CREATION ATTRACTIVE INSTITUTIONAL AMBIENCE AS PRECONDITION FOR ATTRACTING FOREIGN INVESTMENTS

The main purpose of this paper is to investigate this field in order to show the need of establishing an creating institucional environment, creating a favorable investment climate and excellent business environment for the sake of attracting direct foreign investment inflows. Transition countries, Serbia in particular, have not been successful in attracting sufficient quantity of FDI, thus strengthening a country’s attractivity towards foreign capital inflows has become a new imperative. Building an creating institucional environment is a long-term process that should maximise the positive efects and minimise the negative ones of FDI.

Key words: investment environment, investment climate, business environment, foreign direct investments.