If you are looking to sharpen your competitive edge and get a step ahead of your competitors Vojvodina is the right place to grow your profits.
Vojvodina is located in the northern part of the Republic of Serbia, interlocked with EU borders from three sides. With its long industrial tradition, well developed educational system and innovation stimulating environment it is considered to be the engine of Serbia’s economic de- velopment. As a result of its advanced hi-tech culture that positively supports innovation and economic growth, Vojvodina continues to significantly contribute to Serbian GDP creation.
The ideal geographic location of Vojvodina region, covering 21,506 square kilometers, provides excellent opportunities for production sites, logistics, and export processing zones. In addition to various Free Trade Agreements, many benefits originating from its favorable location, inclu- ding the two major Pan-European transport routes (Corridor 10 and Danube River), are readily available to all the companies doing business in Vojvodina.
The region of Vojvodina provides a sound investment environment guaranteed by the legislation that is in line with the relevant EU practices. Along with the number of government initiatives to proactively facilitate the FDI inflow, Vojvodina offers an outstanding support system forgrowing your profits, increasing productivity, and boosting competitiveness.
Vojvodina is among the most culturally vibrant places in the region. It is a home to 26 diffe- rent nationalities where 6 official languages are in use. This magnitude of multicultural density is what guarantees continuous supply of fresh perspectives and an ever-enduring ex- change of creative ideas between people that share the same values of inclusive, cohesive, and open society.
Additionally, various arts and music festivals all year round are continuously invigorating the cultural landscape allowing you to recharge your creative batteries and get in that innovation- oriented mindset.
www.rav.org.rs 1 Czech Republic Ukraine Germany Slovakia 1250km
1000km
750km Austria Switzerland 500km Hungary 250km Slovenia Romania Croatia Vojvodina
Bosnia and Herzegovina Serbia Bulgaria Italy Montenegro
Macedonia
Albania
Greece
E-75
Tisa
Danube Novi Sad
E-70 E-70
Sava 2 Belgrade VOJVODINA DEVELOPMENT AGENCY E-75 VOJVODINA SERBIA
Total area 21,506 km2 Total area 88,407 km2
3 counties Territorial organization Population 7.04 million (excl. Kosovo) 45 municipalities GDP 2017 36.832 billion euros Agriculture Food processing Credit rating BB/Stable Automotive supply industry Main sectors Metal processing 2018 - 43th out of 190 Doing business rating Chemicals 2017 - 47th out of 190 Pharmaceutical industry Unemployment rate 14.7 % Industrial production 7.7 % growth rate 2016/2017
Vojvodina export share in 32.9 % Key export markets total Serbian export 2017 EU 69.8 % CEFTA 16.7 % RUSSIA 6.4 % OTHER 7.1 % Export volume 2017 4.95 billion euros
Export growth rate 14.8 % 2016/2017
Manufacturing 83.5 % Food & Beverage 17.0 % Motor vehicles & trailers 11.8 % % of total export Key export sectors Rubber & Plastics 9.4 % Electrical products 7.8 % Coke and oil derivate production 7.7 % Double Taxation Treaties with 59 countries Chemicals 6.7 %
Unemployment rate 13.2 % Bilateral Invesment Treaties with 39 countries
Source: Vojvodina Chamber of Commerce, NBS
www.rav.org.rs 3 Getting around
Airports On road By rail Airport “Nikola Tesla” Belgrade (70 km from The ideal location and transportation in- Railway-road Corridor X connects Salzburg, Novi Sad) frastructure of Vojvodina enables quick and Ljubljana, Zagreb, Belgrade, Nis and Thessa- easy access to other CEE and SEE countries. loniki with branch Xb Belgrade, Novi Sad, Public roads and railway lines are passing Budapest. The railway network is well or- through the regional administrative center ganised. There are intercity trains between By air of Novi Sad with all other areas being easily all major cities in the region. The closest airport to Novi Sad is Belgrade accessible within a relatively short period Nikola Tesla International Airport (70 km of time. Standard speed limits, which may away), which is served by major European vary according to signs, are 120 km/h on flight-carriers and several low-cost carri- highways; 100 km/h on motorways; on Waterways ers. Once you arrive to Belgrade Airport you main roads outside built-up areas 80 km/h, Corridor VII - Danube, Sava, Tisza, Danube– can easily get to Novi Sad by pre-booking and in built-up areas 50 km/h. Road toll is Tisza–Danube canal a private transfer with the average cost of to be paid on most sections of the highways 30 EUR. (E70, E75), and can be paid: with cash (RSD, EUR); by credit card (Mastercard, Maestro, Visa or American Express, as well as the na- Public transportation tional DinaCard); or electronic system with Public transportation in major cities in Voj- prepayment. vodina is well established and organised, Roadways and can be used by purchasing tickets di- Corridor X: E - 75 highway (Greece – Mace- rectly on the bus. In addition, taxis are quite donia – Serbia – Hungary – Slovakia – Railways cheap and very popular form of transport. Czech Republic – Poland – Finland – Nor- Novi Sad – Budapest (Hungary); Novi Sad way) & E - 70 highway (Spain – France – Zagreb (Croatia); Novi Sad – Thessaloniki – Italy – Slovenia – Croatia – Serbia – Ro- (Greece); Novi Sad – Sofia (Bulgaria); Novi mania – Bulgaria – Turkey – Georgia) Sad – Timisoara (Romania)
4 VOJVODINA DEVELOPMENT AGENCY WHY INVEST?
Did you know that Serbia is the only country outside the Common- The region of Vojvodina has been declared as one of the top FDI re- wealth of Independent States that has a Free Trade Agreement gions for Cost Effectiveness - allowing you to achieve the best ratio with Russia? Additionally, if you want to gain a duty-free access to between cost and quality. 1 billion consumer markets, we also have Free Trade Agreements with EU, CEFTA, EFTA, Belarus, Turkey and Kazakhstan. To jump-start your success and to help you get the greatest value from your investment, investors are rewarded with a generous and If you are looking for the right place to set up your business while easy-to-access incentive packages, both on state and provincial remaining close to your distribution centers – the region of Vojvo- government level. dina offers a quick solution to optimize your operational costs while employing high-quality workforce at competitive rates. We invite you to launch your investment project in the region of Vojvodina and to experience all of the advantages that make Vojvo- Top-notch investment locations suitable for a wide range of activi- dina the first-choice location for growing your business. ties and tailored to your specific requirements provide an excellent starting point to boost your investment to its fullest potential.
Top 5 reasons to invest in Vojvodina
1 Top quality workforce at competitive rates 2 Low operating expenses 3 Quick access to global markets 4 Boosting profits with favorable tax system 5 Generous incentives
www.rav.org.rs 5 1 Top-quality workforce Achieve highest performance at competitive rates
Optimal ratio between cost, productivity, and quality of the CEE Countries Minimum Average monthly workforce boosting the overall competitiveness of the business wage bruto bruto wage environment. (EUR) 2017 (EUR) 2017 Access to exceptional talent pool with multicultural diver- SERBIA 253 550 sity offers flexibility and adaptability for maintaining unrivalled performance levels. Romania 318.5 706 There are 141 registered secondary schools from which 121 Hungary 412.7 939 are state owned and 20 private. Teaching is conducted in Ser- Czech Republic 419.9 1,121 bian, Hungarian, Ruthenian, Slovakian, Romanian and Croatian. Slovakia 435 960 Vojvodina represents a specific hub for University education Croatia 442 1,079 – 3 Universities (1 state – 14 Faculties, 2 private – 9 Faculties) with internationally recognized Faculty of Technical Sciences (28 Poland 473.3 1,020 undergraduate academic profiles, 33 master academic profiles). Slovenia 805 1,625 Source: Eurostat Source: Vojvodina boasts 57,776 enrolled students in 2016/2017 out of which out of which 43,897 attend University of Novi Sad. From all the applicants that speak foreign languages, most of them speak English and German, and some of them Russian, LABOR COST STRUCTURE French, Spanish and Italian. Average salary in Vojvodina 2017 % EUR Net salary 380.87 National Employment Service Grants Personal Income Tax 10% 40.21 Employment Contributions (Employee) 19.9% 104.61 subsidies program cca. € 850 - 1,700 GROSS SALARY 525.69 Apprentice program cca. € 170 - 210 per employee Contributions (Employer) 17.9% 94.10 Re-training program max cca. € 850 per employee TOTAL COST 619.79
Source: National Statistical Office, Eurostat Source: Statistical Office of the Republic of Serbia
6 VOJVODINA DEVELOPMENT AGENCY 2 Competitive operating expenses Get on a fast track to success
Implementation of investment projects in Vojvo- Greenfield and dina results in a significant reduction of opera- tional costs. Brownfield locations
0.150 Greenfield project Industry Construction cost electricity 0.121 Industrial facilities (average cost) 200 - 400 EUR/m2 0.114 0.100 prices Business premises (avg. cost) 750 - 900 EUR/m2 (per kWh) 2017 Average land cost 3 - 10 EUR/m2 0.064 Industry 0.050 gas prices (per kWh) 2017 0.031 0.030 0.031 Brownfield project 0 Exsisting business options COUNTRY SERBIA EU 28 EUROZONE (prices in euros) - Lease (average cost) · Old build 1 - 2.5 EUR/m2 · New Build 3 - 5 EUR/m2 - Built to lease option Source: Eurostat - Lease with purchase option
www.rav.org.rs 7 3 Quick access to global markets Duty free access to 1 bn consumer market
Ideal geographic location - allowing you to most efficiently CEFTA (population 30 mil) - free trade agreement between Alba- implement JIT/JIS production models and to cost-ef- nia, Bosnia and Herzegovina, Macedonia, Moldova, Montenegro, fectively distribute aftermarket products to the region. Serbia and Kosovo. Duty free trade and accumulation of origin. Ex- Positioned at the intersection point of two major European ported products in order to be considered of a Serbian origin, need corridors - Corridor VII and Corridor X. to have undergone sufficient processing in Serbia. EFTA (populatation 13 mil) - free trade agreement between Swit- Only one border crossing the EU along with duty-free ex- zerland, Norway, Iceland, Liechtenstein and Serbia, there is no port to a number of countries, allows companies to serve customs duties except on fish and seafood. Trade of agricultural their global markets from a single location. products is regulated by mutual concessions. The region of Vojvodina is uniquely positioned for global BELARUS (population 10 mil) - abolished custom duties and other trading offering you a duty-free access to over 1 billion taxes with the exception of white sugar, ethyl alcohol, cigarettes, consumer. used cars, buses and tires that will continue to be subject to taxation. KAZAKHSTAN (population 16 mil) - mutual removal of custom EU (population 505 mil) - enabled customs free export of all prod- duties and other taxes with the exception of poultry meat, cheese, ucts bearing the Serbian origin label, excluding wine and baby beef. white sugar, cigarettes, sparkling wine, ethyl alcohol, tires, cotton In addition, the EU FTA abolished customs duties and quantitative weaves, cooling device compressors, tractors and vehicles. restrictions for import of Serbian textile products and guarantees to maintain the same policies in the future. Exemption from pay- USA (population 317 mil) - duty-free entry for more than 4,650 ment of customs duties for all industrial products originating in the products, including most manufactured and intermediate goods and EU, and in the part of agriculture means the exemption / reduction selected agricultural and primary industrial products, has been en- of customs duties, depending on the Annex or the SAA Protocol in abled. The products that have been excluded from this list generally which the product is located. fall in the categories of textile products, leather goods and footwear. RUSSIA (population 142 mil) - All products that have a certified TURKEY (population 72 mil) - Export is duty free, as well as import Serbian origin, meaning that more than 51 % of the product value of industrial products and certain agricultural products such as: has to be generated in Serbia, could be exported customs free to 5,000 t of beef per year as well as clearly defined quota of raw and the Russian market. Exemption are following product groups: poul- refined sunflower oil, sunflower seeds and specific types of pastry try meat, white sugar, cheese, alcoholic beverages, cotton fabrics, products. The export quota from Serbia to Turkey for the particular carpets, monitors, motor vehicles, tractors, wooden furniture. types of frozen vegetables and prunes will be doubled.
8 VOJVODINA DEVELOPMENT AGENCY Advantages of doing business in the free zone regime: Fiscal benefits Customs benefits Financial benefits Benefits of local self-government Efficient Free Zone Administration (One Stop Shop) There are 7 Free Zones in Vojvodina: 1. Free Zone Subotica Novi Subotica Kanjiža Kneževac 2. Kikinda (Free Zone Subotica)
Čoka Senta 3. Free Zone Novi Sad Kikinda Bačka Topola 4. Free Zone Apatin Sombor Ada
Mali Nova 5. Odzaci (Free Zone Apatin) Iđoš Crnja Novi Apatin Kula Bečej 6. Free Zone Zrenjanin Bečej 7. Ruma (Free Zone Šabac) Vrbas Srbobran Žitište Odžaci Temerin Bački Žabalj Sečanj Bač Petrovac Zrenjanin Free zone Bačka Palanka Novi Sad Plandište Titel Free zone branch Beočin Kovačica Irig Alibunar Vršac Šid Inđija Opovo Sremska Mitrovica Ruma Stara Pazova Pančevo Bela Crkva Pećinci
Kovin
www.rav.org.rs 9 4 Boosting profits with favorable tax system
By choosing to invest in Vojvodina, foreign investors enjoy the The base for determining the social security contributions is benefits of a highly competitive and advantageous tax the gross salary. The minimum base for contributions is 35 % system, essential for boosting company profits. In addition, of the average monthly salary earned in Serbia, while the favorable business and investment climate conditions con- maximum base is 5 times the average monthly salary. Social tribute to a proven record of successful FDI attraction. security contributions are paid by both the employer and the employee. In general, Serbia’s tax regime is highly conductive to do- ing business. Corporate profit tax is the lowest in the region, Social Insurance Contributions while VAT, salary tax and social insurance contributions are Pension & disability 12 % 14 % among the most competitive in Central and Eastern Europe. Health Insurance 5.15 % Unemployment 0.75 % Annual Income Tax 10 - 15 % Other Income Tax 20 %
Salary Tax Rate Corporate Profit Tax Rate Corporate Profit Tax Rate Serbia 10 % Serbia 15 % Serbia 20 % Czech Republic 15 % Czech Republic 19 % Czech Republic 21 % Romania 10 % Romania 16 % Romania 19 % Slovakia 19 - 25 % Slovakia 21 % Slovakia 20 % Poland 18 - 32 % Poland 19 % Poland 23 % Croatia 24 - 36 % Croatia 18 % Croatia 25 % Slovenia 16 - 50 % Slovenia 19 % Slovenia 22 % Source: Deloitte 2017, European Commision
10 VOJVODINA DEVELOPMENT AGENCY 5 Generous incentives Get on a fast track to success
Tax holiday – 10 years tax holiday for Funds are awarded for financing investment projects in companies which invest an amount exceed- the manufacturing, service sector object to inter- ing RSD 1 billion (cca € 8.3 million) in fixed INCENTIVES national trade, hotel accomadodation services, assets and employ at least 100 additional OF REPUBLIC agriculture and fishery.The awarded funds are up to employees on an indefinite contract. OF SERBIA 50 % - 70 %, (depending on the size of the company) of the investment amount, based on the investment value Payroll tax incentives - employment of or based on the 2-year gross salary of the employees. the people who were registered with the National Unemployment Agency for more than 6 months entitles employers for a Just as it is done on the republic level, the financial sizable relief of taxes paid on net salary incentives within the same sectors and limitations are from the moment of employment until allocated on the provincial level. December 31, 2019. Two distuinguished types of incentives are: INCENTIVES OF Other subsidies for new employees & education AP VOJVODINA 1. Subsidizing new employment · 10 - 100 new employees · 3,000 - 5,000 euros per worker
2. Co-funding new equipment growing your profits · up to 50 % of total equipment value
increasing productivity Greenfield - free of charge or at a discounted price MUNICIPAL INCENTIVES Local taxes boosting competitiveness
www.rav.org.rs 11 WHERE TO INVEST?
In region of Vojvodina you will find all the support you UNPARALLED INVESTMENT OPPORTUNITIES nedd to successefully set up your investment and make sure it continues to grow. Trim operating cost Maintain high product quality You will easily establish relationship with all the relevant governmental institutions, as wll as the business and sci- Recruit highly qualified workers at competitive wages ence community.Combined with the possibility to directly access the network of key stakeholders within each sector, Achieve better capital optimazation your investment project will be fully equiped to quickly Improve performance levels move forward.
The region of Vojvodina has uniquely diversified economy, hosting a number of companies from different sectors. No matter which sector you choose in addition to preferential INVESTMENT OPPORTUNITIES business setting, you will get the greates support to take your success to the next level. Agribusiness
In region of Vojvodina you will find all the support you need to successefully set up Automotive your investment and make sure it continues to grow. ICT
12 VOJVODINA DEVELOPMENT AGENCY Agribusiness Comparative advantages for the development of agro industry in Vojvodina The region of Vojvodina has all the ingredients you need to successfully service the fast-growing global consumer markets with premium food products.
Out of a total of 1.8 million ha of agricultural land, 90 % is suit- Following institutions able for intensive agricultural production (plow, orchards and vine- yards). represent the engines of Relatively large quantity of arable land per person employed in innovation: agriculture (9.53 ha). 90 % of the total territory makes agricultural land (83.3 % and for- · University of Novi Sad est land 6.7%) . 0.76 ha of arable land per capita, which exceeds European average · Faculty of Agriculture, Novi Sad of 0.21 per capita. Over 50,000 ha on which vegetable crops for seed production are cultivated. · Faculty of Technology, Novi Sad Biomass represents a significant energy potential of the Republic of Serbia and it is available throughout the country. The biomass po- · Institute of Field and Vegetable Crops, Novi Sad tential is estimated at 3,448 million toa and in the overall potential of the renewable energy in Serbia, biomass participates with 61 %. Vojvodina with total arable land of 1,780,000 ha, which dominates · Scientific Veterinary Institute, Novi Sad over forest land, (150,000 ha) has a significant potential in terms of agricultural biomass, in particular the production of biomass from corn, cereals, soy and sunflower. · Institute of Food Techology, Novi Sad
www.rav.org.rs 13 Automotive An optimal ratio between labor cost, productivity, and quality of workforce together with the fast and efficient connection to a network of Pan-European transport routes have caused many component and system manufacturers to recognize Vojvodina as a growing hub for the automotive industry in Europe.
A variety of opportunities to gear up for greater Following institutions are profitability indicators: engines of innovation: Ideal geographic location for JIT/JIS production models, · University of Novi Sad, total of 14 faculties due to close proximity to leading car manufacturers · 2 private universities, total of 9 faculties Access to top OEMs - 1,250 km radius UNIVERSITIES Increasing number of new investments projects in last few years · Higher Education Technical · Faculty of Technical Sciences School of Professional Studies · ”Mihajlo Pupin” Technical Increasing number of reinvestments - Department of Electrical Faculty, Department of Engineering Competitive operational costs Information Technology · Higher Education Technical · Faculty of Science-Depart Top technical education and availability of highly-qulified School - Department of ment of Mathematics and Informatics and Electrical staff Informatics Engineering Long-standing tradition in high-quality production stand VOCATIONAL SECONDARY SCHOOLS Cutting-edge technical education ensuring constant sup- · Electrotechnical – vehicle ply of highly-qualified workforce · Metal processing · Electrotechnical A/C · Car mechanics equipment · Electrotechnical - automatics · Car electrics
14 VOJVODINA DEVELOPMENT AGENCY ICT The region of Vojvodina is increasingly becoming a hot spot for innovation-oriented ICT companies and a first-choice location for reliable, high-quality, and cost-effective alterna- tive to more developed markets
Sophisticated solutions at lower costs Each year about 920 university students enroll at the Faculty of Technical Sciences (IT related studies). Easy access to best quality, experienced IT staff PCBs (up to 24 layers), LED TV assembly lines, PIC develop- Continues increase in number of IT students ment tools and boards, display boards, audio & voice boards, Vast international market expertise of local companies power supply boards, cable harnesses, POS terminals, hand- held terminals, chip design and verification, etc. Strong institutional support for R&D Excellent support through IT-oriented business incubators Educational system harmonized with economy (market) needs Supporting institutions: Over 250 companies in software development ranging from just a few engineers to more than 800 employed by SCHNEIDER · Faculty of Technical Sciences ELECTRIC (design of power distribution management systems). More than 50 companies in electronics manufacturing. · Technical Faculty - Mihajlo Pupin
32 companies that are a part of ICT cluster employ around · Faculty of Sciences 4,000 engineers and have a total annual turnover of more than 200 million EUR. · Faculty of Economy
www.rav.org.rs 15 Vojvodina Development Agency Your reliable partner!
Vojvodina Development Agency (RAV) is established under the jurisdiction of the Gov- ernment of AP of Vojvodina, with aim to provide support for the implementation of the develop- ment policy of Vojvodina, agricultural policy and rural development. Vojvodina Development Agency (RAV) serves as a one-stop-shop for all your investment related enquiries. Due to our close association with various state and provincial government institutions, and our extensive network of local partners from the private sector, academic institutions, and business associations - RAV represents your trusted source for obtaining the most reliable information needed for making an informed investment decision. Our services are designed to help foreign companies establish their businesses in the region of Vojvodina.
16 VOJVODINA DEVELOPMENT AGENCY DEPARTMENT FOR INVESTMENT SUPPORT DEPARTMENT FOR Advisory support for domestic STRATEGIC RESEARCH and foreign investments and busines incubators DEVELOPMENT AND Capacity building for INNOVATION POLICY investment promotion Analysis and reserach of the existing resources and economic potentials Documentation preparation and application for De ning the subsidy measures for available funds the development of the economy agriculture, energy sectors, tourisam and rural development
DEPARTMENT FOR PROMOTION Promotion of all existing resources and potentials DEPARTMENT Positioning Vojvodina FOR NATIONAL AND as an ideal investment INTERNATIONAL FUNDS location for future projects Coordination of funds awarding on local, regional and national level Research and promotion of all available international funds
www.rav.org.rs 17 SUCCESS STORIES
FOREIGN 358 INVESTORS BILLION FDI € 8.54 INVESTMENT NEW JOBS 76,100 CREATED
18 VOJVODINA DEVELOPMENT AGENCY www.rav.org.rs 19 VOJVODINA DEVELOPMENT AGENCY
REPUBLIC OF SERBIA
AUTONOMOUS PROVINCE OF VOJVODINA