We have built a large number of industrial zones, defined new measures of development policy level
We talked to Igor Mirović, Head of the Government of the Autonomous Province of Vojvodina, about the current business climate, new investments from Japan, the operational plan of the new-ly-founded Capital Investments Commission of the Autonomous Province of Vojvodina, exporting Vojvodina’s wines to China and other topics.
You have been at the helm of the Government of the AP Vojvodina for three years now. In that timeframe, what has been done and what remains to be done?
— The three years of great work are behind us, primarily on the implementation of the Provincial Government Programme. The main goals were related to economic development and today – with clear results – we can talk about Vojvodina, which, together with all levels of government, has managed to secure new jobs, reduce unemployment to under 10% and attract many significant investors (like the German ZTF) to come here, along with generating an exceptional demand and great interest from new and domestic and foreign investors in developing their business in Vojvodina. For three years we have been working on improving the business environment. We have built a large number of industrial zones, defined new measures of development policy through the Vojvodina Development Agency (RAV), and stabilized the public finances in the Province, which are now well-regulated. In the report, compiled by the State Audit Institution (DRI), the Province’s finances were the only ones that received a positive opinion at the local self-government level. In short, the focus was on economic development.At the same time, we set in motion a huge investment tide. We have succeeded in realizing all the investments we had prepared in the field of infrastructure, health care, renovation of elementary and high schools, as well as in many other segments. We can confidently say that we have realized over 90% of our programme. What remains to be done is all the things that were planned but unfinished and the ones we are planning to do next year. In the coming period, it is especially important to prepare all the projects for the National Investment Plan, announced by the President of Serbia.
In June, the provincial government formed the Capital Investments Commission of the Autonomous Province of Vojvodina with you at the helm. What prompted you to form such a commission and what are its goals?
— The goals of this commission are to systematize all proposals of local self-governments, that is all local projects and all regional projects while taking into account the importance of individual in-vestments for several municipalities in certain parts of the province. The next goal is to present investments of provincial and national importance on the territory of the AP Vojvodina, such as large infrastructure corridors. The Commission is formed along with the same format as the national Capital Investment Commission, headed by the Prime Minister of Serbia. We must prepare project documentation on time. The budget liquidity is at a desirable level and the public debt is either stagnant or falling, which means that we need to use some of our money faster on public investments, as this will contribute to the further growth of certain segments such as construction, production of construction materials and other segments that need to further fuel the GDP growth.
How far along are you with adopting the Law on Financing of Vojvodina?
— The Republic of Serbia’s National Assembly passes laws. The provincial government has repeatedly referred to the need to pass this law that would clearly define a predictable financing model, primarily for Vojvodina’s development needs, create an orderly model of revenue collection and a regulated, additional model of expenditure control in the AP Vojvodina. At the same time, the law could also define additional sources of financing that Vojvodina does not use, which is quite relevant. By that, I mean securities and everything that can be found in the secondary money market as an additional source.At the moment, there is no indication if or when this law will be enacted, but, undoubtedly, if the law is adopted, in the light of the current political sphere often promoted by political parties in the opposition, it would enter the sphere of a predictable and clear framework that would serve as a lever for economic development. Therefore, the idea is for the law not to complicate the relations between the central and provincial governments, but to simplify, regulate and use them as an argument to counteract those who would like to disrupt the single economic space through this law and thus continue adding fuel to the fire of conflicts in the future too. On the contrary, we are in favour of a completely different solution.
The Agreement on Establishing and Developing Friendly Relations and Cooperation between Vojvodina and the Hainan Province was also signed. How is this collaboration progressing?
— The cooperation agreement signed by Vojvodina and the Chinese province of Hainan has already yielded concrete results; primarily in terms of marketing agricultural products to this fast-growing Chinese province, which has a population of ten million and is poised to become one of the most famous tourist destinations in the world, given their plans and development speed. Hainan is a large island in Southwest China and as guests of this province, we have had the opportunity to see for ourselves the pace of development and the concept that will position the province as one of the most significant levers of development since Hainan will be turned into a free economic zone and it has been developing in line with all environmental standards.Our wine producers have already started exporting the required quantities of this beverage to the renowned hotel chains in Hainan. This is only the first step and we expect that the cooperation to continue because we will nurture the established contacts and will be very concrete in the implementation of common projects.
Any announcements of new investments? Which countries do potential investors come from?
— The RAV and the City of Novi Sad have received a letter of intent stipulating implementation of an extremely significant investment from Japan on the territory of Novi Sad, which would entail an investment of 200 million euro and creation of 3,000 new jobs. This is a strong tech company from Japan that deals with hardware elements in high-tech development. Hopefully, good news will ensue. There are announcements for investments in other parts of Vojvodina too, but Novi Sad is a city with a high birth rate, a city that many people are moving to and that needs such a strong company, even though Lear, Delphi and Continental and many other companies are already developing their business here. We will do our utmost to help this company to launch its business in Novi Sad because this would be the final rounding off of the economic, developmental and technological potential of our city. It is no accident that this company has chosen Novi Sad. They chose us at the Expo Real in Munich last year, which means that our mechanism of presenting our potential at the most important trade shows in the world is working. If this company, based on our investment in the presentation of our potential, comes here and realizes its investment, this will also mean that all our investments were justified too.
What can Vojvodina offer to companies? What would you like to single out as the biggest advantages compared to the rest of Serbia?
— First and foremost, Vojvodina offers fully equipped industrial zones. Today, following my initiative since I have personally managed a few projects, we have locations (fully equipped ones) where investors can invest and do their business. At the same time, we have developed mechanisms via the RAV that are primarily targeting domestic companies, whereby we financially assist the realization of in-vestments by encouraging job creation, as well as the procurement of brand new equipment through appropriate competitions. In this way, through the RAV alone, we have created more than 2,000 new jobs in two years, while providing significant funding for brand new equipment with the help of highly accurate mechanisms. All funds placed by the RAV are covered by commercial bank guarantees, which eliminates the possibility of misuse or channelling funds to something else.Concurrently, Vojvodina offers a very good infrastructure, well-maintained roads and good work habits. Thanks to its university, Vojvodina also has the scientific potential essential for the development and investments by new businesses, which is our advantage. We work very well with local governments to build and implement whatever an investor is looking for when they want to invest in an area, whether it is the infrastructure, utility elements or helping them to find the best locations. All this together com-prises Vojvodina’s advantage.
A memorandum on the construction of the Fruška Gora Corridor was signed this year while the contract is supposed to be signed by spring 2020. How important is this project and when is it going to be implemented?
— The Fruška Gora Corridor is extremely important for the city of Novi Sad, for its economic development, for Petrovaradin, Irig, Ruma and the Ruma industrial zone which is already fully equipped in this segment, has 160 hectares of land and is located on the Ruma motorway interchange. The project also envisages a bridge on the Danube, stretching from Tekija to Kovilj. A great amount of work is being spent on this project which is one of the priorities in the implementation of large investments through the National Investment Plan. The project is no longer managed by the provincial government, though it has been prepared by us, and I have personally coordinated the project for several years. The project is now under the jurisdiction of the Government of the Republic of Serbia, and the President has given his support to its implementation. The following months are decision months.
Are you satisfied with the cooperation between the Government of the Republic of Serbia and the provincial government? Do you think there is room for improvement or is the cooperation strong enough already?
— We cooperate daily and have a really good collaboration with most ministries on the implementation of numerous projects in the AP Vojvodina. In this way, our provincial budget gets 7% which complies with the Constitutional provision on the amount of revenue generated by the AP Vojvodina. Furthermore, concrete joint projects with the Government of the Republic of Serbia and the line ministries also generate additional money for the province. There are numerous examples of this: construction of the water and wellness park in Palić near Subotica, construction of the Science and Technology Park, the BioSens Institute, renovation of hospitals and construction of numerous other facilities on the territory of Vojvodina. One part of the investments is managed by the provincial government and the other by the Public Investment Office. Simply put, we have demonstrated seriousness and a high degree of professionalism in project preparation. I also think that the Government of the Republic of Serbia has a good enough reason to use this cooperation as an example of a good collaborative effort when implementing projects with other government levels.