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The Government of the Republic of Serbia

In the service of citizens

Programme for attracting foreign investors in Kragujevac, Bor and Vranje adopted

Belgrade, 12 May 2005

Serbian Minister of Capital Investment Velimir Ilic said today that the government adopted at its session a programme for attracting foreign investors and opening new jobs in Kragujevac, Bor and Vranje.

Minister of Capital Investment Velimir Ilic, left, and Minister of International Economic Relations Milan Parivodic

Ilic told a press conference that the Serbian government formed a commission to lead this programme. They will talk with representatives of trade unions and the management of Zastava and Zastava Oruzje on Friday, May 13 in Kragujevac.

According to him, the commission members include besides him, Minister of Finance Mladjan Dinkic, Minister of Economy Predrag Bubalo, Minister of International Economic Relations Milan Parivodic and Minister of Public Administration and Local Self-Government Zoran Loncar.

The Minister of Capital Investment said that the commission would, in cooperation with representatives of local self-government, company managers and trade unions, make a strategy for attracting foreign investors and providing investment incentives to solve the unemployment problem in Kragujevac, Bor and Vranje.

He said that the government has decided to pay outstanding debts to road companies in Serbia so that the privatisation of road construction and maintenance companies could continue.

Ilic said that it was decided that the Slavija and Kopaonik hotels should be separated from Jat Airways and enter the privatisation process. He said that the government adopted the Statute of the Serbian Railway Company and formed a managing board of the Serbian power service (EPS).

He said that funds have been set aside for natural disasters in southern Serbia and reminded that the Serbian government has already sent aid to municipalities afflicted by the floods in this area.

“Construction material has already begun to arrive in the Jasa Tomic village, and an additional 40 million dinars was placed in the Natural Disasters Fund for the reconstruction of destroyed or damaged houses”, Ilic said.

Ilic underlined that the Serbian government would fulfil all obligations towards the local population and quickly begin construction works.

Minister of International Economic Relations Milan Parivodic assessed that the agreement with the IMF to extend the three-year arrangement with Serbia is the result of long-term negotiations on essential reforms of the legal and economic system in Serbia.

Parivodic pointed out that in the following years economic and social reforms will be implemented in monetary and fiscal policy, by restructuring companies through privatisation and the restructuring of public enterprises, and by reducing the number of those employed in state administration and the pension system reform.

He said that in order to achieve these goals, a unified stance of the Serbian government, the Serbian President, parliament, and local self-government is necessary.

The Ministry of International Economic Relations emphasised that after the positive feasibility study there was interest in increased investments, and that the ministry was creating a foreign investment strategy, which would include certain investment incentives.

Parivodic announced that ambassadors in Serbia-Montenegro and Serbian government representatives would visit the flooded areas in central Banat on Wednesday, May 18, adding that the European Agency for Reconstruction has earmarked €2 million for flood relief.