Two thirds of foreign direct investments in the Western Balkans arrived in Serbia. So far, more than 40 billion euros, mostly from the European Union. However, in the last few years, 11 investors have left. The Chamber of Commerce says that it is about activities that go after cheap labor and that there is no reason for concern, because they are being replaced by high-tech companies.
For a dozen Belgian companies, Serbia, or rather the heart of Šumadija, will become the new place from which they will do business. They will be led by the company for the production of heating and cooling devices “Jaga”.
“In the first phase, we will invest 35 million euros, and we plan to expand the production capacity to 55,000 square meters by the end of next year,” says Herbert Huben, president of the “East West Valley” company.
They decided on Kragujevac because of the infrastructure, “Mind Park” with a kindergarten for 200 children, and since last month also a mini-airport, where more than 15 companies with over 2,000 employees are already operating.
“I am very happy that we will soon have innovative companies from the Netherlands, Belgium, Benelux, from that area that are not yet present,” says Bratislav Milanović from the Mind Park industrial complex.
In addition to starting production, the Belgian company is also planning a Research and Development Center, because they see the University of Kragujevac as a breeding ground for talented and promising future engineers who can become part of their team.
“We have production in several countries, and we export to over 35 countries. This is a growing market and we truly believe that there are many opportunities,” says Bart Kanini, CEO of East West Valley.
Ministry: Money given to foreign investors will be returned in 16 months
However, there is great dissatisfaction among the public when, after a year of operation, investors close factories. So far, 11 foreign companies have left Serbia after several years of work.
“These are things that happen, it’s the market, it’s normal in every economy. The most important thing is – what is the structure of those new investments. In our case, we managed to make that quantum leap towards some higher technology,” says the president of the Serbian Chamber of Commerce, Marko Čadež.
At one time, the Ministry of Economy did an analysis that showed that the money given to foreign investors is returned fourfold in 16 months, when only the wages of the employees and the state’s income on that basis are taken into account. The analysis did not convince the public, which wonders why these funds are not invested in the domestic economy.
“Slightly more than half of all state-supported investments, which the state gives, are our companies. Here we have, just the other day, the Pionir company, which received support for a new level of development of its factory in Subotica,” says Čadež.
According to some information, about a thousand European companies, due to the problems they had during the pandemic, disruption of supply chains and high transport costs, are planning to move production from Asia.
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