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The Government of the Republic of Serbia

In the service of citizens

Agreement reached to adopt Bill on investment projects

Belgrade, 11 February 2008

Serbian Deputy Prime Minister Bozidar Djelic, Serbian Minister of Trade and Services Predrag Bubalo and representatives of other relevant ministries held a meeting today with representatives of the construction and building materials industries, as part of ongoing dialogue with exporters.

Agreement was reached at the meeting that the government will draft a new law on investment projects which will regulate the payment of tax on building works, the avoidance of double taxation and the incomes of those employed abroad which will encourage Serbian firms registered abroad to return to the country.

It was stressed that Serbian construction companies must return to the traditionally strong markets of the former Soviet republics, Middle East and North Africa, even though they now have more projects within the country.

Merging two funds for financing and export credit insurance, the AOFL and the SMECA, and their recapitalisation with $50 million will make it possible to finance export business under more reasonable conditions.

Considering the fact that the strategic goal of the government is for Serbian firms to be contractors and not subcontractors for construction work being carried out in the country, it is necessary to issue licenses to all construction companies, regardless of their particular activities, which will make certain that they are able to compete on an equal basis for tenders and public procurement.

It was also agreed that the settlement of old state debts to businesses in the construction sector should be accelerated.

The construction and building materials industries in Serbia employ some 120,000 people, while the volume of services provided abroad are worth some €300 million annually.

Serbia’s draft export strategy will be drawn up by the end of February and submitted to exporters for consideration, reads the statement issued by the Serbian Deputy Prime Minister’s Cabinet.