The Council of Foreign Investors in the latest edition of the “White Book” emphasizes that changes are urgently needed in the areas of personal data protection, trade, central records of beneficial owners, mortgages and public procurement.
The crisis will affect investments more than exports and employment, and also, profits will vary more than business income. Within this framework, the financial sector will be less affected than the real one. This is the result of a survey conducted by the Foreign Investors Council among a third of its members in June before the outbreak of the second wave of the Covid 19 epidemic. The latest edition of the “White Book”, published exclusively by Politika, states that the results of this survey GDP.
The Foreign Investors Council states that the government’s measures in the fight against the recession caused by the pandemic were primarily of a fiscal and monetary nature. It does not question the positive effects of these measures, but notes that most of the available fiscal space has already been used. The effect was favorable, as seen in the small decline in GDP, but it had significant fiscal costs. As the economy is in recession and public debt is rising sharply, room for future incentives is limited. Further institutional reforms are therefore needed to return the economy to sustainable growth and secure jobs.
According to the “White Book”, further improvement of the business environment is a long-term necessity. The Council emphasizes that changes are urgently needed in the areas of personal data protection, trade, central records of beneficial owners, mortgages and public procurement. The second block of priorities includes labor hiring, energy sector, sanitary inspection, dual education, court proceedings, public-private partnership, restitution, VAT regulations and central records of temporarily restricted rights, problem loans and insurance and other laws.
Within the six areas identified, real estate continues to require rapid change. The insurance sector, on the other hand, has the lowest priorities. It is interesting to note that the tax sector has priority changes below the general average. In tax policy, the biggest problems are not in regulations and institutions, and not in fiscal policy.
– The Council supports the government’s efforts to help companies and individuals overcome the difficulties in the current recession, but at the same time emphasizes that such assistance has its limits determined by the fiscal deficit and public debt. If those borders are crossed, the entire economy will be exposed to great risk and macroeconomic instability in which no one will do well – it is stated in the “White Book”.
The “White Book” identifies five pillars of development. Among them is transport, the development of which was adversely affected by the pandemic. The introduction of “green corridors” has had positive effects in this regard, but support for the system should be considered even after the current situation has stabilized. The detention time at border crossings has been especially extended. Progress has been made in road transport with the adoption of regulations in the field of dangerous goods and transport licenses, while regulations related to the transport of goods are in line with European regulations. The railway sector is the area where the need for modernization is highest at the moment. It is necessary, they say, to enter into public-private partnerships in areas of transport that are vital, and which are not reserved for the state, and which the state is not able to independently train, restructure or modernize, that is, for which it is more optimal and efficient to do so in partnership with the private sector. As they suggest, additional work should be done on opening the market in railway transport, in order to establish the necessary institutional structures.
When it comes to energy, the Council of Foreign Investors states that the contracting of energy supply for households and small consumers has started to work, but at regulated prices that have not changed for a long time. EPS is still the main supplier of electricity, although there are about 60 registered wholesalers. According to the White Paper, the energy sector requires rapid change. They suggest that the regulation of electricity prices be abandoned (but sensitive customers should be protected), which would enable new investments in the modernization and revitalization of coal and electricity production.
In the field of telecommunications, an important moment in the state of emergency was the sudden jump in domestic traffic, which exceeded the existing capacities of the operators, as a result of which one of the main priorities was significant investment in the network to ensure capacity expansion as soon as possible. At the same time, there has been a drastic decline in roaming traffic due to restrictions on the movement of people outside the territory of national borders around the world, which has resulted in a reduction in revenue.
An interesting recommendation is the government’s more active role in combating conspiracy theories and false news about 5G technology, in order to prevent attacks and disrupt the critical telecommunications infrastructure necessary to provide basic electronic communications services, such as voice and Internet access.
The field of digitalization and electronic business includes electronic commerce, electronic identification and documentation, as well as the business of administrative bodies, including the connection of public databases. This year, the whole world suddenly began to adapt to the new situation caused by the appearance of the corona virus and to turn to e-business due to the completely changed way of life and business that we knew. Many positive changes have also taken place in Serbia.
As in last year’s edition of the “White Book”, the focus of the Foreign Investors Council remains the implementation of the Law on Planning and Construction, the application of a unified procedure for obtaining construction documents, legalization of existing facilities in accordance with new regulations, conversion of construction land into ownership and application of regulations on cadastre and cadastral procedure.
There were no improvements in the area of labor and capital in the previous year, although they were expected, both through amendments to the Labor Law and in court decisions. All this was followed by the Covid 19 pandemic, which fundamentally changed the labor market. The state had to intervene with its decrees, recommendations and announcements, not only to apply incentives to maintain employment but also to specify the rights and obligations of employees and employers in the new circumstances (work from home, the amount of benefits, the rights of employees in self-isolation, paid and unpaid leave, the rights of parents who have children up to 12 years of age, temporary incapacity for work, use of annual leave, etc.).
According to official data, there is no increase in unemployment, that is, at the time of the corona virus, formally registered employment increased. This does not correspond to the situation with the members of the Council of Foreign Investors, nor does it coincide with many surveys of businessmen, it is stated in the “White Book”. It is proposed to introduce the possibility of arranging employment during the establishment or during the employment so that the employee works part of the working time outside the employer’s premises (and not only from home), as well as the possibility of changing the working regime during employment on a special basis to change the agreed conditions work. It is necessary to specify the difference between work from home and teleworking (by place of work or by means of work), and relativize the need to define “place of work” as a mandatory element of the employment contract by introducing “primary place of work” for remote work, as well as specify the obligatory item of the employment contract outside the employer’s premises – “compensation of other labor costs and the manner of their determination”, because legal certainty and security are necessary, Politika reports.
