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Interview with:
Mr. SLOBODAN MILOSAVLJEVIC
Minister of Trade, Tourism and Services Republic of Serbia
Belgrade, November 6th , 2001
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Could you give us a brief overview on trade indicators, and major export figures?
At the moment we are in the middle of reforming our economy from an administrative to a market economy. Last year's trade level was half of the one in 1990. Due to the last 10 years of sanctions and isolation this country cannot offer at the moment good quality, competitive products and prices to the European market.
Comparing the first 9 months of 2000 and 2001, we have increased our export by 5% and imports by 18%. Bearing in mind the fact that our industrial production is highly dependent on the import of raw materials (which is why we have a deficit of 2 million USD in foreign trade every year), these results could actually be considered as positive. Starting a new production requires larger import of raw materials. Regarding trade, our biggest challenge is propping up small companies, since they only have small property and without much capital, which is the result of the inflation in 1993.
We deal with many problems such as sufficient number of workers, average use of the work capacity in our companies (30-35%) and low purchasing power of the citizens. We now have some new laws and we also started to transform our fiscal system. Our aim is to harmonize our law with the positive legislation of the European community.
Regarding the issue of the funds, what is the new development program?
We have two possibilities. Either to recover the old companies or to try and start with greenfield projects. Although we have many good companies, they still have problems - such as large numbers of workers and old technology. Bringing in those new greenfield projects would result in adjusting the number of employees to cover the needs of the producing process.
Our trade is also fragmental, without real capital and mostly based on small shops. Now, a few days ago, trade center Cora signed the contract with our Delta Company to open 5 trade centers in Yugoslavia. This centralized offer may as well bring some problems for the smaller companies and shops, but it is a step in the right direction.
First we need to complete privatization, unification and recovery of our companies in order to enable them to compete with the big companies coming to this market. In spite of the low purchasing power, people here have an increasing need for well arranged and designed products, and they are interested in shopping in the big markets which can be interesting for the foreign investors.
Serbian products suffer from a lackluster image according to the European standards. How do you change that image?
Unfortunately so far we did not have many products recognized worldwide for their quality, but now we are working on a very important project called "Quality from Serbia" with its two-production lines- Ecofood and Etnofood.
Ecofood involves producing fruit, vegetables or any other kind of food without chemical substance. In the last 10 years we could not afford fertilizers in agricultural production and as a result we had maybe smaller productivity but also much better and healthier products.
Etnofood is there to present something characteristic for Serbia itself, for example Ajvar, Kajmak, Cvarci. Our aim is to bring health, good quality and tradition together and give the world something authentic from Serbia.
Moving on tourism, could you give us for instance some figures comparing this season with 1999?
We have had three achievements so far this year in the tourism branch. We managed to increase our foreign tourist trade by 40% (mainly in the City of Belgrade). Then, in September we entered the World Tourism Organization, which is a chance to bring our country back on the tourism market. In order to present the tourist offer of Yugoslavia in the best possible way, we have started a campaign that has a slogan: "Serbia, three times love" and "Serbia, fall in love again". With that campaign we are trying to answer the question "what is Serbia" and we are saying that Serbia is not only nature, or only cultural heritage, or only people- Serbia is all this together, and where is Serbia- Where fruits flourish from gardens of love. Because of that- Serbia is three times love
This year we have also increased the number of visas issued from 150.000 to 260.000 in comparison to last year.
| The main challenges in tourism for the next year will be the reconstruction of the tourist infrastructure destroyed in NATO bombing, preparation of the development program and the creation of tourist products from Serbia.
Serbia can offer various activities and destinations like hunting, river tourism, health tourism, skiing…At the moment we are working on putting all that together and starting a dynamic promotion campaign.
What about the privatization of the hotels?
We started a tender procedure for 6 of our hotels. They are: Metropol, Yugoslavia, Slavia, Serbia, Park in Novi Sad and Lepenski Vir on the Danube. We also have 8 of them on auction: Excelsior, Splendid, Astoria, Palace, Royal, Union, Central.
What is your present strategy in order to attract foreign investment into Serbian tourism?
In the privatization process, we are going to organize first an international tender for finding the consultant and then follow through with the classical auction procedure. So far I had about 60 world famous hotel chains interested in the privatization of our hotels such as Accor, Sheraton…
Last week in Belgium, I met 20 businessmen from the hotel branch interested in the presentation of our hotels, and we were going to provide them with all the information they need for participating in it.
Montenegro is also leading a tourism campaign with "Wild Beauty"… Since you are neighbors with similar markets, are you competing or cooperating?
The best way is to combine the beauties that Serbia and Montenegro have. Montenegro's Adriatic coast and Serbian mountains or hunting areas could make one good offer together. There is more competition between the hotels, because more than 90% of interest is from Belgrade.
Are you going to focus on developing tourism in the City of Belgrade?
Yes, because it is 65% of the whole Serbian tourism, especially thanks to the offshoot of tourism coming from business and congresses.
With your new campaign and your new products, what is your vision of the tourism in this country in the next 5 to 10 years?
Hopefully, in some years' time we will have all the world's most famous hotels here, which is necessary for regaining the trust of the tourism industry in our country.
Another important issue is the reconstruction of the infrastructure. For example, we have just one airport in Yugoslavia although we have possibilities to build new ones, perhaps in Nis or near Zlatibor.
We are on the crossroad position here with all the important roads from East and West passing through our country. But so far, the average stay in this Yugoslavia was 1.5 days per tourist. What we are trying to do is offer them more possibilities and things that would attract them to stay here longer.
In 2005 I see Serbia as a middle-developed country, without visas or official borders. After all, Serbia is a candidate for the European community, and we intend to get closer to our European roots.
Could you give us some background on your professional career prior to becoming Minister of Trade and Tourism?
I am the youngest Minister in this government. For ten years I worked in the Institute for market research in Belgrade. For the last 5 years I was director of the Centre for Macroeconomic Marketing Research. It was my international experience in this field that enabled me to work as a Minister for this first democratic government after almost 50 years. We have already done many things like legalizing the prices in the country, improving the trade regime, establishing a new investment system. This is a new beginning and we have a modern vision of our country.
Now that we managed to reach the right direction, we need not more than 3 to 4 more months to be on the highway with very good speed and no chance for going back!
Note: World Investment News cannot be held responsible for unedited transcriptions |
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© World INvestment NEws, 2002.
This is the electronic edition of the special country report on Serbia published in Forbes Global . June 10th , 2002 Issue.
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