Serbian market

Opportunities and possibilities for Tourism Investment

Serbia own many elements of power which give her the position to be in the top priority of the investors' projects between the growing nations , it attracting foreign and domestic investors both on equal , I can refer to two main elements of Serbian investment attractive power which are:

1 -Geographical nature.

2 -Governmental policies.

About Geographical nature:

Serbia located at a cross point between Asia and Europe, simply that means an amazing landscape and mix of west and east culture, Islamic and Christian remains in addition to the landmarks of ottoman's governance , in Serbia you can find the old churches and Islamic buildings, also Serbia have an amazing weather which is so suitable for the tourists.

Belgrade the capital of Serbia has been ranked seventh in the prestigious list of 10 must-visit cities of the world for 2015 by The British travel guidebook publisher" Rough Guides", this Guides is a renowned UK-based travel guidebook publisher, whose publications cover over 200 destinations and are read around the world, also The Globe and Mail, a major Canadian daily newspaper based in Toronto describes Serbian capital as one of Europe’s most surprising cities.

This results of that classification for " Belgrade " between the world's cities and also the raise trend of tourism there that reflects the great role of government's policies there, Serbian government was aim to diversify the sources of income, that's why it chose the tourism sector to be one of

main ingredient to push economic cycle .

Now it's time to discuss the Serbian government's policies in the investment sector :

Economic system of Serbia has seen a major shift during the period after the collapse of the Soviet Union, turned from socialist central system to the capitalist system and use of the market mechanism, synchronized with the government's efforts to build a strong modern state that was in the 1990s, and in order to achieve a Serbian successful capitalist economy, government took a number of actions, including:

• privatization programs.

• liberalization of markets.

• openness to foreign investment.

The Serbian government has established a "Commission of privatization" in 2001, and proceeded to privatize some companies in Serbia was around 2289 company since 2001 and until 2013, and the total income from sales amounted to 3 billion euros, also reached the total investments made by investors 1.4 billion euros.

Serbian Privatization Commission has identified selling methods, through distribution the capital of a company to be sold as follows: 70% is sold to the investor and 15% bonus shares to employees and 15 shares% sold to citizens through public offerings, which directly under the commission's supervising, Commission announced terms of the offer and allows the investor to study the company before his apply his offer.

All process of selling and privatization are under the umbrella of law and shadow of internal authority's approvals and compatible domestic in order to attract investor, and offer equality between foreign investors and local, but with only one exception for the arms trade exclusively for the local investors, in 2000 a set of legislations which are related to regulate the process of privatization has been promulgated , including:

- Privatization Law.

- set up the privatization commission.

- The rights of free shares to citizens.

- Competition law and consumer protection.

In the same context of Serbian government efforts to facility the investment sector, it has been the established another authority which was "General Agency for Investment Promotion and Export Development" also in 2001, The agency's main target was to attract foreign investment and develop local companies.

The main objectives of the agency were as the following points:

- Collecting economic and financial data, and all issues related with economic sphere .

- Determine needed and necessary investment laws.- choose the appropriate places for investment projects.- Preparing the necessary infrastructure for the investment's projects.- To follow-up of the investment projects.

So clear that Serbia aim to motivate investors, Serbian government has provided support to investors of more than 240 million euros, as new investments have created more than 40 thousand of new jobs , the Agency was supervised this support since 2006.

The following are the most important contributions to the Agency in the context of investment promotion :

• provided the approvals to 226 projects with an aggregate value of more than 1.25Billion euros.

• The Agency has an investment map, include good land and buildings which are ready to investment.

• The agency has a database where all the investment projects .

• Agency's mission to provide technical support to companies Serbian whether to participate or other.

• The rate of increase in the amount of investment in Serbia reached 2 billion annually.

We Can be summarized the incentives granted to investors in Serbia in the following :

• for employment:

European foreign investors especially take advantage of cheaper Serbian labor comparing to other European employment, low salaries and high skills which are equivalent to the level of skills to European countries, and that the investor does not need a large number of employment, and also government provide him with financial assistance.

• Provide data:

Agency offers data which investor need to the project, and give him the land they want, as well as debt desired by the investor.

• Freedom:

The investor has the freedom to choose the sector that he wants to invest in it .

• Competitive Taxes:

Although the taxes on profits in Serbia was 10% and was increased to 15%, but the taxes in most European countries is higher than that.

•Reduction of costs:

Costs in Serbia less than the cost in the rest of Europe especially the cost of salaries.

The agency is also working to bring the investor profits in excess of those expected to be achieved in other countries.

World Bank report shows that the private flows of direct foreign investment in Serbia in 2013 had stated that such 1.974 million, 4.3% of GDP, achieving a significant jump from the previous year in 2012, which won only 2.9 %.

Through a review of these indicators and to shed light on the efforts of the Serbian government in facilitating investments , we can move to the next point, which shows us some of the results of these efforts and how evolved into a powerful economic interfacial relations between Serbia and a number of countries, including, for example, UAE and KSA ;

United Arab Emirates:

Economic relations between the two countries have seen a big jump and numerous areas of investment and trade between the two countries to include several areas of such as:

Manufactured food , which Serbia occupies the leading position in it

The field of armament and military cooperation. Construction Domain, the Serbian giant of construction

"Energoprojekt" which go beyond the projects in the Gulf region about 100 million euros.

In August 2013 "the UAE Union" to fly purchased 49% bought in Gat "Airways" Serbian.

Saudi Arabia:

  Economic relations between the two countries have created strong opportunities for mutual investments, especially in agriculture and food industries which attract investors to it, "Salik" Saudi Arabia working in the field of food industry ranked Serbia as one of a list of priority countries to cooperate with it, and there are many scheduled an agreement on economic technical cooperation for protection of investments. Means that the Serbian government is not only limited to the need to attract foreign investments but also it seeks by its official delegations, ambassadors to do a Serbian companies and investments in several countries and I mentioned United Arab Emirates and Saudi Arabia as examples only.

Conclusion

• Invest in Serbia in general has many comparative advantages such as: flexible procedures, reduction of costs, competitive tax which less than the rest of Europe, as well as the high skill of labor with lower wage rate.

• Serbia is growing nation, as The World Bank reports, which gives them greater investment opportunities in the future much success and prosperity may exceed expected at present.

• The tourism investment, in addition to the aforementioned features added to its natural and geographic features that give Serbia a high ranked country for investment.