After the democratic changes which occurred in October 2000, the country (Republic of Yugoslavia) went through economic liberalization, and experienced fast economic growth (GDP per capita had raised from $1,160 in 2000 to $6,782 in 2008). The most rapid development was recorded in the period 2004 – 2008, as GDP growth averaged 7%, putting Serbia among Europe’s fastest growing economies. As world economic crisis occurred by the end of 2008, Serbia, too, was faced with increased unemployment and drop of industrial production and FDI. 

 

Now in 2012, the prospects of further economic development are realistic, as Serbia gained a candidate status in the process of accessing membership in the European Union, its most important trading partner. Moreover, Serbia is the only country beyond the Commonwealth of Independent States (CIS) that enjoys a Free Trade Agreement with Russia. Additional factor benefiting the development of Serbian economy is the right of duty-free exports to the EU and the U.S. for most products and services and the fact that Serbia is also a member of the CEFTA free trade area of 29 million customers – one of the fastest growing regions in Europe.

Year

 

GDP (USD Billions)

 

GDP growth rate

 

GDP Per Capita (USD)

 

GDP (PPP) per capita (Geary-Khamis $)

 

2000

 

8.70

 

4.50%

 

1,160

 

5,713

 

2008

 

50.00

 

5.60%

 

6 781

 

10 810

 

2011

 

47.03

 

1.50%

 

6 345

 

11 302

 

2012

 

51.11

 

5.00%

 

6 883

 

12 054

 

2013

 

55.84

 

5.50%

 

7 504

 

12 941

 

In recent years, Serbia has seen an increasingly swift foreign direct investment trend, including many blue-chip companies (US Steel, Philip Morris, Microsoft, FIAT, Luk-oil, Coca-Cola, Gazprom, Lafarge, Siemens, Carlsberg and other). By countries, most cash investments in 2000-2007 period came from Austrian companies ($2.2bn), followed by those from Greece ($1.6bn), Norway ($1.6bn), and Germany ($1.4bn). Companies from these four EU countries account for two thirds of all cash investments in that period. More investments are expected in the future, with talks already starting with Volkswagen on possible automobile assembly, as well as with IKEA (furniture manufacturer willing to invest approximately US$2 Billion in southern Serbia) and General Electric (for the construction of locomotive engines).