Serbia gives Swarovski land, incentives for new plant

I wonder what percentage of the foreign investment in Serbia is located north of Nis? You would think if KiM is an "independent country" there would be a flood of investment by foreign companies especially of countries that have recognized. This just isn't the case.

"It was also said then that Swarovski will be given 7.8 hectares of publicly owned land free of charge, for building the factory. This will be Swarovski's first factory outside of Austria and it will produce for export."

Does this mean that Swarovski now owns the land and can sell it if it wishes? How stupid of the Serbian government if this is true! Even if Swarovski does not own the land but only have rights to build its factory, it is still stupid not to charge them rental and put caveats on their land usage eg. no pollutants emitting from the factory production. What is Belgrade thinking?????

Hey Lowe,

Its called an incentive. Governments do this all of the time in order to create jobs. This land is usually not prime real estate so the initial cost is usually low. This in return could help stimulate the local economy.

Gee, I wonder why Swarovski isn't building their crystal factory in the KiM region?

Why would a Western company need free land? Could they not afford it, wtf? If you are going to give anybody free land give it to Serbian farmers who can then grow food to not only feed our population but also EXPORT.

Does the Serbian gov't not believe in an export based economy? Serbia is so empty, its congested in like 4 main cities and empty in between. Although this is a sad thing, most of that land thats empty is completely arable land...meaning food can be grown on it.

Agriculture among a few other sectors, but agriculture in particular is Serbia's ticket to prosperity...but not as long as these incompetent nitwits are in power.

Friends of Serbia, look up '28. Jun' we are working for Serbia!

if KiM is an "independent country" there would be a flood of investment by foreign companies especially of countries that have recognized. This just isn't the case.
(robert1899, 21 March 2012 15:59)

Foreign companies don't care if their government has recognized Kosovo or not. Companies are not like the donor moneys, they prefer to invest in stable regions and not regions with a dubious status. Furthermore, why should any serious company invest in the most corrupt place in Europe, a 'country' without an SAA with the EU, with a (mostly) uneducated workforce, lack of infrastructure and last but not least an unpredictable government (which could, for example, decide to block imports of needed material just for their political games) if there are alternative countries?

Pretty soon Serbia will see an influx of poor K-albanians who will work for pennies just so they can support their family of 14 children back home.

lowe: Really? Boeing moved it's headquarters from Washington to Chicago a few years back, and the "incentives" laid out by the city of Chicago were obviously extreme. This practice of luring businesses from one region to another is practiced daily, in all corners of the world. You think cheap labor in China is not a government incentive for every single multi-national business which opens a factory there, with cheap land and such? Really?

Perhaps you are simply irritated that Serbia is receiving this investment while croatia + albania do not?

Lenard,

I'm sure that would be the reason that Croatia and Albania would turn down a Swarovski investment.

"Hey Lowe,

Its called an incentive. Governments do this all of the time in order to create jobs. This land is usually not prime real estate so the initial cost is usually low. This in return could help stimulate the local economy.
(robert1899, 21 March 2012 16:38)"

Well, seems to me an overly generous incentive by the Serbian governemnt. So does this mean Swarovski now owns that land and can do as they please, including polluting it beyond recovery or selling it off? All in the name of, cough cough, "stimulating the local economy"? What price progress? And no, I don't think all governments do it.

"lowe: Really? Boeing moved it's headquarters from Washington to Chicago a few years back, and the "incentives" laid out by the city of Chicago were obviously extreme. This practice of luring businesses from one region to another is practiced daily, in all corners of the world. You think cheap labor in China is not a government incentive for every single multi-national business which opens a factory there, with cheap land and such? Really?

Perhaps you are simply irritated that Serbia is receiving this investment while croatia + albania do not?
(really?, 21 March 2012 17:01) "

Firstly, we ain't talking about cheap labor or cheap land but FREE land. And I'm not irritated about Serbia or any other country receiving investments, rather the irritation is over multinatinals like Swarovski apparently taking advantage of the situation.

And finally what makes you think that "cheap" Chinese labor (actually not so cheap anymore in their major cities) is a deliberate Chinese government dictate rather than due to the relatively lower living standards in that country? What makes you think the Chinese are simply dying for every single Western MNC to come to their country? If you had bothered to update yourself on the current state of Chinese businesses, methinks you'll be amazed at the investments OUTFLOW from that country to other parts of the world, especially in their investments overseas to secure vital mineral resources.

Crystal is it not made with high consternation of lead component and it is poisines even the crystal wine glasses that are made you cant really drink out of. Poor workers will be poisoned ,what BS workers have to put up with and their health risked with lead poisoning.

All these investors are left to wait on the side until you reach the elections and then the Democratic Party will now be told, now you willbe fine as you are looking to invest in Serbia, and we then say in the election campaign here to see me bring in investors, but steam ofinvestment going into our pockets and not into the pocket of Serbian citizens .. it will not tell you ..

The company is hardly a major international if this is the first factory it's opened abroad. In any case, like it or not, if a country wants a foreign company to come in and provide jobs for its citizens, it's going to have to offer something, and a smallish piece of unused land is probably the cheapest something. If the company makes money, it'll pay taxes, most likely (although that depends on the agreement - often tax relief for a number of years is part of the deal). Even if it doesn't start paying taxes immediately, an unemployment rate of 23% means decently paying jobs are the priority.

As for giving the land to "farmers" - which farmer? Is the land even suitable for farming? and how many new jobs would giving a farmer a few additional acres produce? The products are being manufactured by the factory for EXPORT - and will bring in more euros than a few additional tons of a commodity crop. (Whatever you do, don't start growing raspberries on it - there's obviously a glut, since those growing them now can't get a decent price for their crop.)

In a good economy, and if there were no other similar countries nearby, Serbian wages alone might be enough of an incentive to start manufacturing there, but with wages throughout the Balkans being so low, that won't be the deciding factor in finding a new location for a plant. On the other hand, as wages in China continue to rise and transportation costs keep increasing, the Balkans could turn into a new center of manufacturing for Western Europe.

We're already seeing manufacturing returning to the U.S. from China - wages there are going up (along the Coast, to about $500 a month), productivity is lower than in the U.S. and not rising as fast as wages, land prices for industry are higher than in the U.S. South, and the long supply chain means having to maintain large (expensive) inventories in case of disruption in it. Manufacturing in China is no longer the automatic decision it has been in the past for products to be sold in the U.S., and if the Balkan countries get their acts together, maybe it won't be for products destined for Western Europe, either.

I think the bigger picture is future investment by EU companies looking to stay in Europe, but not having to outsource the labour to another continent.
The Swarovski example is just baby steps.

Eventually, when the Balkan countries play nice (both politically and economically), some of the car manufacturers will be looking for cheaper labour to keep competitive. It's only natural. The Balkans will be the next grow zone.

Hopefully the politicians get this.

Yeah, thats right Tadic government, just sell all the land to froeign companies, soon you won't see any Serbs in serbia.

What a joke, this government can't organize a photo op.

Very very very poor negotiators. You don't SELL the land, you LEASE IT!

Crystal is it not made with high consternation of lead component and it is poisines even the crystal wine glasses that are made you cant really drink out of. Poor workers will be poisoned ,what BS workers have to put up with and their health risked with lead poisoning.

Gee, I wonder why Swarovski isn't building their crystal factory in the KiM region?

"It was also said then that Swarovski will be given 7.8 hectares of publicly owned land free of charge, for building the factory. This will be Swarovski's first factory outside of Austria and it will produce for export."

Does this mean that Swarovski now owns the land and can sell it if it wishes? How stupid of the Serbian government if this is true! Even if Swarovski does not own the land but only have rights to build its factory, it is still stupid not to charge them rental and put caveats on their land usage eg. no pollutants emitting from the factory production. What is Belgrade thinking?????

I wonder what percentage of the foreign investment in Serbia is located north of Nis? You would think if KiM is an "independent country" there would be a flood of investment by foreign companies especially of countries that have recognized. This just isn't the case.

lowe: Really? Boeing moved it's headquarters from Washington to Chicago a few years back, and the "incentives" laid out by the city of Chicago were obviously extreme. This practice of luring businesses from one region to another is practiced daily, in all corners of the world. You think cheap labor in China is not a government incentive for every single multi-national business which opens a factory there, with cheap land and such? Really?

Perhaps you are simply irritated that Serbia is receiving this investment while croatia + albania do not?

Pretty soon Serbia will see an influx of poor K-albanians who will work for pennies just so they can support their family of 14 children back home.

Lenard,

I'm sure that would be the reason that Croatia and Albania would turn down a Swarovski investment.

Hey Lowe,

Its called an incentive. Governments do this all of the time in order to create jobs. This land is usually not prime real estate so the initial cost is usually low. This in return could help stimulate the local economy.

Why would a Western company need free land? Could they not afford it, wtf? If you are going to give anybody free land give it to Serbian farmers who can then grow food to not only feed our population but also EXPORT.

Does the Serbian gov't not believe in an export based economy? Serbia is so empty, its congested in like 4 main cities and empty in between. Although this is a sad thing, most of that land thats empty is completely arable land...meaning food can be grown on it.

Agriculture among a few other sectors, but agriculture in particular is Serbia's ticket to prosperity...but not as long as these incompetent nitwits are in power.

Friends of Serbia, look up '28. Jun' we are working for Serbia!

if KiM is an "independent country" there would be a flood of investment by foreign companies especially of countries that have recognized. This just isn't the case.
(robert1899, 21 March 2012 15:59)

Foreign companies don't care if their government has recognized Kosovo or not. Companies are not like the donor moneys, they prefer to invest in stable regions and not regions with a dubious status. Furthermore, why should any serious company invest in the most corrupt place in Europe, a 'country' without an SAA with the EU, with a (mostly) uneducated workforce, lack of infrastructure and last but not least an unpredictable government (which could, for example, decide to block imports of needed material just for their political games) if there are alternative countries?

"Hey Lowe,

Its called an incentive. Governments do this all of the time in order to create jobs. This land is usually not prime real estate so the initial cost is usually low. This in return could help stimulate the local economy.
(robert1899, 21 March 2012 16:38)"

Well, seems to me an overly generous incentive by the Serbian governemnt. So does this mean Swarovski now owns that land and can do as they please, including polluting it beyond recovery or selling it off? All in the name of, cough cough, "stimulating the local economy"? What price progress? And no, I don't think all governments do it.

"lowe: Really? Boeing moved it's headquarters from Washington to Chicago a few years back, and the "incentives" laid out by the city of Chicago were obviously extreme. This practice of luring businesses from one region to another is practiced daily, in all corners of the world. You think cheap labor in China is not a government incentive for every single multi-national business which opens a factory there, with cheap land and such? Really?

Perhaps you are simply irritated that Serbia is receiving this investment while croatia + albania do not?
(really?, 21 March 2012 17:01) "

Firstly, we ain't talking about cheap labor or cheap land but FREE land. And I'm not irritated about Serbia or any other country receiving investments, rather the irritation is over multinatinals like Swarovski apparently taking advantage of the situation.

And finally what makes you think that "cheap" Chinese labor (actually not so cheap anymore in their major cities) is a deliberate Chinese government dictate rather than due to the relatively lower living standards in that country? What makes you think the Chinese are simply dying for every single Western MNC to come to their country? If you had bothered to update yourself on the current state of Chinese businesses, methinks you'll be amazed at the investments OUTFLOW from that country to other parts of the world, especially in their investments overseas to secure vital mineral resources.

The company is hardly a major international if this is the first factory it's opened abroad. In any case, like it or not, if a country wants a foreign company to come in and provide jobs for its citizens, it's going to have to offer something, and a smallish piece of unused land is probably the cheapest something. If the company makes money, it'll pay taxes, most likely (although that depends on the agreement - often tax relief for a number of years is part of the deal). Even if it doesn't start paying taxes immediately, an unemployment rate of 23% means decently paying jobs are the priority.

As for giving the land to "farmers" - which farmer? Is the land even suitable for farming? and how many new jobs would giving a farmer a few additional acres produce? The products are being manufactured by the factory for EXPORT - and will bring in more euros than a few additional tons of a commodity crop. (Whatever you do, don't start growing raspberries on it - there's obviously a glut, since those growing them now can't get a decent price for their crop.)

In a good economy, and if there were no other similar countries nearby, Serbian wages alone might be enough of an incentive to start manufacturing there, but with wages throughout the Balkans being so low, that won't be the deciding factor in finding a new location for a plant. On the other hand, as wages in China continue to rise and transportation costs keep increasing, the Balkans could turn into a new center of manufacturing for Western Europe.

We're already seeing manufacturing returning to the U.S. from China - wages there are going up (along the Coast, to about $500 a month), productivity is lower than in the U.S. and not rising as fast as wages, land prices for industry are higher than in the U.S. South, and the long supply chain means having to maintain large (expensive) inventories in case of disruption in it. Manufacturing in China is no longer the automatic decision it has been in the past for products to be sold in the U.S., and if the Balkan countries get their acts together, maybe it won't be for products destined for Western Europe, either.

I think the bigger picture is future investment by EU companies looking to stay in Europe, but not having to outsource the labour to another continent.
The Swarovski example is just baby steps.

Eventually, when the Balkan countries play nice (both politically and economically), some of the car manufacturers will be looking for cheaper labour to keep competitive. It's only natural. The Balkans will be the next grow zone.

Hopefully the politicians get this.

Yeah, thats right Tadic government, just sell all the land to froeign companies, soon you won't see any Serbs in serbia.

What a joke, this government can't organize a photo op.

Very very very poor negotiators. You don't SELL the land, you LEASE IT!

All these investors are left to wait on the side until you reach the elections and then the Democratic Party will now be told, now you willbe fine as you are looking to invest in Serbia, and we then say in the election campaign here to see me bring in investors, but steam ofinvestment going into our pockets and not into the pocket of Serbian citizens .. it will not tell you ..