Serbia’s ICT surge is redrawing its export model, but investor risks persist

Serbia’s technology sector is moving beyond its long-standing role as a regional outsourcing base, increasingly positioning the country as a digital economy with export revenues that are starting to rival traditional engines of growth. For investors, the key question is not only how fast ICT is expanding, but how durable the new export economics are—and what structural constraints could limit scaling.

ICT exports accelerate and expand beyond services

International ecosystem assessments cited in the report put Serbia’s ICT export revenues at approximately $4.31 billion in 2024. That figure implies roughly 20% annual growth and a nearly tenfold increase versus 2012. ICT exports alone account for around 5% of GDP, while total ICT value added reaches about 8.5% of GDP—among the highest levels in Southeast Europe.

The transformation is increasingly visible along Serbia’s main technology corridors. Belgrade and Novi Sad are emerging as the country’s primary hubs, with Startup Genome’s 2025 assessment identifying the Belgrade–Novi Sad startup ecosystem as one of the fastest-growing in its development category, particularly across artificial intelligence, biotechnology and advanced software engineering.

Employment and company counts also underscore scale: Serbia’s technology sector employs roughly 115,000 people across more than 4,000 companies, spanning startups and outsourcing firms to international development centers and deep-tech ventures.

From industrial exports to software-driven hard-currency inflows

The report frames a shift in Serbia’s export structure itself. Historically, Serbia’s exports relied heavily on automotive manufacturing, metals, agriculture and industrial production. Now, ICT services are described as one of the largest net-export categories—competing with traditional industrial sectors for foreign-exchange generation and value creation.

This matters because software and digital services have different underlying economics than industrial manufacturing: they require lower physical infrastructure intensity, can support higher margins, and are less exposed to logistics bottlenecks or carbon-adjustment pressures such as CBAM.

AI strategy and policy support help change what gets exported

Artificial intelligence is highlighted as an important growth layer. Serbia was among the first countries in Southeast Europe to adopt a national AI strategy. In parallel, government-backed digitalization programs and science-technology parks have strengthened connections between universities, startups and international investors.

The sector’s composition is also evolving. Earlier phases were dominated by outsourcing and software development for foreign clients. The current cycle increasingly emphasizes proprietary technology and exportable intellectual property across areas including AI tools, gaming, biotech, fintech and enterprise software platforms.

That transition has financial implications: value capture shifts from labor arbitrage toward ownership of products, platforms and scalable digital infrastructure.

Funding rebounds after a difficult year

The report notes that Serbia experienced a difficult financing cycle in 2023 before startup funding rebounded strongly during 2024. According to Garaža’s latest ecosystem report, investment volumes rose by about 89% year-on-year to around €22.4 million. Analysts cited in the text add that deal numbers remain relatively limited; however, larger financing rounds increasingly suggest more scalable and internationally oriented ventures are emerging.

Government targets startup scale—but gaps remain

Policy has been used to support this shift toward a broader startup base. Serbia’s Startup Ecosystem Development Strategy targeted expanding startups toward between 800 and 1,200 firms through innovation funds, tax incentives, science-technology parks and cooperation with international financial institutions.

Geography remains uneven: Belgrade hosts about 71% of Serbia’s startup activity, followed by Novi Sad and Niš. Novi Sad is increasingly positioned around engineering talent, gaming development and industrial software, while Niš is described as emerging as a secondary deep-tech and electronics-oriented hub.

Despite progress, structural challenges persist. The ecosystem faces shortages of senior engineering talent; it remains dependent on foreign outsourcing demand; domestic venture capital depth is limited; and founder migration toward larger European or US markets continues. The report also says Serbia lags leading European innovation hubs in commercialization capacity and late-stage startup financing.

A dual-speed economy—and a test of competitiveness

The macroeconomic implications are presented as significant at a time when Europe confronts carbon-transition costs, supply-chain restructuring and demographic pressure. With ICT exports described as relatively insulated from energy intensity concerns compared with traditional industries—and less exposed to transport disruptions or cross-border tariff mechanisms—ICT becomes an increasingly strategic source of hard-currency inflows for Serbia.

The result is portrayed as a dual-speed economy: one layer still tied closely to industrial manufacturing, energy infrastructure and traditional export sectors; another expanding rapidly around digital services, AI engineering and globally scalable technology products.

Ultimately, the report argues that accelerating ICT exports represent more than sectoral growth—they signal a gradual restructuring of Serbia’s economic identity from a manufacturing-and-transit model toward a hybrid industrial-digital approach integrated into Europe’s knowledge and technology value chains.