The Influence of Foreign Direct Investment Treatment in Domestic Legislation on the Economic Development of the Republic of Serbia

Vukajlović Milica (), Kerković Tamara Milenković () and Jocić Dragana Radenković ()
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Vukajlović Milica: MSc student at University of Niš, Faculty of Economics, Serbia
Kerković Tamara Milenković: University of Niš, Faculty of Economics, Serbia
Jocić Dragana Radenković: University of Niš, Faculty of Economics, Serbia

Economic Themes, 2020, vol. 58, issue 4, 501-516

Abstract: Serbia has been following a policy of subsidizing foreign direct investments since 2006 and it pays great attention to this type of investment capital in the field of development of our economy. Whether this can be considered as justified is a question to which this paper aims to provide an answer. Do the positive aspects of foreign direct investment necessarily come to the leading position in the country importing capital? The analysis of the positive effects of foreign direct investments on the economy of the host country shows that the multiple benefits of such attracted capital certainly exist, but that their manifestation is not unconditional and will depend on numerous factors. Due to the fact that the subsidy policy is current, the criteria for granting state incentives defined by the current regulation should be set so as to contribute to the manifestation of positive effects of foreign direct investments on the Serbian economy. However, their analysis shows that this is not the case. In addition, the impact that foreign direct investment has had on the Serbian economy indicates that the subsidy policy has not given the expected results. Having this in mind, the impact that the treatment of foreign direct investments in domestic legislation has on the economic development of the Republic of Serbia cannot be assessed as satisfactory.

Keywords: foreign direct investments; subsidies; Serbia; economic development; foreign investors; legislation (search for similar items in EconPapers)
JEL-codes: E22 F21 F43 (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:ecothe:v:58:y:2020:i:4:p:501-516:n:2

DOI: 10.2478/ethemes-2020-0028

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