Guide to Free Zones, Industrial Zones & Investments

GUIDE

2016

FREE ZONES, INDUSTRIAL ZONES & INVESTMENTS

S P E C I A L

E D I T I O N

INTERVIEW

Engines of Serbia’s Economic Growth The establishment of industrial and free zones, as well as efficient management and sustainable development, are important prerequisites in the implementation of the development strategy for the Serbian economy, and are equally important both for local communities and the country as a whole GORDANA HAŠIMBEGOVIĆ, SECRETARY GENERAL OF THE

SERBIAN CHAMBER OF COMMERCE & INDUSTRY’S TRADE ASSOCIATION

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n order for the concept of industrial parks and free zones to attract new direct investments effectively, maximised incentives and benefits have to be in place, while cheap labour and the free trade and preferential trade agreements that Serbia has concluded with other countries should be considered only as additional arguments for attracting new investors.

• Industrial parks and free zones are still insufficiently developed as special in-

industrial activities. There are several types of industrial parks that depend on ownership type, location and purpose – industrial, technology, incubators, science & research etc.

Free zones are part of the Republic of Serbia's territory that have been specially sectioned off and marked and represent areas in which companies are eligible for special benefits, as regulated by the Law on Free Zones (Official Gazette #62/2006). Free zones enable their users to do business without having to

IT MEANS A LOT TO US TO SEE THAT THE PIROT AND ZRENJANIN FREE ZONES HAVE BEEN RANKED VERY HIGHLY ON THE FINANCIAL TIMES’ LIST OF THE WORLD’S TOP 50 FREE ZONES, AS RANKED IN TERMS OF FDI struments of economic development for both local communities and the country as a whole. Could you explain the difference between free zones, industrial parks and business zones?

- An industrial park is a designated complex of land allocated for production purposes and supporting activities in the relevant planning documents. This complex of land also has adequate primary and secondary infrastructure for performing

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FREE ZONES, INDUSTRIAL ZONES & INVESTMENTS

pay customs duties or VAT, which in turn facilitates export-orientated production.

When goods produced in a free zone are sold on the domestic market, customs duties and VAT are applied in order to protect the domestic market.

Industrial parks offer the same benefits as free zones and have available land plots with adequate infrastructure.

A free zone can be established within a segment of an industrial or technology

park, and with all of the benefits concentrated in one place we have synergy and compatibility between two concepts that are essentially the same – free zones and industrial parks.

• According to your records, how many industrial zones and parks are there in Serbia and how many free zones?

- Serbia has over 200 work and industrial zones and parks, while the number of free zones is limited and there are currently only 14 – Pirot, Subotica, Novi Sad, Zrenjanin, Šabac, Kragujevac, Užice, Smederevo, Kruševac, Svilajnac, Apatin, Vranje, Priboj and Belgrade. These zones also simultaneously serve as manufacturing industrial parks.

• How are these zones regulated legally and does the regulation provide enough good reasons for new investors to be attracted by local self-governments?

- Industrial zones are not legally regulated in Serbia and local governments are entrusted with their development. As far as the free zones go, they are all active and are home to production companies.

Free zones in Serbia are based on the export processing zone concept,

i.e. zones that are home to export-orientated production companies.

There are always interested investors.

We are briefed on this matter regularly by our members at meetings between the Free Zones Group and customs warehouses, which operate under the auspices of the Serbian Chamber of Commerce & Industry’s Trade Association. Interest is great and investors expect to be granted as many benefits as possible. We have been doing our best, together with the Republic of Serbia’s legislators, to pass laws that will boost the competitiveness of the free zones in Serbia. It means a lot to us to see that the Pirot and Zrenjanin free zones have been ranked very highly on the Financial Times’ list of the world’s Top 50 Free Zones, as ranked in terms of FDI. Turkish investors have been showing a lot of interest in our free zones of late, inquiring about conditions for producing and exporting goods to Russia. However, no concrete investments have been forthcoming as yet.

I can conclude that there is suf-

The free trade agreements that Serbia has concluded with Russia, Belarus and Kazahkstan are unique in the sense that we are the only country to have such agreements.

They stipulate that Serbian goods sold on these markets are exempt from customs duties. It is worth mentioning that these countries are collectively home to over a billion people.

Additionally, production companies in free zones are exempt from paying VAT on the energy products they use, which ensures the entire production process is less costly. Add to this

GOODS PRODUCED IN SERBIA CAN BE EXPORTED UNDER FREE TRADE AGREEMENTS TO THE EU, EFTA COUNTRIES (ICELAND, LIECHTENSTEIN, NORWAY AND SWITZERLAND), AND CEFTA COUNTRIES (ALBANIA, BOSNIA-HERZEGOVINA, MACEDONIA, MOLDOVA, MONTENEGRO, AND UNMIK, ON BEHALF OF KOSOVO). SERBIA ALSO HAS A PREFERENTIAL TRADE REGIME WITH THE U.S. ficient and growing interest and we expect the Ministry of the Economy to offer new tax incentives to investors in free zones.

• What special incentives does Serbia currently offer investors who decide either to launch or expand their operations in one of the Serbian free zones?

- Serbia has maintained good relations with quite a few countries and, thanks to this policy, we have managed to conclude a substantial number of free trade agreements. Goods produced in Serbia can be exported under free trade agreements to the EU, EFTA countries (Iceland, Liechtenstein, Norway and Switzerland), and CEFTA countries (Albania, Bosnia-Herzegovina, Macedonia, Moldova, Montenegro, and UNMIK, on behalf of Kosovo). Serbia also has a preferential trade regime with the U.S.

the fact that all machines, equipment and raw materials used by companies in free zone are exempt from customs duties and VAT, and you have very attractive conditions for investors.

• Considering the current economic situation and the volatile global market, how profitable is it to invest in the construction and infrastructure equipping of these zones?

- Both the state and local self-governments benefit from investments, because new investments create new jobs and added value, while increased production has a positive impact on the country's GDP, which, coupled with higher exports, boosts the country’s foreign currency revenue. People also spend their earnings locally, which means more revenue for local self-governments and their budgets, due to there being higher consump-

tion and more money in circulation.

• In which way does the Serbian Chamber of Commerce & Industry support the economy in its efforts to establish, promote and educate about these zones?

- The establishing of free zones is regulated by relevant laws and comes under the jurisdiction of the Ministry of Finance, or rather its Free Zones Administration. The Serbian Chamber of Commerce & Industry and its Trade Association have formed the free zone group, which is tasked with coordinating activities aimed at promoting free zones and presenting free zones during the official visits of foreign delegations and our Chamber's appearances abroad. We offer all available assistance to interested stakeholders whenever required.

• Do you have data on how many investments have been made in Serbian free zones in the last couple of years and how many new jobs were created as a result?

- There are over 260 companies, mostly domestic, operating in Serbia’s free zones. According to 2014 data, they employ almost 20,000 workers, which is a substantial increase from 2012, when this number stood at just under 8,000.

Over €755 million was invested in all free zones in Serbia in 2012. A year later, in 2013, this amount stood at €198 million, and in 2014 it was €220 million. The data about investments, number of employees and turnovers in 2015 is due to be collated by May this year.

• Which incentives are available to local selfgovernments, with a view to advancing their efforts in the free zone segment?

- During our campaign – “You Have the Word – Be Part of the Solution”, the Free Zone Group suggested additional tax breaks for export-orientated companies in free zones, the simplification of customs procedures, construction of production incubators that would be owned by the state, the drafting of the Master Plan for the Development of Free Zones and a new strategy, extending the benefits offered by free zones once Serbia joins the EU, as well as during the EU accession negotiations, and with local governments providing exemptions from town and municipal charges and fees during the construction and utilisation of production facilities in free zones. With this set of measures, we could increase the competitiveness of free zones in Serbia and boost the investment influx in the period ahead. ■

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INTERVIEW

Success Based on Highest Standards

Thanks to the Pirot Free Zone having amassed almost two decades of experience and proven its success, it doesn’t seem pretentious that the company has set some fairly high standards for itself – namely, in striving to create the most favourable business environment and thus attract as many domestic and foreign companies engaged in export-orientated high technology production as possible, while, of course, offering the best possible services to the Zone’s clients

DRAGAN KOSTIĆ, DIRECTOR OF THE PIROT FREE ZONE

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he Free Zone Pirot JSC spans over 116 hectares, is fully equipped in terms of infrastructure and houses sixteen production firms and more than 100 retail companies that have a combined total of almost 5,800 employees. Excellent infrastructure and an efficient administration, coupled with special incentives for construction, optimum utilisation of existing facilities, doing business and hiring new workers, make the Free Zone Pirot one of the top free zones in Serbia.

completed successfully and contracts have been signed with several companies in the Pirot Free Zone. Consequently, the number of SMEs in the Pirot Free Zone has increased this year and we currently have 16 production companies operating here.

• The Pirot Free Zone was recently recertified as an integrated management system (IMS).

What standards does this recertification relate to specifically, and how do they contribute to

BY PROVIDING HIGH-QUALITY SERVICES, WE STRIVE TO MAKE OUR CLIENTS’ OPERATIONS EASIER AND TO ENABLE THEM TO FOCUS ON THEIR CORE BUSINESSES, IN ORDER TO ACHIEVE BETTER RESULTS • Earlier this year you signed two new contracts with production companies in the Pirot Free Zone. Which companies are coming to the zone; when will those investments be implemented and how many new jobs will they create?

- This year has been dubbed the year of support for small and medium-sized enterprises and we will act accordingly. Following the implementation of large-scale investments, it will be the turn of SMEs. Both existing and future SMEs will support the operations of large companies by providing them with services.

The negotiations with investors that have taken place in the last few months have been

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the development of business in the free zone?

- The Recertified Integrated Management System pertains to quality management systems that in line with the standard SRPS ISO 9001:2008, environmental management system (SRPS ISO 14001:2005) and occupational health and safety (SRPS OHSAS 18001:2008). This certificate expires in the last quarter of 2018.

The main reason for the implementation of IMS is to increase the quality of our services. By providing high-quality services, we strive to make our clients’ operations easier and to enable them to focus on their core businesses, in order to achieve better results.

FREE ZONES, INDUSTRIAL ZONES & INVESTMENTS

Their good results are the best promotion for the Free Zone and can result in the attracting of new users, as well as enabling existing users to increase their capacities.

Moreover, following a large number of requests from users and an increase in the number of administrative tasks, we also received IMS recertification in order to continue carrying out our daily activities in an uninterrupted manner, boost the quality of our services and solidify our business confidence.

• What has the Pirot Free Zone been doing to attract new investors and do you plan to bring new companies here any time soon?

- The Free Zone Pirot is open to new investments and has been working to create a favourable business environment and thus attract domestic and foreign companies engaged in export-orientated production, as well as provide quality service to its clients.

Bringing in new clients is uncertain at present – at least until production facilities are open.

We have held talks with a substantial number of potential zone users, with whom we have had numerous discussions and reached different stages of negotiations. However, we have only established cooperation with those companies that have been insistent upon realising their plans. We negotiate with potential users on an almost daily basis, but we cannot say with certainty that they will become new zone users. Negotiations with

investors are ongoing and we are doing our best to bring in serious investors willing to develop their businesses over the long term.

• There is also an industrial park in the Pirot Free Zone. What kind of benefits are brought by the synergy between these two formats?

- Having a one-stop-shop actually enables the synergy between the industrial park and the free zone. The Pirot Industrial Park provides infrastructure for users of land plots here, while the Free Zone Pirot provides a set of consolidated incentives, including state benefits for the creation of new jobs or preferential trade agreements with various countries (EU, CEFTA, EFTA, Russia, Belarus, Kazakhstan, Turkey, the U.S.), custom incentives, and incentives provided by the local government (such as exemptions from paying various construction fees, partial coverage of waste collection costs etc.).

The Free Zone Pirot has personnel licensed to carry out freight forwarding services, which enables the expediting of import and export procedures. The Zone also has a customs office and customs terminal where goods are inspected, which also boosts operational efficiency. We have also provided a parking lot for haulage vehicles.

In addition to haulage services, we organise

Investors are offered three types of benefits by the Pirot Free Zone: state incentives (the Law on Free Zones, duty and VAT exemption), local incentives, and many other services offered by the Free Zone Pirot Joint Stock Company (freight forwarding services, customs representation, organisation of transport and assisting investors with investment procedures).

• Serbia still has relatively few free zones, though they have proved to be a good for-

PIROT FREE ZONE

THE FREE ZONE PIROT HAS PERSONNEL LICENSED TO CARRY OUT FREIGHT FORWARDING SERVICES, WHICH ENABLES THE EXPEDITING OF IMPORT AND EXPORT PROCEDURES

domestic and international transport, provide storage services, and goods loading/unloading in both indoor and outdoor warehouses at affordable prices. Companies can build their own storage or production facilities in the industrial park, which is fully equipped in terms of infrastructure.

increase industrialisation and export levels.

Serbia’s free zones have achieved better results in recent years than businesses that operate elsewhere, in terms of increasing FDI, export turnover and value, and in terms of the number of employees.

However, Serbian free zones are not currently competitive compared to their global and regional counterparts, which do provide better conditions for investors. The fact that certain tax exemptions will be in place until

mat for attracting investors and developing the overall economy. Why is that so?

- Free zones promote efficient economic instruments that facilitate fast FDI influx into the host country, boost employment, provide access to new technologies, enable workforce training and

Serbia joins the EU, that we have simplified VAT procedures, that the Master Plan for Free Zones is completed and assets for infrastructure have been allocated will certainly increase the attractiveness of our free zones compared to those of neighbouring countries, as well as attracting foreign investments and boosting employment in Serbia.

Unlike direct government subsidies for new jobs, investors can take advantage of the benefits of free zones after they become operational in them. The free zone concept is based on the principle that investors are exempt from paying taxes after they complete the construction of their production facilities and hire workers. Once the effects of direct investments become evident, companies in the zones then become eligible for customs and tax exemptions, which were among the initial motives for their investments. The State then receives new revenue by charging VAT on higher public consumption as a result of new jobs being created.

If this proposal is accepted by legislators, relevant analyses show positive effects on employment, regional development and technology transfer, in addition to an increase in the overall number of free zones in the country. ■

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INTERVIEW

Modern Operations for Top Results The Subotica Free Zone is proud of being engaged in almost all aspects of contemporary operations in this segment – from administrative incentives to a liberal operations regime, as regulated by the Law on Free Zones, as well as special customs clearance benefits BRANISLAVA STOJKOVIĆ MARČETIĆ, DIRECTOR OF THE SUBOTICA FREE ZONE

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he Subotica Free Zone is undoubtedly one of Serbia’s top free zones. It has an exceptional geographical location, comprehensive infrastructure, simplified administrative procedures and staff that go out of their way to meet the demands of existing investors. The Free Zone has brought several multinational companies to Subotica, which found exceptional conditions for doing business here.

• The biggest complaint among investors in Serbia is the country’s complicated administration. Which procedures do investors need to complete in order to use the services of your free zone?

- The procedures are very simple and quite fast.

In order to become a user of the Subotica Free Zone, you would need to fill in an application containing a short description of the business you plan to do in the zone and to submit a photocopy of company registration documents.

After you submit an application, you will sign a contract with the Free Zone and receive written confirmation from us that you are now officially a user of the Zone’s services. Once that is done, your business in the zone can begin. Of course, it is very important for your company to establish offices in one of the facilities inside the Free Zone, regardless of the nature of your business (production or retail).

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• Who currently uses the Subotica Free Zone?

- We are very proud of the business reputation of our users. Apart from Siemens, which was practically the first to come to the Free Zone, today we have many companies that are leaders in their respective business segments. Siemens has been producing wind generators here for over a decade and we are very happy with the fact that every third wind generator used in Europe was actually manufactured in Subotica.

Norma Group is also one of the leading companies in its respective segment and their factory in Subotica produces car parts. They came to Subotica in October 2011 and now have their own production facility spanning 12,000 square metres.

Continental Contitech Fluid is engaged in a wide range of operations and here they produce car parts. They have their own production facility of 7,400 square metres and will soon begin to build the second facility, spanning over 12,000 square metres.

In Subotica, the world-famous Swarowski Company has one of the best equipped production facilities in Europe covering 15,000 square metres. They produce their famous jewellery and jewellery parts in the free zone. They also own four hectares of building plots which they might use to expand their production facility.

Dunkermotoren Company, which was acquired by AMETEK Group in 2012, produces a wide range of multipurpose micro-engines in their 4,500-square-metre production facility in the Subotica Free Zone.

FREE ZONES, INDUSTRIAL ZONES & INVESTMENTS

Another company from the AMETEK Group – AMETEK FSM, which produces similar products for Dunkermotoren, launched production here in June 2015.

Apart from large manufacturers, there is a variety of retail users that store their products in the Free Zone.

• What advantages does the Subotica Free Zone have when it comes to attracting new investors?

- First and foremost, the Free Zone offers more liberal operations regulated by the Law on Free Zones. In addition to special custom clearance benefits and completely simplified administrative procedures, you can do any business here apart from those that might threaten our country’s security or could have an adverse environmental impact.

The land in the zone is regulated and has proper infrastructure, located within the borders of this country altough is an institution that encourages investment of capital, production and product exchange, and it also offers a series of benefits in terms of foreign trade and foreign exchange, with an emphasis on protecting the invested assets and property of our foreign users.

Apart from the aforementioned benefits, another advantage of our Free Zone is that it is close to the border with the EU, which can result in huge savings in terms of transport costs compared to other regions of Serbia.

We would also like to mention our outstanding cooperation with the customs office, our all

day-time working hours, which include Saturdays, and good road links to all major transport corridors. Additionally, we have excellent collaboration with educational institutions and the possibility in mediation on defining educational profiles in high schools and colleges in Subotica, to help to ensure better base for qualified labour force and choice for our clients. Last, but certainly not least, Subotica is a friendly environment for anybody coming to live here from the EU, while the city and its surroundings offer many social activities.

From the business point of view, we have a very

tor hires a third party to build and rent a facility.

We are open to various possibilities and are willing to realise every opportunity that will benefit both, investors and the city.

The Free Zone offers several benefits that can be grouped as follows: FISCAL BENEFITS - Exemption from paying VAT on bringing goods into the Zone, providing transportation and other services in connection with the entry of goods - Exemption from paying VAT on supplying goods and services in the Free Zone

IT IS VIEWED AS AN INSTITUTION THAT ENCOURAGES INVESTMENT OF CAPITAL, PRODUCTION AND PRODUCT EXCHANGE, AND IT ALSO OFFERS A SERIES OF BENEFITS IN TERMS OF FOREIGN TRADE AND FOREIGN EXCHANGE, WITH AN EMPHASIS ON PROTECTING THE INVESTED ASSETS AND PROPERTY OF OUR FOREIGN USERS flexible approach to monitoring the development of companies and their needs, in order to provide them with the best possible infrastructure.

• Are there possibilities for Greenfield investments or it is just the opportunity to use the Zone’s existing facilities?

- Most of the investors have opted for Greenfield investments here and it is our job to follow their requirements according to their business policies. Both types of investments can be realised here and our team has sufficient experience.

Siemens, Dunkermotoren and AMETEK FSM have leased facilities from us, while other investors headed by green fields and built their own production facilities. We are also experienced in tripartite arrangements, where a potential inves-

- Exemption from VAT on supplies of goods between users of two Free Zones - Exemption from paying VAT on energy consumption for production companies.

- Exemption from paying certain types of taxes related to FDIs CUSTOMS CLEARANCE BENEFITS - Exemption from paying custom duties and other import fees on goods to be used in the company’s operations and in the construction of facilities within the Free Zone (raw materials, equipment, construction materials).

FINANCIAL BENEFITS - Free capital, profit and dividend flow - Funds from the Republic of Serbia’s

budget for financing projects in both the production and service sectors that could later be the subject of international trade.

SIMPLE AND FAST CUSTOMS CLEARANCE PROCEDURES - A customs office in every free zone - Simplified customs clearance procedures in free zones Apart from the aforementioned benefits, free zone users also have the right to take advantage of the benefits contained in the free trade agreements which Serbia has signed with the CEFTA and EFTA countries, as well as with the Russian Federation, Kazakhstan, Turkey and Belarus. Of course, first of all it is necessary to fulfill the condition to become a free zone user, which is simple as we described earlier.

• How does the Subotica Free Zone promote its activities?

- We carry out our promotional activities in cooperation with specialised public enterprise PTP (Privredno-Tehnološki Parkovi) and the City of Subotica. We are the part of a team that has managed to achieve one of the best results in attracting foreign investments in last six years. We are very proud of the fact that, from the initial 53 hectares of the available land for the construction of the Mali Bajmok industrial zone, today we have grown to encompass over 100,000 square metres of production halls, where more than 3,500 of our fellow citizens have found job. Apart from the companies that operates in the Free Zone Subotica, there is another company – Calzedonia – that does business in the industrial zone and has approximately 1,150 workers.

We regularly attend the most prestigious investor fairs (particularly REAL EXPO MUNICH), appear in specialised magazines and collaborate with many chambers of commerce and agencies like Austria Advantage.

We are convinced that our biggest promotion power in the forthcoming period is the satisfaction of our users and their recommendations to everyone to become the part of of a successful team.

In the next period we have accepted a new challenge, in which, with Municipality of Kikinda will together, apply the successful recipe from Subotica and where we will expand our land plots on the territory of Kikinda with additional 40 hectares of land plot for the purpose of our business. ■

FREE ZONES, INDUSTRIAL ZONES & INVESTMENTS

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INTERVIEW

Gem Yet to be Discovered The municipality of Plandište is located halfway between Zrenjanin and Vršac, on the Plandište-Alibunar-PančevoBelgrade regional road. It spans 383 square kilometres of fertile land and is surrounded by the River Brzava and the Danube-Tisza-Danube and Šulhovo canals

MILAN SELAKOVIĆ, PRESIDENT OF THE MUNICIPALITY OF PLANDIŠTE

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espite the fact that Plandište is categorised as a less developed municipality, it has huge potential in terms of arable land, water resources, infrastructure, ample hunting grounds, oil fields, twohundred-year-old parks, castles that date back to the late 18th and early 19th centuries and many other reasons that make it appealing to investors.

• Plandište is categorised as one of the less developed municipalities in Serbia. How high is unemployment locally and what is the situation when it comes to the municipality’s finances?

- Unemployment is one of the most difficult economic and social problems in Serbia and in the municipality of Plandište, where the unemployment rate has been high for a number of

WE HAVE MANAGED TO REPAY MOST OF OUR DEBTS TO OUR CREDITORS AND STABILISE OUR FINANCES, WITH A LOT OF DIFFICULTY AND INVESTED EFFORT. WITHIN OUR BUDGET MEANS WE HAVE BEEN ALLOCATING A LOT OF FUNDS FOR INVESTMENTS PRIMARILY AIMED AT BOOSTING EMPLOYMENT, IMPLEMENTING INFRASTRUCTURE PROJECTS AND ADVANCING AGRICULTURE Agriculture is the most developed economic branch here, with tourism – primarily hunting and rural – also having great potential. We should add to this the new Zapad (West) work zone, which covers eight hectares of land and has so far seen investments worth over 100 million Dinars. The zone’s infrastructure is due to be finished by the end of April this year.

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years. Overall economic and social trends have had an immediate impact on the situation and the tendencies on the labour market in terms of employment. According to the National Employment Service, the municipality has 1,614 unemployed persons and the local unemployment rate stands at approximately 35 per cent, which is much higher than the state’s average,

despite the fact that the municipality has been doing everything in its power to increase employment through its measures of active employment policy and in collaboration with the National Employment Service, the competent ministry and the provincial secretariat.

In terms of the municipal budget, we have managed to repay most of our debts to our creditors and stabilise our finances, with a lot of difficulty and invested effort. Within our budget means we have been allocating a lot of funds for investments primarily aimed at boosting employment, implementing infrastructure projects and advancing agriculture.

• What is hindering the development of this mostly agricultural municipality? Is it possible to make a living from agriculture?

- The majority of the municipal population is engaged in agriculture, mainly farming. We are in constant contact with our population and have been trying to boost agricultural production with the help of various subsidies and incentives.

• What is the local government doing to boost Plandište’s economic development?

- By providing incentives for all agricultural segments, primarily for farming and fruit growing, the municipality is trying to help so-called small producers. We have also been allocating substantial funds for our food industry, with an emphasis on the development of poultry farming.

• Do you receive any help from the state and provincial authorities? We noticed that in April 2014 domestic company Jasmil opened a production facility here, thanks to the New Technologies Programme. Did this investment meet your expectations and are there any other state-assisted projects in the pipeline?

- The municipality of Plandište has excellent cooperation both with the state and provincial authorities. Thanks to the funds we obtained through competitions launched by the state and provincial bodies, we have managed to advance the municipal infrastructure, find jobs for a substantial number of young people, improve the municipality’s business environment and create favourable conditions for investors. I am con-

fident that this successful cooperation will continue in the future.

In collaboration with the provincial government, we managed to secure some of the funds needed for the launch of Jasmil’s production facility in

Plandište. The facility now employs 100 workers.

Following the arrival of Jasmil, the average salary in the municipality of Plandište increased, which pushed Plandište from the fourth to the third category in terms of the development level in the Republic of Serbia, which we consider a great success. In the following period we expect Jasmil to employ 50 more people and, by so doing, impact positively on the living standard in the municipality.

have fulfilled yet another prerequisite for attracting investors.

• How is Plandište attracting investors and how many have either arrived in the municipality or announced their arrival? What would you say is the municipality’s comparative advantage in terms of investments?

- By investing constantly in infrastruc-

• Two years ago it was announced that an industrial zone would be opened in Plandište. How far along is that project, which could substantially improve the municipality’s economic standing?

- Two years ago we opened a new work zone called Zapad

TWO YEARS AGO WE OPENED A NEW WORK ZONE CALLED ZAPAD (WEST|), WHICH SPANS EIGHT HECTARES. I AM VERY PLEASED TO SAY THAT THE ZONE’S INFRASTRUCTURE WILL BE COMPLETED IN LATE APRIL. THE TOTAL VALUE OF THIS INVESTMENT IS AROUND 100 MILLION DINARS

(West|), which spans eight hectares. I am very pleased to say that the zone’s infrastructure will be completed in late April. The total value of this investment is around 100 million Dinars. Once the zone’s infrastructure is finished, we will

ture, we have been striving to create a favourable business climate and environment, thereby facilitating the arrival of investors. In addition to Jasmil, we expect production to be launched in what used to be the Banatplast Company.

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With regard to the food industry, Vindija has employed quite a few people here in the last few years. We are also set for talks with a potential investor operating in the textiles industry.

• You have now been the president of the Municipality of Plandište for four years. How did you personally contribute to the municipality’s development and what are your future plans if you remain in this position following the coming elections?

KATH. KIRCHE PLANDISTE

offer investors for the first time ever.

Here I am referring to the industrial zone, where between 300 and 500 people will find jobs – as proposed by the Serbian Government.

Following the arrival of large global companies like Tönnies, the world’s biggest producer of pork, we expect another 100 new jobs to be created in the agriculture sector. There are also a lot of suppliers who are going to cooperate with the company. This is the only way to keep our rural areas alive.

CHURCH SAINT RAFAILA BANATSKOG

DYNAMIC ECONOMIC GROWTH WILL LEAD TO AN EVEN BETTER AND BIGGER INCREASE IN BUDGET FUNDS, WHICH WILL IN TURN FACILITATE BETTER CARE OF OUR CHILDREN, YOUTH, OLD AND DISABLED PEOPLE, IMPROVING HEALTHCARE AND PROMOTING SPORT, CULTURE AND RURAL DEVELOPMENT. COURT PROCEEDINGS REGARDING THE SEWER SYSTEM IN PLANDIŠTE ARE OVER AND WORKS CAN NOW CONTINUE - First and foremost, finding jobs for young and educated people. We have managed to find jobs for the young people who have helped us to accomplish the aforementioned results. Of course, we should also not forget the significant results we achieved in stabilising our municipal budget.

We feel great responsibility in managing and leading the local government and the municipality has something to

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to an even better and bigger increase in budget funds, which will in turn facilitate better care of our children, youth, old and disabled people, improving healthcare and promoting sport, culture and rural development. Court proceedings regarding the sewer system in Plandište are over and works can now continue.

The blueprint of the BelgradePančevo motorway project is finished and this road link will definitely pass through the municipality of Plandište, which will bring additional benefits to

Vindija is building four additional chicken farms and a meat processing facility that will employ another 150 people.

Jasmil will stay here for at least another ten years and the company has plans to open a vocational textile school here.

We also plan to enable passenger transport on the Vršac – Plandište – Stari Lec railway segment (a monthly ticket would cost 1,500 Dinars).

Dynamic economic growth will lead

both existing and new investors, as well as to the municipal population. By having the motorway run through our municipality, we have managed to defend the municipality’s strategic goals and interests against a much stronger lobby coming from a neighbouring municipality.

In collaboration with our neighbour – Romania, we have submitted six projects for EU funding valued at over a million euros, while we also expect to be granted a permit to build a border crossing.

Maintaining local roads Plandište – Veliki Gaj and Banatski Sokolac – Miletićevo – Stari Lec, as well as maintenance and construction of other local roads, is among our priorities. All of the relevant projects have been drafted in line with new regulations.

We have no plans to change our property tax, which is the lowest in South Banat. ■

INTERVIEW

From Tourism and Agriculture to an Industrial Park and Good Infrastructure The Municipality of Bela Crkva has developed a comprehensive assistance and support programme for existing and potential investors that is implemented via the Local Economic Development Office, starting with a letter of intent and land lease request, to the acquiring of all necessary construction permits and the commissioning of facilities

DARKO BOGOSAVLJEVIĆ

President of Bela Crkva Municipality

T

he Municipality of Bela Crkva lies along the border with Romania in the fertile area of the Banat District. It is surrounded by rivers, canals, lakes and the Deliblato Sands – a one-of-a-kind nature reserve and a genuine green oasis. This municipality has for decades been viewed as a prime example of multicultural and multinational harmony between 20 different nationalities.

The people here are diligent and welcoming, which provides excellent incentive for potential investors to pick this location for their projects.

• What are the most important reasons to invest in Bela Crkva?

- Bela Crkva municipality is situated to the northeast of Central Serbia and in the far southeast of

blato Sands (also known as the European desert) is a unique nature reserve located only 15km from Bela Crkva. Hunting and breeding grounds, with all sorts of game, span an area of 1,500 hectares and this area is also known for its diverse bird population. All of the aforementioned ensure that our municipality is a wonderful place to live and work.

• What options do you offer potential investors?

- The municipality offers many investment opportunities and locations. Potential investors can lease land near Bela Crkva’s lakes, where they can build tourist facilities and hotels. They can also lease land in our industrial park.

• What advantages does Bela Crkva's Nera Industrial Park offer?

BOTH THE MUNICIPAL AUTHORITIES AND THE LOCAL ECONOMIC DEVELOPMENT OFFICE ARE HERE TO OFFER ANY ASSISTANCE INVESTORS MIGHT NEED – FROM WRITING A LETTER OF INTENT AND LEASING LAND, TO ACQUIRING ALL NECESSARY PERMITS FOR BUILDING AND COMMISSIONING FACILITIES Vojvodina and Banat. It is 106km east of Belgrade and spans an area of 353 square kilometres. The population is 17,367 and we have 20 different nationalities living here. Apart from the Serbian language, Romanian, Czech and Hungarian are also spoken here. Bela Crkva town is tranquil and has wonderful Baroque buildings. Life is leisurely and calm, while our rivers – Karaš and Nera – are a wonderful natural resource. The western part of the town has a complex of seven manmade lakes, the Danube-TiszaDanube Canal and the River Danube itself. The Deli-

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- The industrial park spans a total of 14.26 hectares and is located in the existing work zone. The park has good links to B category state road 18, which starts in Zrenjanin and passes through the municipalities of Sečanj, Plandište, Vršac, Uljma and Bela Crkva before ending not far from the Kaluđerovo border crossing. The state border with Romania is only two kilometres from this road, while Kaluđerovo is some 11km away. The lease fee is 0.10RSD per square metre per month. Available land plots come in different sizes and range from four hectares and 68 square

metres to 56 hectares and 16 square metres, with several plots joined together. Up to 12 land modules can be joined together.

The land is leased for a 99-year period, in accordance with a special planning project. Investors can build commercial, production and storage facilities in the industrial park, as well as multi-purpose facilities. The land plots can be connected to water, power and transport grids. Until the construction of sewer links is completed, waste water can be collected in impermeable septic tanks.

Joint Serbian–German company Flammat d.o.o. has been operating successfully in the industrial zone since 2012 and this company also plans to open a production and distribution facility for kerosene ignitors soon.

• What kind of incentives and support does the municipality offer investors wanting to utilise the Nera industrial park?

- Both the municipal authorities and the Local Economic Development Office are here to offer any assistance investors might need – from writing a letter of intent and leasing land, to acquiring all necessary permits for building and commissioning facilities.

In collaboration with the National Employment Office, the municipality trains unemployed citizens and funds their first year of work. We are also trying to secure the best possible infrastructure and human capacities that would facilitate easier and faster economic development. ■

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INTERVIEW

Ample Capacity For Development and Investments

The current economic situation in Kraljevo is exceptionally difficult and is actually the result of the failed privatisations of companies Magnohrom, Fabrika Vagona and Autotransport, which have been completely devastated TOMISLAV ILIĆ, MAYOR OF KRALJEVO

"W

e have started to partially solve these inherited problems with the help of the Serbian Government, which has recognised the serious implications for Kraljevo and its citizens,” says Kraljevo Mayor Tomislav Ivić. “The unemployment rate in Kraljevo stands at close to 33 per cent and such high unemployment is a consequence of badly executed privatisations and a huge number of workers who lost their jobs in privatised companies.”

On the other hand, notes Ivić, the City

sporting etc. The local government has been investing in amplifying resources and identifying the town’s potential. Kraljevo has allocated relevant funds to the Agriculture Development Fund, while we have also allocated funds for the development of rural tourism in this year’s city budget. We will also definitely help the SME sector.

I have to say that the state authorities have recognised Kraljevo’s potential and have been helping us, primarily with the construction of infrastructure in the locations that will house industrial zones.

LAST YEAR SAW THE MOST FUNDS INVESTED IN KRALJEVO’S AGRICULTURE, ROAD INFRASTRUCTURE AND, WITH THE HELP OF THE SERBIAN GOVERNMENT, IN BUILDING INFRASTRUCTURE IN THE FUTURE INDUSTRIAL ZONES WHICH WILL DEFINITELY PROVIDE THE BASIS FOR THE TOWN’S DEVELOPMENT of Kraljevo has no debts, so we can say with pride that our budget is completely stable.

• Kraljevo is known as a retail centre with a developed service sector. Which economic branches have a chance to develop further, and how much have the local and national authorities been investing in improving the municipality’s potential?

- The City of Kraljevo has excellent foundations for the development of various kinds of tourism – religious, spa, mountain, rural,

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FREE ZONES, INDUSTRIAL ZONES & INVESTMENTS

• How many new investments have been realised in Kraljevo in the past year and in which economic segments?

- Last year saw the most funds invested in Kraljevo’s agriculture, road infrastructure and, with the help of the Serbian Government, in building infrastructure in the future industrial zones which will definitely provide the basis for the town’s development.

• It was announced recently that Lađevci Airport will finally open and a cargo facility will be built there, while there are also plans to build a new children’s resort on Mount Goč. When will these projects be implemented and what importance do they hold for Kraljevo?

- The Serbian Government has founded Public Enterprise Airports of Serbia, which includes Lađevci Airport. This airport is a major development opportunity for Kraljevo’s economy and once we link the town to Corridor 11 our territory will become appealing to investors.

And, yes, there is a plan to build a cargo facility.

There is also a plan to build a new pavilion

on Mount Goč, close to the town. Construction will start in late April or early May. Once the pavilion is finished, the resort’s children’s accommodation will be vastly improved, because Goč is envisaged as providing accommodation for preschool and school children. There is a so-called nature school in the mountain, which means a lot to Kraljevo. We also plan to implement a sports village project. Kraljevo is currently negotiating with our twinned town of Maribor in Slovenia, which will provide funds for the construction of ski slopes and ski lifts that will also serve to greatly increase the town’s tourist potential.

• When do you expect the situation to be resolved with regard to Magnohrom and the

Mataruška Spa, and what do you think will happen to these two companies?

- We expect the situation with Magnohrom to be resolved pretty quickly, i.e. we believe a serious buyer will show up soon and that the company will re-hire a certain number of workers. In terms of the Mataruška and Bogutovačka spas and Natural Health Resorts, we expect a swift and transparent privatisation. With the help of the Serbian Government, we also want to restore the former glory of the Mataruška and Bogutovačka spas, which were once renowned beyond our country’s borders.

• What has the local government been doing in an effort to attract new investors?

- We are currently lobbying with the Serbian Government to construct the aforementioned cargo facility near Lađevci Airport and to purchase land near the airport from private owners. We are starting to install utilities infrastructure in the Sportski Aerodrom business zone near Magnohrom, namely access roads, water supply and sewer connections. We have set up

an office that will assist with the resolving of various property-related legal issues, provide help with putting together various documents and issue required permits with the support of other local services. Furthermore, the City authorities have been striving to attract investors by providing subsidies for utility fees, charges associated with the use of public areas, utility connection charges etc. We are also certified as a municipality with a favourable business environment and last year we achieved great success in drafting project documents for a waste water filter, valued at €17.1 million. This waste water collector will be one of the best in Serbia and we hope that, thanks to the EU grants, we will be able start building it in 2017. The town

the project documents that need to be written in accordance with the General Spatial Plan, which is also something for which we are receiving assistance from the Serbian Government.

This zone will also have a bypass, as well as a section of the Pojate-Preljina motorway. Industrial zones are definitely going to be the driving force behind economic development. Once the airport is opened and the Morava Corridor built, and considering how close Corridor 11 is, the territory of Kraljevo will become one of the most appealing investment destinations.

• What are your priorities when it comes to the town’s development and what are your plans for the future?

THE TOWN WILL CONTINUE TO WORK ON PREPARING BUSINESS AND INDUSTRIAL ZONES IN THE FUTURE, IMPROVING THE BUSINESS ENVIRONMENT TO MAKE IT MORE CONDUCIVE TO FOREIGN INVESTMENTS AND CONSTRUCTING TRANSPORT AND OTHER TYPES OF INFRASTRUCTURE also plans to invest in, and provide incentives for, renewable energy sources.

• Industry is Kraljevo’s weak point, but industrial zones have always been a good driving force behind economic development. How many active industrial zones are there in Kraljevo and do you have any investors interested in doing business there? We should also mention work zones too, and if we are not mistaken you currently have two of them.

- Our industrial zones cover several locations – the first one is in the Šeovac Industrial Zone, the construction of which was funded by the local authorities. We also plan to build a zone close to Magnohrom and the Sportski Aerodrom (airport for small planes). We are currently drafting

- The town of Kraljevo has assisted with the development of agriculture and SMEs by providing utility infrastructure in order to facilitate and ease business. We have invested most heavily in the development of agriculture via the Agriculture Development Fund, which covers the entire territory of the town.

Apart from domestic companies, we also have French and British companies engaged in wholesale fruit buying and bulk freezing.

The town will continue to work on preparing business and industrial zones in the future, improving the business environment to make it more conducive to foreign investments and constructing transport and other types of infrastructure. ■

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INTERVIEW

Great Ambitions, Realistic Foundations Our plans are serious and ambitious and in order to realise them we need to overcome all of the problems we encounter. I would single out unemployment and utility and transport infrastructure as the biggest problems – says Boban Janković, President of the Municipality of Mionica

BOBAN JANKOVIĆ,

PRESIDENT OF THE MUNICIPALITY OF MIONICA

M

ionica is a municipality with a small population that is mainly engaged in fruit growing and cattle and poultry farming. The locals produce 120 million eggs or 8,600 eggs per capita annually, which makes Mionica one of the world’s most successful municipalities in this respect.

• What is the current situation in the municipality of Mionica; what are the biggest problems and what is the local government doing to boost the municipality’s development?

- Exactly one year after my appoint-

We are a municipality with a small population that is mostly engaged in agriculture and tourism and, thanks to our rich natural resources, we are one of the Serbian municipalities with the brightest future, and that’s where we see our chance for development. We can only utilise all of the municipality’s resources and potential if we have powerful large-scale processing capacities here. Hence, our number one task is to attract potential investors and build proper infrastructure.

• The Mionica area is known for agriculture. Which branches have the

FRUIT GROWING AND CATTLE AND POULTRY FARMING HAVE THE GREATEST DEVELOPMENT POTENTIAL IN THE MUNICIPALITY OF MIONICA, DUE TO THIS AREA’S NATURAL RESOURCES ment as municipal president, the situation today is much better than it was. When I came into office, the municipality was deeply indebted, we had bailiffs knocking on our door every day and our local income was almost nonexistent. Today, however, we regularly meet our financial obligations and have continuity in collecting municipal claims. Thanks to the persistence and determination of the team working with me, and the support we have received from the Serbian Government, we have managed to achieve our goals.

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& INVESTMENTS

greatest development potential and how does the municipality stimulate this potential?

- Fruit growing and cattle and poultry farming have the greatest development potential in the municipality of Mionica, due to this area’s natural resources. In 2016, the municipality allocated substantial funds to boost these agricultural branches. Apart from this, we also offer advice and professional help to both potential manufacturers and small farms. Mionica produces 120 million eggs, or 8,600 eggs per capita,

annually, making it one of the most successful municipalities in the world in this respect. We also raise 1.2 million white broilers annually. We are focused mostly on primary production, which also has huge investment potential for investors from the processing industry. Our capacity is over 15,000 head of cattle. We produce a lot of milk and exceptionally high quality dairy products, around 30 million litres annually. Fruit growing is definitely the segment with the highest potential and we export our raspberries and strawberries to the EU. • Tourism is also one of the economic branches that could contribute significantly to Mionica’s development.

You have the Vrujci Spa, with Mišić’s Days as one of the more popular events. What should be done to attract more tourists to this area?

- We have been celebrating Mišić’s Days, in honour of Duke Živojin Mišić, since 1997, and this is one of the most important events held in the municipality and in Serbia. Each July, as part of this cultural, historical and tourist event, a number of artists, figures from the culture scene and scientists gather in Struganik, the birthplace of Duke Živojin Mišić. This event includes many exhibitions, culture evenings, children’s and adult plays, performances of folk dance groups from all over the world and sporting competitions.

The Vrujci Spa tourist resort has the highest tourism potential in the Kolubara District.

It has many natural and tourist resources, including a favourable geographical location, thermal mineral water wells with healing properties and a capacity of over 200 litres per second, making this spa the number one in Serbia, radioactive mud with medicinal properties, a good microclimate and diverse plant and animal species.

All of the aforementioned potentials are not utilised fully, which hinders the development of the Vrujci Spa. What we need to do now is to attract knowhow, investments and capital (you can read more about investments on the municipality’s website www.mionica.rs ).

Natural and tourist resources can be used to develop various kinds of tourism and we are currently drafting the Development Strategy for Tourism in Mionica, which stipulates that tourism should be stimulated in order for it to have a more dynamic role in the municipality’s economic development.

By the way, Mionica has the best thermal mineral water in the area and there are three water bottling companies operating here.

in those negotiations. Diplomatic cooperation between Serbia and the world has resulted in a growing number of free trade agreements that give Serbian producers a privileged position on markets with a total of over 1.1 billion people.

The municipality of Mionica has the necessary investment capacities in terms of natural and human resources and infrastructure.

• What concrete steps have been taken by the local authorities in order to bring investors to Mionica? Have any investors expressed interest in opening factories in the municipality lately, as Sinalco did back in the day?

three years (in the case of SMEs) after the implementation of the investment project. Investment companies have to pay out regular salaries that are at least 20 per cent higher than Serbia’s minimum wage. Incentives are allocated following a public call and in line with the relevant regulations. The municipal authorities are currently negotiating with several investors interested in greenfield and especially brownfield investments.

• How can you improve the municipality’s economy and what projects do you have in the pipeline?

• How many companies currently operate in Mionica?

- There are 145 companies and 487 small businesses registered on the territory of our municipality. The predominant branches here are

NATURAL AND TOURIST RESOURCES CAN BE USED TO DEVELOP VARIOUS KINDS OF TOURISM AND WE ARE CURRENTLY DRAFTING THE DEVELOPMENT STRATEGY FOR TOURISM IN MIONICA the food industry and the metal processing industry and, to a certain extent, construction, the services sector and tourism.

• Which industries in Mionica are suitable for investment?

- The most wanted investors would be those willing to invest in agriculture and the processing industry, tourism and hospitality, metal processing and mining. Mionica is in group four, undeveloped municipalities. The Government has devised a development programme for similar municipalities in order to develop their economies. The ratings received by Serbia from credit rating agencies show that the country’s economic future is sustainable. Fitch, Moody’s and S&P have all given Serbia positive ratings, in light of ongoing reforms, EU accession negotiations and the opening of new chapters

- Mionica is geared towards meeting the needs of potential investors. We provide free locations, exemptions from paying local fees and assistance in training the workforce in certain areas. We also provide investment incentives in the production and service sectors, which could engage in export. The level of incentives depends on the investment sector, the value of investment, company size and the number of new jobs it will create. Incentives are allocated on the basis of substantiated investment costs and the costs of gross salaries for new workers. The requirements for these incentives are for an investor to stay in the same location for at least five years after the project has been implemented (or three years if investors are SMEs) and for the number of employees to remain the same for at least five years (in the case of large companies) or

- We are planning to extend the old industrial zone and install the required infrastructure there. We also want to install proper infrastructure in rural areas and construct sewage and install filters, as well as doing everything that the Vrujci Spa needs in order to expand its capacities. We additionally plan to replace asbestos pipes in the municipality’s water system. There is also an initiative to establish a business association or club that would have a representative in the municipal authorities.

By having their own local association, businesses would be able to participate actively in the process of making important decisions that are in the best interests of the municipal population. We are currently putting together the Catalogue of Resources in the Municipality of Mionica.

Considering Mionica’s existing resources, we need just a little push to become an engine of development in the Kolubara District, particularly in agriculture and tourism. I am absolutely convinced that we are going to become that one day. ■

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ŠABAC FREE ZONE

Excellent Business Environment, Location and Efficient Governance

The Šabac Free Zone offers everything that an investor might need – from providing land with complete infrastructure and brownfield investments, to ensuring efficient administration

T

he town of Šabac took the formal decision to establish the Šabac Free Zone in 2009, despite the global financial crisis and unstable market trends.

Successfully resisting negative trends in the macro-economic environment, this Zone has been marked by sustainable growth since it was established. Its success is attributed to its excellent geographical location, easy access to a market of 15 million consumers, regulated property and legal issues, dedicated staff and the clear goal of the local authorities to create the best possible business environment and to support anyone wanting to work. Šabac is the administrative centre of the Mačvanski District and has a population of 120,000. Over

GREENFIELD The Northwest Work Zone covers 600 hectares of land, making it one of the biggest industrial zones in the region. A total of 208 hectares of land has been made available to investors in this zone, which is situated just four kilometres from the town centre. The appeal of this location lies in the fact that the

THE ŠABAC FREE ZONE ATTRIBUTES ITS SUCCESS TO ITS EXCELLENT GEOGRAPHICAL LOCATION, EASY ACCESS TO A MARKET OF 15 MILLION CONSUMERS, REGULATED PROPERTY AND LEGAL ISSUES, A DEDICATED STAFF AND THE CLEAR GOAL OF THE LOCAL AUTHORITIES TO CREATE THE BEST POSSIBLE BUSINESS ENVIRONMENT AND TO SUPPORT ANYONE WANTING TO WORK 300,000 people also gravitate towards the town for work and trade. Šabac has an excellent road network and is linked to directly to the E-70 motorway via a 24km-long segment. Belgrade is just 70 km away, while the national borders with Bosnia-Herzegovina and Croatia are just 35km and 40km away respectively. The Šabac Free Zone has made two locations available to investors, spanning a total of 243 hectares.

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land, currently owned by the town’s authorities, can become investor’s property less than 35 days after confirmation of the purchase. The land is still not divided, so investors can choose the shape and size of their land plots. Gas, water and sewage networks are in place, as well as electricity connections and an access road. Land here is priced at €7 per square metre. In line with global trends, considering that time is money and recognis-

FREE ZONES, INDUSTRIAL ZONES & INVESTMENTS

ing the needs of serious stakeholders, the zone also includes a customs office, while investors are not required to submit an additional construction project.

BROWNFIELD The East Industrial Zone, located in the complex of the Šabac Goods & Transport Centre AD, covers 35 hectares of land. Apart from being linked to main roads, this location is equipped with the necessary infrastructure and is connected to the industrial rail tracks that are operated by Serbian Railways. The Šabac Customs Office is located beside this complex. Further plans include the construction of an international port on the River Sava in this area. The zone also contains a closed production and storage area spanning 12,000 square metres and is completely adapted to cater to the needs of investors.

SELECTING INVESTORS Over time, the Šabac Free Zone has evolved into a business oasis – thanks to the fact that its operations are run in a responsible manner, while full legal security is provided for its users, which are considered as being the most valuable resource. By taking care of its clients – which include companies like Camozzi Industries, SBE Serbia – Vescovini Group, Vopachel S.r.l. and others – the Šabac Free Zone has gradually earned their trust. ■

Contact: Slobodna zona Šabac doo Beogradski put bb, Šabac Phone +381 64 876 27 70 www.sabac.rs; E-mail: violeta.sestic@sabac.org

MUNICIPALITY OF VLADIMIRCI

Great Potential Awaits Investors

The Municipality of Vladimirci, located in the Posavsko-Tamnavski District, comprises 29 towns and villages. According to the 2002 census, some 20,373 people live in the municipality’s 6,834 households. Of the total population, 16,000 people are farmers, while agricultural land covers 28,298 hectares

MILORAD MILINKOVIĆ President of the Municipality of Vladimirci

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n terms of geographical location, existing infrastructure, a river transport network and proximity to main roads and airports, the Municipality of Vladimirci has huge investment potential that primarily lies in agricultural production, where the dominant segments are crop, vegetable and fruit production, as well as cattle breeding .

• Although Vladimirci is predominantly an agricultural municipality, located in the resource-rich Posavsko-Tamnavski District, it is still considered as one Serbia’s poorer areas. Why is that? Which segments of agricultural production have the greatest development potential in Vladimirci?

- Vladimirci is located in the cultivated PosavskoTamnavski District and is traversed by the River Sava and the River Tamnava, in the direction of Koceljeva.

We are an agricultural municipality that spans an area of 50 kilometres and comprises 29 local com-

ity of 10,000 pigs, were completely destroyed. The potential in terms of agricultural development lies in re-establishing cattle, fruit and vegetable cooperatives, building processing facilities (dryers and cold storage units for fruit and vegetables), launching organic production and selling finished products, as opposed to basic raw materials.

• Apart from agriculture, the municipality has rich mineral, water and geo-thermal resources. How much have these resources been utilised to date and what are your future plans in this respect?

- In the settlement of Jazovik the municipality has a semi-marbled stone quarry that is used as a raw material by the sugar industry. The quarry has an almost

THERE ARE PLANS TO BUILD AN INDUSTRIAL ZONE. WE HAVE PURCHASED FIVE HECTARES OF LAND NEAR THE ENTRANCE TO VLADIMIRCI AND OUR PLAN IS TO MAKE THIS LAND AVAILABLE TO INVESTORS munities. The municipality’s population is mostly engaged in clean agricultural production, of which 95 per cent is crop, fruit and vegetable production and cattle breeding. The main reason that the municipality remains undeveloped is the fact that agriculture has been neglected and is undervalued in our country. We had two leaders of agricultural production here – the Vladimirci Social Enterprise and the 7th July Enterprise, located in Debrc – which have both collapsed. Following so-called “successful” privatisation in the period between 2000 and 2005, the entire agricultural complex, cattle farms that reared 2,000 heifers annually and pig farms with an annual capac-

inexhaustible capacity, while Jazovik also has huge deposits of quartz sand. A company from Singapore is interested in building two run-of-the-river hydroelectric plants in the aforementioned villages. This investment would be worth €110 million, while negotiations are pending.

There is also a plan to build a multipurpose dam in the Vukošić local community, which would have a capacity of approximately 15 million cubic metres of water, as well as creating a beautiful lake spanning 150 hectares and with a 15-metre-high water column. This would provide a great opportunity to further develop tourism here. We are additionally planning to build

a lakeside ethno village that would include motels, hotels, fishing spots and hunting grounds. We also plan to increase the population of wild ducks, in order to encourage hunters from abroad to come here on hunting trips. In the town of Vladimirci we have made a 400-metre-deep geo-thermal bore that could be used by spas. The water has a temperature of about 50°C and high sulphur content making it suitable for the treatment of skin disorders. All of the aforementioned projects await investors.

• There was a plan to build an industrial & business zone in Vladimirci. How is that project advancing and what importance does it hold for the municipality?

- Yes, there are plans to build an industrial zone. We have purchased five hectares of land near the entrance to Vladimirci and our plan is to make this land available to investors, as well as to provide proper infrastructure. However, this project is currently on hold due to a lack of funding.

• What efforts have the local authorities exerted in an effort to attract investors to Vladimirci, and what would you say has been your biggest personal contribution to boosting the municipality’s investment climate?

- The local authorities are doing everything in their power to attract investors to the municipality. We have managed to find an investor to invest in the Faso Company, which was declared bankrupt, and we are currently finalising negotiations with the Ministry of Economy and the liquidation administrator regarding this matter. We need to install recycling equipment for all types of plastic masses – from candy wrappers to jumbo bags. This company would initially take 20 unemployed people from the local job office.

In my capacity as municipal president, in less than a year I have contributed to establishing a much simpler and faster process for issuing permits and licenses, including building permits and various others. The administrative procedure for issuing these permits is now simplified and expedited to the best of our abilities. ■

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INTERVIEW

Realistic Plans for Economic Development Thanks to its geographical position in the tristate area between Serbia, Croatia and Hungary, the town of Sombor has all the necessary prerequisites to improve its competitiveness, achieve better economic results, attract both foreign and domestic direct investments and raise the population’s living standards through planned improvements in economic infrastructure

VLADISLAV ŽIVANOVIĆ DEPUTY MAYOR OF SOMBOR

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n order to achieve these goals, one of the Town’s priorities is to develop the free and industrial zone sector, in particular by designating and developing a free zone in the town itself, which would result in sustainable economic development. It is only fitting that the main goal of the 2014-2020 Strategy of Sustainable Development of the Town of Sombor is to boost the economic capacities and competitiveness of local businesses, as well as creating a positive environment for doing business.

product processing; 4. Mara d.o.o. – production of frozen and fresh pastries and wafers.

There are several other smaller companies also doing business in the industrial zone.

In terms of attracting investments, the local authorities have been carrying out numerous activities to that end. We have established and maintained contacts with potential domestic and foreign investors, with the objective of developing cooperation with them and enticing them here.

When it comes to the arrival of major inves-

ONE OF OUR STRATEGIC PRIORITIES IN TERMS OF BUSINESS INFRASTRUCTURE IS ESTABLISHING FREE AND INDUSTRIAL ZONES, WITH THE END GOAL OF DEVELOPING A FREE ZONE IN THE TOWN OF SOMOBOR • How many companies currently operate in the Sombor Industrial Zone and which would you single out as being the most important? Have some investors announced their imminent arrival here and what have you been doing to attract investors?

- The following companies, ranked in terms of economic relevance (number of employees), operate in the Sombor Industrial Zone: 1. Calzedonia Group – Fiorano d.o.o. - textiles industry; 2. Sunce AD – food industry; 3. Meteor Commerce – storage and primary

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tors, we have reached an agreement with British company Poseidon Group on the construction of Capitol Park Sombor, in which this company will invest over €10 million. Around 200 workers will be hired to construct this retail park. We have also signed a contract with German supermarket chain Lidl, which is to construct its own facility on a plot next to Capitol Park Sombor. Chinese company Longin plans to build an industrial park in Sombor and we have signed a Memorandum of Understanding with them pertaining to the construction of a 30-hectare-industrial zone.

FREE ZONES, INDUSTRIAL ZONES & INVESTMENTS

• There was talk last year about Sombor getting its own free zone. How far have you progressed on that front and what would a free zone mean for the town?

- One of our strategic priorities in terms of business infrastructure is establishing free and industrial zones, with the end goal of developing a free zone in the town of Somobor.

In 2015 we implemented a project entitled “Drafting Technical Documentation for the Establishment of the Free Zone”. As a result of this project, we conducted surveys on the preparation and implementation of the research necessary to establish the Sombor Free Zone, and on the economic viability of setting up such a zone and the territory it would cover in Sombor.

The whole process of establishing the Sombor Free Zone is being done with the goal of achieving sustainable economic development that will facilitate competitiveness, enable better business results, bring in domestic and foreign direct investments, raise the living standard of the local population and create adequate infrastructure, as well as any other condition that would boost Sombor’s development. Sombor’s main strategic goal is to attract the FDI that is crucial to the town’s development, which is why we need to utilise the opportunities created by free zones fully, as a wellknown and proven instrument of economic policy.

During the process of setting up the Free Zone, the town’s authorities and the Municipal-

ity of Apatin have reached an agreement about extending the Apatin Free Zone. The Sombor authorities are currently negotiating with several companies on the implementation of large-scale investments with the aim of having these companies occupy the free zone, which would help us complete its establishment.

• Could you tell us something about Sombor's business image? Does the town provide sufficient opportunities for the development of small businesses; which economic branches are the most common; are there any hidden economic opportunities; how many unemployed people do you have and what have the local authorities been doing to improve Sombor's economic situation?

- Opportunities for the development of small business in Sombor mainly lie in agriculture, tourism and the processing industry, considering the town’s geostrategic features, natural resources and infrastructure. There are many opportunities for the development of tourist infrastructure, as Sombor doesn’t currently have hotels or motels that could take more than 50 guests.

The business sectors with the highest number of employees in Sombor are the production

of textiles and footwear, food processing and production, agriculture, retail and services, and the metal processing sector and related services.

As of 31st January 2016, the town of Sombor had 7,453 people registered as unemployed, including 2,891 women (source: the National Employment Office).

The main goal of the 2014–2020 Strategy for the Sustainable Development of the Town

supporting entrepreneurship (self-employment) and supporting young people through work experience placements.

• What has been done recently with regard to the strategic economic development of Sombor?

- We have achieved many results regarding Sombor's economic development during the current government's term. First and foremost is the

WE HAVE ACHIEVED MANY RESULTS REGARDING SOMBOR'S ECONOMIC DEVELOPMENT DURING THE CURRENT GOVERNMENT'S TERM. FIRST AND FOREMOST IS THE DRAFTING AND ADOPTING OF THE 2014-2020 SUSTAINABLE DEVELOPMENT STRATEGY of Sombor is to increase the economic capacities and competitiveness of local businesses, as well as creating a positive business environment. One of the measures for reducing unemployment is to devise and implement an annual Local Action Programme, which stipulates various employment policies. The measures stated in the programme would contribute significantly to the creation of new jobs (new employment programme), setting up companies,

drafting and adopting of the 2014-2020 Sustainable Development Strategy, which has been harmonised with the EU’s strategic documents that together comprise the Europe 2020 – Strategy for Smart, Sustainable and Inclusive Growth.

All advancements made in terms of economic development in the last two years are the result of a joint effort of all of Sombor’s services and their excellent coordination with the work done by the town’s executive authority. ■

ADVANTAGES OF BUSINESS ENVIRONMENT ● The certification programme for municipalities with favourable business environment ● Campaign at Nikola Tesla Airport - promotion of certified municipalities and towns ● Improving business environment on the local level through regulatory reform

Trg cara Uroša 1, 25000 Sombor +381 25 468 111 www.sombor.rs FREE ZONES, INDUSTRIAL ZONES & INVESTMENTS

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INTERVIEW

Priority on Infrastructure and Industrial Zones

The development of the economy in the municipality of Bela Palanka lies in the hands of a dozen companies that are leaders in the production of children’s footwear in Serbia. The municipality manages a large area of land and has significant resources to develop agriculture and tourism, as well as constructing hydro power plants and industrial zones. Regarding the latter, the Murica 1 industrial zone now has complete infrastructure

GORAN MILJKOVIĆ, PRESIDENT OF THE MUNICIPALITY OF BELA PALANKA

T

he advantages of the municipality of Bela Palanka can be found in its exceptional natural resources and opportunities for the development of cattle, sheep and goat farming. The municipality currently has 1,406 head of cattle, 7,000 sheep, 2,613 pigs and 2,121 goats. A lot has been done in the last few years to improve existing breeds and acquire quality bulls, primarily for breeding purposes.

Orchards cover approximately 500 hectares of land in the municipality and are predominantly plum orchards. However, thanks to the local gov-

cherry and plum, with our subsidies. We are working on being granted the protection of geographical indication for our indigenous variety of pepper, called Belopalanačka Vrtka. The environment here is perfect for growing medicinal herbs and we have the biggest lavender farm in the Balkans, spanning 30 hectares. Beekeeping is also very well developed, thanks to the bountiful flora in the hills and mountains, as well as a well-organised beekeepers' association called Kovanluk.

Bela Palanka has a great cultural and historical heritage which we have been promoting constant-

WE TRY TO DO SOMETHING GOOD FOR OUR POPULATION EVERY DAY. AS MUCH AS OUR CAPACITIES ALLOW, WE TRY TO MAKE EVERYONE FEEL AS THOUGH THIS LOCAL GOVERNMENT IS WORKING IN THE SERVICE OF ITS CITIZENS ernment’s assistance to private investors, 30 hectares of cherry orchards have also been created.

• Which areas have the greatest development potential in the municipality of Bela Palanka?

- The real development potential here lies in the municipality’s exceptional strategic position, wealth of natural resources, good climate, many tourism opportunities and cultural heritage.

Agricultural production is also a great development opportunity and, that to our almost ideal climatic conditions, our aim is to facilitate the development of fruit growing, primarily cherry, sour

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ly with the goal of developing various aspects of tourism. Our long history enabled us to become a member of the Association of European Capitals and Cities of Culture in 2013. We have been of great assistance to the Bela Palanka Tourist Association, which is engaged in promoting the municipality’s historical heritage and tradition. The municipality was also declared the most successful local government in terms of helping with the staging of various events. Our most important event, which is renowned nationwide, is the Banica Days, during which we promote the cultural heritage of the Bela Palanka area, our traditional banica dish, our

FREE ZONES, INDUSTRIAL ZONES & INVESTMENTS

customs and old crafts. This is a very popular event and in 2015 alone we had over 20,000 visitors from Serbia and 4,000 visitors from Bulgaria.

• What are the municipal authorities plans when it comes to improving the overall economic image of the municipality and how much help do you receive from the state authorities?

- Good infrastructure and well-equipped industrial zones are the main prerequisites for enticing investments and this is our priority. We have launched a public call for the allocation of subsidies for private companies, which would hire unemployed people who are usually less employable, as well as for introducing new standards and products and improving the quality of existing products.

We also provide agricultural subsidies for the acquisition of equipment, machinery, irrigation systems and registered cattle, as well as subsidies for the acquisition of greenhouses with the relevant equipment and beekeeping equipment.

All of our documents and plans are drafted in accordance with the Municipality of Bela Palanka’s Sustainable Development Strategy. We have established cooperation with international organisations, the Institute of the Regions of Europe, the OSCE, the Danish Council, and the EU PROGRESS, and we have also implemented large-scale projects within the framework of the Cross Border Cooperation Programme. The municipality of Bela Palanka has won many awards, including one for success-

fully implementing a project in the Exchange 3 Programme and the Leader of Sustainable Development Award presented to us by the CEDEF.

of the good strategic position of our industrial zones. The Detailed Regulatory Plan now allows us to start working on the Murica 2 zone.

• All municipalities expect an FDI influx, including Bela Palanka. Could you tell us something about the municipality’s priorities in terms of attracting potential investments?

- Revitalising economic capacities and regulating industrial zones are the main priorities in our municipality. The Murica 1 industrial zone now has complete infrastructure. We are currently negotiating with investors and expect between 300 and 500 new jobs to be created through greenfield and brownfield investments.

Tourism is also one of our top priorities. Thanks to the public-private partnership and Cross Border Cooperation Programme, we will implement projects that will improve our tourist infrastructure. Since we expect a lot of tourists to visit our municipality, we are going to construct the Vrelo Hotel in an attractive location, near the town centre.

The hotel will improve the town’s tourist offer and create new jobs.

We have applied for funds from the Cross Border Coooperation Programme with our project “Construction of the Cultural-Tourist-Educational Centre Vrelo in the location of the Vrelo Park”. We will also establish a facility that will provide all sorts of services to tourists, host cultural events and educate future hospitality staff, both from Serbia and abroad. During implementation of the “Rehabilitation of Lapidarium” project, we are going to revitalise the old Remisiana archaeological site and improve our town’s tourist offer.

• A section of Corridor 10 recently opened in the municipality. How much is this going to improve the municipality’s economic environment?

- Bela Palanka has an extremely favourable geographical location and transport position. In addition, Corridor 10, which has a 32-kilometre-long segment traversing our municipality and which connects Central and Western Europe to the Middle East, ensures that Bela Palanka is also well-connected to other regional centres. We are 42km from Niš and 108km from Sofia. Companies from Turkey have heard about our good strategic position and, with the help of the Turkish ambassador to Serbia, we have man-

• The municipal spatial plan envisages three industrial zones. When do you expect these zones to become active?

-Yes, our spatial plan envisages three industrial zones in the close proximity of Corridor 10. Following the adoption of the General Regulation Plan and Detailed Regulation Plan for the Murica 1 industrial zone, we installed complete infrastructure in that zone, which spans eight hectares. We are currently negotiating with potential investors who are very interested in investing in our municipality because

aged to establish contact with them and present our municipality’s potential to businesspeople from Istanbul, Ankara and Kocaeli.

• What are the biggest challenges you’ve had to face since you became municipal president and what are your future plans?

- We inherited a lot of debt, exceeding 250 million Dinars. We have managed to normalise the functioning of the local public enterprises that are vital for the entire municipal population. We invested a lot of effort into implementing large-scale infrastructure projects with the funds (around €1.5 million) we received from the EU. We have built a sports hall and the Banjica Environmental and Recreational Centre. Since we need more money to continue working on the Centre, we have applied for funds from the Cross Border Cooperation Programme.

After providing full infrastructure for the Murica 1 industrial zone, we are in the final stages of negotiations with future investors and we expect

between 300 and 500 new jobs to be created as a result. Following the adoption of the Detailed Regulatory Plan, we are going to install infrastructure in the Murica 2 zone. Bela Palanka also has several other locations suitable for brownfield investments.

We also plan to build 10 small hydro power plants with a total output of 11 megawatts, which will cost €30 million. In order to build these plants, we had to adopt five detailed regulatory plans and two spatial planning projects. We are currently constructing the Vrgudinac mini hydro power plant, valued at €4.5 million.

International funds have recognised our expertise and experience in project management, which is why Bela Palanka has been chosen to be one of the 34 partners in the EU PROGRESS programme, thanks to which we have been implementing several important infrastructure projects. In cooperation with this programme, we have been preparing a number of large-scale investments for the 2016-2019 period.

We will pay a lot of attention to young people in rural areas and plan to award grants for the development of farms, especially small dairy farms, with the aim of encouraging young people to return to, or stay in, rural areas.

We are also going to support farms that want to engage in the fruit processing sector, through subsidies for the construction of small driers and cold storage units, as well as providing support to farmers who want to grow vegetables. We will focus in particular on granting incentives for growing Vrtka, our indigenous variety of bell pepper.

We have been trying to achieve economic progress based on the contemporary concept of economic and social development and, in order to do this, we need to both plan and define our development goals. In our 2010-2020 Sustainable Development Strategy we have identified key areas that require additional investments, with the endgoal being the swift economic recovery of the municipality of Bela Palanka.

We try to do something good for our population every day. As much as our capacities allow, we try to make everyone feel as though this local government is working in the service of its citizens. ■

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INTERVIEW

Hidden Treasures of Homolje The municipality of Kučevo is located in Northeast Serbia and belongs to the Braničevo District. It occupies the lower part of the River Pek basin and the flat part of the municipality stretches across the Zviška Valley, while the southern part spans across Braničevo (the lower part of the Pek). The mountainous part of the municipality belongs to the Zviške Mountains and North Kučaj, nestled alongside the north-western slopes of Homolje Mountains

NOVICA JANOŠEVIĆ

PRESIDENT OF THE MUNICIPALITY OF KUČEVO

K

učevo is known for its wellpreserved natural resources (caves, forests, clean rivers and lakes and mineral water), interesting folk customs, events with a long tradition and a wealth of archaeological heritage. Due to its vast quantities of primary raw materials, the wood and stone processing industries have the best opportunities for development here. Agriculture is also an important

istry for Categorisation of Rural Tourism Facilities, which enables the owners of registered farms to engage in tourism as well if they wish. By doing this we have enriched our municipality's tourist offer, as well as helping our farmers to become more economically empowered.

With the goal of developing tourism, the municipality has also launched construction of the Ravništarka ethnovillage in the close proximity of the

THERE ARE EXCELLENT OPPORTUNITIES FOR THE DEVELOPMENT OF THE WOOD PROCESSING INDUSTRY, GIVEN THAT HALF OF THE MUNICIPALITY OF KUČEVO IS COVERED IN FORESTLAND. THE MUNICIPALITY SPANS 721 SQUARE KILOMETRES, WITH 348 SQUARE KILOMETRES OF FOREST AREA

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economic branch in the area, especially cattle breeding – considering that we have many pastures.

eponymous cave. There is also a nearby restaurant, as well as a tourist information centre and a wooden lodge.

• The economy of the municipality of Kučevo is mainly based on agriculture, especially cattle breeding, which, in synergy with the natural beauty of Homolje, provide an excellent opportunity for the development of rural tourism.

- The municipality of Kučevo has the Reg-

• Kučevo had a lime pit called Veljko Dugošević which was operational until U.S. Steel decided to withdraw from Serbia. Is there any chance of this factory reopening and what should be done for this timber-rich municipality to utilise this potential fully?

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- There are excellent opportunities for the development of the wood processing industry, given that half of the municipality of Kučevo is covered in forestland.

The municipality spans 721 square kilometres, with 348 square kilometres of forest area. Our municipality was home to one of the biggest wood processing companies in the former Yugoslavia – ŠIK Kučevo – which used to produce lumber, veneer, plywood, seats and chair backs, kitchen doors, wardrobes and similar products. Today this company's premises in the Kučevo industrial zone are suitable for brownfield investments. The zone has several other available land plots suitable for new investments and is one of the investment locations in our municipality.

• What other areas have hidden investment opportunities and how can they be promoted and developed?

- It is very important to mention that our municipality borders municipalities that are also heavily forested, which is quite important in terms of acquiring raw materials and reducing costs. I would also like to underline that we have workers who are trained in the wood processing industry, as well as in the lime and stone extraction industry.

Apart from the wood industry, we also had a very well developed lime and stone processing industry.

The location which today houses the former lime processing facility is also suitable for brownfield investments. It is located on the premises belonging to the Smederevo Steelworks, immediately in front of the surface mine, some six or seven kilometres from the town centre and less than a kilometre from the M-24 main road and the Belgrade-Zaječar railroad. The location also has its own rail track leading to the industrial facility. Suffice to say that this location has complete infrastructure necessary for lime and quartz production.

at developing sports tourism. This year, in collaboration with the Ministry of Sport, the municipality is going to build new pitches with artificial turf in the Kučevo Sports Centre.

We are also planning to reconstruct and revitalise the summer residence of King Aleksandar Karađorđević I in Neresnica, which would contribute significantly to the development of tourism here.

• You have been the municipality’s president for two years now. Is there something you are especially proud of in terms of your personal

village infirmary; - Renovating a school, procuring school equipment and teaching aids; - Renovating an old people’s home in Kučevo; - Cleaning the basin of the River Pek in Kučevo and Neresnica, improving the municipality’s flood protection system; - Successfully staging the Homoljski Motivi event in the original timeslot; - Building a new, multifunctional sports ground suitable for volleyball, basketball, five-a-side football and handball at the Kučevo high school; - Building a sports ground in Rakova Bara;

• The municipality has an industrial zone. How many investors currently occupy that zone and what are your plans for attracting new investors?

Do you plan to build new industrial zones?

- In terms of attracting investments in this area, it is important to mention that a gas system installation project will be implemented in the region, which includes our municipality.

• Kučevo places special emphasis

ESTABLISHING THE INDUSTRIAL ZONE, WHERE WE CURRENTLY HAVE MINERAL RAW-MATERIAL/STONE PROCESSING COMPANY ABM INTERNATIONAL D.O.O., IS THE BASIS FOR DEVELOPING THE BUSINESS ENVIRONMENT IN OUR MUNICIPALITY on brownfield investments. Which brownfield locations are available to future investors?

- The two aforementioned brownfield locations are the most important investment locations in our municipality. The municipal authorities have also been working on employing new workers through the implementation of the new jobs programme, which has been devised by the National Employment Office.

• Which large-scale investments have been implemented in Kučevo in the last year or so and how big are investments planned for this year?

- Establishing the industrial zone, where we currently have mineral raw-material/stone processing company ABM International d.o.o., is the basis for developing the business environment in our municipality.

We have also carried out activities aimed

contribution to the development of Kučevo?

- I would like to single out the following successful projects implemented during my term in the office: - Paving roads in all populated municipal areas, covering a length of 35km; - Reconstructing and rehabilitating pavements in Kučevo; - Installing an optical cable from Petrovac to Kučevo; - Renovating a nursery last year, completely replacing the woodwork and renewing the building’s façade; - Opening a new nursery in Rabovo; - Building a contemporary facility for meat and animal product vendors in the Kučevo outdoor market; - Renovating the local health centre, acquiring new medical equipment and renovating the

- Organising a number of cultural events, including the FESTEF Film Festival, theatre plays, concerts, exhibitions, festivals and murals; - Joining the gas system installation project; - Renovating culture centres; - Assisting in the construction of religious facilities in Rabrovo, Mišljenova, Turija, Ševica and Voluja; - Constructing the main part of the water supply system in Ševica; - Simplifying procedures for the issuing of building permits; - Helping farmers and agricultural associations by supplying fruit saplings and providing financial and professional help; - Providing assistance to ABM International Company; - Providing free transportation for primary school pupils and for high school students from impoverished families; - Helping socially vulnerable persons in the municipality of Kučevo; - Charity campaigns; - Rehabilitating infrastructure and the machinery park at Kučevo Public Enterprise; - Providing scholarships for 100 students. ■

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INTERVIEW

Town With a Great Future Zrenjanin’s free zone is one of the most attractive investment locations in the world. Following research conducted by FDI Intelligence (the Financial Times), the Zrenjanin-Southeast Free Zone was ranked 48th among the top free zones in the world in terms of investment appeal.

This research covered 600 zones in over 120 countries

ČEDOMIR JANJIĆ MAYOR OF ZRENJANIN

Z

renjanin has one of only 14 industrial zones in Serbia. It spans three different locations – Southeast (51 hectares), Bagljaš (40 hectares) and Cvetna (6 hectares). These locations are fully equipped and ready to accept new investors. As the motor that drives the economic development of Zrenjanin, these zones are supposed to facilitate faster industrial development, infra-

tion facility here. This company produces steel structures, mainly for the petroleum industry, and the value of the initial investment is close to €4 million, while the company plans to invest a further €6 million.

The Southeast industrial zone spans 72 hectares, has relevant infrastructure and can be extended to include an additional 1,100 hectares of land. At present we have 30 hectares available.

THE FINANCIAL TIMES DECLARED THE ZRENJANIN FREE ZONE THE BEST ZONE IN EUROPE, IN TERMS OF INCENTIVES FOR INVESTORS. OUR ZONE IS ALSO THE RECIPIENT OF THE BRAND LEADER AWARD structure construction, new technologies, the acquisition of knowhow, employment and better living standards for the people of Zrenjanin and the entire region.

• How many investors currently operate in these zones; what is the total value of concluded contracts and how many new jobs have been created?

- Apart from domestic investors, we also have foreign ones, including joint RussianSerbian company “Crown”, which invested €8 million in a food processing facility. Italian company Tecnostrutture, which is headquartered in Belgrade, is building a produc-

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In addition, we have built the BagljašElemir industrial zone, which is located in close proximity to the Zrenjanin-Novi Sad regional road. Several companies are doing business there, including Italian companies Modital, Geze, and Fulgar, as well as German company Draexlmaier, which is currently the biggest company in Zrenjanin and the biggest exporter in the Zrenjanin Free Zone and Central Banat region. The company has 3,500 employees and is currently building a third production hall spanning 14,000 square metres.

Thanks to contracts concluded with

investors between 2013 and 2015, a total of 1,600 new jobs were created. Once the remaining contracts have been implemented, another 200 new jobs will be opened.

• Do you plan to build more industrial zones and are new investors coming to Zrenjanin?

- There are still locations available in our existing zones for interested investors. Of course, we have several investors interested in coming to our city, because we have been promoting it successfully as a good place to invest. We have also been trying to create a good business environment for investors in our town. If there is a need to expand our zones, I am confident we will also achieve that successfully.

• Apart from industrial zones, Zrenjanin also has one of only 14 free zones in Serbia. How important is this free zone for the town?

- We are very proud of our free zone. It was established in 2005 and there are currently 13 companies operating there, including Swedish company LK Armatures and Slovenian company Kolpa. Apart from these companies' turnovers, it is important to mention

that they have hired over 3,000 local workers.

The free zone spans 90 hectares and comprises three locations in the town. The biggest location is Southeast Ečka, which covers 50 hectares, followed by the Bagljaš location (40 hectares) and the location in Cvetna Street (6 hectares).

The Financial Times declared the Zrenjanin Free Zone the best zone in Europe, in terms of incentives for investors. Our zone is also the recipient of the Brand Leader Award which was presented to us by Transport & Logistics of Southeast Europe and the Danube Region (TIL) Business Conference.

The Zrenjanin Free Zone is one of 14 free zones in Serbia. Companies can cut their costs by up to 40 per cent by opting to do business in free zones.

pany Fulgar, which is now expanding its production halls for the fourth time.

• What is your secret when it comes to attracting investors?

- We try to create a good business environment for investors and our industrial zones have complete infrastructure. Investors can also use offices in our Business Incubator.

They are given both administrative and technical assistance with the issuing of permits and we provide financial incentives (30% reduced price of land if they make a one-off payment and exemptions from paying contributions for production activities). We have also extended the area of the Zrenjanin Free Zone.

Thanks to all of the aforementioned activities, we have received many international awards, but the most important thing is that several investors here have decided to extend their capacities – like Draexlmaier, which has done that three times already, or Italian com-

too. We have great IT potential and educated young people in this town, which has prompted interest among investors.

Our Mihajlo Pupin Technical College has great courses for future computer programmers and IT professionals. Joint Dutch-Serbian company LEVI9 Global Sourcing Balkan has been operating in Zrenjanin since 2014. This is the first IT company to lease business premises in our town, while there are indications that an IT company from Novi Sad – founded and owned by a Zrenjanin local – will open a branch office here.

• Zrenjanin is predominantly an industrial town.

Which industrial branches are the most developed here? Is there room for further development and what other branches can become a driving force behind the town’s economic development?

- Back in the day, Zrenjanin's industry had the entire Yugoslav market at its disposal. However, that market disappeared and then problems with transition and privatisation came, all of which combined to force many great companies to die out. However, we have been trying to recapture some of that old glory in Zrenjanin.

Production is the predominant branch here, while great opportunities also lie in agriculture, the food industry and, as of late, in the IT sector

• What about the SME sector? Does the local government invest in SME development and, if so, in which ways?

- Of course we care about small businesses as much companies that have hundreds of workers.

Let me remind you that the Serbian Government declared 2016 the Year of Small Business. The City of Zrenjanin has been implementing several projects in accordance with the Government’s goals, especially those that involve educating young people on entrepreneurial skills and how to launch a new business.

Together with my colleagues, I have set up several meetings with businesspeople from Zrenjanin so that we could discuss their problems and needs. The local self-government will do everything in its power to help them, as we want both domestic investors and SMEs to be supported in the best possible way.

• How would you describe the overall economic image of Zrenjanin? What can be done to increase employment, engage available capacities and boost economic potential?

- The economic image of Zrenjanin has been changing for the better in the last few years and investors in our zones have certainly contributed to this positive trend. However, bearing in mind that there are a lot of unemployed people here, according to the National Employment Office's records, we are not happy. We are going to work on improving the efficiency of the local administration, with myself at its helm, promoting our town's potential and finding development opportunities in new segments. All of this will be done with the aim of providing the best possible living conditions for the people of Zrenjanin. It is important to mention that most of the projects stipulated in the Development Strategy for Zrenjanin we have drafted pertain to the economy and the development of the town, its economy and agriculture.

• How have you contributed personally to promoting and developing this town since you took up this leadership post?

- When I was appointed mayor I promised that I would work on improving living conditions in the town. That was my promise to my fellow citizens and this is what I have been working on. My associates should also be commended for everything that has been done so far, and I thank them for the support they give me. I have also emphasised that my biggest task is to move the city forward and create conditions conducive to employing as many people in Zrenjanin as possible, as this has been one of our town’s biggest problems. I think I have been successful in that. Zrenjanin has a future. I am absolutely convinced of that and that's the direction in which we are headed. ■

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INTERVIEW

Good Conditions For Investors Požarevac spans an area of 481 square kilometres and comprises two municipalities – Požarevac and Kostolac.

Some 80 per cent of the territory comprises arable land.

This land is one of the most valuable assets in the area and encompasses the Stiška Plain and the banks of three rivers – Velika Morava, Danube and Mlava

MIOMIR ILIĆ,

MAYOR OF POŽAREVAC

T

he most successful companies in the area are food producer Bambi, TE-KO - Termoelektrane i Kopovi Company from Kostolac (former Kostolac Industrial and Energy Combine), Veolia Transport (former TP Litas) and Žitostig. Small businesses, construction and agriculture are also developing rapidly here, thanks to the fact

ed in launching operations in this zone?

- All planned industrial zones in the city of Požarevac are regulated by the General Spatial Plan. There will be a possibility of constructing businesses and industrial facilities, as well as facilities for other purposes. The North Block of the Industrial Zone in Požarevac comprises the revitalised old industrial zone and a

HAVING A FREE ZONE WOULD MEAN A LOT FOR OUR POPULATION, THE MAJORITY OF OUR WORKERS AND POTENTIAL INVESTORS. IT HAS BEEN PROVEN THAT FREE ZONES ARE EXCEPTIONALLY APPEALING TO FOREIGN INVESTORS. WE ARE GOING TO ALLOCATE AN AREA FOR A FREE ZONE IN SPATIAL PLANNING DOCUMENTS REGULATING THE INDUSTRIAL ZONE that some of the rural population works abroad and usually invests their savings in small family businesses, construction and the services sector.

• Construction of the Požarevac Industrial Zone started in 2011. Is it now completely finished? You bought a former sugar plant from the state last year and, as a result, Požarevac now has more land available in the industrial zone. Are there any investors interest-

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new segment connected to the old zone.

The industrial zone is linked to Požarevac and the surrounding area via state roads of the first and second order, corridors 10 and 7, and the Belgrade-Majdanpek railroad.

The new block received complete infrastructure in 2013, including internal and access roads, sewer connections and rainwater drainage, a gas supply system, communal lighting, a transformer station, TS and MN networks and other facilities.

We have launched a public call that is open to legal entities and individuals (both domestic and foreign), relating to the construction of planned production

capacities. Several investors have already expressed interest.

Following the purchase of the movable and immovable assets of the Požarevac Sugar Factory, we have created the opportunity to establish new production facilities.

We are currently preparing a tender in which all interested parties can participate, whether they are legal entities or individuals (domestic and foreign).

• It was announced that Israel-based company Aviv Arlon would build a retail park in

Požarevac. How far along is that project?

- Aviv Arlon is currently busy leasing its facilities to interested retailers and we expect official confirmation of the launch of the bidding procedure for the purchase of the land to be made soon.

• What have the local authorities been doing to entice investors and are there major investors who are willing to invest in Požarevac in the near future?

- We have established contact with a number of interested investors and foreign delegations. The local authorities have been preparing spatial planning documents and we plan to adopt a new Decision on Incentives for Investors in 2016, in accordance with the Law on Investment. Aviv Arlon is currently our biggest investor.

• Is there any chance of Požarevac opening a free zone and, if so, how important would that be for the city and its population?

- There is interest because having a free zone would mean a lot for our population, the ma-

jority of our workers and potential investors.

It has been proven that free zones are exceptionally appealing to foreign investors. We are going to allocate an area for a free zone in spatial planning documents regulating the industrial zone.

• Industrial corporations like Bambi and TE-KO Kostolac are the engines that drive Požarevac’s development. What is happening to small businesses? In which way do the city’s authorities support the development of SMEs?

the period ahead will be based on implementing all of our development plans for the TE-KO Kostolac and especially development plans for the agriculture and food industries, because this area has a lot of fertile land.

• Which economic branches have the greatest development potential for the city?

- Apart from development of TE-KO Kostolac and local agricultural production, special attention should be paid to developing tourism, because the city of Požarevac is located between three rivers (the Danube, the Velika

APART FROM DEVELOPMENT OF TE-KO KOSTOLAC AND LOCAL AGRICULTURAL PRODUCTION, SPECIAL ATTENTION SHOULD BE PAID TO DEVELOPING TOURISM, BECAUSE THE CITY OF POŽAREVAC IS LOCATED BETWEEN THREE RIVERS (THE DANUBE, THE VELIKA MORAVA AND THE MLAVA) AND HAS MANY HISTORICAL SITES - In terms of the Serbian and local energy sector, TE-KO Kostolac is definitely the engine that drives development. The Bambi Concern does the same for the food industry.

The City of Požarevac plans to revitalise the old industrial zone and factories that used to be the driving force behind the agricultural development of this area.

The city allocates substantial funds every year that are aimed at boosting agricultural production and helping farmers (crop farming, cattle breeding, wine growing etc.).

• What do you think of the overall economic situation in the city and what should be done to improve Požarevac’s economic image?

- In my opinion, Požarevac’s development in

Morava and the Mlava) and has many historical sites (Viminacium, Požarevački Mir, Ljubičevo Stables etc.).

• How have you contributed personally to the economic development of Požarevac since you’ve been the city’s mayor?

- Many utility and infrastructure projects have been implemented in Požarevac in the last four years (roads, sewers, rainwater drainage, 260km of gas supply grid, construction of two nurseries, construction of two water wells and others).

Following the construction of production facilities in the new industrial zone and the revitalisation of the old zone, we have created numerous job opportunities for young people. ■

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OPŠTINA PLANDIŠTE Vojvode Putnika 38, Plandište, SRBIJA, Tel:+381(0)13/861-033,Fax: +381(0)13/ 861-134, office@plandiste-opstina.rs www.plandiste-opstina.rs