Keepin touch

Whether you have a question, comment, suggestion or any problem in the purview of the government, send us your message and we will try to respond as soon as possible. If your problem is not in our purview, we will forward your message to the relevant institution.

The Government of the Republic of Serbia

In the service of citizens

EIB’s loan largest financial incentive to Serbian export sector

Belgrade, 17 May 2011

Deputy Prime Minister for European Integration Bozidar Djelic said today that the loan of the European Investment Bank (EIB), signed yesterday in Luxembourg, is the largest ever financial incentive to the export sector of Serbia.

Djelic told Radio Television Serbia that the loan is a confirmation that the investment of Fiat in Serbia is going under the plan and stressed that Serbia will continue to responsibly manage its finances.

The Deputy Prime Minister announced that €500 million of EIB loan will go to Fiat Automobili Srbija, in which Fiat has 70% and Serbia 30%.

He explained that of those €500 million, Serbia with €200 million, Fiat with €100 million and a specialised agency for export from Italy with €200 million will guarantee the return of the money from the sale of cars.

It is expected that in the first year the company exports will reach the value of between €1.3 billion and €1.5 billion, said Djelic.

The Deputy Prime Minister announced that by the end of the year pilot production is expected to begin while next year the factory should produce between 200,000 and 300,000 vehicles annually.

€250 million is earmarked almost exclusively for known and most powerful domestic exporters, he said listing successful companies such as Tigar in Pirot, copper and aluminium rolling mills in Sevojno, Pionir and Simpo from Vranje so they could get loans under the conditions that their competitors have.

He pointed out that these loans will be repaid within seven years with a grace period of two years or within 12 years with a grace period of four years and the interest that is 4-5% per annum.

He said that Serbia is one of the least indebted economies in Europe with a debt representing 43% of GDP of Serbia.

Unlike Croatia which is already down to around 60% of GDP, while countries such as Greece have as much as the debt amounting to 100-120% of GDP.

The Deputy Prime Minister said that government borrowing must be exclusively for infrastructure and motorways and railways that allow the competitiveness of enterprises and a better life for citizens.

The loans taken by the state should be intended to enhance exports and bring the money to economy and citizens, and not to be used for consumption, said Djelic.