After several months of protests, Serbian President Aleksandar Vucic and other officials have criticised student protesters for damaging the country’s economy. Yet meeting the demands for more efficient institutions and a stronger judiciary would actually improve the country’s investment climate in the long-term. 

Widespread protests sparked by the November 2024 collapse of a canopy roof in Novi Sad railway station, which killed 15 people, have already resulted in the resignation of Prime Minister Vučević and the collapse of his government. 

This prompted a recent claim by Vučić that the protests were ruining the economy. Jorgovanka Tabakovic, governor of the National Bank of Serbia, has also stressed the importance of political stability in Serbia’s efforts to become a high-income economy. 

While the protests have drawn international attention, the protesters are not seeking to overthrow the government but demanding reforms such as adherence to the rule of law, more efficient institutions and a stronger judiciary, while protesting in a peaceful manner.

Reviewing the current protests' impact on investment in the country, Dušan Šoškić, a professor at the Faculty of Economics, University of Belgrade, told bne IntelliNews that, “protests demanding respect for the constitution, the law, strengthening of institutions, better education, rule of law, and the fight against corruption can only encourage credible investors to invest more and better in Serbia in the future, with better results for the real well-being of the country.” 

He added: “the fulfilment of the demands of the protesters [who demand more effective institutions] in Serbia should be a good sign for the future of investments and economic development in Serbia.”

Statistics office data from January also contradicts Vucic’s claim. The tourism and industrial production sectors continued to show positive growth. According to data released by the country's statistics office on February 28, Serbia recorded a 16% increase in foreign tourist numbers in January 2025 compared to the same month last year. The same data also showed that industrial production in January was 0.4% higher than in January of last year.

Despite the ongoing political instability in Serbia, Šoškić looks at the long-term picture. “Advocacy for the fight against corruption, for better functioning of state institutions, and for respecting the law can only be beneficial for the country’s economy. This is especially true if the country is at the bottom of the European continent in the Transparency International corruption perception index,” said Šoškić.

Serbia dropped to 105th place on the latest index, meaning it is below all but a handful of European countries such as Belarus, Bosnia & Herzegovina, Russia and Ukraine. 

Economist Saša Đogović, speaking to Danas, made a similar point to Šoškić, saying that the current student blockades and protests do not have any significant negative effect on the country's economy. Regarding investments, Đogović pointed out that even if foreign direct investments show a negative trends, they are certainly not caused by the protests "but rather [are] a consequence of the lack of effective institutions, which are exactly what these protests are addressing."

The political instability caused by student-led protests is only one of the challenges to investment in Serbia. Other issues include bureaucratic delays and corruption, loss-making state-owned enterprises, a large informal economy, an inefficient judiciary. Despite all these, the majority of analysts believe investment will continue to grow in Serbia. 

According to the US 2024 Investment Climate Statements for Serbia, steps taken already on macroeconomic reforms, financial stability, fiscal discipline, and the government's prioritisation of foreign investment have enabled the country to maintain a relatively stable investment sector. 

Shortly before the protests started, in October 2024 Serbia achieved its first-ever investment-grade credit rating when international credit rating agency Standard & Poor's (S&P) Global Ratings upgraded the country's long-standing BB+ rating to BBB-. Serbia thus became the first Western Balkans state and EU candidate to obtain investment-grade status. 

Since then, another major credit rating agency, Fitch, has raised concerns about the ongoing political instability in Serbia, saying this could delay reforms and project implementation. However, its latest report indicates that the impact of the current political situation on the country's policy mix will be minimal.

Fitch estimates that Serbia will experience robust investment-led economic growth, underpinned by the Leap into the Future — Serbia Expo 2027 plan, which includes €18bn of investment. While €1.2bn will be specifically allocated to the Expo itself, likely for event-related infrastructure, facilities and operations, the remaining investment will be directed to road and rail, industrialisation, and other infrastructure projects, which could lead to increased interest among investors.

Commenting on Serbia's reputation among investors during the current wave of protests, Šoškić believes that while some investors who have spoken with the current political establishment in Serbia may view the public uprising as an added uncertainty in their investment decisions, this should not be a concern for credible and long-term investments. This is particularly true since such investments should not be tied to the existing group of politicians, as the turnover of politicians is a normal occurrence in democratic countries.

Nina Miholjčić Ivković is a researcher based in Serbia with a background in political science and international relations.