia is in the gradual process of accession to the EU and receives substantial EU development funds. Serbia’s main trading partners are Germany, Italy, China, and Russia.
Russia, China, and neighboring Balkan countries are very active in Serbia, focusing on procurements, investments, continued trade liberalization, and infrastructure. Serbia is the fourth biggest recipient of Chinese investment in Europe, particularly in greenfield projects, and is an active participant in China’s Belt & Road Initiative.
American investment in Serbia now totals around $4.8 billion and is growing. U.S. exports of goods to Serbia has fluctuated from $551.2 million in 2019 to $442.3 million in 2020, to rise again in 2021 to $483.4 million. Primary exports from the United States include aviation parts and machines, pharmaceutical and medical products, vinyl chloride polymers, as well as tobacco and optical instruments. U.S. imports from Serbia have grown from $303 million in 2019 to $369.3 million in 2020 and $512.9 million in 2021 (Statistical Office of the Republic of Serbia data). FIAT automobiles are a major U.S. import from Serbia, followed by tires, frozen fruits and nuts, and hunting rifles and ammunition. In May 2022, Serbia ranked 132 among U.S. export destinations, and 94 among importers to the U.S. (U.S. Census Bureau data).
Despite its relatively small size, Serbia’s emerging economy represents significant opportunities for exports and investments across a wide range of sectors, particularly infrastructure, ICT, healthcare, agribusiness, energy, and environmental technologies. While certain segments remain highly price sensitive, rising prosperity presents an opportunity for business and government to procure Western brands of high quality. Key challenges remain in public procurement, bureaucratic processes, corruption, and inefficient commercial courts. However, the market is ripe for new U.S. products, which are viewed positively for their value, quality, and price.