Serbia, Fiat sign deal

Government and Fiat representatives have signed a contract on joint investment in Zastava in Belgrade today. The contract, worth around EUR 950mn and expected to create some 5,000 new jobs, was signed by Economy Minister Mladjan Dinkic and Fiat Group Chairman Sergio Marchionne, on behalf of the Serbian government and Fiat respectively. Serbia, Fiat sign deal Under the agreement, the new joint company, in which Fiat owns a 67 percent stake and the Serbian government the remaining 33 percent, becomes the owner of the Zastava factory’s assets. The contract envisages an initial investment by Fiat of about EUR 700mn, with the Serbian government contributing more than EUR 200mn. The government also signed a memorandum of understanding with Iveco and Magnetti Marelli for the production of buses, special vehicles and automotive components. The document also provides for the formation of two new joint companies where the Italians would own a 70 percent stake, and the Serbian government 30 percent. The starting investment of these companies would be about EUR 240mn. The signing of the agreement was attended by Italian Foreign Minister Franco Frattini, Serbian President Boris Tadic and Prime Minister Mirko Cvetkovic. Tadic said that the agreement with Fiat was of special political importance because the close relationship between Serbia and Italy and its readiness to help in Serbia’s European integration had now been underpinned in the economic sphere as well. “This is a big day for Serbia, for Fiat and Italian industry. After 50 years, this is a new beginning and that is why I share the pride of Serbian citizens at having one of the world’s largest companies and Italy’s largest company in Serbia once again,” Tadic said after the signing. He said that besides the 5,000 jobs that would be created, he expected increased employment opportunities in other sectors as well, adding that the deal marked a new economic dawn for the Sumadija region and all of Serbia. The president said that the role of the government, state and president was to offer a chance to Serbian citizens to showcase their capacities, because that was the only way to compete with the rest of the automotive industry worldwide. Cvetkovic expressed his happiness at signing the agreement with Fiat. He said that the deal would have several positive knock-on effects, the first of which would be the chance to attract other large investments to Serbia. The prime minister said after the signing that he expected a positive impact on the country’s foreign-trade balance, with the deal expected to bring in EUR 1bn in exports. Marchionne and Dinkic at today's signing (Beta) Djelic: Serbia to become next Slovakia The government held an emergency cabinet meeting yesterday to prepare the documentation which, following the signing, will represent the foundation for the creation of a joint company where the Italians will hold a controlling stake of 67 percent, and the Serbian state 33 percent. The government says that this is the biggest contract signed thus far by Serbia in the field of industrial development, as the overall investment between the companies of Fiat, Iveco and Magneti Mareli—the three companies currently involved in the project —will be worth over EUR 1bn, and will create 5,000 new jobs. Deputy Prime Minister Bozidar Djelic told B92 that the Fiat deal was an excellent job for both Kragujevac and Serbia that would exceed EUR 1bn. “We’ve seen that that is EUR 844mn in joint investment for cars. We’re talking about 300,000 cars after a few years, with 200,000 in the first phase, and that for a new model. Now the project's been extended to buses and components. That’s around EUR 240mn in investment. Serbia will add about a further third on top of this, and to bring this off, a further EUR 200mn investment will be required in infrastructure,” Djelic explained. The minister said that the project would also create around 5,000 new jobs. “This is a great job. This job is costing our country quite a bit. It’s no secret that we’re investing on our side more than Slovakia, but that’s the price for attracting, in these difficult times, one of the biggest car manufacturers. That’s the initial spark from which Serbia could become the next Slovakia, a country with the highest number of manufactured cars per head of the population. Slovakia fought for her first factories like this six or seven years ago. Now it’s Serbia’s turn,” he said.

Serbia, Fiat sign deal

Under the agreement, the new joint company, in which Fiat owns a 67 percent stake and the Serbian government the remaining 33 percent, becomes the owner of the Zastava factory’s assets. The contract envisages an initial investment by Fiat of about EUR 700mn, with the Serbian government contributing more than EUR 200mn.

The government also signed a memorandum of understanding with Iveco and Magnetti Marelli for the production of buses, special vehicles and automotive components.

The document also provides for the formation of two new joint companies where the Italians would own a 70 percent stake, and the Serbian government 30 percent.

The starting investment of these companies would be about EUR 240mn.

The signing of the agreement was attended by Italian Foreign Minister Franco Frattini, Serbian President Boris Tadić and Prime Minister Mirko Cvetković.

Tadić said that the agreement with Fiat was of special political importance because the close relationship between Serbia and Italy and its readiness to help in Serbia’s European integration had now been underpinned in the economic sphere as well.

“This is a big day for Serbia, for Fiat and Italian industry. After 50 years, this is a new beginning and that is why I share the pride of Serbian citizens at having one of the world’s largest companies and Italy’s largest company in Serbia once again,” Tadić said after the signing.

He said that besides the 5,000 jobs that would be created, he expected increased employment opportunities in other sectors as well, adding that the deal marked a new economic dawn for the Šumadija region and all of Serbia.

The president said that the role of the government, state and president was to offer a chance to Serbian citizens to showcase their capacities, because that was the only way to compete with the rest of the automotive industry worldwide.

Cvetković expressed his happiness at signing the agreement with Fiat. He said that the deal would have several positive knock-on effects, the first of which would be the chance to attract other large investments to Serbia.

The prime minister said after the signing that he expected a positive impact on the country’s foreign-trade balance, with the deal expected to bring in EUR 1bn in exports.

Đelić: Serbia to become next Slovakia

The government held an emergency cabinet meeting yesterday to prepare the documentation which, following the signing, will represent the foundation for the creation of a joint company where the Italians will hold a controlling stake of 67 percent, and the Serbian state 33 percent.

The government says that this is the biggest contract signed thus far by Serbia in the field of industrial development, as the overall investment between the companies of Fiat, Iveco and Magneti Mareli—the three companies currently involved in the project —will be worth over EUR 1bn, and will create 5,000 new jobs.

Deputy Prime Minister Božidar Đelić told B92 that the Fiat deal was an excellent job for both Kragujevac and Serbia that would exceed EUR 1bn.

“We’ve seen that that is EUR 844mn in joint investment for cars. We’re talking about 300,000 cars after a few years, with 200,000 in the first phase, and that for a new model. Now the project's been extended to buses and components. That’s around EUR 240mn in investment. Serbia will add about a further third on top of this, and to bring this off, a further EUR 200mn investment will be required in infrastructure,” Đelić explained.

The minister said that the project would also create around 5,000 new jobs.

“This is a great job. This job is costing our country quite a bit. It’s no secret that we’re investing on our side more than Slovakia, but that’s the price for attracting, in these difficult times, one of the biggest car manufacturers. That’s the initial spark from which Serbia could become the next Slovakia, a country with the highest number of manufactured cars per head of the population. Slovakia fought for her first factories like this six or seven years ago. Now it’s Serbia’s turn,” he said.