SERBIA – CZECH REPUBLIC Opportunities for growth Serbia Investment and Export Promotion Agency SERBIA – CZECH REPUBLIC Opportunities for growth Mr. Bozidar Laganin| Director PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

Investment Track Record Czech Republic investments to Serbia Serbia Investment and Export Promotion Agency PRESENTATION OUTLINE Investment Track Record Czech Republic investments to Serbia Most Improved Business Environment South East Europe – snap shot view by consultants Skilled and Competitive Workers Attractive tax and financial environment SIEPA Activities and Services PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

LEADING FOREIGN INVESTORS Serbia Investment and Export Promotion Agency LEADING FOREIGN INVESTORS Since 2001 Serbia attracted around 20 billion USD of investments Source: Vienna Institute for Economics PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

Serbia FDI analysis 2001/2009 – based on 180 projects Serbia Investment and Export Promotion Agency Serbia FDI analysis 2001/2009 – based on 180 projects Source: SIEPA PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

SERBIA – CHEZCH INVESTMENT RELATIONS k Serbia Investment and Export Promotion Agency SERBIA – CHEZCH INVESTMENT RELATIONS According to the National Bank of Serbia the value of investments from Czech Republic stands at modest 21.4 million USD; However, actual investments are higher; In September 2008, company CGS Mitas bought Serbian Ruma Guma, the value of investment around 35 million Eur; Company Connex Morava bought a Serbian LITAS for 1.4 million Euros while planning to invest additional 9.9 million; Czech companies are also very interested to participate in the Serbian energy sector but also in the reconstruction of the railway on Corridor X; PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

Serbia FDI analysis 2001/2009 – based on 180 projects Serbia Investment and Export Promotion Agency Serbia FDI analysis 2001/2009 – based on 180 projects Source: SIEPA PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

Serbia FDI analysis 2001/2009 – based on 180 projects Serbia Investment and Export Promotion Agency Serbia FDI analysis 2001/2009 – based on 180 projects Source: SIEPA PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

MAJOR AUTOMOTIVE AND FOOD INDUSTRY INVESTORS Serbia Investment and Export Promotion Agency MAJOR AUTOMOTIVE AND FOOD INDUSTRY INVESTORS PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

MOST IMPROVED BUSINESS ENVIRONMENT Serbia Investment and Export Promotion Agency MOST IMPROVED BUSINESS ENVIRONMENT Economist Intelligence Unit: “SERBIA IS FORECAST TO MAKE THE LARGEST IMPROVEMENT IN THE BUSINESS ENVIRONMENT IN THE REGION OF EASTERN EUROPE BETWEEN 2009 AND 2013.” “OUT OF 16 COUNTRIES INCLUDED IN THE RESEARCH, SERBIA WILL BE LEADING THE REGION IN TERMS OF BUSINESS REFORMS BY A WIDE MARGIN.” PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

BELGRADE – CITY OF THE FUTURE Serbia Investment and Export Promotion Agency BELGRADE – CITY OF THE FUTURE Belgrade, the capital, has been awarded as the City of the Future for Southern Europe 2007 by the fDi Magazine. Selection criteria - economic potential, cost effectiveness, human resources, IT and telecommunications, transport, quality of life, and FDI promotion. In 2008 the municipality of Indjija was ranked among the Top 25 Most Attractive locations for foreign direct investment in Europe by the Financial Times. PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

ATTRACTIVE DESTINATION Serbia Investment and Export Promotion Agency ATTRACTIVE DESTINATION SERBIA IS THE 3RD MOST ATTRACTIVE MANUFACTURING AND 7TH MOST ATTRACTIVE SERVICES FDI DESTINATION AMONG EMERGING ECONOMIES, ACCORDING TO PRICEWATERHOUSECOOPERS. THE 2ND BEST PERFORMANCE IN THE SOUTH EAST EUROPE REGION WITH NEARLY 150 INWARD INVESTMENT PROJECTS IN 2007, 2008 AND 2009, BY ERNST & YOUNG. PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

Serbia Investment and Export Promotion Agency SEE – A CLEAR LEADER Which region in Europe is the most attractive in terms of labor and productivity? Labor cost Flexibility of labor legislation Productivity increase 49% 1 36% 33% 1 1 18% 16% 15% 14% 13% 2 10% 2 3 2 3 3 Central Europe Southeast Europe Russia Ukraine Belarus Western Europe Southeast Europe Central Europe Western Europe Southeast Europe Central Europe Source: Ernst & Young Southeast Europe Attractiveness Survey 2008 - 216 international executives If you want to receive the full report please contact SIEPA or Ernst & Young PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

SNAPSHOT OF INVESTMENT PERCEPTION AND REALITY Serbia Investment and Export Promotion Agency SNAPSHOT OF INVESTMENT PERCEPTION AND REALITY Which region is the most attractive for manufacturing activities? Matching image and reality 150 Romania Image/reality Outsider with a poor image but strong results 100 (No. of inward FDI projects 2007) REAL ATTRACTIVENESS Challengers with a stronger image than the reality SERBIA Bulgaria 50 Bosnia & Herzegovina Turkey Croatia Greece Cyprus 0% 20% 40% 60% Source: Ernst & Young Southeast Europe Attractiveness Survey 2008 - 216 international executives/E&Y European Investment Monitor 2008 If you want to receive the full report please contact SIEPA or Ernst & Young PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

A wide availability of highly qualified staff Serbia Investment and Export Promotion Agency HUMAN RESOURCES 27,000 university and 2-year college graduates, and 75,000 high school graduates per year Top quality technical education at both high school and university level A wide availability of highly qualified staff Strong command of the English language “This initiative demonstrates our confidence and trust in Serbia, its industry, management competence, and the skill of its workers.“ Sergio Marchionne, CEO PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

TECHNICAL EDUCATION 11 technical faculties for white collar workers Serbia Investment and Export Promotion Agency TECHNICAL EDUCATION 11 technical faculties for white collar workers 71 technical schools for blue collar workers Faculty of Mechanical Engineering Faculty of Technical Sciences Faculty of Electrical Engineering Faculty of Traffic and Transport Engineering Faculty of Technology and Metallurgy PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

Gross monthly wages in 2009 in EUR Serbia Investment and Export Promotion Agency SALARIES IN SERBIA Gross monthly wages in 2009 in EUR NET SALARY GROSS SALARY 25,000 RSD (250 EUR) 41,037 RSD (400 EUR) 40,000 RSD 66,266 RSD (650 EUR) 60,000 RSD (600 EUR) 99,903 RSD (1,000 EUR) Net vs. Gross Salary Source: Vienna Institute for Economics PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

USA – preff. trade regime Serbia Investment and Export Promotion Agency TRADE DIPLOMACY – MARKET ACCESS European Union EFTA Russia Kazakhstan CEFTA USA – preff. trade regime Turkey Belorussia PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

COMPETITIVE TAX SYSTEM Serbia Investment and Export Promotion Agency COMPETITIVE TAX SYSTEM Withholding tax of 20% (double taxation treaty rules apply); Annual income tax is 10 or 15 % for annual income below or above 8 times the average annual salary in Serbia (tax applies on the difference); PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

FINANCIAL INCENTIVES TO INVESTORS Serbia Investment and Export Promotion Agency FINANCIAL INCENTIVES TO INVESTORS Eligible Sectors Large-scale Projects Standard-scale Projects Manufacturing Export Related Services Capital and Labour Intensive Projects Capital Intensive Projects Investment Realised in Devastated Regions Investments in Automotive, Electronics and IT, Realised in Regions of Special State Interest Investment Realised in Other Regions Investments in All Regions Grant Amount (EUR) 25% of the total investment 20% of the total investment € 4,000 - 10,000 / per job created € 5,000 - 10,000 / per job created € 2,000 - 5,000 / per job created € 2,000 - 10,000 / per job created The Minimum Investment Amount € 200 mn € 50 mn € 0.5 mn € 1 mn The Minimum Number of New Jobs Created 1.000 300 50 10 PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

SERBIA – CZECH REPUBLIC, A WORLD OF OPPORTUNITIES Serbia Investment and Export Promotion Agency SERBIA – CZECH REPUBLIC, A WORLD OF OPPORTUNITIES We are yet to explore the full potential of cooperation; trade is still limited but is showing signs of recovery; investments are yet to grow; Two countries have signed the double taxation treaty; Serbia offers national treatment of foreign investors; Free transfer of financial and other assets; No industry restrictions; The industrial heritage and current situation in Czech Republic can be complementary to Serbian and we see a lot of potential in JV’s, technology and know-how transfer; I believe that many companies of Czech origin supplying MNE’s in the automotive and electronic sector can find opportunities in Serbia; Logistics and transportation are also very interesting; For Czech companies looking to develop retail activities in SEE, we see Serbia as the perfect platform; PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

PROMOTING INVESTMENTS Serbia Investment and Export Promotion Agency OUR ACTIVITIES PROMOTING INVESTMENTS Providing information Selecting investment location Managing investment projects Project aftercare Assistance in various activities Selecting suppliers Linking all stakeholders Web site Conferences Investment seminars Project management Financial grants administration Tax, legal, other assistance General data Tax and legislation Sector analysis, brochures Municipal data Brownfield locations Greenfield locations PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

DATABASE OF AVAILABLE BROWNFIELD AND GREENFIELD LOCATIONS Serbia Investment and Export Promotion Agency DATABASE OF AVAILABLE BROWNFIELD AND GREENFIELD LOCATIONS PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

SIEPA SUPPLIERS DATABASE Serbia Investment and Export Promotion Agency SIEPA SUPPLIERS DATABASE On our website Search by: Sector / sub-sector, markets, technology, used products, certificates PRESENTATION RIGHTS RESERVED. COPYRIGHT SIEPA. YEAR 2010.

Thank you for your attention! Serbia Investment and Export Promotion Agency Thank you for your attention! SERBIA INVESTMENT AND EXPORT PROMOTION AGENCY 3, Vlajkoviceva St. 11000 Belgrade, Serbia Phone: +381 11 33 98 55 0 Fax: +381 11 33 98 81 4 E-mail: office@siepa.gov.rs www.siepa.gov.rs