POTENTIAL AND ADVANTAGES FOR FOREIGN INVESTMENTS IN SERBIA

Centre for Development, Restructuring and Privatization

2013

Area : 88,361 km2

Population : 9.5 million

Official Language: Serbian

Form of Government: Democratic Republic

Capital: Belgrade, 1.6 million

Currency : Republic of Serbia dinar (RSD)

Republic of Serbia

Corridor X: Highway Salzburg-Thessaloniki Corridor VII: The Rhine– Main – Danube Canal

linking the North and Black Seas Internal network: 40,845 km

- 5,525 km of main roads - 11,540 km of regional roads

- 23,780 km of local roads 8 ports on the Danube, 1 on the Sava and 1 on the

Tisa River

Strategic Position and Infrastructure

Stabilization and Association Agreement signed in April 2008 SAA ratified in the European Parliament in January 2011 The EU Candidate status granted in March 2012 Interim Trade Agreement with the EU Visa liberalization for the citizens of Serbia in December 2009

Serbia and the EU

CEFTA 2006 – entered into force in July 2007, for Serbia in October 2007

EFTA – with Switzerland and Liechtenstein, signed in December 2009 and entered into

force in October 2010; with Norway and Island, entered into force in 2011

The Russian Federation– entered into force in 2000, further trade liberalization became

effective in April 2009

Belorussia – signed and became effective in March 2009

Kazakhstan – signed in October 2010

Turkey – signed in June 2009 and became effective in September 2010

International Free Trade Agreements

Foreign Direct Investments (Greenfield) Brownfield investments Joint venture Implementation of PPP framework Privatization (656 companies from the real sector for privatization,

Rehabilitation Centres in Spas of Serbia, ongoing privatization of the

public companies) Trade of shares on the Belgrade Stock Exchange

Investment Opportunities

Indirect benefits: More favourable prices of land than market prices

Direct benefits: free import and export of goods0% customs tariff for import of goods intended for export import of goods and rendering transportation and other

services in the free zones are VAT exempted

Investments into Free Zones

Industrial Zones in Serbia

Investment projects eligible for the financial support Projects of special importance Large investment projects Medium investment projects

Amount of funding Up to 17% of total investment amount

Up to 20% of total investment amount Up to 10% of total investment amount

Minimum investment amount 200 million EUR 50 million EUR 50 million EUR

Minimum number of new jobs created 1,000 300 150

* According to the Decree of the RS on direct financing of investors

Financial Support

Investment projects eligible for the financial support

Direct investments

Manufacturing sectorInternationally marketable

services Strategic projects in tourism

Investments in the 4th group of local self-governments and

devastated regions

Investments in the 1st , 2nd and 3rd , group of local self-

governments

In the entire territory of the Republic of Serbia

In the entire territory of the Republic of Serbia

Amount of financial support

(in EUR)

4,000 – 10,000

for each new job

4,000 – 10,000

for each new job

4,000 – 10,000

for each new job

4,000 – 10,000

for each new job

Minimum investment amount0.5

million EUR

1

million EUR

0,5

million EUR

5

million EUR

Minimum number of new jobs 50 50 10 50

* According to the Decree of the RS on direct financing of investors

Financial Support

Lowest VAT Rate

Favourable Tax Environment

Serbia Bulgaria Slovakia Czech Republic Poland Romania Croatia Hungary0%

5%

10%

15%

20%

25%

30%

20% 20% 20% 20%

23%24%

25%

27%

Lowest corporate profit tax

Favourable Tax Environment

Serbia Bulgraria Romania Hungary Slovakia Czech Republic Poland Croatia0%

5%

10%

15%

20%

25%

10% 10%

16%

19% 19% 19% 19%20%

Lowest salary tax

Favourable Tax Environment

Serbia Romania Slovakia Bulgaria Poland Hungary Slovenia Croatia0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

12%

16%

19%

24%

32%

36%

41%

45%

Net salary Gross salary

25,000 RSD(250 EUR)

41,037 RSD(400 EUR)

40,000 RSD(400 EUR)

66,266 RSD(650 EUR)

60,000 RSD(600 EUR)

99,903 RSD(1,000 EUR)

Gross monthly salaries in EUR

Salaries in Serbia and in the Region

Serbia Hungary Poland Slovakia Czech Republic Croatia0

200

400

600

800

1000

1200

469

713 717 745

893

1051

Level of Investments in Serbia from 2002

* Source NBS

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

326

1071796

1440

4286

2004

2362

17711510

21422361

FDIs by industry in 2012

69%

11%

6%

3%2%

2%2%

2% 1%1% 1% 0%

Прерађивачка индустрија

Трговина на велико и трговина на мало

Грађевинарство

Пословање некретнинама

Финансијске делатности и делатност осигурања

Неразврстано

Информисање и комуникације

Стручне, научне, иновационе и техничке делатности

Рударство

Саобраћај и складиштење

Снабдевање електричном енергијом, гасом, паром…

Пољопривреда, шумарство и рибарство

* Source NBS

Top ten countries by amount of investments 2005 – 2012 in mln. EUR

* Source NBS

Аустрија

Норвешка

Немачка

Луксембург

Грчка

Холандија

Италија

Руска федерација

Словенија

Мађарска

The bigest foreign investment in Serbia

British American Tobaco South East EuropeAirport City Beograd

Pepsi Co MarboLukoil - Beopetrol

Fondiaria SAICrédit Agricole Srbija

US SteelMerkator

National Bank of Greece - Vojvodjanska BankaAgrokor

CEE / BIG shopping centersStarBev– Apаtinska pivаrа

Salford Investment FundRaiffeisen banka

Eurobank EFGBanca Intesa - Delta Banka

Philip Morris DINMobilkom - VIP Mobile

Stada - HemofarmDelhaize

Fiat Automobili SerbiaGazprom Neft - NIS

Telenor

200200210210220

264280

413425

450470487500500500508

630633650

933940947

1602

* In mil. Eur, Source SIEPA

155 years of existence and business operation

110,000 companies and 220,000 entrepreneurs

Germany, Austria, France, Italy, Montenegro, Ukraine, Belgium, the Russian Federation

Membership in the international chamber associations (ICC, Eurochambres, ASCAME, ABC)

More than 70 agreements with chambers, agencies and associations

Tradition

Membership

Representative Offices Abroad

Networking

Correspondence

CCI Serbia – in the best interest of the economy

Centre for Development, Restructuring and Privatization

investicioniprojekti@pks.rs

тeл: (+381 11) 3300-983 e-mail: slobodanka.kojic@pks.rsтeл: (+381 11) 33-04-547 e-mail: velibor.djordjevic@pks.rs

www.pks.rs