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The Government of the Republic of Serbia

In the service of citizens

Start-up loan agreements signed with young entrepreneurs

Belgrade, 31 October 2007

Serbian Minister of Economy and Regional Development Mladjan Dinkic signed today start-up loan agreements with young entrepreneurs, which will be approved for a period of five years, at an annual interest rate of 1%.

Author: Fonet

Dinkic told a press conference that hitherto 1,507 start-up loans were approved to those who cannot provide a guarantee for a loan. The total value of the loans was nearly RSD 1.9 billion. He added that this will lead to 5,300 new jobs.

He said that 640 such loans were approved during the past ten years, adding that they were mainly approved for activities in the services sector, wood-processing and metal industry.

According to Dinkic, the guarantee in such loans is the mortgage on equipment which is purchased.

Dinkic recalled that the Ministry of Economy and Regional Development announced a competition for distribution of start-up loans without the need for a mortgage, and loans for self-employment under very favourable conditions.

The Minister said that a total amount of RSD 3 billion was approved for these two programmes, which will lead to the creation of 8,000 new jobs.

The signing of loans agreements was also attended by Director of the Agency for Small and Medium-Sized Enterprises and Entrepreneurship Dejan Jovanovic and Director of the Serbian Development Fund Olivera Bozic.

Dinkic said at the conference that the Ministry of Economy and Regional Development is preparing a bill on distribution of free shares, which the Serbian government should adopt by the end of November.

He stated that the Ministry has prepared a privatisation strategy for public companies in Serbia which will enable every citizen to buy up to €5,000 of shares of large public companies.

According to him, first the Serbian President and Prime Minister will be acquainted with the strategy and afterwards it will be forwarded to the Serbian government.

He stressed that the Ministry advocates the concept of massive citizen participation in purchasing shares of large companies in Serbia. That way, large companies will not be the only ones with access to the capital market.

The strategy would enable every citizen to buy shares up to the stated amount, in line with the model of the initial public offer for Telekom Hrvatska, where 360,000 Croatian citizens became that company’s shareholders, recalled Dinkic.

He said he expects that this model will raise the level of economic development in Serbia and have a positive effect on the capital market.

He also voiced expectation that the money gained that way will not go to the budget alone, but, for example, a portion of the money from the shares of the Electric Power Industry of Serbia (EPS) will be used for investments in new thermal electric power plants.

That would mean that new power plants can be built from domestic funds, garnered from the sale of EPS shares on the Belgrade stock market, and not by way of joint investments with foreign investors, explained Dinkic.

He pointed out that the Law on the securities market must be urgently amended in order to regulate the initial public offer of shares on the Belgrade stock market. He also specified that the state could thus offer shares on the stock market just as public companies do.

A model of issuing and offering shares has been offered for every company, said Dinkic and announced that more will be said on this matter at a press conference of the Ministry of Economy and Regional Development scheduled for November 5.