photo: jadranka ilić / tanjugOnce popular for the opening of foreign factories, Serbia is now less attractive, says President Aleksandar Vučić, and the blockades and the fact that there is no longer a cheap workforce are to blame for this. Is that right?
He said that Serbia is no longer an attractive place for foreign investments because it no longer has a cheap workforce, and because "someone deliberately destroyed the university and dual education". the president of Serbia, Aleksandar Vučić on Thursday (October 9).
He thus once again used the opportunity to indirectly repeat that they faculty blockades during the previous academic year and protests influenced Serbia to become less interesting to foreign investors.
President Vučić's statement comes a few days after the US State Department announced that the investment climate in Serbia has slightly improved in recent years, but that the problems of bureaucracy, corruption, inefficient state enterprises, a large informal sector and an inefficient judiciary remain.
The interlocutors of "Vremen" believe that the claims of President Vučić are not in place, and they state that the reason for the lack of interest of foreign investors lies in corruption, energy and general political instability.
"The real reason that we have less foreign investment and that some foreign investors are leaving is really our bad general climate here", according to foreign investment consultant Milan Kovačević.
"When I say the general climate, I mean both political and economic. Lately, we simply don't have any plan where we are going. The budget is passed by being written by the finance minister and it is adopted without any discussion. There is no thought whatsoever about how, for example, we will overcome the problems we have in the energy sector. So, in fact, our policy and our state deter foreign investors."
Among the reasons for the absence of foreign investments, economist Saša Đogović cites an extremely high degree of political crisis, an extremely high degree of corruption in the country and the lack of a stimulating institutional environment.
"Every other company from Germany that operates in Serbia has pointed out that the institutional environment is a big obstacle and a high risk in their business. That is quite enough as an argument. If it is a problem in business for those who have already come to this market, then you can imagine how it is for those who have some intention to eventually come to this market, then it seems completely repulsive", Đogović believes.
He also cites the fact that Serbia does not have energy sovereignty, that is, that it is completely dependent on other geopolitical players, as a reason for the lower interest of foreign investors:
"We didn't do anything in that field to ensure some kind of sovereignty and energy predictability, so now we find ourselves in a pinch. In a situation where you can't see if you will have enough oil in a month to operate your refinery, then it's completely clear that you can't expect investors to come to you, because they don't really know what they can handle when we talk about the energy sector."
As he adds, the institutional environment in Serbia stimulates privileged players and the endemic corruption for which they are recognizable.
"Given those elements and this latest energy crisis, then it is completely clear that you cannot expect a rush of investors, but investors will avoid this market until they see a stable, predictable, stimulating institutional environment, which, unfortunately, we do not have," says Đogović.
That university blockades are to blame for investors leaving, representatives of the authorities repeated on several occasions.
The interlocutors of "Vremen" believe that the blockades have little to do with reduced investments.
"The fact that universities are not working and that education has collapsed is the result of the institutional crisis we are in and for which there are no answers or solutions," Đogović believes.
Kovačević emphasizes the high ranking of domestic universities and scientists abroad and the reputation they have received in the world, and adds that mentioning universities in that context does not make much sense.
"Disregard for rights is one of the most important reasons that rejects investments here. For investors, certain security, the certainty of knowing what will happen, is important, and there is none of that here."
Minimum wage it has been increased in Serbia to 550 euros since October, and the President of Serbia cited that as a reason for the departure of foreign investors, but Kovačević emphasizes that wages were increased due to the poor functioning of the state and high inflation.
"It is true that foreign investments are also attracted through cheap labor, and it cannot be cheap because inflation has increased our salaries. Our salaries have not increased, but, unfortunately, we have created excessive inflation, higher than other countries, so we are an expensive country. Then salaries must be higher," says Kovačević.
As he adds, it was not wages that stimulated less interest from investors, but the wrong moves of the government - bad spending of money and too high inflation.
The President of Serbia assessed that Serbia is no longer an attractive place for foreign investments as it was before, adding that this is partly because we no longer have cheap labor, and stating that from India to Tunisia there are many more places with incomparably lower minimum and average wages, and that people go to where bigger profits can be made.
"In the previous year, someone deliberately destroyed the university and dual education and the fact that we could offer professions - and the people who come to our country know that," he said.
"Someone has destroyed the education system, deliberately and deliberately, a little from the outside, a little from the inside - a little irresponsible rectors and deans and others... That's why we will have to invest a lot of money in the construction of new industrial zones, so that, with the subsidies we give, we will be attractive to foreign investors. We will especially work on the expansion of three zones - Leskovac, Ćuprija, Inđija", he stated.
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