SKOPJE, Aug 2 (BV) – Serbia remained the largest recipient of foreign direct investment (FDI) in the Western Balkans in 2025, while Albania consolidated its position as the region’s second-largest destination and Kosovo posted strong growth, according to official central bank data and preliminary institutional estimates.
Serbia attracted 2.28 billion euros in net FDI in 2025, according to the National Bank of Serbia, maintaining a significant lead over its regional peers despite a decline from the exceptionally high levels recorded in 2024.
Albania is estimated to have received 1.8-1.9 billion euros, based on Bank of Albania external sector statistics and market estimates, while Kosovo attracted around 1.1 billion euros, according to the Vienna Institute for International Economic Studies (wiiw), marking one of the strongest year-on-year increases in the region.
Montenegro and Bosnia and Herzegovina each received close to 1 billion euros in foreign investment, according to preliminary estimates based on central bank and institutional data.
North Macedonia recorded 467.5 million euros in FDI in 2025, according to official data from the National Bank, placing it last among the six Western Balkan economies after a record performance a year earlier.
The comparison should be treated with caution because only Serbia and North Macedonia have published final official balance-of-payments data for the full year, while figures for Albania, Kosovo, Montenegro and Bosnia and Herzegovina remain preliminary.
A reversal after a record 2024
The regional picture contrasts sharply with 2024, when all six Western Balkan economies increased FDI inflows despite weaker global investment conditions.
Serbia led with around 5.2 billion euros, followed by Albania with 1.6 billion euros and North Macedonia with a record 1.25 billion euros, driven largely by manufacturing investments, automotive suppliers and production facilities in technological industrial development zones.
Bosnia and Herzegovina attracted roughly 1 billion euros, Montenegro around 900 million euros, and Kosovo approximately 850 million euros.
The decline in North Macedonia’s inflows from a record 2024 to less than half a billion euros in 2025 marks the most pronounced shift among the region’s economies, although the country continues to attract export-oriented manufacturing investment.
Size matters
In absolute terms, Serbia continues to dominate the Western Balkans because of the size of its economy and market.
Measured against the size of national economies, however, the picture changes.
Montenegro remains the regional leader, with FDI averaging around 11% of GDP, followed by Albania, Kosovo and Serbia at roughly 7%, North Macedonia at 5-6%, and Bosnia and Herzegovina at 4-5%.
This suggests that while Serbia attracts the largest volume of investment, smaller economies remain more dependent on foreign capital relative to their economic output.
Competition for capital
The Western Balkans continue to compete for export-oriented manufacturing, energy, tourism, real estate and infrastructure investment.
The European Union remains by far the largest source of foreign investment across the region, although capital from China, Türkiye and Gulf countries has become increasingly visible in selected sectors over the past decade.
Governments across the region continue to rely on tax incentives, industrial zones and investment subsidies to attract multinational companies, while long-term competitiveness increasingly depends on labour availability, infrastructure quality, regulatory certainty and progress toward European Union integration.