Serbia’s progress in international competitiveness assessments is placing greater emphasis on the quality of its industrial base, institutional environment and workforce as investors increasingly evaluate sustainability, technology and operational resilience alongside traditional cost considerations.
The OECD competitiveness framework, as highlighted by the National Bank of Serbia (NBS), recorded improvements in eight of 15 areas compared with 2021. Serbia also performed above the Western Balkan average in 13 areas.
The strongest advances included science, technology and innovation, agriculture and employment policy. The framework also covers energy, environmental protection, education, transport and digital society, connecting competitiveness performance with issues increasingly examined by lenders and institutional investors through environmental, social and governance (ESG) assessments.
Investment Decisions Extend Beyond Operating Costs
The criteria used to assess manufacturing investments are broadening. Alongside labour costs and tax treatment, investors increasingly examine energy sourcing, environmental compliance, workforce skills, transport efficiency, governance and supply-chain resilience as interconnected factors affecting industrial operations.
This approach can favour projects with greater productivity and technology intensity, where operational performance depends on skilled employees, efficient resource use and reliable infrastructure. At the same time, older industrial facilities may face additional expenditure on energy, labour and environmental requirements to maintain their competitiveness. These costs can influence investment decisions and the ability of existing assets to compete with more productive operations.
Competitiveness, Energy and Workforce Development
Serbia’s progress provides a stronger starting point for the next phase of investment, but further competitiveness gains will require closer coordination between industrial strategy, energy investment, environmental performance and workforce development.
The OECD framework’s coverage of education, transport, energy and digital society reflects the range of factors shaping the country’s business environment. Improvements in these areas can affect the conditions in which companies operate and investors assess potential projects.
For lenders and investors, these considerations are increasingly incorporated into a single project bankability assessment, rather than treated as separate ESG issues. Industrial productivity, compliance requirements, infrastructure access and workforce quality are becoming closely connected elements of investment evaluation.
