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The Government of the Republic of Serbia

In the service of citizens

Agreement on stabilisation and association by mid 2006

Belgrade, 15 April 2005

Serbian Minister of International Economic Relations Milan Parivodic said today that it was realistic to expect our country to conclude the agreement on stabilisation and association with the EU by the middle of next year.

Author: Fonet

At a working breakfast with journalists with the topic of “Serbian Trade Relations with the EU”, Parivodic said that we are above all expected to consolidate the constitution, that is adopt a new constitution, which will organise the country’s political system in a more modern way.

According to him, one of the key elements of this agreement is the creation of a free trade zone with the EU. Thus in the forthcoming period a series of meetings with EU representatives regarding this issue is expected.

Parivodic explained that the talks will centre on, above all, time periods in which our country will abolish certain import-export restrictions in agreement with the EU.

The Minister said that our ministries would draw up a classification of goods and services and request of the EU an adjustment period for abolishing custom duties and quantity restrictions.

Parivodic pointed out that the length of the adjustment period was still being considered and added that this time frame will not slow down our country’s EU accession in any way, as we can become candidates for full-fledged membership and EU members during this period.

The Minister reminded that besides negotiations on stabilisation and association, our country must also negotiate with the World Trade Organisation and further improve bilateral free trade agreements with neighbouring countries.

Parivodic explained that instead of 28 bilateral trade agreements, the EU proposed that one multilateral agreement should be concluded, which would uniquely organise a free trade zone in the region.

The Minister announced that in the forthcoming period the country’s tariff system would be revised in agreement with the EU and specified that certain rates unjustifiably reduced due to harmonisation of the tariff regime with Montenegro would be increased. On the other hand tariff rates on the import of intermediate goods would be reduced, in order to stimulate export.

Parivodic explained that, according to this proposal, the average tariff rate would be 8.5 percent, compared 7.4 percent now, and pointed out that the proposal for changing tariff rates was presented to the European Commission Trade Directorate whose answer is expected today.

Parivodic reminded that EU approval was necessary for changing the tariff rates, as the preferentials approved in 2001 for the export of certain products free of duty by the EU contain a clause according to which tariff rates must remain on the level which they were at when the agreement was signed.