Serbia is starting the process of reindustrialization, and by April the government will make a plan to revive the industry. Also upcoming are the changes to legal regulations to create better conditions for business and foreign investments. The reindustrialization was also a topic of this year’s Kopaonik Business Forum, where it was said that the state would provide additional incentives for the development of automotive, food, IT and military industry. Jelena Milenkovic has more on the subject.

The Serbian government is ready to take a new turn in the economic policy, in order to make the conditions for the faster economic recovery and decrease of the public debt. The hitherto model of the economic policy did not yield expected results, as it was aimed at controlling the inflation and stimulating the consumption, trade and services.

At the Kopaonik Business Forum, Prime Minister Ivica Dacic, Minister of Finance and Economy Mladjan Dinkic, along with economic experts, have confirmed that the economic policy will take a new direction. It is clear that there is no universal recipe to deal with the crisis, but each individual country has to find hew own model. It is good that the financial consolidation and macroeconomic stability have been established, but in order to “cure” the economy and enable the planned growth, the bigger industrial production is needed.

The process of reindustrialization will be focused on the modernization of the existing plants and opening of the new ones, thus providing the new working places. The role of the state will be even more visible, so that the better business setting would be achieved for the boost to the economic branches that can be revitalized quickest. As pointed during the forum, the government is preparing a set of measures to support the development and investments in the automotive, food industry and agriculture, as well as in the IT and defense industry. Serbia must use these comparative advantages to change the structure of its exports and distribute finished products instead of raw materials.

Some of the main aces are the automotive and food industry, it was assessed by Minister of Economy Mladjan Dinkic. The exports have grown by 25% in this year, based on the increased placement of the Fiat vehicles in the European market, and the bigger production in the Serbian Oil Industry. A great boost in achieving better results would be an agreement on the duty free exports of automobiles to Russia, and the talks in that regard with Russian officials will take place soon, Dinkic announced.

A good example of profitable investment in industry is seen in the case of the Korean company Yura, which opened a factory in Nis. They are manufacturing the electric components for the automobile industry, and almost 60% of the production is for the needs of South Korean companies Hyundai and KIA Motors. The value of this investment is 15 million euros. Another good example is the Beamtex factory in Leskovac, making yarn. This town in southern Serbia was once wide renowned for the textile fabric that was sought after in England, Germany and France. This branch of industry used to employ more than 10 thousand workers in Leskovac, while today only few family manufactures have survived. In order to revive this sector, new investments are required, and the state will support the process. Beamtex is a mid-sized private company, and the investment in the new plant amounted to 1.2 million euros, which should enable the higher productivity, export and new working places. The annual export of material for socks and meat-packaging nets amounts to 5 million euros, with partners coming from Italy, Greece and countries of the CEFTA region.

The attractive position of Serbia as the destination for investments is also testified by the arrival of renowned Italian companies, such as the Geox shoes and Diti Italia furniture manufactures in the city of Vranje. Namely, the Geox is planning the investment of some 15 million euros, and will offer jobs for 1,200 people. Source; Radio Srbija