REGIONAL COOPERATION AND ECONOMIC INTEGRATION

FDI FLOWS IN SOUTH EASTERN EUROPE
Sasha Obradovic
Assistant Professor
University of Kragujevac
Department of Economics
Serbia
Abstract
ANALYSYIS OF THE STIMULUS AND LIMITATION FOR
FOREIGN DIRECT INVESTMENT IN SERBIA
Foreign direct investment is the most important international factor in accomplishing the
goals concerning the total economic growth and development in Croatia. That’s why they
make an extra stimulus to important national economic goals referring to development
of small and middle companies, development of infra-structure and public sector reform.
rawing benefits from greater number of foreign investment from EU countries, first of
all, give the economic strength to the government in carrying out modernization and
advancement in other regions. All of this is, of course, in the function of the ultimate goal
referring to joining and full membership in the EU. Unfortunately, Croatia did not manage
to draw great and continuing income of foreign direct investment, partly because of the bad
business environment and manifested weaknesses in carrying out the institutional reforms.
Increasing the level of economic freedom and effective use of modern law resolutions can
contribute environmment business improvement.
Key words: Investment, GDP, Economic Growth and Competitiveness.
INTRODUCTION
Attracting and maintaining a high level of foreign direct investment is an important goal
for Serbia, since it is clear that it has a complementary role in creation of new employment,
increase of export, transfer technology, increase of competitiveness and improvement of
the overall production. Creating favorable conditions for foreign investment represents a
big challenge for Serbia, in view of the globalization and the pressure to be competitive,
which makes a need for constant improvements of the general business environment. At
macroeconomic level, in ensuring stability and improving the general business environment,
government has the main role, while the market pressures to be competitive require
permanent improvement and success of the management structures in the economy.
Business environment development means removing all unnecessary difficulties and
excessive government intervention in economy, all this with a goal of providing wider
field for trade and developing of entrepreneurship (including lower administrative prices).
Goal of the economic politics creator should be continuing advancement of the business
environment and rules especially in the field of long-term production investment. Engaging
the state into the economy and public sector spending should be considerably reduced,
because the activity of developing the state can give results only when clear and effective
rules of the market competitivity are defined.
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