Austria is one of the largest investment companies in Serbia, so that our cooperation could be further increased we talked with Erika Teoman Brenner, Commercial Counsellor Embassy of Austria. Some of the interview topics are the perspective of economic cooperation between Serbia and Austria, what does our country mean for the implantation of dual education, and how important it is for the economy.
Erika Teoman Brenner says austrian companies – banks, insurance companies or other service providers – are
constantly innovating within their respective markets and upgrading their services to customers in line with the most modern technologies.
Serbia recorded a surplus in the trade with Austria in January 2019. To what extent are Austrian investors in Serbia contributing to this favourable result?
– We are pleased to note that exports from Serbia have continuously increased over the last years, thus narrowing the trade gap between our two countries. This is a good sign for the competitiveness of Serbian producers as well as for the growing internationalization of production chains in Serbia. AS to the impact of Austrian investors, it is difficult to make a valid assessment on the basis of just one month. Since these preliminary data do not give any indication regarding the product groups, we cannot seriously comment on the contribution of Austrian investors to these results.
How would you estimate today the percentage of the Austrian investments in Serbia which can be considered as technologically advanced?
– Given the fact that Austrian companies in Serbia are predominantly active in the service sector, we can rightly claim that they are technologically very much advanced. These companies – be it banks, insurance companies or other service providers – are constantly innovating within their respective markets and upgrading their services to customers in line with the most modern technologies. We have also a significant investment in an IT-company in Serbia that develops extremely advanced systems for the European automotive industry. On the other hand, even those investments that originally came to Serbia as “low-tech” manufacturing, are gradually upgraded as we know from our companies.
To what extent is Serbian cost effectiveness of labour an attractive value proposition for Austrian investors? How do Austrian companies envisage risks of shortage of quality labour in Serbia?
– If the goal is to set up production in Serbia, or in any other country, a potential investor from Austria takes into consideration the availability of labour and its costs , infrastructure etc. A service sector company, on the other hand, most often targets the domestic market and, therefore, looks at a completely different set of parameters. In this case, it is really important to see if there is demand for that service, what is the income situation of the customers´ groups, what are the trends in customer behaviour etc. Labour shortage is slowly becoming an issue for the companies here, although not to the extent, yet, as in some of the neighbouring countries. It is, therefore, of utmost importance to develop strategies to make certain professions more attractive to people by demonstrating promising carrier opportunities and providing an excellent working environment.
Is dual education an adequate response? Are there other measures that may improve this segment of the market?
– Dual vocational education is definitely a key element in training skilled people and should be a priority when it comes to reducing the risk of shortage of qualified labour. The main characteristic of dual education is not only the full integration of the young person in the company and the close cooperation of the company with the vocational school, but also the strong commitment of the company, both financially and in terms of human resources. This system guarantees that young people get the chance to develop their social as much as their professional skills. Our experience in Austria shows that the majority of these apprentices get employed right upon completion of their apprenticeship training as fully qualified staff member by the same company. This alone should be a very promising perspective for anybody considering to enter a dual vocational training program. Additionally, we are currently working on turning the dual-education system into a three-track education by adding and focusing on digital competencies. Thus, we make sure that young people are prepared for a digitized work environment. Among all the possible measures to deal with a future shortage of labour, I would think that attracting more women to technical professions is probably the most effective and would benefit all parties involved – not least the women, since it means also higher wages for them.
What could Serbia learn from your experiences in dual education when we talk about tertiary education?
– Apart from the apprenticeship concept, there are colleges for higher vocational education concentrating on engineering, arts and crafts. Students finish these schools normally at the age of 19. The two final years are now classified as short-cycle tertiary education in order to make sure that these schools´ special position in terms of awarding full professional qualification as well as access to university education, is recognized also on an international level. Joint projects are often carried out by these schools working together with the business community, such as diploma projects focusing, for example, on the practical implementation of research and development findings. These schools, along with the apprenticeship system, are considered to be exemplary throughout Europe. We know from many international surveys that foreign investors consider these colleges as one of the most important assets of the Austrian educational system.
How do you evaluate the current trend of reforms and changes in the business environment?
– Serbia has definitely made significant improvements in the overall business climate through reforms of the labour and construction law. Also, the firm commitment of the Serbian government to follow the EU-path enhances trust and confidence on the part of foreign investors. Apart from the obvious criteria, like costs of infrastructure and labour, they also evaluate very carefully the framework conditions for operating a business. This applies mainly to the rule of law and, more specifically, to transparency and length of administrative and regulatory procedures. Hence, any improvement in these areas will have a positive impact on potential investors, both domestic and foreign.
What do you see as your priorities in the future?
– We are very pleased to see that our bilateral trade has developed favorably in the last few years and has reached a record high of 1,2 billion Euro. It is naturally our goal to keep this positive trend and see the trade grow even faster. Towards this end, we organize a series of events and conferences, both in Serbia and in Austria and hope that these will help to strengthen existing business ties and establish new ones between our two countries. A special highlight this year will be our regional conference AUSTRIA CONNECT Southeast Europe 4.0 in cooperation with the prestigious IEDC- Bled School of Management in Slovenia. This event will focus on the challenges of digitalization for companies in the region and the role of executives in this transformation. Top speakers combined with first-hand testimonials of successful Austrian companies in Southeast Europe, and not least the beautiful setting, should lead to an intensive exchange of ideas and information on the part of the participants, which will ultimately result in closer cooperation between the businesses of this region.