Transport & Logistics Serbia 2019

2019

TRANSPORT AND LOGISTICS

INTERVIEW

ZORANA MIHAJLOVIĆ PH.D., SERBIAN DEPUTY PRIME MINISTER AND MINISTER OF CONSTRUCTION, TRANSPORT AND INFRASTRUCTURE

Striding Towards Realising Our Vision We have succeeded in changing the picture of infrastructure in the minds of citizens, who can today rest assured that Serbia can complete the largest and most complex projects. With such a foundation, we are this year embarking on a new investment cycle, which will help us move closer to our vision of Serbia becoming a transport hub in this part of Europe in all modes of transport

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erbia has exerted a lot of effort in order to connect with the region and Europe, perhaps like never previously, but there is still work to be done. The formation and work of the Permanent Secretariat of the Southeast European Transport Community represent a new incentive on that road, both for Serbia and the region, says Serbian Deputy Prime Minister and Minister of Construction, Transport and Infrastructure Zorana Mihajlović Ph.D. • What does the launch of the work of the Secretariat mean for Serbia and the region?

- The fact that the headquarters of the Transport Community is in Belgrade is not significant just because it is the first European and international organisation to be headquartered in Serbia. It is significant because the 4 |

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entire region of the Western Balkans region will have – here in Serbia, in Belgrade – an organisation that deals with precisely what we’re striving to achieve: to be the transport hub of this part of the region, in road, rail, water and air transport.

Serbia is already that hub geographically and – by investing in all types of infrastructure – it is becoming a hub in reality day by day. Initiatives will be launched from Belgrade, plans will be made, works will be negotiated on everything that concerns transport in the region, and transport is the lifeblood of the economies of our countries... We are also gladdened by the fact that all countries of the Western Balkans agreed and unanimously decided for the headquarters to be in Serbia.They alll supported Belgrade, and that is great recognition for us, for everything we’ve done in this area.

But we’re now awaited by great works, by a big job to connect our entire region even faster and more securely, because transport can’t wait; people, ideas and goods can’t wait.

• To what extent can it be stated today that Serbia is well connected to Europe, when it comes to rail and water transport routes?

- Serbia has exerted a lot of effort to connect with the region and with Europe, perhaps like never before, but there is still work to be done.

We’ve completed the most important road connection with Europe and Asia - Corridor 10, and by year’s end we will make the complete branch of the highway to Bulgaria operational.

We have more than 100km of highway from Obrenovac to Čačak, and in December – with the completion of the section from Surčin to Obrenovac – we will bring the Miloš the Great

Highway five minutes from Belgrade.

We are now launching a new investment cycle worth close to 10 billion euros. We’ve started construction of the Belgrade-Sarajevo highway, as well as the continuation of “Miloš the Great” from Preljina to Požega. Construction is starting on the highway from Niš to Merdar and the highway and high-speed road link Ruma-Šabac-Loznica, while we are working on the Belgrade Bypass and should soon sign a contract for the construction of the Moravian Corridor from Čačak to Kruševac... Likewise, we’ll also prepare project documentation for the the Šumadijan Corridor, or the Vožd Karađorđe Highway.

Over the next two years we will complete another 500 km of renewed rail tracks for speeds exceeding 100km per hour, while we will invest about 400 million euros in water transport and, in addition to Belgrade and Niš, we have opened another international airport in Kraljevo…

with the realisation of the goals set to date?

- This year is indeed a watershed year for infrastructure in Serbia, because – as I said – we are this year completing construction of Corridor 10, the largest project in the last 30 years. We have already built around 300 kilometres of highways, thanks to which transit transports have returned to Serbia, so this year we will have about 58 million vehicles on our highways, compared to 37 million vehicles in 2014.

We also have behind us more than 500 kilometres of reconstructed national and regional railway lines, procurements of new passenger trains and locomotives for freight trains, completion of the Žezelj Bridge, the launch of construction of the first high-speed railway in the region, a concession for Nikola Tesla Airport, investments in airports in Niš and Kraljevo, new factories for water, a stateof-the-art system for issuing building permits electronically etc.

Investing in infrastructure was set as one of the the priorities of the Government back in 2014, and today we see dozens of factories that have opened along newly constructed sections of the highway along Corridor 10 And all of this is excellent and significant for Serbia. But the countries of the region – together with the EU – have to do much more to remove non-physical barriers at the borders, because it isn’t enough for us to build all the new roads, railways, ports and airports if trucks and people are waiting for hours and hours at borders. We have one border crossing with Macedonia and that is a good way, but with EU member states we have a problem, and that’s what I insist on in every conversation with European officials and fellow ministers from the region. I also expect the Transport Community to help when it comes to solving this problem in the interests of all, because the fast and safe transportation of goods and services is a precondition for economic development.

• You’ve said that 2019 is a key year for infrastructure in Serbia. How satisfied are you

And that’s just part of what’s been done.

Apart from the things that have been constructed that are visible, a lot has also changed in the way projects are managed and investments are planned, and in the way public enterprises function. And there’s no more going back to the old way, to works that start without project documentation being prepared and expropriation completed; to underdeveloped and forgotten railways; to unreformed rail enterprises and road maintenance contracts from 20 years or more ago.

Finally, we’ve succeeded in changing the picture of infrastructure in the minds of citizens, who can today take pride on the new highways that they drive on, and new trains, and can have faith that Serbia is capable of completing the largest and most complex projects, such as the highway through Grdelica Gorge.

With such a foundation, we are this year

embarking on a new investment cycle that will help us connect with the region even better, not only with highways, but also with rail and water transport routes, because our vision is to make Serbia a transport hub of this part of Europe in all forms of transport, which it deserves on the basis of its geographical position.

• What does the construction of road corridors mean for Serbia in terms of advancing economic growth and connecting with the European market?

- Infrastructure is a prerequisite for development, because where there is no infrastructure there is no opportunity for connection, nor for the arrival of investors, and thus not for faster economic growth. Investing in infrastructure was set as one of the the priorities of the Government back in 2014, and we see the results of that commitment in dozens of factories that have opened along newly constructed sections of the highway along Corridor 10, as well as an increase in the number of vehicles passing through Serbia, from 37 million vehicles to a total of around 58 million that we expect by the end of this year.

This is why we’re not satisfied with completing - after 30 years - the construction of the road route of Corridor 10, but rather we’re launching the construction of new highways, continuing the modernisation of railways and also investing in water transport and aviation, because we want Serbia to be connected with all of its neighbours, but also with the European Union, because we can only develop faster if we’re connected.

• To what extent are investments in production operations linked to the revitalisation of the rail transport network and what are your Ministry’s most important plans?

- Modernisation of the railway is as important to us as the construction of highways, and testifying that this is really the case is the more than 500 kilometres of renewed railway lines and the 48 new, modern trains that run on Serbian tracks today. Serbia is today part of China’s global “One Belt, One Road” initiative; we’re building a high-speed rail link from Belgrade to Budapest, renewing the railway line to Bar [Montenegro] with Russian Railways, and preparing to continue OCTOBER

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for Chapter 27 – Environment, which is led by the Ministry of Environmental Protection, while the Ministry of Construction, Transport and Infrastructure, apart from monitoring and contributing to this process, also strives to respect all environmental standards in preparing and implementing all transport infrastructure projects that we are realising.

• How successful is Serbia when it comes to securing the funds necessary to carry out all of these tasks? How much does it rely on EU funds and how much on other donors and lenders?

- Serbia is today a country with stable public finances and a stable budget that has enough money to plan development projects, to the modernisation of Corridor 10, for which we have signed a memorandum with Chinese partners.

Something like that was unthinkable just a few years ago, because many years passed without a single kilometre of tracks being reconstructed. According to one World Bank study, Serbia missed out on 2.5 investment cycles for railways, or about 40 years of development, and we are today battling to make up for that lost time.

Today, alongside investments in Corridor 10 and the reconstruction of the Bar railway, we are now also investing in regional rail lines, and by the end of next year we will have reconstructed a total of around 800 kilometres of regional rail lines. The modernisation of rail tracks is also important for our citizens, who will again be able to ride on the railways, but also for the possibility of significantly increasing the volume of freight transported by rail, which is our strategic goal and an area in which Serbia has huge potential.

• Cooperation with the EU relates to the applying of technical standards, interoperability, safety, the management of traffic, public procurement and environmental protection. How much are we progressing in these areas?

- The Ministry of Construction, Transport and Infrastructure manages the work of the Negotiation Group for chapters 14 - Transport 6 |

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According to one World Bank study, Serbia missed out on about 40 years of railway development, and we are today battling to make up for that lost time as quickly as possible Policy and 21 - Trans-European Networks, and participates in the work of seven other negotiation groups.

Let me remind your readers that the last annual progress report of the European Commission rated the transport policy as one of the areas in which Serbia already has a good level of harmonisation with the EU, and the most progress since the previous report has been achieved in the reform of railways. Serbia adopted new laws on railways, safety in rail transport and the interoperability of the rail system in 2018, with which we achieved a high level of harmonisation with EU regulations in establishing a single European railway area.

In road transport, in the previous period we amended the Law on Traffic Safety, through which a large number of provisions of EU regulations were incorporated. Moreover, through the so-called Berlin Process, which includes the Western Balkan Six and the EC, it can bee seen that Serbia is far ahead of others in the region when it comes to this area.

The area of environmental protection is the subject of the Negotiation Group

guarantee them and implement them. The projects we are implementing in the area of infrastructure are funded from a variety of sources, including the national budget, EU grants, credits from European and other international banks, as well as loans from bilateral partners.

For example, the construction of Corridor 10 is being financed mainly through loans from the EIB, EBRD and World Bank, while contractors and banks from the People’s Republic of China and Azerbaijan are present on the Corridor, because at the time when we contracted these projects European banks weren’t interested in this corridor, which is extremely important for the citizens of Serbia – as can best be seen in the fact that nearly 300,000 vehicles have passed the toll booths of this highway since tolls began being charged.

During the period ahead, we want to see more public-private partnerships in infrastructure projects, like the one we already have with Belgrade Airport, and for that it’s important that we also have financially stable, reformed and efficient public enterprises. ■

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TRANSPORT COMMUNITY PERMANENT SECRETARIAT OPENED IN BELGRADE

Tool For Connecting The Region

ANA BRNABIĆ, VIOLETA BULC, ALEN BARON, ZORANA MIHAJLOVIĆ, SEM FABRIZI

The Transport Community Permanent Secretariat head office was opened in Belgrade on 13th September. The ceremony was attended by high EU and Serbian officials: the European Commissioner for Transport Violeta Bulc, Head of the EU Delegation to Serbia Ambassador Sem Fabrizi, Prime Minister of Serbia Ana Brnabić, Minister of Construction, Transport and Infrastructure Zorana Mihajlović, Acting Director of the Transport Community, Alen Baron, and the ambassadors of the EU countries

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uropean Commissioner Violeta Bulc pointed out that the opening of Transport Community Permanent Secretariat head office in Belgrade was a sign of political goodwill and just the beginning of further joint cooperation.

“Transport networking means cooperation, peace and hope. This is the first

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time that the Western Balkan countries have a direct access to the European Single Market. The Secretariat will contribute to cost reduction of the projects and attract new investments. This is a hub that will enable networking of the EU countries with the Western Balkans region,“ emphasized the Commissioner.

She remarked that it is very impor-

tant that the railroad transport will be united across the whole region, but also the EU, which is a great step for the Western Balkans.

Bulc pointed out that the business community will receive quality investors and that the costs of the realisation of the transport projects will be lower than 30 per cent.

Photo: Photo Credit EU Info Centar

The railroads will remain the priority for the EU and more than 60 per cent of all investments in transport within the EU will go to that sector, the Commissioner added.

Prime Minister Brnabić said that this is the first head office of the international community in Serbia, adding that this is a sign of great trust in Serbia and a great honour for Belgrade.

“Today all of us together are sending an important message that we can successfully cooperate with all partners in the region and that we are finding ways to overcome obstacles and create a bet-

“Transport networking means cooperation, peace and hope. This is the first time that the Western Balkan countries have a direct access to the European Single Market. The Secretariat will contribute to cost reduction of the projects and attract new investments. This is a hub that will enable networking of the EU countries with the Western Balkans region“ ter future“, stressed the Prime Minister.

Minister Mihajlović said that transport is the most powerful tool for all

our citizens, to develop and live better, for new investments and better living standard.

It is very important to understand that the Transport Community is not related to the Western Balkans only, but that its impact is much wider, says Acting Director of that institution, Alen Baron.

“The Secretariat will the center of excellence, it will oversee the transport operations, support partners in the region with regards to reforms in the field of transport, it will provide technical assistance for project preparation, it will assist to partners when faced with difficulties in networking the EU Member States“ says Baron.

Head of EU Delegation to Serbia Sem Fabrizi said that the Transport Community will not be focusing only on roads, but also railroads, river and sea transport.

“This is a tool for connecting the region with the EU”, stated Fabrizi, adding that the tasks of the community will include technical and security standards and aspects, legislature, environment and other issues.

Fabrizi added that the goal is reaching the EU standards, which are highest in the world.

The seminar on “How Transport Community Can Promote Transport and Mobility of People in the Western Balkans“ was held at “Beograd“ palace after the ceremony. ■ OCTOBER

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BUSINESS

JOHN PEARSON, CEO DHL EXPRESS

We Connect People Worldwide DHL has grown since 1969 to become a globe-spanning family of DHL companies, with about 380,000 employees in over 220 countries and territories that covers the entire spectrum of logistics and supply chain services. DHL is the logistics industry's leading global brand

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he DHL family of divisions offer an unrivalled portfolio of logistics services ranging from national and international parcel delivery, e-commerce shipping and fulfilment solutions, international express, road, air and ocean transport, to industrial supply chain management.

• John, you have personally been an integral part of DHL’s history for many years and have witnessed some of the company’s major milestones. What are you particularly proud of?

- Deutsche Post DHL Group’s aspiration is still to connect people all over the world. With innovative logistics and transport solutions, we want to help simplify their everyday lives, whether private or professional.

We test and deploy innovative technologies along the entire supply chain to make the delivery and transport process as efficient as possible and to assist our employees in their work. In addition to using augmented reality and robotics solutions in the supply chain, I am particularly proud that we have also found new ways to deliver to hard-to-reach delivery areas.

Our autonomous DHL parcel drone enables us to make rapid deliveries of medicines to a remote island in Lake Victoria, and in China a customer is regularly supplied with important documents twice a day.

In addition, the StreetScooter, which we have developed and manufactured ourselves, has already enabled us to provide an initial response to the challenges facing the 10 |

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logistics of the future and environmental protection.

• What will DHL’s contribution in this area be in the long term?

- In 2008, the Group pledged to improve carbon efficiency by 30% by the year 2020, compared to the 2007 baseline. We achieved that goal as early as 2016 and established ourselves on the market as experts in green logistics solutions. We want to reduce transport-related emissions to zero by 2050. Our journey along that path has already begun, and I’m confident that we will achieve this important milestone for our Group – not only via the very ambitious

with access to up-to-date technology and a better education. We are also celebrating Beethoven’s legacy and DHL’s anniversary by using our logistics expertise to transport the “BTHVN on tour” anniversary exhibition, as it makes its way through Germany, the U.S. and – from 2020 onwards – other countries in Europe and Asia.

Each of our 100,000 Express employees around the world has received a special edition coffee table book, a large-format illustrated volume outlining the history of DHL’s origins.

As a founding member and global logistics partner of Formula E, we also organised an online fan competition entitled “50 Moments that Delivered”, on the occasion of the 50th Formula

As a company with global operations, we are doing everything we can to ensure that our ecological footprint is as small as possible interim targets that we have set ourselves for the year 2025.

• So how is DHL celebrating its 50th anniversary?

- Various anniversary events are being held for our employees, customers and partners throughout the year. For example, we donated and delivered two Information and Communication Technology (ICT) centres equipped with modern computers to SOS Children’s Villages Colombia, in order to provide the children there

E race. But the absolute highlight for us is the tree planting campaign as part of Bryan Adams’ “Shine A Light” tour. Together, we would like to set a clear example for climate protection and – in collaboration with Bryan Adams, the Arbor Day Foundation, Plant-for-the-Planet, WeForest and Taking Root – we have pledged to plant one tree for every concert ticket sold – totalling a million trees worldwide this year.

So far, new areas of forest comprising around 300,000 trees have already been planted in Indonesia, Nicaragua, Malawi and the U.S. ■

DEJAN TRIFUNOVIĆ, CEO AND OWNER OF SDT GROUP BUSINESS

SDT Is A Port For Young Experts Over the course of just 10 years, SDT Group has become an authorised importer, distributor and repair service provider for some of Europe's largest manufacturers of buses, trailer vehicles, auto transporters and commercial vehicles. The signing of a franchise agreement with Hungarian company VIA Bérautó, the largest commercial vehicle rental company in Eastern Europe, presents an introduction to the new business year

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ith additional investments and the creation of new jobs, the SDT Group will this year again provide a major contribution to the development of the domestic economy. Thanks to new contract with VIA Bérautó, Serbia’s roads will be cruised by an ever increasing number of new and safe vehicles that satisfy all environmental standards of the EU.

are the official service centre for as many as three European manufacturers of vehicle transporters - Kassbohrer, Rolfo and Lohr and also a representative of Czech company Greenchem, which produces the highest quality AdBlue in Europe. SDT is unique multi brand service compentence centre in this part of Europe. We offer a complete service according to the “bumper to bumper” system.

• We are approaching the celebrating of your first decade of operations, which has proved more than successful for the company. What are you proud of in particular?

- We have proven that we have competent people who, with their work and knowhow, are able to realise big ideas and form a company that can serve Serbia with pride. SDT Group is today the authorised bus service provider for Southeast Europe of Polish company Solaris Bus & Coach, which is among the top European and world manufacturers, in terms of the number of vehicles sold and their quality, especially in the category of buses that don’t emit harmful gases. We are also the official importer, distributor and repair service provider for German Kögel trailers for Serbia and Montenegro. SDT is an agent, project designer, distributor and service provider for Fogmaker - Swedish fire protection systems for the engine space. We

• You once stated that your successful operations are a result of investing in the young people. Is that the recipe for success?

- SDT has been a port for young professionals since day one and – as a company that possesses all certificates – we are a training ground for their further educating. Apart from this, most of our workers have also further refined their skills at world-renowned companies. With this we have invested in them, in our company, but also in the state – given that they remained in the country thanks to SDT having provided them with an opportunity to realise their professional dreams in Serbia.

Another important prerequisite for successful operations is boldness in accepting challenges and achieving new business success.

The one we achieved in 2019 is the signing of a franchise agreement with Hungarian company VIA Bérautó, which has SDT as its official partner in Serbia.

• How is the significance of your collaboration with VIA Bérautó reflected?

- This company has been Hungary’s undisputed leader in the field of rentals of trucks, vans and other commercial vehicles for 27 years, while it has also held the same position on the Slovakian market for the last six years. SDT will offer something new on the local market that will suite needs of many customers - rental with full service and European level of quality. Almost all commercial vehicle brands and vehicle types are available.

We can offer everything from small 500kg carrying capacity vans to 40-ton capacity vehicle combinations. European roads are currently being cruised by 1,600 vehicles of this company, and it is thanks to SDT that Serbia has also become part of that network. This contract also guarantees new investments and jobs, with which the SDT Group contributed to the development of the domestic economy in 2019, as well as motivating the local workforce to seek the securing of their future in Serbia.

We simultaneously want to motivate the state to accelerate the harmonising of laws with EU regulations and the adopting of appropriate legal norms, which will allow commercial vehicles rented in Serbia to move freely throughout the whole of Europe. ■ OCTOBER

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BUSINESS

VLADAN SEKULIĆ, GENERAL MANAGER, SP LASTA BELGRADE

Lasta Drives To The Top Again Thanks to tradition, experience, tens of millions of miles travelled to the satisfaction of more than 100 million passengers, new standards, procedures and leadership, Lasta Transport is well on its way to re-occupying the leading position where it belongs

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y the end of October, a state-ofthe-art information booking system will be installed, so that Lastina passengers will be able to receive information on departures and changes to the timetable, and also buy a ticket with one click via their phone or computer. The coordinated cooperation between the Managing Director and the Supervisory Board of SP Lasta is carrying out the company’s business strategy and achieving its business goals.

• Lasta has long been a leader in road passenger transport in Serbia and south-eastern Europe, but then experienced a difficult period that you have been able to overcome.

Where is Lasta today?

- I can proudly say that Lasta is slowly rising from the ashes and that it is well on the way to regaining the leading position where it belongs. We have been in the process of privatisation since 2003, behind us is a failed sale and an extremely difficult year in 2014, but the results from the first half of this year are encouraging. In the first six months, we were able to reclaim some of the lines we lost and buy 50 new buses.

I have told our staff that behind us is a strong brand and 70 years of tradition that gives us a responsibility. The competition is enormous and the demands and expectations of passengers are increasing, so there is no sleeping or relaxing if we want to be the best again. Although we have the 12 |

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support of the City and the Republic, the staff need to understand that we are our own best friends and that our commitment will determine where Lasta will be and how we and our families will live.

• Even more than safety, reliability, comfort, and a good price are in demand today. How difficult is it to keep up with the times?

- While we were struggling with our problems, the competition was growing stronger, but now we are ready to return to the market because a company of the rank and reputation of Lasta can’t allow anyone else to be better. All our vehicles operating on local and international

due to a pay increase of almost 10 percent, the first for 10 years for all staff, but also the fact that the company has a future again. Drivers are no longer leaving us, quite the opposite. We even have drivers coming from some private companies because the name Lasta means something again, the fleet is being restored, investment coming… Drivers and technical services are working well, there are no redundancies in the administration, so I can proudly say that almost 2,000 employees believe that better days are coming and that it is up to us.

• What are your plans for the coming period?

Expanding capacity, increasing comfort and

Compared to the same period last year, our revenues are up by 220 million and our net profit by 110 million

lines have Wi-Fi and we have renovated all 1718 branches throughout Serbia. In addition to excellent working conditions, the staff have been given new uniforms, and all drivers will receive them too.

• Carriers across Europe complain about a lack of drivers. How does Lasta deal with this problem?

- At one point when it was most difficult for us, we were faced with the departure of drivers, but this trend has stopped. I believe this was also

quality, applying innovative technologies ...?

- Our finances are stable and that is the most important. Loans are regularly serviced and some will be refinanced. For the coming period we are planning to purchase 10 state-of-the-art double decker buses for international routes, and gradually, based on an agreement with the City of Belgrade, we will buy new low-floor vehicles for regular traffic. Our plans are ambitious, but they are justified by our work to date and the results we have achieved since the beginning of the year. ■

WORLD TRANSPORT OVERSEAS – WTO SERBIA BUSINESS

Your Cargo Is Our Concern For almost a decade, the multinational company WTO has been operating as one of the leaders of Serbian and regional markets in providing international transport and logistics services. Its mission is to offer customers in Serbia and the wider region a more affordable and efficient supply chain

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ue to its growing business and the needs of its customers, WTO invests in developing its own and deploying state-of-the-art IT work platforms, taking care of flexibility and connectivity with other IT systems commonly used by local and international companies An efficient supply chain management system is crucial for all companies that trade internationally, and this is exactly what World

warehousing centres on all six continents.

“It is with great pride and pleasure that we can say that, thanks to our professionalism, our dedication to success and our expert team and in cooperation with our international partners, we have been able to achieve full coverage of the global market through all major shipping ports with direct LCL lines to most world destinations. This usually involves organising door-to-door LCL

By implementing modern logistics solutions, WTO has further optimized and adapted its services to the needs of its clients Transport Overseas (WTO Serbia) provides.

As an unavoidable success factor in today’s business environment, WTO has developed a highly efficient door-to-door pickup and delivery system in collaboration with its partners worldwide. As a distinct service and an effective solution for import and export of goods, ‘less than container load’ transport (LCL) is of growing importance, supported by a developed network of partners and

transport for all types of general cargo, besides the organisation of container, oversized and special cargo”, says Bogdan Gavrilović, Sales Manager of World Transport Overseas in Serbia.

The plan is to complete the introduction of MS Dynamic NAV in all WTO offices in the region this year, which will enable the full advantage of the opportunities offered by the platform.

The new IT platform assures sophisticated supply chain management, which will integrate the business of all WTO offices and their needs into a single operating system. A set of functional areas includes shipment tracking, communication, data and document management, financial activities, storage, sales and, most importantly, customer support.

“Construction of a state-of-the-art logistics centre located in the industrial zone near Belgrade customs terminal is in its final stage”, says Gavrilović. “We will then be able to use our own storage space with the option of increasing capacity according to our needs. The location of the logistics centre and the proximity of the Belgrade and Dobanovci customs terminals enable our clients to carry out all operations efficiently and optimally.”

It is a modern facility that will be equipped with state-of-the-art storage equipment and a warehouse management system (WMS). Using the WMS optimises the cost of warehouse operations by managing the movement of goods and workflows in the warehouse. ■ OCTOBER

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OVERVIEW

New Investment Cycle For Regional Interconnection And The Faster Development Of Serbia

MILOŠ THE GREAT HIGHWAY

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ignificant results have been achieved during the last four years in all areas under the jurisdiction of the Serbian Ministry of Construction, Transport and Infrastructure and Deputy Prime Minister and Minister Zorana Mihajlović – from the construction of more than 300km of highways, the completion of construction and opening of the complete road route of Pan-European Corridor 10 from north to south, the commissioning of 103km of the Miloš the Great Highway, the completion of Novi Sad’s Žezelj Bridge and the reconstruction mof ore than 500km of railway tracks, but also the launch of construction of the first high-speed railway in the region, from

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Belgrade to Budapest, the granting of a concession for Belgrade Nikola Tesla Airport, via the development of Niš Constantine the Great Airport and the opening of Morava Airport near Kraljevo, to investments in water transport, municipal infrastructure and water plants, to the realising of progress on gender equality and the social inclusion of Roma people.

In the previous period, among other things, a new toll station has been installed in Vrčin, the first phase of construction of the Belgrade-Central railway station in Prokop has been completed, the Batrovci border crossing has been expanded, the new Ljubovija-Bratunac Bridge has been built and

About 300km of highways have been constructed and more than 500km of railway lines have been restored over the course of the last four years, with construction becoming the driver of economic growth.

A new investment cycle worth around €10 billion was launched this year, with projects in road, rail, water transport and aviation, which will enable the further connecting of Serbia with the region, the EU and the rest of the world, but also the arrival new investments and a better life for citizens the first high-speed chargers for electric cars have been installed along Corridor 10.

Serbian rail lines are now being traversed by 48 new trains, while 16 new freight locomotives have been procured and investments are being made in the reconstruction of regional rail lines after a break of several decades, which will lead to around 800 kilometres of rail tracks being renewed in the 2018-2020 period.

Projects in water transport have a total value of around €340 million and include, amongst others, reconstruction of the Đerdap Hydro Power Plant, revitalisation of the navigable waterways of the rivers Sava and Danube, construction and expansion of

ŽEZELJ BRIDGE

ports in Novi Sad, Smederevo, Belgrade, Sremska Mitrovica and Bogojevo, as well as the introduction of a state-of-the-art system for the safe management of navigation.

In air transport, a concession contract was concluded with French company Vinci worth €1.46 billion euros, including investments worth €732 million, while state investments have resulted in increasing the number of passengers at Niš’s airport from 1,335 passengers in 2014 to 351,581 passengers in 2018, with a tendency for further growth.

The construction sector has been fully regulated in legislative terms over the course of the past two years, with Serbia now ranked among the top 10 or 11 countries in the world for the issuance of building permits and – thanks to major investments in infrastructure – this branch has once again become an driver of economic growth in Serbia.

On the basis of results achieved and reforms implemented, a new investment cycle worth more than €10 billion has also been launched with projects in road, rail, air and water transport. These projects will ensures Serbia’s good connectivity with the region, the European Union and the rest of the world, but also new investments and a better quality of life for Serbian citizens.

The construction of seven new highways is also planned within the scope of this new investment cycle, which we present here.

FAST TRACK STARA PAZOVA - NOVI SAD, ČORTANOVCI

SREMSKA RAČA-KUZMIN HIGHWAY (SECTION OF THE BELGRADE-SARAJEVO HIGHWAY) This highway will be constructed in two directions: Bijeljina - Sremska Rača (border with Bosnia-Herzegovina) – Kuzmin; Požega - Kotroman (border with BosniaHerzegovina) A commercial contract for the elaboration of detailed regulatory plans, project design and construction of these sections of the Belgrade-Sarajevo Highway was signed in Belgrade on 19th December 2018 between the Government of the Republic of Serbia, Public Company ‘Roads of Serbia’ and Turkish company TASYAPI. This commercial contract is valued at €250 million and encompasses the preparation of planning, design and technical documentation and the execution of works on the Sremska Rača-Kuzmin section (totalling €225 million) and the preparation of design and technical documentation for the Požega-Kotroman section (€25 million).

The project will be financed jointly through a loan from a Turkish bank and the budget of the Republic of Serbia.

Preparatory works began in August 2019 on the construction of the Sava Bridge in Sremska Rača, along the 18km section of the Kuzmin-Sremska Rača Highway. The bridge over the Sava near Sremska Rača, with a length of about 1.3 km long, represents the

main structure being built along the route of this highway, while the construction of a border crossing is envisaged in addition to the bridge.

The second section - Požega-UžiceKotroman (border with Bosnia-Herzegovina) - will cover a distance of about 60 kilometres and will connect with Miloš the Great Highway at Požega, and from there it will be connected with Corridor 10 via the Moravian Corridor (Preljina-Pojate).

MORAVIAN CORRIDOR (HIGHWAY POJATE-PRELJINA) The Moravian Corridor, covering a length of 112 km, will connect Corridor 10 and Miloš The Great Highway, passing through all major towns and cities in this part of Serbia, which is home to around 500,000 people (Čačak, Kraljevo, Vrnjačka Banja, Trstenik, Kruševac, Stalać and Ćićevac).

Alongside construction of the highway, this project will also encompass the regulating of the West Morava river and its tributaries, as well as the construction of telecommunications infrastructure.

On the basis of a conducted public invitation, in late August the Government of Serbia adopted the Decision to select a strategic partner with the aim of implementing the project to construct the infrastructure corridor for Highway E-761’s Pojate-Preljina section (Moravian Corridor), through which OCTOBER

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SREMSKA RAČA-KUZMIN HIGHWAY

the Bechtel-ENKA consortium was selected as the strategic partner.

PRELJINA-POŽEGA SECTION, CONTINUATION OF MILOŠ THE GREAT HIGHWAY The section from Preljina to Požega (30.96 km) intersects the sections of Miloš the Great Highway from Obrenovac to Preljina, which are already open to traffic. This highway is important not only for the faster development of this part of Serbia – primarily the Moravica District, but also for regional connectivity. Highways leading to BosniaHerzegovina (Belgrade-Sarajevo Highway) and Montenegro (Corridor 11) will intersect at Požega, while Corridors 10 and 11, towards Bulgaria and Greece, will intersect at Čačak.

A commercial contract for the PreljinaPožega section of the highway was signed with China Communications Construction Company (CCCC) in November 2017. This 16 |

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contract (project) is valued at €450 million).

The launch of works was officially commemorated on 17th May 2019, with the President of Serbia and the Deputy Prime Minister in attendance, while works initially began on the Laz and Munjino brdo tunnels. This section is specific in that it passes through very difficult geographical terrain, which ensures numerous tunnels and bridges will have to be built (almost a third of the route comprises bridges and tunnels, with a total of three tunnels and 35 bridges).

RUMA-ŠABAC HIGHWAY AND THE ŠABAC-LOZNICA EXPRESSWAY The project for the construction of B class state road I from Ruma to Šabac (highway) and Šabac to Loznica (expressway) implies the construction of a total road length of about 80 km, including around 55km of the Šabac-Loznica section. This project includes the construction of a bridge

over the Sava with access road structures.

Negotiations on the concluding of a commercial contract for the continuation of the design and execution of works on the Ruma-Šabac-Loznica roadway are being led with Azerbaijani company Azvirt by the Working Group named by the Government according to the Decision for the implementation of this project. Negotiations to reach agreement on a loan are underway with the Republic of Azerbaijan.

The signing of a contract is expected by the end of this year. It is planned for the first works on the project to start in November this year, initially on the construction of workers’ camps and access roads to the construction site of the bridge over the Sava, and construction of the bridge itself.

HIGHWAY NIŠ-MERDARE-PRIŠTINA The Niš-Merdare-Priština highway forms part of the EU’s core indicative trans-

VRČIN PAY TOLL

port network. Corridor 10 and this highway will connect at Niš and enable departures from Serbia to Albania’s ports on the Adriatic Sea, and will also contribute to better connecting around 500,000 people (Pirot, Nišava and Toplica districts).

The the future Niš-Durres highway will cover a length of 383km. The length of the first section, from Niš to Pločnik, covers 33km, while the second section – PločnikMerdare – is 37km long.

NEW BELGRADE-SURČIN HIGHWAY The section of highway from New Belgrade to Surčin (7.9 km) represents part of Corridor E-763 and a functional connection to the City of Belgrade. The contracted value of the project is €64.5 million, and the works contractor is the aforementioned CCCC, with which a commercial contract was signed on 18th August 2019.

This section comprises the initial sec-

tion of Highway E-763 from Belgrade to the border with Montenegro and Belgrade’s connection to the highway.

A loan agreement for this project worth €100 million was signed with the European Investment Bank on 12th September 2019, as well an investment grant contract worth €40.6 million. Works on this section are expected to be launched in March 2020, with a deadline of 18 months from the start of the contractor’s activities (works are planned for completion in November 2021). ŠUMADIJAN CORRIDOR - VOŽD KARAĐORĐE HIGHWAY The Šumadijan Corridor, aka Vožd Karađorđe Highway, will cover a length of 220km long, though its length will increase to around 270km if this corridor is also connected with Corridor 10 near Mali Požarevac and with Corridor 11 via

Miloš the Great Highway.

The new highway will be in the form of the letter ‘Y’ and will connect districts and municipalities that are home to around a million people. On one side, the road will follow the route Mladenovac-OrašacAranđelovac, while on the other it will link Lazarevac and Aranđelovac, where it will connect and continue on to Rača, Svilajnac, Despotovac and Bor. If the expressway variant is selected and there are no connections to the aforementioned highways, then the total amount could go from €1.7 billion to €2.3 billion, providedit is fully constructed as a highway, with connections to Corridor 10 and Miloš the Great Highway. The first steps in implementing this project are the formation of a working group for its implementation and the beginning of preparation of project documentation. Works could begin during 2021 at the earliest. ■ OCTOBER

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BUSINESS

TIMOCOM

Economic Slowdown Affects Transport European Countries With Strong Export Economies Hit Hard

G

ermany, France and the Benelux states are feeling the impact of the global economic slowdown.

These are the current numbers on the TIMOCOM transport barometer, which this IT company uses every quarter to document the development of transport offers and requests on Europe’s largest freight exchange.

The number of freight offers made on the market via TIMOCOM between the beginning of April and the end of June 2019 was 20 per cent lower than in the same quarter of last year.

“The U.S. Government’s protectionist economic policies are hampering global trade, which in turn reduces the amount of goods exported. Export-orientated countries like Germany, France and the Benelux states are suffering the worst effects,” says TIMOCOM Business Analyst David Moog.

In total, the freight smart app, which companies can use to place and manage their freight transport offers on the freight exchange, hosted 21,817,810 offers in the second quarter, while the number of offers for the same period last year was 27,565,605. Moog reports that the decline is having a major impact on the transport of industry and investment goods, from the 18 |

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supplier industry amongst others.

The impending Brexit is also taking its toll. “After transport to Britain increased in the first quarter, as companies increased the amount of goods in stock, we are now seeing a market downturn,” reports Moog.

For example, the number of exports from Europe to the UK in the second quarter decreased by 56 per cent compared to the same quarter of last year, according to TIMOCOM. This is despite the development of exports in Southern Europe. Italy, Spain, Portugal and Greece transported significantly more goods to other European countries

this quarter than in the previous year, with growth of 21%. Moog: “the fruit and vegetable season in these countries is in full swing.”

The transport barometer is an instrument used by this IT company to analyse quarterly trends in transport offers and demand as found on the freight exchange, which is part of the TIMOCOM Smart Logistics System. With more than 130,000 users and up to 750,000 international freight and vehicle offers daily, TIMOCOM is the largest digital system for the road transport of goods in Europe.

You can find more information on TIMOCOM at www.timocom.com. ■

About TIMOCOM TIMOCOM GmbH is a medium-sized IT and data specialist company with a focus on augmented logistics. As the provider of Europe’s first Smart Logistics System, TIMOCOM uses smart, safe and simple solutions to help customers meet their logistics goals. More than 43,000 verified companies are connected via the system, where up to 750,000 international freight and vehicle offers are entered every day.

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NEWS

‘FLYING TAXI’ TESTED IN PARIS

BRITISH INTERRAIL TRAVEL BACK ON TRACK Despite Brexit, the UK will not leave Interrail – the decades-old European scheme that’s popular with young travellers, the UK’s industry body has said.

The Rail Delivery Group (RDG) announced it was a reversing a recent decision that would exclude British train services from Interrail or Eurail passes as of 1st January 2020.

“Britain’s train companies never wanted to leave Interrail,” it said in a statement.

“Following the strong reaction to news of our departure, we and Eurail, the company which runs Interrail, renewed talks.”

The decision, which RDG said was unrelated to Brexit, was met with criticism on Twitter, with many claiming that it would put young people off travelling beyond London.

With air pollution posing a threat to Paris and with transport lines bursting at the seams during rush hour, one start-up is proposing a “flying taxi”, as a greener alternative that makes use of the River Seine.

The Seabubbles start-up, which specialises in “flying” vehicles, launched a four-day test run of their “flying taxi” on the Seine in late September.

The “Bubble” is powered by electricity and lifts out of the water on “wings”. A taxi service using the vehicles could launch in the city as soon as spring 2020 if the trials prove successful, according to a press release from the office of the Mayor of Paris.

The “Bubble” boasts green credentials, such as being noise- and pollution-free.

Since launching in 2016, the company has been refining the design of the “Bubble”, which costs around €200,000 to construct.

ALLSEAS AWARDED GYDA PLATFORM REMOVAL Repsol Norge has awarded Allseas an EPRD contract for the removal, transfer, load-in to shore and disposal of its Gyda platform in the Norwegian North Sea. The contract covers both the 18,000 tonne topsides and 11,200 tonne jacket, and includes an option for reinstallation on another field, which would be an unprecedented step for a fixed installation off the coast of Norway. Also included is an option for the removal, transfer, load-in and disposal of the jacket’s 32 conductors, weighing a total 3,100 tonnes. Gyda is a field in the southern part of the Norwegian sector of the North Sea, between the Ula and Ekofisk fields. The field has been developed with a combined drilling, accommodation and processing facility, with a steel jacket standing in a water depth of 66 metres.

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NEWS

NEW BEIJING AIRPORT TO BECOME THE WORLD’S LARGEST

CABLE CAR TO CONNECT RUSSIA AND CHINA IN UNDER EIGHT MINUTES

China opened Beijing Daxing Airport on 25th September, thus establishing the second international airport in the Chinese capital. When it reaches full operational capacity – expected in the next several years – 100 million passengers are forecast to traverse the airport annually.

The International Air Transport Association expects Asia Pacific to be the biggest driver of air passenger demand in the 20 years until 2035.

Specifically, the association predicts that China will replace the U.S. as the world’s largest aviation market in about five years. The market is defined by traffic to and from the country, as well as domestic flights within its borders.

The bulk of the growth in Chinese air travel has come in the three decades since the government began earnest efforts to reduce state control of the economy and open up its market to foreign access.

DAIMLER TESTS AUTOMATED TRUCKS ON PUBLIC ROADS Daimler Trucks and Torc Robotics are actively developing and testing automated trucks with SAE Level 4 intent technology on public roads. The initial routes are on highways in southwest Virginia, where Torc Robotics is headquartered. All automated runs require both an engineer overseeing the system and a highly trained safety driver certified by Daimler Trucks and Torc Robotics. All safety drivers hold a commercial driver’s license and are specially trained in vehicle dynamics and automated systems.

The deployment on public roads takes place after months of extensive testing and safety validation on a closed loop track. As part of the comprehensive safety process by Daimler Trucks and Torc Robotics, both test track and on-road validation play an integral role in establishing the essential building blocks for successfully advancing automated technology.

What is claimed to be the world’s first transnational cable car is set to connect China and Russia across the River Amur.

It will take passengers between the cities of Heihe in China and Blagoveshchensk in Russia in under eight minutes.

Passengers will get a bird’s eye view of the Amur and the cities on either side of the line.

The cabins will carry up to 60 passengers and their luggage, with one leaving every 15 minutes.

Managed by Strelka KB, a Russian-based urban planning and strategy consultancy, the project is already underway.

The Amur, which is often frozen over during winter, has historically been a link that connects Heihe and Blagoveshchensk for trade and social reasons.

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BUSINESS

SRĐAN PEJOVIĆ, DIRECTOR, TRANS LOGISTIC AG

Our Trucks Are Modern Offices Trans Logistic AG is a forwarding company with a proven track record of safety, speed and reliability, whether for export or import. It owes its success to skilled staff, modern equipment and a state-of-the-art fleet, but also to dedication to work

C

lients of Trans Logistic AG include international traders and local and foreign freight forwarding companies, which provides a breadth of business, so in addition to a complete load, it can provide grouped shipments and special oversized cargoes • Your company is well known both among exporters and importers. How did you gain such a good reputation? What else, besides security, speed and reliability, is important in your business?

- Our company was founded in 2001 and has been built up for years as the market and circumstances dictated. We have never entered into projects that were too big for us, and so we have always been seen on the market as a reliable and well-organised company with a professional approach to our work. We have always striven to meet every request of our clients with all the capacities of the company. We are available to all of them to contribute to the good preparation and operation of each transport with our knowledge and experience.

• What services do you provide to your clients besides the organisation of international road transport, customs brokering, consulting etc.?

- In a modern approach to our business, it is very important for each of our customers to receive a comprehensive service, and we suc-

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ceed through the knowledge and experience we have gained over the years with the help of an educated and above all hard-working team who organise the transport. Often, we also engage in foreign trade activities that are not within our scope, so that we can complete the entire process, from procurement of goods to delivery to the end customer. This is an advantage for a company like ours, because we can devote ourselves to the client and complete the transport with him professionally.

The diversity of our clientele, which includes international traders and local and foreign freight forwarding companies, provides a breadth of business, so in addition to a complete load, we can provide grouped shipments and special oversized cargoes.

automatic payment of toll, fuel and various other expenses, in addition to GPS tracking.

All our drivers have credit cards, navigation, TVs, DVDs and scanners, so they can receive orders, print and forward shipping documents directly to us at the office, and to our end customer. This is an advantage of smaller and well-organised firms ... to provide the client with everything they need.

• What would Serbia’s accession to the EU and the abolition of borders do for you?

- I think we would have market prices similar to those in the EU and it would create uniform business standards. It would make the business easier for us truck owners, and the drivers would also have benefits as European transporters (fuelling, toll bills for the client

The average age of our vehicles is less than three years, which is very important for customers. They want to know who they are entrusting their cargo to

• Are your good business results worth the constant investment in transport and modern IT equipment?

- We absolutely follow all the innovations in the IT industry. Today, the interior of each of our vehicles looks like a state-of-the-art office, every vehicle has GPS devices for

company, subsidies for buying new vehicles, equal pay, standardised handling). That would take care for us of part of the administration we need today. Licenses, CEMT licenses and various certificates would be replaced by licenses that would allow us to move and load throughout the EU. ■