Friday, 10th October 2025

Serbia’s Foreign Investment Boom Faces Uncertainty

Despite a record influx of foreign direct investments, Serbia's economic growth model, reliant on external capital, teeters on the edge of unsustainability

Serbia’s economic landscape has witnessed a striking surge in foreign direct investment (FDI), with a record $5.8 billion flowing into the country in 2024, surpassing the previous peak of 2011.

Yet, as investment continues to pour in, an equally alarming trend emerges: capital outflows. Over $20 billion has left Serbia since 2008, largely in the form of profits repatriated by foreign investors.

The growing discrepancy between incoming FDI and the repatriated earnings signals potential risks to the country’s long-term economic stability.

While reinvestments in 2024 reached a historic $1.72 billion, and profits from existing investments hit $4.95 billion, Serbia’s reliance on FDI as a primary growth engine now faces scrutiny.

The nation’s increasing dependency on foreign capital to sustain growth—coupled with the accelerating capital outflows—raises critical questions about the sustainability of this model, especially as Europe’s car industry, once the backbone of these investments, faces growing challenges.

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