Serbia’s New Growth Agenda : Increasing Exports
Evidence from several countries reveals that nations that have open economies tend to enjoy higher income than those with closed economies (Lind and Ramondo 2018). Openness to hosting multinationalfirms can lead to firms in receiving countries acqu...
| Main Authors: | , , , |
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| Language: | English |
| Published: |
World Bank, Washington, DC
2020
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/496521585544006401/Serbia-s-New-Growth-Agenda-Country-Economic-Memorandum-Increasing-Exports http://hdl.handle.net/10986/33568 |
| Summary: | Evidence from several countries reveals
that nations that have open economies tend to enjoy higher
income than those with closed economies (Lind and Ramondo
2018). Openness to hosting multinationalfirms can lead to
firms in receiving countries acquiring new technology and
skills (Harrison and Rodriguez-Clare 2010), and to
productivity-enhancing spillovers, particularly through
vertical commercial relationships between foreign and
domestic suppliers. Learning by exporting offers positive
knowledge externalities, and it comprises myriad ways in
which exports can stimulate growth in productivity,
including development of exporter capabilities, such as
marketing new products; upgrading product quality; and
acquiring expertise in managing customer relationships by
dealing with foreign buyers. The value from knowledge
spillovers and the promise of job creation are often seen as
positive externalities and are usually brought in to justify
policy interventions in the form of tax incentives, grants,
and other concessions (access to land sites at minimal or
low cost). It is often thought that spillovers from foreign
firms are driven by transfers of technology and by learning
about markets by exporting. Learning from foreign buyers is
supposed to be channeled directly to the exporters or passed
through to local suppliers and competitors in domestic
markets. There is some evidence that in Serbia, the
international competitiveness of domestic exporters has been
diminishing, and government programs to support links with
markets receive meager financial allocations. Recent
successes in exports of manufactures have revealed the great
potential of Serbia, but these have been driven by only a
few firms, many of them foreign-owned. This has lowered
expectations of inclusive and widespread growth. There is
also a growing sense that government efforts to promote
exports and attract export-oriented investment in Serbia
have instead been directed to attracting foreign direct
investment (FDI) at the expense of export promotion, which
has not been particularly effective. A looming question has
become whether the current policy mix for promoting
competitive Serbian exports needs realignment. |
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