The “Belgrade Waterfront” project raises questions about whether it serves the public interest or primarily benefits foreign investors. Recent claims by Serbia’s President that the project has positively impacted the Serbian economy by €9.7 billion have sparked discussions. During a presentation related to a promotional campaign, Finance Minister Sinisa Mali was asked for clarification on how much the state invested versus what it earned from this project.
As the project continues to expand, there is ongoing state investment without a transparent calculation of costs to citizens or returns received. When pressed on the basis for the €9.7 billion economic impact, Minister Mali mentioned various benefits, including construction earnings, increased tourism, job creation and tax revenue, but he did not specify the total state investment.
Mali highlighted that “the best company” for measuring economic impacts has provided the €9.7 billion estimate. He noted that while the state holds a minority stake in the “Belgrade on the Water” company, it has already received €9.7 million in dividends, with €30 million paid overall.
The minister acknowledged that the infrastructure investment might have been a few million euros but couldn’t recall the exact figure. Regarding land valuation, he stated that the area previously housed dilapidated shacks that generated no tax revenue.
When asked why the state didn’t auction the land to determine its true value, Mali questioned why such actions hadn’t been taken in the past. The analysis referenced by officials was conducted by the company “Oxera,” which remains private as it is commissioned by a company partly owned by a foreign investor.
FEFA University professor Goran Radosavljević noted the lack of transparency in the project’s financial viability. He estimated that the state invested several billion euros in land and infrastructure but emphasized that the project’s benefits, particularly for the state budget, appear modest.
Despite claims of significant economic influence, the joint venture responsible for selling 7,000 apartments has not generated impressive profits. After initial losses, the first profits were reported in 2018, with total earnings over nine years amounting to €145.3 million. The state has received €9.7 million from these earnings, a stark contrast to the claimed €9.7 billion impact.
While taxes on profits, property sales, and employee wages contribute to state income, these figures still fall short of the billions initially mentioned. The project operates under an interstate agreement, which exempts it from Serbian laws, including tendering requirements, allowing foreign investors to benefit significantly from a 99-year land lease without initial costs. Further expansions of the project remain under consideration but have not yet been approved.
