The Western Balkans region attracted $9.36bn of inbound greenfield foreign investment in 2018, according to greenfield investment monitor fDi Markets, marking the second highest flows since records began in 2003. 

The Western Balkans comprises six countries located in the south-east of the European continent that have bilateral free-trade agreements with – but are not members of – the EU. The six countries – Albania, Bosnia-Herzegovina, Kosovo, Montenegro, North Macedonia and Serbia – have been working towards EU membership through a number of reforms in recent years, but the EU remains split on their accession.


Despite remaining outside of the EU, the region attracted 147 greenfield FDI projects in 2018, the highest number of investments for six years, according to fDi Markets. Serbia, the largest Western Balkan country by landmass and population, led the region in 2018 with a record $5.98bn invested into 105 greenfield projects. 

Referring to headline FDI figures, Serbia’s prime minister, Ana Brnabić, said at the June 2019 FT Western Balkans Forum: “In 2018, [Serbia] attracted €3.5bn in FDI, [compared with] €2.6bn in 2017. In the first five months of 2019 we attracted €1.2bn, which is 17% better than in 2018. I think the future is bright as we continue with structural reforms.”

Despite Serbia accounting for the lion’s share (70%) of Western Balkan greenfield projects in 2018, Bosnia-Herzegovina accounted for 11.6%, despite attracting four fewer greenfield projects than in 2017, according to fDi Markets. On the other hand Montenegro performed well in 2018, attracting a record 11 greenfield FDI projects.

According to the latest annual fDi Markets data from June 2018 to May 2019, North Macedonia and Albania attracted $184.4m and $809.9m of inbound greenfield investment, respectively, as the number of inbound greenfield projects rose by 200% and 80%, compared with the same period a year earlier.

Despite Western Balkan countries attracting significantly less greenfield FDI projects than their counterparts in central, eastern and western Europe, the region performs very well relative to its share of global GDP.

Despite political tensions that have plagued the region since the fall of communism, there has been recent movement towards more regional economic integration and co-operation. Positive recent developments include North Macedonia’s name change under Zoran Zaev’s government which resolved a 28-year dispute with Greece, judicial reforms in Albania and structural reforms in Serbia.

A recent panel discussion between the prime ministers of Albania, Serbia and North Macedonia, as well as the formation of a joint investment promotion initiative in 2017 through the Western Balkans 6 Chamber Investment Forum (WB6 CIF), provide further evidence of a region attempting to band together to attract investment and foster economic growth.

Albania’s prime minister, Edi Rama, called for “a new chapter by simply tabling this obsessive history and politics of borders through a new approach and creating a Western Balkans Schengen Area. I have no doubt we will open up to much bigger opportunities and explore an important part of our regional potential.”

The WB6 CIF, a private sector body which represents about 350,000 companies across the Western Balkans, is trying to spur foreign investment through focusing on particular success stories. WB6 CIF president Marko Čadež hopes the organisation will promote FDI into the region leading it to become “more and more part of the European economy and economic system”.

Despite these efforts, EU membership for Western Balkan countries seems unlikely in the near future due to lacking unanimity between EU member countries about accession talks with candidate countries, and Bosnia-Herzegovina and Kosovo yet to achieve candidate status. Nonetheless, continued reform efforts and collaboration appear to be sending good signals to foreign investors looking to profit from Europe’s most untapped investment region.