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Home , Apatin, Belgrade, Port of Novi Sad, Vojvodina

BUSINESS OPPORTUNITIES in , FREE TRADE

PRODUCTIVITY 2017

NEW TECHNOLOGY 2

Vojvodina is a northern of the Republic of Serbia and it is sourrounded by the EU member states. The ideal geographic location of Vojvodina , covering 21,506 square kilometers, and its abundancy in natural resources, provide excellent opportunities for agricultural production and export, production sites in various industries, logistics, and export processing zones.

VOJVODINA SERBIA

admin center capital

total area total area 21,506 km² 88,361 km²

population population 1.89 mil 7.09 mil

26 nationalities 6 official languages

terrain rich fertile

GMT + 1h 3

The closest airport is the Airport "" in Belgrade (70 km from Novi Sad).

Vojvodina also has a well-developed system of roads and railways, as well as an extensive network of canals and navigable waterways.

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If you want to unlock your export potential and gain a duty-free access to a number of markets, optimize operational costs, employ high-quality workforce at competitive rates, or relocate and remain close to your distribution centers, Vojvodina is the region that meets your needs.

Top-notch investment locations suitable for a wide range of activities and tailored to your specific requirements - provide an excellent starting point to boost your investment to its fullest potential.

growing your profits

Increasing productivity

Check out our video about Vojvodina boosting competitiveness 5

With its long industrial tradition, well VOJVODINA KEY EXPORT SECTORS: developed educational system, and 84.9% MANUFACTURING innovation stimulating environment - 15.3% Food & Beverage Vojvodina is considered to be the 8.6% Machines & Equipment 7.4% Chemicals engine of Serbia’s economic Year 7.4% Rubber & Plastic development. As a result of its 2015 6.3% Motor vehicles & trailers advanced hi-tech culture that VOJVODINA positively supports an aptitude for SERBIA quickly applying new technologies, GDP* Active population € 32,908 million 799,983 Vojvodina continues to significantly *according to ESA 2010 Export volume contribute to Serbian GDP creation. Currency: € 4.3 bn (RSD) Export growth unemployment 3.2% 18.5% Export markets Inflation y-o-y EU, CEFTA, 1.5%

Source: NBS, Vojvodina Chamber of Commerce, 6

As the land of farmers, of electro motors Sever , iindustrialization in Vojvodina has Airplane factory Utva Pancevo, Factory first started within agricultural of armatures, Factory of dental production. equipment and many others. Next phase led to further Development of industrial production in development of industrial Vojvodina had a significant influence on capacities, which has improved the education in Vojvodina, thus production in Vojvodina in other encouraging development of human sectors as well, and enabled resources in certain industry sectors, construction of large number of which resulted in large number of factories. Those were mainly for technical schools (high schools and different kind of metal production, universities) that had a goal to form metal processing, and machine basis of professionals for industry of tools industry, and later on metal processing. construction of many foundries and Today, we have in Vojvodina more than metal casting foundries. 30 schools for machine industry, two Furthermore, Vojvodina was colleges and Machine department on worldwide known for its industry the .

3 UNIVERSITIES IN VOJVODINA:  FACULTY OF TECHNICAL SCIENCE NOVI SAD – 12,500 students  1 state University - 14 Faculties  2 private Universities - 9 Faculties  TECHNICAL FACULTY

VOCATIONAL SECONDARY SCHOOLS Strong command of the  Metal processing  Car mechanics  Electrotechnical – automatics  Electrotechnical – vehicle Introduction of  Electrotechnical A/C equipment dual education  Car electrics

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It is a rich , also known as the Granary of the , due to its abundant agricultural resources. Extraordinary plain landscape with a lot of greenery, big rivers (one of the largest in – ), canals, lakes, spas, "Fruska " National park and Deliblatska desert (sandy terrain) are only a part of Vojvodina treasure.

Land – The geography and climate of Vojvodina are extremely conducive to agricultural production. The arable area consists of 1.78 million hectares of fertile agricultural land, 84% of the province’s territory, providing a solid resource base. Most of this territory is under intensive steppe-field agricultural production. The fields are generally very fertile and alluvial.

Climate – Vojvodina enjoys a moderate continental climate. With extremely favorable edaphic and climate conditions, it is suitable for agricultural production.

Water – The region is also rich in water. Major rivers, the Danube, and Tisa, flow through Vojvodina. One of the largest hydrological nodes in Europe is situated in Vojvodina with about 1,400 km of navigable rivers and canals.

Rural activity – Vojvodina is unique in the high percentage of its rural population actively involved in primary agricultural production. Approximately 1.6 million hectares of agricultural land in Vojvodina is being used by either familiy holdings or big companies, who are involved in agricultural production. 8

Premium food products for global markets No. 1 FDI sector: #companies, #investment volume, #workers High-quality resource base, optimal climate conditions Ample fertile soil: 1.5 mil ha – 84% of territory Strictly prohibited production and trade of GMO food Growth trend in the export volume share

Gear up for greater profitability indicators Ideal geographic location for JIT/JIS production Close proximity to leading car manufacturers Access to top OEMs – 1,250 km radius Cutting-edge technical education Tradition in high-quality production standards Optimal ratio: labor cost – productivity - quality

Growing demand for modern real estate development Residential, office, and retail development projects Industrial zones for manufacturing facilities Free Zones in Novi Sad, Subotica, Zrenjanin, Intermodal logistics hubs: water, rail, road infrastructure National parks, nature resorts, rivers, lakes, canal networks, hotels, spa centers, resorts, golf courses, marina complexes

Hot spot for innovation-oriented ICT companies Reliable, high-quality, and cost effective alternative Sophisticated solutions at lower cost Easy access to best quality, experienced IT staff Continuous increase in a number of enrolled ICT students Vast international market expertise of local companies Strong capacity to adjust to new market demands

Abundant potential in renewable energy sources Biomass, Wind power, Solar energy, Hydropower Easy access to raw material base 1.5 ha of arable land – full value chain coverage Ideal locations for wind power plants – average 6.27 m/s 20-30% higher insolation intensity than EU average Small hydropower plants potential – approx. 20.2 MW 9

By choosing to locate in Vojvodina, foreign investors enjoy the benefits of a highly competitive and advantageous tax system, essential for boosting company profits. In general, Serbia’s tax regime is highly conductive to doing business. Corporate profit tax is the lowest in the region, while VAT, salary tax and social insurance contributions are among the most competitive in Central and .

Serbia 15 % Serbia 10 % Serbia 20 % 16 % Czech Republic 15 % 20 % 19 % Romania 16 % Czech Republic 21 % Poland 19 % Hungary 15 % Poland 23 % Czech Republic 19 % Slovakia 19-25 % Romania 20 % 20 % Poland 18-32 % Croatia 25 % Slovakia 22 % Croatia 12-40 % Hungary 27 %  10 year corporate tax holiday  Carrying forward of losses 5 years  Annual Income tax deductions  Duty-free import of equipment  Salary tax base deduction  65-75% contributions reimbursment

If a resident taxpayer earns profit by conducting business in another state and tax was paid on that Serbia and China profit in another state, it shall be granted a tax credit have signed a on its enterprise profit tax account determined in Double Taxation conformity with the provisions of this Corporate Profit Tax Law, amounting to the tax paid in another state. Treaty on avoiding At the moment 54 countries have signed the Double double taxation! Taxation Treaty with Serbia. 10

The region of Vojvodina is DUTY-FREE EXPORT uniquely positioned for global TO OVER 1 BILLION trading offering you a duty-free CONSUMER BASE access to over 1 billion consumer base!

As the most developed part of Serbia, Vojvodina has unique economic and trade relations with the European Union and other European countries, which have enabled customs free export of all products bearing the Serbian origin label, excluding wine and baby beef.

In addition, the EU FTA abolished customs duties and quantitative restrictions for import of Serbian textile products and guarantees to maintain the same policies in the future. Using this strategy the Serbian export of these products will become entirely free.

Other Free Trade Agreements with: 11

Excellent ratio between labor quality, cost and productivity is particularly appealing to foreign investors seeking to achieve higher profitability through cost effectiveness, while not compromising their quality standards.

In addition to the existing skilled and semiskilled labor pool in the manufacturing sector, the region of Vojvodina is characterized by the constant influx of newly qualified workers.

An access to exceptional talent pool along with the multicultural diversity offers flexibility and adaptability, which has a profound impact on LABOR COST STRUCTURE maintaining the unrivalled Average salary in Vojvodina, EUR performance levels. Moreover, June 2016 the income growth rate does NET Salary 10% 378 not exceed the inflation rate Personal Income Tax 40 and is much lower than the Contributions (employee) 19.9% 99 growth of income rate in e.g. GROSS Salary 497 Contributions (employer) 17.9% 89 Slovakia, Romania, and . TOTAL Cost 606 12

For your greenfield and brownfield investments, Vojvodina offers a unique database of 120 greenfield and 100 brownfield sites!

The new Law on Planning and Construction in Serbia has introduced a one-stop-shop concept for issuing relevant permits, designs and connection conditions through a “unified procedure”. 13

For projects of special importance for the realization of local economic development, municipalities and cities in Serbia have the right to alienate land in public ownership, whether at a price lower than the market price or free of charge! The condition is that the realization of the investment project increases the number of employees in the economy of the respective municipality/city for at least 1%, which will enable increase in public revenues.

There are 14 registered and operational Free zones in the Republic of Serbia, from which 4 are in Vojvodina region: Apatin (including Odžaci & ), Subotica (including ), Zrenjanin, Novi Sad

BENEFITS: • Imported raw materials and semi-finished products set aside for export are exempted from customs duty and other import duties • Imported equipment, machines and construction materials (for construction of facilities) are exempted from duty and other taxes • Import of goods into the zone is duty free. Goods from the Zone can be placed to the home market after customs clearance i.e. after paying customs and VAT • Exemption from VAT on coal, heating oil, gas and electricity • Goods from the Zone can be temporarily carried out of the Zone to additional processing • Free Zone has its own Customs office which enables faster customs procedures • Companies delivering logistics services to Users of the Free Zones are exempt from paying VAT for the delivered services.

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In addition to existing benefits (strategic geographical location, duty-free exports, favorable tax system, educated and skilled labor, etc.) investors may be awarded funds for financing investment projects in the manufacturing sector and the services sector which may be subject to international trade.

More info at http://www.ras.gov.rs/invest-in-serbia/why-serbia/financial-benefits-and-incentives

RE-TRAINING PROGRAM max cca. € 750 per employee

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UK

France

Italy

Spain

Novi Sad

Belgrade

On the following pages you will have the opportunity to check out some of our selected LOCATIONS AVAILABLE FOR INVESTORS in Vojvodina region. These sites are located in the ADMINISTRATIVE CENTER OF VOJVODINA, CITY OF NOVI SAD

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The North IV industrial zone is located on Total area 54ha the highway E75, several kilometers from Ready to build 6ha the center of the City of Novi Sad. The total Intended use Manufacturing land area of the zone is 54ha. The City of Plot coverage 50% Novi Sad is constructing building (built to Plot ratio 1,5 lease) for the company LEAR in this zone Infrastructure Complete on the 8ha of the land. The city will Ownership City of Novi Sad develop 6ha of construction land more for the potential investors. The zone is equipped with complete infrastructure and utilities. It will have access to the highway E75. 17

The plots are located in the industrial zone Total area 28.670 m² “North II” in the vicinity of marshaling yard No. plots 8 and waterway Canal DTD. The location has Intended use Manufacturing excellent road connection with highway and Plot coverage 50% the of City of Novi Sad. The plots can be combined according to the investor’s No. of floors GF-GF+1 requirements. The site is fully equipped with Plot ratio 0,5 - 1,5 utilities. Conditions for construction are Infrastructure Complete regulated by the General regulation plan of Ownership City of Novi Sad the area for business in the northwest part of the City of Novi Sad.

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The Cable Factory – Novkabel based in The Port of Novi Sad on the River Novi Sad was established in 1921 and Danube and the Novi Sad Marshalling represents the oldest cable factory in Yard are in the vicinity of the production the Balkans. The Novkabel Company complex. Novkabel spreads on a land was producing a wide range of energy area of almost 44 hectares in the cables and conductors, tele- industrial zone of Novi Sad with more communication and electronic than 100,000 sqm of the closed equipment cables to suit various production space. The complex is divided requirements of industries such as into 3 different plots. construction, mining, shipbuilding, oil, Plot A with the land area of 32 ha is not transportation, automotive and other used by existing Novkabel production industries. By the time development of and is available for renting and/or new products and product range purchase. The production halls No 1 to 5 enable factory to achieve about 16,000 are approx. 11,000 sqm each. registered products. The plot B with the area of 10 ha is used After unsuccessful privatization by Novkabel for the existing cable Novkabel Company is in the process of production. reorganization. The plot C with the area of 2 ha is available for purchase. 19

greenfield projects in 2015 total Serbian FDI 36%

320 Foreign investors Million FDI total Serbian export EUR 8.3 investments 70,000 New jobs created 32% 20

Government of Vojvodina is focused on further economic and social development of the region, including strong support for new foreign investments. Our goal is to bring new technologies to our region and to open new workplaces, especially for young generations. As a one-stop-shop service for foreign companies interested in doing business in our region, Vojvodina has special purpose agency - Vojvodina Investment Promotion – VIP, that offers comprehensive package of advisory and assistance services to foreign companies looking to establish their business in the region of Vojvodina.

We offer:  Tailor made solutions for your investment  Search through our unique location database  Institutional support from the beginning  Contacs with all relevant partners for your business  Aftercare support

Vojvodina Government and VIP Agency represent your trusted source for obtaining the most reliable information needed for making an informed investment decision.

All of our services are free of charge and fully confidential.

Promotion CONTACT

E-mail: [email protected]

Tel: +381 21 487 4244