Prudence pays off as investors move in
LONG A TRADING CROSSROADS, SERBIA IS NOW AIMING TO RECAPTURE ITS FORMER COMMERCIAL PRESTIGE BY USHERING IN ECONOMIC REFORMS

ACTIVE IN BOTH DOMESTIC and foreign markets, the Yugoslav Bank for International Economic Cooperation supports national exports in addition to offering a wide range of financial products and services.

During the Milosevic era, Serbia became an outcast state, shunned by the West and isolated politically and economically by many of its former friends and allies.
But the new administration that now has the daunting task of rebuilding Serbia is determined to do its utmost to bring about the rapid reintegration of the republic into the international community.
In particular Serbia sees improved relations with the United States as the key ingredient in its quest to cast off the shadow of the former Yugoslav president.
Finance and Economics Minister Bozidar Djelic outlines two major strands in the relationship between the two countries. Firstly he says the U.S. can use its influence in international financial circles to help Serbia gain substantial debt relief and, secondly, it can forge new bilateral agreements to help the republic recover from the devastation of the past decade.

The new administration has demonstrated its determination to cooperate with the international community by its extradition of Milosevic in June and is now keen to stress the benefits that a stable, democratic Serbia can bring to the region as a whole.
“Of course we understand that any deals with the U.S. are conditional on future democratization and the collaboration with The Hague tribunal, but we share those goals and so it shouldn’t be an obstacle to improving our relations,” says Mr. Djelic.

ON TRACK Serbia is hoping that debt relief and new bilateral agreements with the U.S. will serve to rejuvenate the republic’s economic potential.

The hope is that Serbia’s actions will now help speed up moves to secure relief from the crushing burden of debt inherited by the new government. “We have to deliver to the international community on a number of issues that they requested from us,” comments Goran Pitic, Minister of International Economic Relations. “This is a very sensitive question which comes at a time when the population is impatient. We are trying to work on both tracks.”
The government is also collaborating hand-in-hand with international agencies such as the IMF and the World Bank to successfully transform the economy. In June the IMF granted a $250 million standby credit and later praised Serbia for its implementation of prudent economic policies that have resulted in progressive reforms and greater stability. In September, the World Bank approved a $540 million structural adjustment loan for the next three years, although it is clear the enormous task of rebuilding the republic’s infrastructure will still rely heavily on foreign investment.
The privatization program is also a key element (see page 4), and Mr. Pitic stresses that “the privatization process has not occurred yet in this country and will affect thousands of companies. This process, as well as our well-educated and cheap labor force and the prospect of free trade with Russia, should give investors a great opportunity.”

Trade and Tourism Minister Slobodan Milosavljevic says investors must come to recognize the potential in terms of human resources, market and industrial power that is at present unexploited in the Serb economy. “We have a well-
educated workforce, many of whom have worked abroad for international companies and labor costs are low here,” he explains. “In the past Serbia acted as a crossroads between the East and the West and the North and the South, we were a conduit for trade between the west and the former Soviet Union and we want to fulfill that role once more.”

DARKO CUKIC President of Yugoslav Bank for International Economic Cooperation

One organization that is doing its best to help the country tap into the circulation of international capital is the Yugoslav Bank for International Economic Cooperation, presided by Darko Cukic.
Operating as a commercial bank since 1997, it offers a full range of products and services to a wide client base, but is primarily engaged in operations in support of Yugoslav exports, providing professional assistance in the preparation of pre-investment studies and guidance for negotiations with foreign partners.
The bank has an established international reputation and has developed good relationships with many of the world’s leading financial institutions. It prides itself on tailoring its services to individual customer needs.
It defines its role as “helping to restore Yugoslavia to its rightful place in Europe, where it belongs from the point of view of civilization, geopolitical position and economic perspective.” A goal that is, of course, fully shared by the new administration.