- 5 key arguments in favor of opening a company in Serbia
- 1. Serbia is a respectable non-offshore jurisdiction
- 2. Serbia is experiencing stable development
- 3. Serbia is confidently moving towards the EU
- 4. Serbia is a politically and economically neutral country
- 5. Serbia is one of the leaders among European countries in terms of minimal company maintenance expenses
- Open a company or branch in Serbia with our assistance
The Serbian economy continues to grow despite the impact of COVID and other disruptions. In 2022, the country’s GDP increased by 2-2.5%. Despite pessimistic forecasts for foreign direct investment in 2022, investors have not stopped pouring billions of dollars into this Balkan republic.
Over the past years, Serbia has achieved remarkable economic results. Implemented reforms have reduced the national debt and attracted foreign capital, which has positively influenced the development of small and medium-sized enterprises.
International rating agency Fitch has assigned Serbia a sovereign credit rating of “BB+” with a stable outlook. Standard and Poor’s has given a similar assessment.
While this news may come as a surprise to some, those who have been closely following Serbia find such developments quite evident. We have repeatedly highlighted the improvement in the business climate in the republic and emphasized the broad opportunities for those seeking to open their own company or branch in Serbia.
If anyone has concerns about potential risks, now is the time to reconsider all the pros and cons. Frankly speaking, the arguments against Serbia are virtually indistinguishable from the potential entrepreneurial risks in any other European country. However, the arguments in favor become more compelling and irrefutable.
Moreover, Serbia has a number of exceptional advantages for foreign businesses compared to other European markets.
5 key arguments in favor of opening a company in Serbia
1. Serbia is a respectable non-offshore jurisdiction
The aggressive deoffshorization policies pursued by most leading countries have inevitably changed the trends and priorities for global business. The gray areas with low taxes and high levels of confidentiality are fading away, transforming into transparent jurisdictions. While this may lead to a capital outflow in the short term, it presents significant prospects for the future.
Legalization and transparency are the main trends for the coming years and are essential for successful business operations. In such realities, new factors become advantageous, and it is crucial to recognize them.
For instance, since the summer of 2019, Serbia has joined the Common Reporting Standard (CRS) for the automatic exchange of information on financial accounts. As a result, foreign owners of various enterprises or bank accounts in the country can no longer rely on the tax authority of their tax residence country remaining unaware of their assets.
However, this also brings forth additional benefits for business owners: Serbia is completely excluded from international regulators’ black and gray lists. This means that your business will no longer face doubt or obstruction. You will be able to openly and fearlessly conduct your business in leading markets worldwide.
It is also essential to understand that the exchange of information does not imply the actual disclosure of all your information in the public domain. Thus, a certain level of confidentiality is preserved.
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2. Serbia is experiencing stable development
In August 2019, Serbia signed the United Nations Convention on International Settlement Agreements Resulting from Mediation, also known as the Singapore Convention. This is another clear indication that the country strives for greater stability and predictability in international trade operations. According to the statement by the State Secretary of the Ministry of Justice of Serbia, this signing will contribute to expanding economic rights and opportunities, as well as improving conditions for conducting business.
Essentially, this relates to what we touched upon at the beginning – the growth of the country’s economic potential.
The trend of progressive improvement in the business climate in Serbia is a leading driver for attracting foreign investments, opening new markets or expanding existing ones, and developing infrastructure and financial institutions. This, in turn, attracts an even greater flow of interested players. It is a positive feedback loop that works and helps everyone involved in the process to prosper.
A prime example can be seen with China. China’s leading businesses, rapidly taking top positions globally, actively invest in local enterprises and promising profitable projects. Within the framework of the One Belt, One Road strategy, new labor markets are being formed in Serbia to meet emerging or developing demand in various sectors. It can be confidently stated that this represents tremendous growth potential for many companies participating in the implementation of such projects.
Serbia occupies a very interesting position in its relationships with China and the European Union while maintaining good relations with all parties.
Read more about the Serbian economy in our review.
3. Serbia is confidently moving towards the EU
The Serbian government has repeatedly stated that its goal is to join the European family, and tangible actions and decisions have been taken to support this objective. Although the process has been ongoing since 2012, and there has not been a significant leap forward observed yet, and sometimes doubts arise, the overall direction remains intact.
Many members of the European Union (particularly Hungary) have already expressed their full readiness for Serbia to unite with Europe and that all participants in the process will contribute to this shortly. It is noteworthy that the EU is primarily concerned about the strengthening interests of China in Serbia, as well as the friendly relations with Russia (the country has not imposed sanctions so far and continues cooperation).
This once again emphasizes the attractiveness of Serbia for European businesses and other players.
However, the key takeaway is that Serbia can offer a relatively fast and easy path to accessing European markets. Today, you own a Serbian company, and tomorrow the entire EU is open to you.
This should also be kept in mind if you are interested in minimizing national risks. In this regard, Serbia is quite appealing. We are talking about obtaining a residence permit or even pursuing citizenship and residency in this country. We can assist you in obtaining legal and tax residence in Serbia via company registration.
In addition, we encourage you to consult with our experts to learn more about opportunities for investment and relocation to Serbia or other countries.
4. Serbia is a politically and economically neutral country
This is yet another positive factor for entrepreneurs from different countries worldwide. In today’s reality, banks can simply freeze your accounts and cripple your business operations if you happen to fall under another round of sanctions or become associated with other individuals on the sanctions list.
Serbia maintains a neutral position in international relations. As mentioned earlier, this country maintains good relations not only with the EU but also with China and even Russia, which is quite challenging in the current political environment.
Due to pressure from the EU, the situation has become somewhat more complex, but nevertheless, opening a company in Serbia will enable you to conduct business with virtually any country in the world.
Find out what taxes business needs to pay in Serbia.
5. Serbia is one of the leaders among European countries in terms of minimal company maintenance expenses
The main expenses for maintaining your company will be office rent and accountant fees. Rental prices start at EUR 2400 per year. The average salary in 2023 is around EUR 700 (having increased in recent years), and the country possesses a large pool of highly skilled workforce. Social and medical insurance contributions are minimal and quite reasonable compared to Europe.
Serbia also boasts low indicators (in comparison to Europe) of expenses on electricity (due to self-generation), gas, and fuel (thanks to favorable contracts with suppliers).
In addition, we can consider the tax burden, which also becomes part of the expenses for maintaining your company. The corporate tax rate in Serbia is 15%, which remains a favorable offer compared to the majority of European countries.
Don’t know what business to do in Serbia? Read the recommendations of our experts!
Open a company or branch in Serbia with our assistance
The list of arguments in favor of opening a company or branch in Serbia can be extended further, but we have focused on the most important and defining factors.
One of the advantages of opening a company or branch in Serbia is the speed of registration and the ability to conduct many operations remotely. In this matter, we provide full support both in preparing the necessary documents and in the subsequent process.
It is worth considering the fact that on this path, many interested entrepreneurs may encounter obstacles and difficulties, so it is essential to rely on the assistance and loyalty of professionals.
Our specialists possess all the necessary skills, experience, and, importantly, a well-developed communication network (in other words, they know where and to whom to turn). Our office operates directly in Serbia, so we have a precise understanding of the local conditions.
If we have helped you make your choice or have additional questions about the registration conditions for a company/branch in Serbia or obtaining residency in the country, feel free to contact us at info@offshore-pro.info.
Please write to us today, and our specialists will provide detailed answers to all your questions.
