The Western Balkans recorded the largest inflow of Greenfield Foreign Direct Investment (FDI) in a decade - from $ 9.36 billion in 2018, with the lion's share of nearly six billion attracted by Serbia, writes portal "fDi Intelligence", a specialized Financial Times department.
This is the second largest inflow of greenfield foreign investments in the Western Balkans since 2003, since the “FDI Markets” service was established to track these investments, the text says.
Despite still being outside the European Union, the region has attracted 147 greenfield FDI projects last year, the highest number in the last six years, according to " FDI Markets".
"Serbia, the largest Western Balkan country by territory and population, led the region in 2018 with a record $ 5.98 billion in foreign investment in 105 Greenfield projects," they reported.
The analysis states that, despite political tensions that have hit the region since the fall of communism, there has recently been moves towards greater regional economic integration and co-operation.
"Recent positive developments include the change of the name of Northern Macedonia under the government of Zoran Zaev, which has resolved the 28-year dispute with Greece, as well as the judicial reform in Albania and structural reforms in Serbia."
Additionally, the formation of a joint initiative for the promotion of investments in 2017 through the Chamber of Commerce Investment Forum, six economies of the Western Balkans (WB6 CIF), all provide further evidence that the region is striving to unite in order to attract investment and stimulate economic growth, reads the text.
WB6 CIF, a private sector organization representing around 350,000 companies across the Western Balkans, is striving to encourage foreign investment by focusing in particular on successful stories.
President WB6 CIF Marko Čadež hopes that this organization will improve FDI in the region, which will become "an increasingly important part of the European economy and economic system".
Despite these efforts, membership of the Western Balkan countries in the EU seems unlikely in the near future as the members of the Union are divided on their path to accession. This has provided fertile ground from investments from China which has entered through two initiatives – 16+1 and One Belt One Road, both of which go through the region. Recent Chinese investments have been both public and private and go from infrastructure (bridges, highways, railways) to brownfield investments such as HeSteel acquiring Serbian Steel giant “Smederevska Zelezara” (Serbia Steelworks).
It will be interesting to watch FDI in this region reflect the policies of EU and China in their work to establish footholds in Western Balkans, as these European Tigers transition towards open markets and provide their economies growth opportunities to the world.
Information Source: Financial Times
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