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The Government of the Republic of Serbia

In the service of citizens

Time to invest in Serbia

Belgrade, 23 May 2005

Serbian Deputy Prime Minister Miroljub Labus said that the message of all participants in the 14th Annual Meeting and Business Forum of the European Bank for Reconstruction and Development (EBRD) is that now is the time to invest in Serbia.

Author: Fonet

Speaking at a press conference summarising the results of the three-day meeting, Labus said that a common market of more than 50 million potential consumers is being created in the western Balkans, which is a very attractive business space for all serious potential investors.

Labus said that the fact that the EBRD's Annual Meeting has been held exactly here in Belgrade is proof that Serbia is back on Europe's map.

The Deputy Prime Minister said that all those who participated in the organisation of the event did a very good job and that the Serbian government and the Belgrade authorities established a very good level of cooperation.

He said that one of the most important meetings he had during the weekend was the meeting with EU Economic and Monetary Affairs Commissioner Joaquin Almunia, with whom he discussed the future negotiations on the EU stabilisation and association agreement, which will most likely begin in October.

Also, the two officials agreed that regular consultation should be held aimed at creating new infrastructure for relations between the Serbian government and the European Commission, Labus said. Another topic of the talks was the financial instruments that the European Commission will provide to Serbia.

Labus said that Serbia's relations with the United States are good and there are no more open issues except for full cooperation with the Hague tribunal. The government has already taken all measures to establish full cooperation, Labus said and added that the US voiced its support for economic and structural reforms in Serbia, as well as to the EU accession process.

He added that Serbia's negotiating position concerning the future status of Kosovo-Metohija has also been welcomed.

"We are very satisfied that US investors come to Serbia's market much more quickly than others, which is an encouragement to other investors", Labus said.

The Deputy Prime Minister said that the meetings with Japanese businessmen and representatives of the Japan Bank for International Cooperation were also very successful. This bank has established close cooperation with the Serbian government's Investment and Export Promotion Agency (SIEPA), Labus said and concluded that it is highly appropriate that Japanese businessmen return to the Serbian market, since they were here thirty years ago.

Author: Fonet

Serbian Minister of Finance Mladjan Dinkic, who is also the Serbia-Montenegrin Governor at the EBRD, said that the three-day meeting was successful and he stressed that Serbia’s image in the eyes of foreign investors has begun to change.

Dinkic expressed gratitude to the Serbian Investment and Export Promotion Agency (SIEPA) and he said that this is the right time to invest in Serbia, recalling that the country expects at least $2 billion of foreign direct investment in 2005.

The banking sector alone will attract between $750 million and $1 billion, while a further $1 billion will be invested in the economy by the end of the year, he explained.

Dinkic said that EBRD investments in Serbia have reached €800 million and that the EBRD has also helped to attract another €1.2 billion of private investment.

He added that the European Investment Bank (EIB) has signed a number of new projects worth a total of €250 million and that the modernisation of railroads and clinical centres in Serbia are the most important among them.

According to him, Serbia is also looking at cooperation with the Nordic Investment Bank, which has agreed to assist infrastructure, health, and environmental projects in the forthcoming period.

Dinkic added that the Council of Europe’s Development Bank has agreed to send a mission to Serbia to establish the extent of damage in the flooded areas of Central Banat, after which the bank will approve a favourable loan to rebuild the flooded houses.

Serbian Minister of Economy Predrag Bubalo said that many participants of the EBRD Annual Meeting have told him that the situation in Serbia is much better that the image the country has had in the world.

Bubalo added that EBRD officials also agreed to give donations towards flood relief efforts in Central Banat and to finance a series of projects for the harmonisation of domestic regulations with those of the EU.

Bubalo also said that foreign investors have expressed interest in investing in Serbia’s small and medium sized enterprises.

Minister of International Economic Relations Milan Parivodic said that the EBRD’s holding of its annual meeting in Belgrade is a message to the whole world that Serbia is finally on the right track.

The main message from Belgrade to foreign investors is that this government is a democratic one, just as every government to come will be, said Parivodic and added that Serbia is a politically stable country and an element of stability in the region.

According to Parivodic, last night’s dinner at the office of President Boris Tadic was proof of stability in the country, given that it gathered at the same table all the leaders in the state union of Serbia-Montenegro.

Announcing the privatisation of Belgrade’s construction land and changes to the urban planning and construction legislation, Parivodic said that foreign companies operating in Serbia are making profits and that they are very satisfied with the local workforce, who can speak good English.

Governor of the National Bank of Serbia (NBS) Radovan Jelasic said that NBS representatives held more than 50 meetings with representatives of the financial sector and added that there is a high level interest shown by the world's leading banks to come to Serbia. He explained that bank representatives are ready to strengthen the capital base, that is, to carry out recapitalisation of the Serbian banks. According to first estimates, that sum should be around $300 million.

Jelasic voiced hope that a law on insurance companies will be adopted by the end of this year, so that the establishment of the first voluntary pension funds could be possible. The Governor added that he had a number of bilateral meetings with the governors of the national banks in the region.

According to Jelasic, agreements with the Macedonian and Albanian governors are underway as to the joint presentation in the European Central Bank. Being the largest country in the region, Serbia should hold a leading role in that process.