Investment boom without sufficient returns for Serbia – Economy



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Authorities and the professional public have different views on the United States’ participation in infrastructure projects envisaged by the Washington Agreement

While Zorana Mihajlovic, Minister of Construction, affirms that the economic agreement, signed in Washington, “investment boom”, the national professional public does not share his optimism and is skeptical about whether it will really be profitable for Serbia.

Investment boom without sufficient returns for Serbia 1Photo: FoNet / Beoinfo

Minister Mihajlović affirmed that the Washington Accord is worth about four billion dollars and that Serbia will dialogue with representatives of the American Development Fund on financing the sections of the Nis-Merdare-Pristina highway.

The tender for the first stretch from Nis to Plocnik, 33 kilometers long, will be announced in late October or early November. To this end, 40 million euros of non-reimbursable funds from the European Union have been provided and a loan contract has been signed with the European Investment Bank for 100 million euros.

Goran Radosavljevic, a professor at FEFA, told Danas that at this time it is not possible to evaluate the funds that Serbia will be able to count on with regard to the money that US financial institutions will allocate for the implementation of infrastructure projects in which our country is involved.

– Furthermore, it is now impossible to estimate how much financial burden Serbia will have in carrying out these projects. Representatives of the competent US agency will arrive in Belgrade on September 21 and then we will learn more details related to the concrete implementation of the Washington Agreement. The arrival of US financial institutions in our territory is certainly something important and useful. On the other hand, how much benefit will Serbia have when it comes to the realization of certain projects, such as the construction of the Nis – Merdare – Pristina highway, is something that is very difficult to assess at this stage. It is completely clear that the Americans will insist that their companies be the bearers of the realization of the project and not the Serbian companies, which is a loss and a worse variant for our side. In that sense, we cannot expect these projects to be excessively lucrative and profitable for Serbia, says our interlocutor. According to him, the construction of the highway from Nis to Pristina is not a priority for Serbia in a situation where there are no roads with which our country is connected, for example, with the Republika Srpska, Montenegro and Romania – explains Radosavljevic.

Goran Rodić, Vice President of the Serbian Chamber of Construction, tells Danas that the construction of the Niš – Priština highway is an important project from which our country can benefit.

– It is an important highway, important to American interests, and considering that an increasing number of our tourists go to the sea in Albania, the construction of that highway also makes sense for the Serbian side. I don’t think Americans ask their companies to do those jobs. They will certainly insist on announcing a tender for the construction of that highway, if an agreement is reached on the participation of the US side in its construction. In that case, our party should insist that the conditions of these tenders be such that Serbian companies are equal to the parties. That the conditions are such that they can participate in these tenders and fight for a job. Therefore, they must be guaranteed the opportunity to be, if not the job holders, then at least partners in its implementation. Only in this way, the national construction operator can benefit and it can be said that the implementation of these projects is profitable for the state of Serbia – concludes our interlocutor.

The DFC delegation will arrive in Belgrade on September 21

The executive director of the American International Development Finance Corporation (DFC), Adam Bohler, announced that the high-level delegation would visit Belgrade on September 21.

He called last week’s talks between Belgrade and Pristina in Washington historic, and confirmed on Twitter that the DFC would open an office to initiate crucial projects for economic normalization between Belgrade and Pristina, agreed at a meeting at the White House.

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