Serbia has substantially benefited from trade and economic integration with the EU. The EU is traditionally Serbia’s key trading partner accounting for over 66% of Serbia’s total exports and more than 62% of Serbia’s total imports of goods in 2017 with similar percentages persisting over the years. The value of Serbian exports to the EU more than tripled from EUR 3.2 billion in 2009 to EUR 9.9 billion in 2017!
Trade deficit is still on the Serbian side but has been persistently decreasing over the years. In other words, Serbia’s exports to the EU have been growing faster than imports from the EU, resulting in a decreasing trade deficit and improving coverage of imports by exports on the Serbian side from below 50% in 2009 to over 77% in 2017 (77% of imports from the EU were covered by Serbian exports to the EU).
Individual EUMSs traditionally top the list of Serbia’s most important trade partners in goods, notably Italy and Germany, but also Romania as an important export destination and Hungary as important country of origin for Serbian imports. Serbia exported more than 13% of total goods exports to Italy alone and another 12.6% to Germany in 2017. On the import side, Serbia imported almost 13% of all shipments from Germany and another 10% from Italy alone.
Concerning trade in agricultural and food products, Serbia traditionally enjoys a rising surplus vis-a-vis the EU. This surplus on the Serbian side has fluctuated around EUR 400 million for the last couple of years. The surplus reached its peak in 2016 at almost EUR 600 million, but it fell to EUR 337 million in 2017 due to drought that affected Serbian agricultural production and exports.
The significance of the EU market as an export destination for Serbian agricultural produce is considerable, as around half of Serbia’s agricultural exports are shipped to the EU. In 2017, Serbian agricultural exports to the EU accounted for 45% of total agricultural exports. Serbia’s agricultural exports to the EU more than doubled over the past decade, steadily rising from EUR 640 million in 2009 to almost EUR 1.3 billion in 2017. At the same time, Serbian imports of agricultural products from the EU also doubled from EUR 440 million in 2009 to around EUR 945 million in 2017.
Investment benefits for Serbia
Foreign direct investment coming from the EU accounted for 73% of total FDI coming to Serbia over the past eight years, from 2010 until 2017, according to the latest information of the National Bank of Serbia. Companies headquartered in the EU accounted for almost three quarters of the cumulative FDI inflows in the given period, employing almost 200.000 people. In absolute terms, FDI from the EU countries reached a total of EUR 11.3 billion over the past eight years.
Companies from the EU have been the leading investors in Serbia over the previous decade. These companies have brought efficiency, modern technology and know-how into the Serbian economy. This has in turn significantly increased productivity and competitiveness of the Serbian economy, boosting its export potential, increasing budget revenues and generating economic growth. Ultimately, opening up of the Serbian market to companies from the EU has generated a variety of choice and lower prices for consumers.