Doing Business in the Middle East: Contributed by Linda Anani
In retrospect, 2013 was an incredibly busy year for Serbian economic generators. Here is a brief overview of the extensive growing interest from giant Middle Eastern partners, as well as major challenges in the expanding markets of Central Eastern Europe:
Serbia’s recent participation in Dubai’s GITEX expo (20-24 October 2013), introduced some of the country’s leading IT companies, and helped extend the country’s marketing reach into the Middle East. A total of fourteen Serbian IT companies took part in MENA’s largest and most influential IT and communications event, with Serbia’s Investment and Export Promotion Agency (SIEPA) reporting a “steep growth path in recent years” in international business, trade and investment relations between Serbia and the Middle East. One of the most notable Serbian exhibitors at this event was one of Europe’s most revered and leading game developers, NORDEUS.
The year also witnessed the recent partnering of the UAE’s Etihad Airways with the government of Serbia to bring into existence the new Air Serbia, while earlier visits by His Royal Highness Sheikh Abdullah bin Zayed al Nahyan culminated in three major business deals that will total USD 220 million by 2017, SIEPA said.
Air Serbia, a rebranded JAT Airways, was established in 1927 and presently serves over 30 Euro-Mediterranean destinations, through its code sharing partners and future 49% shareholding equity partner, Etihad Airways. The new airline is anticipated to play a vital and critical role in reshaping the country’s aviation industry and pave the way towards revitalizing Serbia’s national infrastructures and the development of its travel and tourism industry.
Earlier this year, Serbia also signed a major agriculture agreement with leading Abu Dhabi based agro-industrial company al-Dahra. The Serbian Finance and Economy Ministry said in a press release at the time, that a third of the investment was to be used to purchase assets of eight failed agricultural combines, while the rest was to be allocated for the installation of irrigation systems, purchasing and upgrading modern equipment and current assets needed for construction and the operation of at least five factories for the production of cattle feed.
Meanwhile, Serbian Deputy Prime Minister, Aleksandar Vucic, said in early October 2013 media statements that he expected his country to conclude talks with Abu Dhabi’s Investment Fund, Mubadala, on the construction of an aircraft components factory towards the end of the year. The project is expected to be developed by Strata, Mubadala’s aerospace manufacturing arm, and the plant will hopefully produce parts for Boeing and Airbus with around 600 employees. Mubadala and the Serbian government also announced at the same time to have signed four memoranda of understanding (MOUs) in the fields of aircraft technology, telecommunications semi-conductors, and renewable energy.
Among the many available opportunities in Serbia, potential investors are now also expressing interest in the country’s largest pharmaceutical company, Galenika, after the announcement of a Government-backed restructuring process that would clear its debts in accordance with the new law on privatisation.