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The Government of the Republic of Serbia

In the service of citizens

Productivity increase crucial for Serbian economy

Belgrade, 28 December 2004

The main issue of boosting productivity is crucial for survival of the Serbian economy, Serbian Minister of Labour, Employment and Social Policy Slobodan Lalovic said today at the signing of a work productivity programme.

The agreement was signed by Minister of Economy Predrag Bubalo, President of the Work Productivity Centre Petar Petrovic and Zoran Branovacki of the Serbian Chamber of Commerce.

Lalovic said that when it comes to productivity, Serbia is at the bottom in Europe, noting that only after there are productivity increases in the economy can we expect to be competitive.

Serbia will have to open up its borders in the years to come and Serbian companies will have to compete on the market, but they will have no chance if they do not raise their productivity, Lalovic said.

The Minister said that an increase in productivity is a good foundation for upgrading salaries in the long run.

According to him, the Ministry of Labour, Employment and Social Policy expects that within six months there will be productivity increases in the companies involved in the Ministry’s pilot programme. He said that if this programme proves to be successful in the ten trial companies, it will apply to the whole Serbian economy.

Serbian Minister of Economy Predrag Bubalo said that raising productivity is essential for Serbia’s economy, adding that there are two ways to boost productivity.

One of them is the “mechanical” raising of productivity, through social programmes and by resolving the problems of surplus labour in companies.

The other way to raise productivity, according to Bubalo, is re-organisation of production and modernisation of Serbia’s obsolete equipment. This will bring us closer to the European Union and improve the quality of our industry, said Bubalo.

Chairman of the Centre for Productivity Petar Petrovic said the project to raise productivity was presented to the Ministry of Labour immediately after it was promoted in Turin, Italy, in March this year.

This model was tested on 25,000 companies in Sweden and it gave great results, according to Petrovic. He said that this model is being applied in Great Britain, Italy, Sweden, and Portugal.