Italian – Serbian economic cooperation is affected by the pandemic immensely – More than 11500 thousand Serbian companies operate with Italy and Italian companies who are members of Confindustria employ more than 30 000 employees in Serbia. Confindustria’s message is: Let’s face the economic emergency in order to protect the working places and the business!
Patricio Dei Tos, president of the Association of Italian Industrialists in Serbia is a businessman from Treviso. He is the founder and CEO of Labor Legno and Itlas, a leader in the Italian market in the production of wooden floors and floor coverings. Under the name “Labor SRB” the company has been operating successfully in Serbia since 2015, when it opened its first plant in Sremska Mitrovica and a second plant in October 2018. The Covid 19 pandemic has changed a lot in the operations of his companies as well as the activities of Confindustria Association Mr. Dei Tos leads.
How did you organize your business activities?
“Following the decision of the Italian Government to suspend a large number of economic activities, to preserve people’s lives and health my company in Italy Labor Legno and Itlas made a very difficult decision. Namely we have decided to suspend our production activities in Italy and close the company on March12th 2020. This was absolutely necessary due to extremely difficult humanitarian situation in Italy caused by the dramatic consequences of the expansion of COVID 19,” says to Diplomacy&Commerce Mr. Dei Tos who, in addition to being a successful industrialist in Italy and Serbia, is also the President of the Association of Italian Industrialists – Confindustria since December 2019. He will lead this reputable business association in Serbia until 2022.
“I think we made the right decision! The health of the people working with me is an essential aspect and it assures us that it will be more substantial later, once the danger of this pandemic COVID 19 is over.
You run businesses both in Italy and Serbia and you lead Confindustria Serbia? How are the daily business routines affected by the current situation?
“I became president of Confindustria Association in December 2019. Together with the Members of Confindustria Management board, Vice Presidents and operational team of Confindustria in Belgrade – we have planned many activities and events for 2020 but now all efforts are focused on providing daily support to the Confindustria member companies in Serbia. Italian companies operating in Serbia need timely information daily. Our working days are very complex and unpredictable. Confindustria has 170 member companies and we have to address their problems. That is why Confindustria Serbia is very active in regards to numerous business and economic initiatives that should help the Italian trade and business in Serbia to cope with this challenge. We are the strong and proactive bilateral bond between Italy and Serbia and the constant driving force of initiatives and large number of follow up activities between our colleagues from Confindustria system Italy, Brussels and Serbian institutions,” emphasizes Mr. Dei Tos.
“We are aware that we need to be as effective as possible in addressing many issues and challenges Confindustria member companies are facing on daily level. The situation is difficult in all sectors of economy, business and trade- from manufacturing, services, IT, financial, transportation and pharmaceutical sectors. Italy and Serbia are reliable economic partners and thus the problems that arise are very complex. According to the latest available data from the Serbian Customs Administration, over 11 500 thousand Serbian companies operate with Italy. The member companies of Confindustria Serbia employ more than 30,000 employees.
Italy is the first Western country to be affected by the virus. Based on the experience of our colleagues in Italy, we could have made the best decisions at the right moment. For example, Confindustria in Italy implemented the model of Smart Working, so when the situation in Serbia dramatically changed due to this lethal virus, beyond the worst imagination, we introduced the same model, with only a part of the team in the office.
Confindustria members in Serbia have also taken all necessary precautions to protect their employees, trying to maintain at the same time a functional business and production process.
Italian companies in Serbia are also facing daily difficulties and emergency requests trying to solve economic, logistic but also family and personal problems. The business-related trips of both the Italians and Serbs, who are our managers and technicians are very difficult to organize and if they should return to Italy, they must remain in quarantine for 14 days and therefore cannot return to Serbia. If they return, they must stay in quarantine in Serbia for 28 days.
Together with other business associations, Confindustria Serbia has sent a letter to Serbian Minister of Finance asking for assistance in the name of Italian companies who operate in Serbia in these difficult days of Pandemic. What are the expectations?
“Yes, this is just one of the initiatives aimed at joint action of a large number of foreign investors in Serbia, intending to support the Serbian government in the adoption of necessary and appropriate anti-crisis measures. It is essential for Confindustria that we are a member of a working group coordinated by the Serbian Chamber of Commerce. Representatives from the FIC, AmCham and Serbian Association of Employers are also included. We exchange information daily, take initiatives and try to solve problems.
What are the major problems the Italian companies in Serbia are facing due to the Pandemic?
First of all, there were significant problems with the transportation of goods and movement of people, treatment of truck drivers, customs procedures, permits and everything related to the implementation of the Serbian, CEFTA and EU government’s emergency measures. Group of experts and members of the Confindustria Serbia executive board created an important document in which we proposed some fiscal measures to the Serbian government, aiming to mitigate the negative impact of the coronavirus pandemic on the private sector. Confindustria’s message is: let’s face the economic emergency for the protection of work! The proposals for an immediate reaction!
The instruments, complementary to national fiscal policies, should be aimed at counteracting the negative effects of COVID-19, stabilizing the country’s economy by safeguarding employment, supporting the earnings of employee’s families, ensuring liquidity for businesses. An action that must be aimed at providing all companies – small, medium and large – with a so called “bridge” liquidity to overcome the period of freezing of activities and demand and which must be carried out very quickly, with guarantee and facilitated financing instruments extraordinary. In order to support the business activity, the Government should consider temporary tax relief and deferral of tax collection. Also, we focused on measures related important labor-related measures, tax and accounting measures, transport, border controls. This method of intervention would have the advantage and essential importance once the state of emergency is over, to support the recovery of the growth path. We need extraordinary measures for the liquidity and financial relief for companies, to support companies affected by the emergency; we need the intervention of the Guarantee Fund for SMEs. It is necessary to introduce additional extraordinary measures both to finance its working capital during the fall in turnover and to improve the financial situation by extending the existing loans. Businesses have to overcome the critical phase, obtaining new liquidity and diluting the impact of debt over time. The latest information is that the Government of Serbia has announced the activation of negative impact depreciation measures, allocating a 5.1 billion euro of a state aid package for the economy of the country. These are anti-crisis measures, but the timing of their activation remains a question. They are necessary for us to keep our employees and the volume of economic activity in the situation when the whole world is shutting down production activities, and Europe is hardly receiving our goods. The Government of Serbia assisted Italian companies at the beginning of investment cycles life in this country. We believe that with these measures and through a “challenge-response” will now support and guarantee business continuity. We know that the health of the citizens is a conditional element, but we also need economic support to keep and maintain our business.”
How are you spending your private time during the Pandemic?
“Of course, I have to stay at home. However, I do not have much free time since I have daily conference calls with Confindustria associations operating under the auspices of Confindustria East Europe, as well as regular communication with our Association board members and Confindustria Serbia office. There are also local authorities, the Italian Embassy in Serbia or colleagues from my company who manage the company’s activities. The importance of keeping in touch with my co-workers is of paramount importance too because people may suffer from this long period of staying at home and many may face a real personal crisis. It is important to stay together, use the benefits of all social instruments and remain healthy to overcome these difficulties. I’m also happy to spend the time with family!
What will you do first after the state of emergency is abolished?
“I am sure we have to keep ready physically and psychologically to come back to our healthy and ordinary life again and I am looking forward to my social habits and also to my day to day tasks.