Economy of Belgrade

This article is about the economy of Belgrade, capital of Serbia.

The total GDP of Belgrade for 2014 is estimated at US$16.97 billion, which equates to US$10,086 per capita in real terms – given an estimated 2014 population of 1,682,934 (based on Census 2011 results). GDP at purchasing power parity is estimated at US$36.1 billion, which is US$21,461 per capita in terms of purchasing power parity.^[1]

Growth of investments in Belgrade

The troubled political and economic transition during the 1990s left Belgrade, like the rest of the country, severely affected by an internationally imposed trade embargo. The hyperinflation of the Yugoslav dinar, the highest inflation ever recorded in the world,^[2][3] decimated the city's economy In the competition for European cities and regions of the future in 2006 and 2007, organized by the Financial Times magazine, Belgrade was proclaimed “City of the Future in Southern Europe” on March 16 in Cannes. Apart from Belgrade, awards also went to Paris as the “City of the Future in Western Europe”, Brno as the “City of the Future in Central Europe”, Baku as the “City of the Future in Eastern Europe” and London as the “City of the future in Northern Europe”, which was also named “European City of the Future 2006/07”.

The latest greenfield investments are also being increasingly realized in Zemun, the part of the city which will soon be on a par, according to investments, with New Belgrade, where the largest construction works have been carried out so far. The mayor expects foreign capital to start arriving faster in Belgrade and Serbia, which is also the precondition for the opening of new jobs and the start of new programs.

The competition for “Cities and Regions of the Future” is organized by the specialized edition of the Financial Times for foreign direct investments – FDI Magazine, and this prestigious annual award is presented for all the continents. The award also represents a recommendation of the world’s leading economic magazine for the locations where one should invest, since it is based on criteria such as economic potential, operating costs, human resources, transport, IT and telecommunication, as well as the quality of life for foreign investors.

Business

In the recent years, investment climate in Belgrade and Serbia have been improved. The country is in the process of negotiating the Stabilization and Association Agreement with the European Union, and is the world’s leading reformer as stated by the World Bank. In addition, the pace of structural reforms is ahead of that in other transition countries according to the European Bank for Reconstruction and Development.

Many notable Serbian companies are based in Belgrade, such as Jat Airways, Telekom Srbija, Telenor Serbia, Delta Holding, Elektroprivreda Srbije, Komercijalna banka, Imlek, Ikarbus, Štark, Post Serbia, Galenika a.d., Yugoimport SDPR, Pink International Company...

Regional centers for AXA,^[4] Société Générale, Motorola, Mubadala, Arabtec, Samsung, MTV Adria,^[5] Kraft Foods,^[6] Carlsberg,^[7] OMV, Delhaize Group,^[8] Unilever, General Electric,^[9] Zepter, Maquet,^[10] Japan Tobacco, Sinohydro Corporation,^[11] Procter & Gamble,^[12] and many others.^[13] Stocks are traded at the Belgrade Stock Exchange.

Information Technology

With 6,924 companies in the IT sector (2013 data), Belgrade is one of the information technology centers in this part of Europe, with strong growth.^[14] Microsoft Development Center located in Belgrade was at the time of its establishment fifth such center in the world.^[15] Many world IT companies choose Belgrade as regional or European center such as Asus,^[16] Intel,^[17] Dell,^[18] Huawei, NCR^[19] etc. What brought companies like Microsoft in the first place was a large pool of talented engineers and mathematicians in a lower wage country and these major investments had by 2011 generated over €200 million in exports.^[20] Nordeus, a local video game startup, is one of Europe's fastest growing gaming companies.^[21] In just five years of operation, Nordeus has grown to over 150 employees and €64 million of yearly sales.^[22] In just the first quarter of 2016, more than US$65 million has been raised by Serbian startups including US$45 million for Seven Bridges (a Bioinformatics firm) and US$14 million for Vast (a data analysis firm).^[23][24] Also in 2016, a Belgrade based website AskGamblers which is generating over €810,000 in revenue and €620,000 in profits was sold to Catena Media for €15 million, all 30 employees will continue to work as normal.^[25]The startup community is helped by a non profit organization called Startit which is an active community that acts as an incubator for new companies. Startit raised US$108,000 from its Kickstarter campaign in 2015, allowing it to expand its Belgrade center and build a second center in Inđija which was completed February 2016.^[26] Other exiting developments include an Agriculture Drone startup that uses drones for land surveying, TeleSkin an app which can identify and track skin cancer and there was another successful Kickstarter for Hexiwear a customizable smartwatch for developers.^[27] Progress in Serbian IT over the last six years has been tremendous with the fast growth only increasing as Serbia's many talented engineers, scientists and mathematicians break into this new industry where gross salaries average €2,000 per month (far more than the €600 national average).^[20]

Intellectual capital

As a leading educational center in Serbia comprising 62 university-level institutions, Belgrade boasts well educated, fast learning, multilingual and IT literate labor force. Over 8,000 students graduate from Belgrade University every year, with 1/3 of them adding to the traditionally strong engineer base. According to the Gallup International, the percentage of English speakers is the highest in Central and Eastern Europe, and an increasing number of western business schools open their affiliates in Belgrade.

Location and infrastructure

Belgrade is located in the center of South East Europe, at the intersection of the strategic transportation corridors No. 10 and No. 7 linking Western and Central Europe with the Middle East. It is lying at the confluence of the Sava and the Danube river.

Footnotes

1. http://webrzs.stat.gov.rs/WebSite/public/PublicationView.aspx?pKey=41&pLevel=1&pubType=2&pubKey=2625
2. Watkins, Thayer. "The Worst Episode of Hyperinflation in History: Yugoslavia 1993–94". Episodes of Hyperinflation. San José State University Department of Economics. Retrieved 26 July 2007.
3. Taylor, Bryan. "Countries that Suffered the Greatest Inflation in the Twentieth century". The Century of Inflation. Global Financial Data. pp. 8, 10. Archived from the original (Word document) on 8 August 2007. Retrieved 26 July 2007.
4. "Svjetski lider u osiguranju Aksa odabrao Beograd za centar regiona". Trazimkredit.com. 17 June 2011. Archived from the original on January 17, 2012. Retrieved 15 September 2011.
5. "Vesti dana: MTV se preselio u Beograd: POLITIKA". Politika.rs. Retrieved 25 July 2009.
6. "Beograd će biti regionalni centar:: emportal:: Ekonomske vesti iz Srbije". Emportal.rs. Archived from the original on May 22, 2011. Retrieved 16 November 2010.
7. "Beograd konkuriše Beču". Politika. 21 February 2008. Retrieved 5 May 2009.
8. '+relative_time(twitters[i].created_at)+' (2012-08-20). "Novi poslovni objekat u Beogradu sa parking mestima za bicikle, tuševima i restoranima | Gradnja - Portal građevinarstva i arhitekture". Gradnja.rs. Retrieved 2013-03-12.
10. Слободан Костић. [http://www.politika.rs/rubrike/Ekonomija/Vise-ne-placem-kada-idem-iz-Beograda.sr.html?fb_action_ids=10151442216954031&fb_action_types=og.recommends&fb_source=timeline_og&action_object_map=%7B%2210151442216954031%22%3A368497493258483%7D&action_type_map=%7B%2210151442216954031%22%3A%22og.recommends%22%7D&action_ref_map=[] "Више не плачем када идем из Београда : Економија : ПОЛИТИКА"]. Politika.rs. Retrieved 2013-03-12.
11. "Biz - Vesti - Lice kineske ekspanzije u Srbiji". B92. Retrieved 2013-03-12.
12. "Procter&Gamble Belgrade". Pgbalkans.com. Retrieved 16 November 2010.
13. "JTI u Srbiju ulaže oko $100 mil" (in Serbian). B92 Biz. 24 April 2007. Archived from the original on 24 May 2007. Retrieved 19 May 2007.
14. "U Beogradu radi 120.000 firmi". Večernje Novosti. 23 April 2013. Retrieved 4 November 2013.
15. "Microsoft Development Center Serbia". Microsoft.com. 1 April 2011. Retrieved 15 May 2013.
16. "Asus otvorio regionalni centar u Beogradu". Emportal.rs. Archived from the original on 22 May 2011. Retrieved 16 November 2010.
17. "Centar kompanije 'Intel' za Balkan u Beogradu – Srbija deo 'Intel World Ahead Program'". E kapija. Retrieved 7 July 2009.
18. Beograd, Ana Vlahović, (25 September 2011). "Srbija centar IT industrije". Pressonline.rs. Retrieved 12 March 2013.
19. NCR planira da udvostruči broj zaposlenih u Srbiji u 2014 (in Serbian), eKapija, 24 July 2013, retrieved 4 November 2013
21. "Srpski Zakerberg: Branko je napustio "Majkrosft" i u Srbiji napravio firmu koja je partner "Fejsbuka"". Blic.rs.
22. "Подаци о обвезнику". fi.apr.gov.rs.