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The Government of the Republic of Serbia

In the service of citizens

More optimism after concluding textile agreement with EU

Belgrade, 23 December 2004

Serbian Minister of Economy Predrag Bubalo expressed more optimism about the forthcoming year, bearing in mind that import quotas for exporting textile products made in Serbia to the EU market have been terminated.

Predrag Bubalo

At a meeting with representatives of the Association of Textile, Wear, Leather and Footwear Producers, Bubalo said that Serbian industry can improve its own competitiveness in the macroeconomic plan by relieving debt and reducing the number of employees, both conditions needed for successful privatisation.

The Minister also announced that amendments to the privatisation law should be adopted by January 15 next year.

The meeting was organised at the initiative of the Serbian Chamber of Commerce as a tool for preparing local textile producers for the market competition that will come once the textile agreement goes into effect in the first quarter of 2005.

The textile producers demanded that the issue of bonds to the Serbian Development Fund be resolved, and that interest for investment loans should be reduced. The textile makers also demanded further stimulations for exporters and simplification of the administrative procedure.

The textile producers also asked that criteria for exporting rawhide should be tightened, and called for a solution relating to their claims in Iraq. They also demanded that obligations of companies be reduced in accordance with the write-off of the debts to the Paris and London clubs of creditors.

Contributions and taxes for those employed in the textile industry will be reduced for those branches with a large number of employees, Bubalo said, adding that it will be an incentive for foreign investors.

The Minister promised to explore higher subsidies and more favourable loans from the Development Fund for textile exporters.

According to Bubalo, companies from underdeveloped regions will be granted loans with lower interest rates. He said that planned subsidies in the Serbian budget for 2005 amount to 5 billion dinars.