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The Government of the Republic of Serbia

In the service of citizens

Simplifying procedures and reducing investment costs

Belgrade, 12 May 2004

Director of the Serbian Investment and Export Promotion Agency (SIEPA) Jasna Matic said today that the Agreement on Free Trade between Serbia and the Russian Federation is one of Serbia's major advantages in relation to its neighbouring countries and a chance for greater presence of foreign investors on the domestic market.

Jasna Matic

During the presentation of the investment climate in Serbia to potential investors, held at the 48th International Fair of Technology and Technological Achievements in Belgrade, Matic said that Serbia has access to the Russian market without larger customs duties for goods whose 50 percent of value and more is produced in Serbia. She added that the Russian market gets increasingly stable and strong, and for that reason, all countries want to be present there.

According to Matic, one of Serbia's advantages is highly educated workers who mostly speak foreign languages, as well as a long tradition of cooperating with international companies. Owing to that, investors will spend less time on training workers to use new technologies.

She added that the profit tax of 14 percent is very attractive for foreign investors because is one of the lowest in Europe. Last year, foreign investment exceeded $1.2 billion, and it mostly came through privatisation. The major investors were the British American Tobacco (BAT) and Philip Morris, who bought tobacco industries in Nis and Vranje.

Matic said that it is necessary to boost inflow of greenfield investment, which is directed at construction of production plants in Serbia. The first case of the greenfield investment is the US corporation Ball Packaging Europe, which begins with the construction of a can factory in Zemun Polje, said Matic and announced that a construction of factory by a Slovenian firm is in plan.

She explained that investors mostly complain to red tape and sluggishness in the resolution of problems, and overlapping of jurisdictions. For that reason, the Serbian government will make efforts to simplify procedures and reduce investment costs.