Today, the Minister of Finance Sinisa Mali and the US Ambassador to Serbia Anthony Godfrey signed the Interstate Agreement on Encouraging Investments in the Government of Serbia, which is a precondition for starting the activities of the American International Development Corporation (DFC) in Serbia.
The signing of the Agreement was also attended by the director of the DFC office in Serbia, John Jovanovic.
All three officials agreed that this is an extremely important agreement for the economic development of Serbia and the entire region, as well as for attracting investments and creating new jobs.
Also, the Agreement is a confirmation of trust between the American administration and the Government of the Republic of Serbia.
“Today, we signed an extremely important agreement with the US Government on encouraging investments. The agreement is of great importance for the economic development of our country and the realization of high rates of economic growth, which we have defined in the budget for 2021, as well as for the years ahead,” said Minister Sinisa Mali after signing the agreement.
According to him, there are three reasons why this Agreement is of exceptional importance for the citizens of Serbia, and especially businessmen.
“The first reason is that he confirms that the Washington agreement is still being implemented. I would like to remind you that one of the points of that Agreement was the opening of the American Development Agency in Serbia, which covers the entire region. We fulfilled that, the agency opened in September last year, and with this Agreement, we are now opening the door to further cooperation with the American administration. That is why it is very important news for the citizens of Serbia,” said Mali.
He added that another important reason is that the Agreement indicates the great trust that the American administration has in the economic reforms implemented by Serbia.
“The second reason is that the signing of such an agreement indicates the great trust that the American administration has in economic reforms as well as in the growth prospects of our economy. Why would the American development agency invest money in Serbia, if it is not sure not only that it will make money, but that this is a safe and attractive destination for investments. It is a signal to other investors not only from America but also from other parts of the world to come to Serbia, which is open for investments and is fighting for every job,” said Mali.
He also stated that the third reason for the importance of this document is that it is a precondition for the realization of the guarantee scheme which will be implemented in Serbia in cooperation with DFC and commercial banks in Serbia.
“We remain committed to harmonizing the guarantee scheme with DFC by the end of the first quarter and to make that money available to our companies and commercial banks by the end of the second quarter in order to provide existing jobs and create new ones,” said Mali about the amount of almost a billion dollars.
According to him, that money will be available to businessmen, small and medium enterprises, for working capital and investments. He emphasizes that this is a huge capital that will give them the opportunity to reduce the negative consequences of the corona virus, to grow and develop and realize their plans. The intention is for the deadline for approving these loans to be for a period longer than ten years, which is not the case in the guarantee scheme that is currently in force.
The Minister reminded that there is already a guarantee scheme in Serbia that has been agreed with commercial banks, in which the guarantor of the realization of part of the loan is the Republic of Serbia. He added that the guarantee scheme has achieved its purpose and given extraordinary results, especially in preserving the economic substance of companies and jobs.
“About 23,000 companies used 1.580.000.000 euros of the existing guarantee scheme of a total of two billion euros, which was available. It was a huge incentive for liquidity, for investments and for working capital. So, we are talking about hundreds of thousands of jobs that we saved with the help of the guarantor of the scheme,” he stated.
The Minister reiterated that the state support measures in the total value of six billion euros (12.5 percent of Serbia’s GDP) have shown their justification in the results we have achieved, which is the smallest drop in GDP in Europe, preservation of jobs and avoidance of black scenarios regarding mass layoffs that have occurred in other countries.
According to him, we are successfully fighting on the other front, and that is the fight for the health of citizens, we were the first in the region to launch mass vaccination, which is a precondition to break the burden of the pandemic and “full sprint”, move forward to achieve economic progress.
Mali also announced that he would come out with another package of measures in a couple of weeks, and that, together with the guarantor scheme agreed with the DFC, it will be an addition to everything that the government will do through its budget and help our businessmen.
US Ambassador to Serbia Anthony Godfrey pointed out that this Agreement shows the US commitment to the economic future of Serbia.
“Serbia has the support of the United States to achieve its goal of full European integration and a future as an economic leader in the Balkans. This agreement will allow the DFC to use its full range of financial instruments such as debt financing, capital investments, political risk insurance and technical assistance personnel. Our goal is to use these instruments to mobilize new investments in Serbia, not only foreign but also investments of domestic Serbian companies in order to create new jobs and support the development of the economy,” Godfrey said.
He also underlined the importance of the presence of DFC in Serbia, emphasizing that some programs have already been concretized, such as support of 91 million dollars for the sector of small and medium enterprises in food production, agreed with the Ministry of Agriculture.
The director of the DFC office in Serbia, John Jovanovic, pointed out that the Agreement opens the use of the DFC’s travel potential in Serbia.
He reminded that our country is one of the first countries with which the DFC has concluded an agreement on encouraging investments.
“I hope that the opportunity will be used to increase the number of new investments, create new jobs and help the citizens of Serbia with the support of the DFC. Since we opened the office, we have been working tirelessly to further engage the public and private sectors in the wider region. The presence of the DFC confirms America’s readiness to expand financial assistance to Serbia based on common values, together with our European partners, so that Serbia can ultimately achieve its European future,” Jovanovic said.
He added that the immediate priority is to establish a financial support scheme for small and medium enterprises, to overcome the economic consequences of Covid 19 and that the goal is to do that in cooperation with domestic commercial banks, Alo reports.
