Diplomacy&Commerce
2017
INVEST IN
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01. Ada mall 02. Waterfront towers 03. Sava promenade 04. A new bus station in block 42 05. Street Vuk KaradŞić 06. Slavija fountain 07. Belgrade Waterfront
contents
Diplomacy&Commerce
2017
INVEST IN BELGRADE 08 WE DID THE IMPOSSIBLE
Siniša Mali
Mayor of Belgrade
12 WE’LL GIVE BELGRADE BACK TO THE CITIZENS
Editor in Chief ŽIKICA MILOŠEVIĆ zikica.milosevic@color.rs Editorial manager TANJA BANKOVIĆ tanja.bankovic@color.rs Art director ILIJA PETROVIĆ ”IndigoChild” ilija.petrovic @color.rs Advertising managers VANJA KOVAČEV vanja.kovacev@color.rs JOVANA MARKOVIĆ jovana.markovic@color.rs NATAŠA NEŠIĆ natasa.nesic@color.rs DRAGANA RADOVIĆ dragana.radovic@color.rs Magazine director RUŽA RISTANOVIĆ ruza.ristanovic@color.rs Director ROBERT ČOBAN robert.coban@color.rs Photos GORAN ZLATKOVIĆ BEOINFO Translation and lecturer MRP EDITORIAL Translation SNEŽANA BJELOTOMIĆ
”Color Media Communications” LTD, 21000 Novi Sad, Temerinska 102 TIN 107871532 • Matriculation number 20887303 · Phone: +381 21 4897 100 • Fax: +381 21 4897 126 Office: Vase Čarapića 3/IV/38, Belgrade • 011 4044 960
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Milutin Folić Chief Architect and Director of Urban Planning of the City of Belgrade
16 WE ARE PRUDENT
Borko Milosavljević
Assistant Belgrade Mayor
20 PROJECTS IMPORTANCE FOR DEVELOPING THE CITY OF BELGRADE Luka Petrović
Director of the Agency for Investment and Housing of the City of Belgrade
22 IN THE SERVICE OF CITIZENS AND NEW INVESTMENTS
34 ASSISTING THE GREENER FUTURE OF THE CITY Arne Gooss
Director, KfW, Office in Belgrade
36 TIGHTLY CONTROLLED FINANCES GOOD FOR THE CITY Gjorgji Josifov
Assistant Vice President, Analyst of Moody's
38 SUCCESSFUL RESULTS IN SERBIA AND ABROAD Vladimir Milovanović
CEO of Energoprojekt Holding a.d., Belgrade
40 BEST OF THE BEST FOR DEVELOPMENT OF BELGRADE Nikola Nedeljković
General Manager of Belgrade Waterfront
42 MORE THAN JUST A DEPARTMENT STORE
Branislav Popović
Vladislav Lalić
26 MUTUAL BENEFIT AS FOUNDATION FOR COOPERATION
44 WE ARE SETTING NEW STANDARDS
Director of the Belgrade Land Development and Construction Directorate
H.E. Li Manchang
Ambassador of the People’s Republic of China
28 WE MAY DEVELOP VALUABLE PARTNERSHIPS H. E. Christine Moro
French Ambassador to Serbia
30 IMPROVING THE INVESTMENT CLIMATE Thomas Lubeck
IFC Regional Manager for the Western Balkans
30 GOOD INFRASTRUCTURE LEADS TO NEW INVESTMENTS Dubravka Negre
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Head of the Western Balkan Regional Office of the European Investment Bank (EIB)
Property and Expansion Manager, IKEA South East Europe
Nebojša Vasilić, Dušica Gaković
Project Development Managers of „A Blok“
45 TOP QUALITY OFFER IN THE HEART OF THE CITY Dragan Lazarević Belaga doo
46 SHOPPING PLEASURE IN THE HEART OF THE CITY Tsahi Boneh
Director of ABD
48 WE APPRECIATE SERBIA’S POTENTIALS James Gunn
Director Poseidon Group
50 INTO THE NEW YEAR WITH A NEW MALL GTC Group
F
or a long time, Belgrade has been harbouring an ambition to position itself as one of the important hubs and capital cities in the region of Southeast Europe. The initial ascent, after the year 2000, which a result of the arrival of foreign investors who turned Novi Beograd (New Belgrade) into a new business and financial centre of Southeast Europe, as well as the arrival of big supermarket chains, and ambitious plans for construction of residential and tourist facilities and shopping malls, have all slowed down with the onset of the global economic crisis. Large-scale infrastructure projects, like the Ada Bridge or the Pupin Bridge, were hampered by many obstacles, partly because of the complicated institutional framework and partly because of the unresolved property issues and other problems that dampened the initial enthusiasm for the revitalization of the capital city. Once the reforms in Serbia picked up, the GDP begun to grow and the city started to exercise proper control of the amassed debt, many projects were launched. The majority of them, like the relocation and reconstruction of the new railway and bus station respectively, the construction of a subway and numerous roads, the reconstruction of building fronts, the restoration of cultural facilities and green areas, and utilization of the areas around river banks, have been waiting for decades to be implemented. A this moment, over 1/3 of all construction work in Serbia is located in Belgrade and, if the ambitiously devised plans come to fruition, this share will continue to grow. The changes made to the institutional framework, expediting administrative procedures and more efficient use of the already granted project loans, have re-
sulted in renewed interest of large investors like the EIB, EBRD, KfW, Chinese companies and other subjects for Belgrade's potential and its need to reconstruct and build road, railway and airport infrastructure, overcome many environmental challenges and build tourist and cultural facilities that would successfully respond to the heightened interest of tourists in the Serbian capital. Also, some of the key investments, like the arrival of Air Serbia which made Belgrade its regional hub, concluding a contract on construction of Belgrade Waterfront, and many others, sent a signal and changed the minds of those investors who maybe did not view Belgrade as an attractive destination before. Belgrade's appeal to investors was also increased by making various funding modalities available including public-private partnerships on certain large-scale projects like, for instance, the VinÄ?a landfill, which, instead of currently being a burning problem, could become one of the driving forces behind Belgrade's economic development and a chance to create different Belgrade that would be greener and healthier for its population and numerous visitors. The similar financing format was also envisaged for public transportation, waste management and construction of a water filtering facility. The prerequisite for accomplishing these ambitious plans is, on one hand, having a continous fiscal discipline which made it possible for Belgrade to receive its very own credit rating this autumn, and, on the other hand, to have a clear plan on how to redefine the city's development in line with new standards while using modern planning and development modelling technologies, with the end goal of improving the quality of life of Belgrade's citizens.
foreword
MODERN CAPITAL CITY – FROM PLANS TO IMPLEMENTATION
Although Belgrade is the driving force behind Serbian economy with a 40% share in GDP, and is undoubtedly the tourist, commercial, industrial, transport, financial, cultural, scientific and educational centre of our country, the city failed to fully utilize its potential until recently
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interview SiniĹĄa Mali
Mayor of Belgrade
The city's debt is under control, we have 500 active construction sites, and we are very agile in issuing building permits and implementing projects. All of the aforementioned have made Belgrade a desirable location for investing and creation of new jobs. Many international partners are participating in the transformation of our city which commenced with the construction of the Belgrade Waterfront 8
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WE DID THE IMPOSSIBLE B
y getting its own credit rating Belgrade has proven that it has enough discipline to manage its own finances which has additionally spurred investors on. In 2017, a financial plan for six large-scale projects will be drafted, and the construction of a new bus station will commence, as will the reconstruction of the Sava Centre. The project partner for the latter will be chosen next year too. The investment momentum is accompanied by serious planning activities, primarily through public-private partnerships for which Belgrade has hired the IFC as an adviser.
having cranes instead of old shacks in that part of the town, we are also going to build the required infrastructure up to the project's geographical border which, again, is something that has been waiting for decades to be done. There are several hundred very dilligent workers on the construction site and they are working very hard on completing the facilities envisaged in the first stage of the project. Of course, other potential investors have noticed the changed investment environment in the city and have expressed a wish to invest here. Naturally, our doors are always opened to them.
Did the Belgrade Waterfront project draw in other investors to Belgrade? How much progress has been made on this project? — The Belgrade Waterfront has instigated many things in the city that have been at standstill for decades. Apart from now
How important is the adoption of the General Spatial Plan for the investment community? — After many years, Belgrade has finally become a good investment destination. At the foundation of this is the adoption of the planning documents which cur-
rently cover exactly a half of the city's territory. This was a huge and very important job because now we know exactly what we can offer to investors. Back in the day, they had to wait for years to be issued with permits. For instance, we have issued IKEA with a permit for construction of their department store in two days flat. By adopting a serious approach to investors, we have resolved the problem which, ten years ago, seemed unsolvable. To corroborate this, I would like to say that Belgrade has become the city of cranes with 500 active construction sites all over the city. More investors means stronger construction industry, more jobs and a city that is more beautiful and more contemporary.
WE HAVE 500 ACTIVE CONSTRUCTION SITES ALL OVER THE CITY WHICH JUST GOES TO SHOW THAT BELGRADE HAS BECOME THE CITY OF CRANES. THE MOST IMPORTANT CONSTRUCTION WORKS ARE THOSE ON THE BELGRADE WATERFRONT WHICH ARE PROGRESSING REALLY WELL
Considering that you often talk to the EBRD, EIB, KfW, Chinese companies and other investors, could you tell us what projects are closest to implementation in terms of having already prepared financial plans and commencement of works? — The final decision regarding the financial resources for construction of a waste water filtering facility and the completion of an interceptor will be made in early 2017. Possible sources of financing could be either a loan from Japan or KfW, and we are also negotiating with the Chinse investors about their financial terms. Tenders for formation of public-private partnerships (PPP) for replacement of street lights in suburban areas and assigning concession for six underground garages in downtown Belgrade, for which several financial institutions have already expressed readiness to provide funding, should be launched in the same period. Of course, all major international financial institutions are also going to fund the public-private partnership for the landfill in Vinča which will be forged in spring 2017. Last but not least, we have already achieved a preliminary agreement with KfW regarding the construction of a heating system that would run across the Gazela Bridge and a cogeneration facility in Voždovac. So, all in all, we have a total of 6 largescale projects for which we are going to have a financial structure in place in 2017. Furthermore, in the same year, we expect the construction of the new bus station in the Block 42 to start. This project will INVEST IN BELGRADE
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be implemented together with the company Beogradska Autobuska Stanica a.d. Also, we expect the reconstruction of the Sava Centre to start in 2017. We will have chosen a project partner for this endeavour by early 2017. Both projects will be fully funded by our project partners.
Considering the IFC's advice, which projects did the city government choose to be implemented via PPP? — The IFC is our adviser on PPP project regarding the Vinča landfill which is one of the worst landfills in Europe. Then there is the question of funding of the construction of the main sewage system and waste water processing facility in Veliko Selo, as well as establishing the Energy Efficiency Fund. PPP is a great format for implementing large-scale projects which are necessary for the city's development especially when you find the city budget drained, which is what happened when we took over. Apart from financial reasons, we need private partners because they already have enough experience in certain areas and the know-how that we don't have. How important is the fact that Belgrade now has its own credit rating for implementing the said plan? — Credit rating of B1 with positive outlook, which we have been given by the renowned global credit rating agency Moody's, just validates our all efforts on
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PUBLIC-PRIVATE PARTNERSHIP IS A GREAT FORMAT FOR IMPLEMENTING LARGESCALE PROJECTS WHICH ARE NECESSARY FOR THE CITY'S DEVELOPMENT ESPECIALLY WHEN YOU HAD A DRAINED CITY BUDGET, WHICH IS WHAT HAPPENED WHEN WE TOOK OVER
consolidation of public finances in the last three years. We now have the same credit rating as Serbia, and this is actually the highest rating that local authorities can get. The reaction from bankers and investors to us being given this rating was excellent and I am proud to say that we really did a good job. This is definitely going to positively affect all our ambitious plans and projects and it will be a good foundation for realizing what we have planned.
The B1 credit rating was assigned after the city had reduced its deficit. How ready is the city to fund its projects from its own budget? — We did the impossible in the last three years. We have reduced the deficit four-
fold, paid 443 million EUR of debt, and our public enterprises have started to become profitable. Next year, we need to pay another 72 million EUR of debt and, only at the end of 2017, we are going to be able to say that we have stable finances. We have been trying to set realistic priorities and to spend the saved money in a proper way. This, among other things, entails having enough money to do city projects like extending the pedestrian zone and reconstructing our squares and streets. For instance, the Serbian government has agreed to financially assist us in restoring building fronts because Prime Minister Vucic cares a great deal about having neat building fronts so that Belgrade can look its best.
FOR THE FIRST TIME IN MANY YEARS, THE CITY OF BELGRADE HAS LESS THAN 100,000 UNEMPLOYED PERSONS. THE NEGATIVE TREND OF GROWING UNEMPLOYMENT HAS FINALLY STOPPED AND I THINK THAT THINGS WILL CONTINUE TO IMPROVE IN YEARS TO COME
What is your vision for developing Belgrade's tourism potential? — I think that Belgrade is a town with a huge tourist potential which hasn't been used properly so far. Foreigners know what Belgrade can offer which is why we have invested a lot of effort into having the best tourist offer possible and to draw tourists in. Having a direct flight from Belgrade to New York will certainly contribute to this because we know occupy an inviolable position in the region thanks to this flight. The number of tourists has gone up by 12% since the beginning of this year compared to the same period last year and it is still growing. Our goal for next year is to attract more tourists from China. We are going to have a large campaign in that country while all of the tourist signs in Belgrade will be written in the Chinese language too. How important could the aforementioned projects be for the higher economic output of Belgrade and creation of new jobs? — Everything we do – from giving free work space to unemployed people to opening our doors to investors – is for the benefit of new jobs. For the first time in many years, the city of Belgrade has less than 100,000 unemployed persons. The negative trend of growing unemployment has finally stopped and I think that things will continue to improve in years to come. To illustrate what kind of healthy business environment we have created, let me just say that we have never had so many operational small businesses in the city. Their number has grown by 5,000 in the last three years.
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interview Milutin Folić
Chief Architect and Director of Urban Planning of the City of Belgrade
WE’LL GIVE BELGRADE BACK TO THE CITIZENS F With the adoption of the IME project – short for Identity Mobility Ecology – Belgrade has made precisely these values a priority in organisation and development
rom a gloomy city of automobiles, it will become a city in which people will enjoy landscaped public spaces, a city that will descend to its rivers and take advantage of the natural potential it possesses. We spoke with the City of Belgrade’s Chief Architect and Director of Urban Planning, Milutin Folić, about ambitious plans for the transformation of Belgrade.
What does the adoption of the IME project mean for the transformation of Belgrade into a modern metropolis? — The biggest challenges facing today’s metropolis include ecology and the health of citizens, which form the basis for measuring quality of life. The strategy of the City of Belgrade is to use the organising of public spaces - streets, squares, urban pockets, parks and riverbank areas - and
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the construction of comprehensive bicycle infrastructure in order to change the hierarchy in traffic in such a way that pedestrians and cyclists will be given priority over motor vehicle traffic. With the adoption of the IME project – short for Identity Mobility Ecology – Belgrade has made precisely these values a priority in organisation and development.
In which way will the 20 sub-projects that form an integral part of the IME project change the identity of our capital city? — Belgrade will be converted from a gloomy city of automobiles into a city for the people. A city in which people will enjoy landscaped public spaces, a city that will descend to its rivers and take advantage of the natural potential it possesses. People who walk and ride bikes more are healthier, and healthy people are happy people.
One of the key aims of this new approach is to transform the city in such a way that it becomes accessible to pedestrians. Which projects are crucial to achieving this goal? — That is an entire series of projects that relate to the organising of public areas, because regulated public spaces tailored to people ensure that people spend more time in public places and go on foot more. The basis for this is of course the standards that we set in the CATALOGUE OF URBAN EQUIPMENT, which is now obligatory for all those doing something in a public space. After many years, order has been introduced to the pedestrian area of Knez Mihajlova Street, which will next year have all gardens uniformed and its entrance will be controlled, with only delivery vehicles allowed in certain periods. We have almost doubled the Knez Mihailova pedestrian area by paving Vuka Karadžića Street, the plateau at “Crvenog Petla”, part of Zmaj Jovina Street to Vasina Street, Obilićev Venac and part of Topličin Venac, as well as by expanding the footpath on Carica Milica Street and rearranging the cobblestones on Kosančićev Venac, which is also becoming part of the pedestrian oasis. Works are currently underway on paving Delijska Street, Cara Lazara Street, Gračanička Street and part of Kralja Petra Street, as well as on the reconstruction of the cobblestones on Kosančićev Venac, which – following reconstruction – will form part of the pedestrian oasis. In the days ahead work is set to begin on the renovation of Maršala Birjuzova Street and design work is ongoing for Sremska Street up to the junction with Knez Mihailova Street, where a pedestrian corridor will be expanded as the main entrance to the pedestrian area. With the construction of the new terminus in New Belgrade, the conditions have been created to close Republic Square, Vasina Street and Student’s Square for traffic, while the preparation of project documentation is underway for the paving of that part of the city, as well as for landscaping Vojvoda Vuk Park from Topličin Venac to Pop Lukina Street. The selection of contractors is underway for paving Nušićeva Street, while designers have been selected to arrange the Terazije plateau, Bezistan and the underground passage on Terazije. Moreover, in 2016 a large number of
urban pockets were arranged, such as the square in Novopazarska Street, the park near Stara Herzegovina and, particularly significantly, the steps with a public fountain and bench in Pasterova Street, in a place where we succeeded, after 30 years, in removing the unregulated pharmacy building that occupied a public space intended for all citizens. Reconstruction works have commenced on Slavija Square, while plans for next year include the reconstruction of Roosevelt Street, Republic Square, Terazije plateau and Karađorđeva Street from Branko’s Bridge to Beton Hala, construction of a pedestrian footbridge
WITH A SERIES OF SUB-PROJECTS, FROM THE EXPANSION OF PEDESTRIAN ZONES TO THE RESTRUCTURING OF FAÇADES, STREETS, SQUARES AND GREEN SPACES, BELGRADE SHOULD GAIN A NEW IDENTITY AND BECOME GREENER AND HEALTHIER
from the Kalemegdan to Beton Hala and many other projects. It is also important that these activities don’t relate only to the city centre, but also other parts of Belgrade. Thus, the
centre of Grocka has received a new pedestrian area, while the pedestrian area in Zemun will get new paving and equipment, as well as being expanded from Gospodska Street to the Danube, where it will finally emerge onto the riverbank.
The Serbian capital is recording growth in the number of tourists and the arrival of major hotel chains. How prepared is the City to contribute to making the old hub of Belgrade appear more attractive through the restoration of façades? — In the last two years, Belgrade has broadened its hotel offer with new hotels Courtyard Marriott and Radisson Blu,
with while Hilton, W Hotel, St Regis and several other hotels are currently under construction. Furthermore, by extending the pedestrian zone and improving numerous public areas, the number of restaurants and coffee shops has gone up which, owing to their quality, have repeatedly contributed to Belgrade being declared one of the top tourist destinations in the world. The restoration of façades is something that goes without saying. Unfortunately, in Belgrade it is still not acceptable to oblige mostly poor citizens to reconstruct their own façades. It is for this reason that the City has allocated significant funds and we have prepared a threeyear plan for the restoration of façades in the city centre, and the result will be a more orderly city – not only for tourists, but also for citizens. In parallel with reconstruction, façades will also receive decorative lighting, which will also make the city look more attractive at night. INVEST IN BELGRADE
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What plans does the City have for Slavija Square following the construction of the fountain? — The fountain is just one detail. What is essential is that the project to arrange Slavija also encompasses the arranging of a significant public space around the roundabout, and in particular the part up to the start of Kralja Milutina Street, which is now a shambles. That area will become a new public space with benches, trees and
other activities, and also in this area a monument to Dimitrije Tucović will be erected, in the axis with Mekenzijeva Street.
Apart from expanding and arranging pedestrian areas, another of the priorities is also relocating freight traffic from the city centre and moving the main train and bus stations. How close to those goals are we today? — The importance of the Belgrade Waterfront project is precisely in the fact that it initiated the completion of a series of major infrastructure projects that were started long ago. Alongside completion of the sewerage system, construction of the bridge across the Sava and the tunnel that will connect the Sava and the Danube amphitheatre, one of the projects that it also revived is the completion of the Belgrade railway hub that was started back in 1972, during the time of Branko Pešić. Today, after many years, Prokop is being completed, works have started on the construction of new bus and train stations in Block 42, while the freight railway terminal was relocated to Makiš a few months ago. However, the greatest effect will be
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seen when they remove the rail tracks that today go around Kalemegdan, thereby completely separating Belgrade from its rivers, and we are working intensively for that unnatural barrier to be removed completely by the end of 2019. Then we will be able to say that Belgrade has moved down to the rivers.
One demanding project that progresses in this direction is the reconstruction of
THE IMPORTANCE OF THE BELGRADE WATERFRONT PROJECT IS PRECISELY IN THE FACT THAT IT INITIATED THE COMPLETION OF A SERIES OF MAJOR INFRASTRUCTURE PROJECTS, FROM THE SEWERAGE SYSTEM, TO THE CONSTRUCTION OF THE BRIDGE OVER THE SAVA AND THE BELGRADE RAIL HUB
the old Sava Bridge. When can the final conceptual design and the securing of finances for the construction of the bridge be expected? — With the launch of the construction industry, we filled the budget for the reno-
vation of the city, but also for the construction of pieces of infrastructure like the Sava Bridge. It is planned for technical documentation to be developed during 2017 and for construction to start in 2018. That bridge will receive two additional traffic lanes, a bicycle lane and pedestrian walkways.
You have announced that the construction of access roads to Ada Bridge will continue in spring. When will this bridge become fully functional? — Work is in progress on the construction of access roads on the New Belgrade side and we expect Ada Bridge will have a direct connection to Tošin Bunar by summer. By then works will also begin on installing tracks that will enrich this bridge with tram traffic too. One of the most controversial projects that the City has presented is the construction of an elevated gondola lift. Do you support this project? — This is an idea that is now in the phase of technical-economic analysis that will show whether that project is worth it and whether it is possible to place it where it will yield the best results, after which the preparation of planning and technical documentation would follow. For now it is still on the table. We are witnessing the increasing popularity of cycling to work around the world. What are the City’s plans when it comes to constructing cycling infrastructure? — We have also set high goals when it comes to developing a network of bicycle paths. After marking cycling routes along Bulevar Oslobođenje, a cycle path was made that links the neighbourhoods of Banjica and Topčider, as well as one linking Branko’s Bridge and Pop Lukina Street, as a continuation of construction of the primary network of cycle lanes, while a plan has been made for 120km of cycle lanes that will be marked during 2017. A large number of parking spots for bikes have been set up, and next year they will also be placed at another 120 locations. In parallel with that, 160 locations have been prepared, as well as a competition to select the operator for the system of public bicycles in Belgrade, which the Secretariat for Transport will announce at the beginning of 2017, so we can justifiably expect that by summer we will have a functional system of public bicycles.
GREAT WAR ISLAND
interview Borko Milosavljević Assistant Belgrade Mayor
WE ARE PRUDENT O All public enterprises, with the exception of the city public transportation company Beograd and Sava Centre, have become profitable and this is the biggest success of our reforms. At the same time, a series of supervisory procedures have been put in place that are supposed to ensure that these management mechanisms are long lasting, and that they positively contribute to the city’s credit rating while raising the quality of life for our citizens
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ur public companies are no longer illiquid, slow, cumbersome, lacking funds and depending on our budget. We are talking to Assistant Belgrade Mayor, Borko Milosavljević about the change in direction as a result of the reforms.
Belgrade has recently been assigned a credit rating largely thanks to finally getting the city’s debt under control. How much did the public sector reform in the city contribute to this? — This credit rating is the best validation of the comprehensive reforms that have been implementing in Belgrade. We are talking about reforming public finances and the city’s budget, on one hand, and public enterprises, on the other. The reform of public enterprises was very important for the entire process because if our public enterprises had not been reformed, they would have continued to be illiquid and a burden to the city budget.
Which reform principles did you apply in these enterprises? — The main principle that we applied in reforming our public enterprises was making a clear distinction between the responsibilities of their founder – the City of Belgrade, and their own responsibilities. The main role of the City of Belgrade is to control public enterprises it has founded, while the management at these public enterprises had one goal only, which is to offer good service, or rather provide a good product. The bottom line of reforming public enterprises in Belgrade was to cut back on unnecessary costs and to have only those expenses that stem from the enterprise’s core activity. Which public enterprises did the best in practice? — During this reform process, which has been lasted for three years now, the performances of our public enterprises have
drastically improved. The cumulative financial results of Belgrade’s public enterprises in 2013 showed a 2-billion-dinar loss. In only three years, following the reforms, these public enterprises transitioned from financial losers to financial winners. According to the projected balance of accounts for this year, ending on 31st December, 2016, the public enterprises in Belgrade are going to generate profit to the tune of over 5 billion Dinars. This means that they have improved their financial standing by over 7 billion Dinars. All public enterprises, with the exception of the city public transportation company Beograd and Sava Centre, have been prof-
itable and this is the biggest success of our reforms. Beogradske Elektrane, Parking Servis, Gradska Čistoća, and Beogradski Vodovod i Kanalizacija top the list.
What are the biggest remaining problems and what does the city government intend to do to resolve them? — The two public enterprises that still have to round off the reform process are Sava Centre and the city public transportation company Beograd (GSP). The optimization of their costs has been carried out, and, unlike in other public companies, the main problem with GSP is revenue. If we look at their cost structure, 70% of the revenue goes towards salaries and fuel. If both of these components were reduced, that would result in lower quality of services, fewer buses and fewer drives.
This is not what we want because the main principle that we have to adhere to is for our public enterprises to offer quality services. The problem that GSP has been facing is collecting money for tickets. Changing the ticketing policy and the tariff system, improving the collection of ticket money and carrying out ticket control are the main goals and tasks in this company. Next year, we are going to continue applying ourselves to solve the problems that GSP has because, once we do that, we are going to round off the reform of the public sector in Belgrade. In regard to Sava Centre, we are going to pick a strategic business partner for the
BY REFORMING PUBLIC ENTERPRISES, WE HAVE CREATED AN OPPORTUNITY FOR THEM TO BECOME STABLE COMPANIES AND NOT A BURDEN TO THE CITY BUDGET
Centre probably in the Q1 of 2017. The building that houses Sava Centre has not been built to be energy efficient, and, as a result of the tardiness and neglect of the former management, the Centre’s event timetable is not full. By bringing in the
strategic partner, where the city would remain the majority owner while the private partner would own a minority stake, we are going to transfer the management of the Centre to that partner while the relevant contract will stipulate that the strategic partner would be obligated to repair the Centre and improve its energy efficiency. This will be a way out for Sava Centre.
What else did the city government do to make this prudent financial behaviour and management changes permanent, and to ensure that public enterprises continue operating in a transparent manner?
— The City of Belgrade based its entire reform on having a systemic solution and approach. By carrying out preventive and post festum control, the city government has increased the transparency and sustainability of this new format of running public enterprises. We have formed an entire team comprised of relevant institutions that have been continuously supervising the functioning of public enterprises. The bottom line of our reform is preventive control which is why we pay a great deal of attention to operational programmes and public procurements. This is also why we have budget inspectors and internal auditors as members of our team who, together with the line secretariats and the overall team, have been supervising every single expense and public procurement in each individual public enterprise. INVEST IN BELGRADE
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How are citizens benefitting from the changes you have made in public enterprises? — There are multiple benefits for our citizens from reforming public enterprises. Public enterprises in Belgrade were founded to provide utility services which are the lifeline of every big city. Our everyday lives are directly affected by the quality of utility services which include water supply, sewage, maintaining green areas, zoo-hygiene, rubbish disposal, heating, public transportation and other. If only one of those services stopped, the
terprises in Belgrade have invested 12 billion Dinars of their own money, while they have allocated 16 billion Dinars in their next year business plans for improving utility infrastructure. Some of the projects they are going to fund are reconstructing the Kalenić outdoor market, and a total reconstruction of the Palilula outdoor market. Parking Servis is going to reconstruct the garage in Obilićev Venac and build new parking places while Beogradski Vodovod i Kanalizacija plans to replace 2% of the old, dilapidated asbestos pipes which will bring us closer to
same time, working on shutting down old boiler rooms that use oil fuel and replacing them with new, more efficient boiler rooms that use gas. These investments just show that all public enterprises are embarking on large-scale investment endeavours. Bearing in mind that public enterprises have become stable companies, private initiatives and private capital are increasingly becoming an option so that our public enterprises could implement certain projects via PPP. Speaking of PPP, next year, the plan is to build six underground garages. Also, there is a big project
city would collapse. Our goal is to constantly advance the services provided by public enterprises. The positive business results accomplished by our public enterprises mean that 85% of their profit is paid directly into the city budget. In this way, public enterprises are providing funds for all budget beneficiaries, including pensioners, pregnant women, and socially vulnerable groups, while also contributing to culture and sports. This is where the biggest change was made compared to the previous period.
BY BEING PROFITABLE, PUBLIC ENTERPRISES ARE PROVIDING FUNDS FOR ALL BUDGET BENEFICIARIES – PENSIONERS, PREGNANT WOMEN, AND SOCIALLY VULNERABLE GROUPS
on replacing street lights via PPP in line with the ESCO model. This will be done primarily in suburban areas where there aren’t enough street lights, or where they are inefficient.
Public enterprises are becoming more appealing to private partners through public private partnerships (PPP). What are the most important projects that could be funded in this way? — Apart from performing important services for citizens, public enterprises have also become big investors in Belgrade. They spend portions of their profit on their own investments. In 2016, public en-
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the European average. The plan is to replace 2% of these pipes every year (so far, only 0.02% or sometimes 0.2% was replaced annually). Also, new investments in providing better access to water supply and sewage have been planned. Beogradske Elektrane will spend 2.5 billion Dinars on new installations while, at the
What are your plans for 2017? — The plans are to continue with the reforms, to further improve public enterprises, to help them stay on this positive course that they embarked on in 2013, and to devise a special plan for the two financially crippled public enterprises – GSP and Sava Centre – in order for them to become profitable and to round off the reforms so that Belgrade can become a role model when it comes to having successful public enterprises. In order to achieve all of this, their founder needs to supervise their operations and for everybody to put public interests above individual ones. We are not preaching anything new here. We are just behaving prudently.
BELGRADE OLD CITY INVEST IN BELGRADE
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interview
PROJECTS IMPORTANCE FOR DEVELOPING THE CITY OF BELGRADE upon the previous Belgrade SMARTPLAN from 2009, in order to reflect the current trends in the travel industry, and in accordance with the conurbation and the long-term vision of development and growth until 2033 that was agreed through consultation with the City’s institutions and other stakeholders with various public and individual interests. The focus of the SMARTPLAN is the preparation and evaluation of scenarios that cover various forms of public transport (metro/tram/trolley/urban-suburban trains/assigned parking “park & ride”), as well as the prioritisation of short-, medium- and long-term transport infrastructure measures and projects, which take into account economic, financial, technical and social aspects, as well as environmental aspects.
Luka Petrović
Director of the Agency for Investment and Housing of the City of Belgrade
The main activities of the Agency for Investment and Housing are related to implementing projects on the construction, upgrading, reconstruction, adaptation and renovation of facilities intended for public use and residential buildings, as well as the realisation of major infrastructure works projects of the City of Belgrade
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n its time, and through the funds of the Western Balkans Investment Framework (WBIF) fund, the Agency initiated and secured an updating or the actual creation of a new SMARTPLAN – the Master Plan for transport infrastructure, for which we prepared terms of reference carefully and in cooperation with the City’s competent institutions (Traffic Secretariat, Directorate for Construction Land and Building of Belgrade and the Urban Institute of Belgrade), and we are implementing it in cooperation with the Office of the Mayor, while monitoring is carried out by the Secretariat for Environmental Protection.
One of the goals of the City is to reroute heavy traffic away from the city centre and to return the city centre to citizens and tourists. What does that mean from the perspective of the Agency’s competences? —The primary objective of this SMARTPLAN is to implement approaches of sustainable planning for traffic in the city and updating and significantly expanding
Which projects from the construction sector in the phase of designing and carrying out construction works (transportation infrastructure) are most relevant for realising the plans of the City? — In December 2016 a Letter of Invitation was published on the EBRD website for participation in a tender for the reconstruction of Slavija Square, Bulevar oslobođenje, Ruzveltova Street and Mije Kovačevića Street. The opening of bids occurs on 7th February 2017, while the deadline to complete the entire jobs is 180 days from the date of the Contractor’s arrival on the construction site. As is this is the most important civil engineering project to be done this year, the tender conditions are strict in order to ensure the tender goes to a contractor capable of completing the job entrusted to them on time. In order for us to be able to follow the dynamics of the quality of works, we envisaged seven phased deadlines, where we will penalise the Contractor if works are late. In the event that works are finished earlier, the Contractor will immediately be enabled to transfer to the next phase of the works, and in that way they
will increase their chances of gaining a bonus (reward) if the entire job is completed in less than the envisaged 180 days. Next year a tender will be announced for design and works on 27.marta, Kraljice Marije, Džordža Vašingtona and Cara Dušana streets, covering a total length of 3,000 metres. The funds for this procurement were provided from the budget of the City of Belgrade. Works are expected to be carried out in 2018. The financing of works (about €20 million) will most likely be secured through credit from the EBRD.
You mentioned a metro. When can we hope to see the final choice of the concept? — The concept for the development of the Belgrade metro (synthesised with the development of BG: train) is one of the main products of the work of the Assistant Director of the Agency, consultant WSP Parsons Brinckerhoff and the Commission for the SMARTPLAN. The metro project is under preparation, has been approved in principle by the Government of Serbia and it is expected that, in cooperation with the French side, there will be a switch to creating a new Pre-feasibility and general design study, and then a feasibility study and preliminary design of the first phase of the metro, with the adoption of a financing model by the competent national and city institutions. Then follows the compiling of complete technical documentation, tenders for contract works (construction works and the execution and installation of all systems), while in parallel with all of this is also the procurement of rolling stock. Something more can only be discussed after the completion of the Pre-feasibility and general design study, as well as a detailed examination of the financing model. Such a large number of works also requires very careful financial planning. To what extent is the city budget today in a position to realise such a dynamic work schedule? — With the help of the projection of possibilities of the City budget, i.e. the work of the Secretariat of Finance and experts in the Office of the Mayor, with the expert assistance, methodology and tools of the World Bank and the International Finance Corporation (IFC), and the analysis of other funding possibilities, under the auspices of the SMARTPLAN we are trying to deal with only the most important prior-
itised infrastructure projects, which bring tangible benefits and for which real funding may be available. The outcome (March-April 2017) is an action-financial plan for the optimal scenario (2021/2027/2033), a strategic environmental impact assessment in accordance with the applicable EU directive, and then will follow the implementation of these results in valid planning documents (Regional spatial plan of Belgrade and then the required urban plans), but also financial plans and the activities of relevant secretariats and agencies/directorates. In addition to this plan, it will also be necessary to develop as soon as possible
FACILITIES COMPLETED IN 2016
- Adaptation and rehabilitation of the open-air stadium with a fixed skating rink SRC “Tašmajdan” - Construction of the social non-profit residential facility C.2 - (133 apartments) - Construction of 45 apartments – facility of social and affordable housing in Kamendin - Adaptation and rehabilitation of the building of the “Dragojlo Dudić” Primary School - Restoration and renovation of the “Jovan Cvijić” Museum
FACILITIES ACTIVE IN 2016
- Small hall of the “KOMBANK ARENA” complex - BUILDING “B” - Construction of the Health Centre facility in Mali Mokri Lug. - Construction of the Health Centre facility in Rakovica. - Construction of residential buildings – 235 apartments, II phase of social housing in the settlement of Ovča. a strategy-plan for sustainable urban mobility (SUMP), a strategy for logistics and development of an entire series of socalled soft measures (emphasis on bicycles, pedestrians and the quality of urban public transport, a sustainable policy for the development of parking), in order to come to high quality solutions for the urban mobility of Belgrade.
Please tell us in more detail about the major construction projects that are in the programme preparation and design phases? — Standing out as the most important culture facility is the Historical Archives
of the City of Belgrade, followed by reconstruction and upgrading of the facility at 40b Resavska Street and the re-designating of the Museum of the City of Belgrade. Under preparation is the development of the project for the reconstruction of the building of the Central Tower at the Staro sajmište monumental complex. The reconstruction of the Museum of African Art will significantly increase the usable space of this museum. At the city’s oldest children’s theatre - Boško Buha - reconstruction of the facility will resolve many technical and fire-prevention problems. The signing of a contract for works on the Bitef Theatre building is expected at the beginning of the year. As for the Tašmajdan caves – under preparation is the development of projects that will enable this attractive space to be made accessible to visitors in a safe way. Standing out as one of the capital projects of the City is implementing the intentions for SRC “Pionirski Grad”. A plan has been completed for the detailed regulation of the spatial cultural and historical site of Topčider, which will enable the development of diverse and attractive one-day and multi-day sports and recreational, educational, cultural and entertainment contents. Under preparation is a project for modifications to the system of heating and cooling for the facility of the “Predah” Foundation for the occasional and temporary residence of children and people with developmental disabilities, located at 8 Šekspirova Street. Preparations are underway on the project for the construction of a new wing of the Obrenovac Health Centre, while there are also plans to design new health stations – a large one in Borča and a somewhat smaller one in Ugrinovci. When it comes to primary schools, it is planned to prepare extension projects: for the physical education hall of the “Dositej Obradović” Primary School in Umca, the physical education hall and lacking classrooms at the “Svetislav Golubovic-Mitraljeta” Primary School in Batajnica, and lacking classrooms at the “Sava Šumanović” Primary School on Altina, while plans also include the reconstruction and rehabilitation of the small “14. Oktobar” Primary School in Kneževac. When it comes to housing, we highlight two projects, Social Housing in Ovča, City Municipality Palilula 2nd Blok – 235 apartments and Housing - location KAMENDIN 1.7, Zemun polje. INVEST IN BELGRADE
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interview Branislav Popović
Director of the Belgrade Land Development and Construction Directorate
IN THE SERVICE OF CITIZENS AND NEW INVESTMENTS T Next year, the Belgrade Land Development Public Agencywill continue to develop themost important transportroutes in Belgrade, like theconstruction of traffic areasthat will be used by the busstation in the Block 42 inNovi Beograd, the roadson the territory coveredby Belgrade Waterfrontand laying tramway tracksacross the Ada Bridge
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he Belgrade Land Development Public Agency has been successfully accomplishing the tasks that it had been entrusted with, as well as facilitating a balanced growth of all parts of the city, ensuring better living conditions for Belgrade citizens, and creating prerequisites for new, large-scale investments – says Branislav Popović, Director of the Belgrade Land Development Public Agency.
In the last two years, the Agency has increased the funds for construction of infrastructure threefold. At the same time, close to 2 billion dinars of the city's budget funds have been saved. How did you manage to achieve this? — The key thing was to carry out tenders via an open procedure and to relax terms and conditions of tenders as much as possible while not compromising their quality.
Our tenders cover a wide range of activities – from making geodetic and topographic maps to forming building lots, drafting conceptual and preliminary designs and studies, devising projects needed to obtain building permits and executing construction works. Such a wide array of activities, along with terms and conditions of our tenders becoming acceptable to many companies, have resulted in bidders being eager to submit the lowest bids possible while not compromising on the quality of their services. In this way, since August last year, we have saved over 2 billion dinars of the city's money. The savings were achieved in nearly 200 public procurements, which had been initially estimated to be worth around 8 billion dinars, while in the course of tender procedure, the bidders on their own reduced this estimated amount to 5.9 billion dinars of contracted works.
Considering there is an exceptional high number of active construction sites in Belgrade, how challenging is this for the Agency, professionally- and organization wise? — All of the projects that we have been entrusted with by our founder the Belgrade City Assembly have been professionally and efficiently implemented. It would not have been possible to finish any of these projects, if it weren't for the team work of the people working in the Agency, and the cooperation with other public utility enterprises and other units of the city administration. For instance, on one project alone, the Agency's departments have to carry out dozens of stipulated procedures in order to carry out construction of infrastructure in certain areas of Belgrade, which, in the end, is the only thing that the citizens of Belgrade are concerned about. Development of Belgrade also entails building several roads. What are the Agency's main priorities in the following period?
— Definitely having good traffic infrastructure which is vital for the city's development. The lack of proper water supply and sewage systems is also a painful subject for our citizens. Hence, the Agency has been closely cooperating with all city municipalities when devising its activity programme in order for their demands regarding water supply and sewage to be included in the Agency's plans. Next year, the Agency will continue developing the most important traffic
routes in Belgrade, including the External Arterial Tangent Road, for which the Agency has already drafted the preliminary design, along with a feasibility study for construction of the Ada Huja Bridge. Also, our plan is to launch a tender for
THE GEOGRAPHIC INFORMATION SYSTEM (GIS), WHICH THE DIRECTORATE HAS DEVELOPED FOR CITY OF BELGRADE, IS INVALUABLY IMPORTANT FOR RESOLVING THE ISSUES RELATING TO SPATIAL PLANNING AND MANAGING BUILDING PLOTS
construction of the Crnotravska – Vojvode Stepe segment, which is a part of the External Arterial Tangent Road project. We have also been drafting technical documents needed to continue building the Inner City Semi-Ring Road. One of the projects will cover the Topčider Tunnel that stretches from Hipodrom to Autokomanda, and we are going to finish drafting the preliminary design of the Autokomanda – Šumice segment. Next year, our plan is to finish the preliminary design of
the last two segments of the Inner City Semi-Ring Road, stretching from Šumice to Bogoslovija. Furthermore, we are going to start building traffic areas that will be used by the bus station in the Block 42 in Novi Beograd, the roads on the territory covered by Belgrade Waterfront and laying tramway tracks across the Ada Bridge.
Is the infrastructure that the city has built sufficient enough to satisfy the interest shown by investors for construction of new facilities? — The complexity of managing building plots is also reflected in the fact that it is essential to build infrastructure for the citizens to use where there is none at all, while, at the same time, continuing to develop those locations that already have infrastructure which could be interesting to private investors. The Agency has managed to carry out both of these tasks and to build infrastructure in those locations that will be assigned to investors. This year, we sold six locations to investors, spanning 1.9 hectares, on which they
can build up to 21.600 square metres of facilities. As a result, the Agency has earned 221 million dinars which ended up in the city budget. These locations are scattered across the town which just demonstrates the balance between the development of central and suburban parts of the city.
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and how much progress has been made in resolving this problem? — For decades, illegal construction has been hindering the systematic development of infrastructure because illegal facilities occupy the routes that had been designated for infrastructure thus pre-
venting construction. The owners of such facilities did subsequently apply for legalization, but until the courts finalize the entire process, the illegally constructed facilities cannot be destroyed to make room for infrastructure. The goal of the owners of illegally built houses and facilities is legalize their property and then have the costs of expropriation covered by the city budget, or rather by taxpayers. Although, none of these buildings constructed along the routes reserved for public infrastructure will be legalized, the exhausted legalization process has lasted for decades now with various peddlers from private and public sector putting their own selfish interests above the public interests and construction of infrastructure which is of crucial importance for our citizens. Because of this blatant misuse and disregard of the law, the Agency has launched several initiatives for amendments to the laws regulating this segment because this is one of the ways to expedite the implementation of our plans for development of water supply and sewage systems and building infrastructure.
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How important is the GIS application? — The geographic information system (GIS), which the Agency has developed for city of Belgrade, is invaluably important for resolving the issues relating to spatial planning and managing building plots. Its practicality has been proven over and
IN LINE WITH THE NEW CONSTRUCTION LAWS, THE DIRECTORATE'S HAS MADE SURE THAT THE PROPERTY ISSUES RELATING TO PROJECTS BELGRADE WATERFRONT, IKEA AND THE BATAJNICA INTERMODAL TERMINAL ARE RESOLVED IN THE SHORTEST POSSIBLE TIME
over again in the last ten years during which all organizational units of the city administration and public enterprises started using the GIS application in their everyday work.
Apart from the city administration, the GIS application has become an irreplaceable tool for many other services which use spatial planning data in implementation of their activities. Thanks to the application, issuing of building permits has become much simpler, calculating relevant taxes and fees is now more efficient, the exchange of information between the city administration departments has improved, the control over immovable assets has increased, processing applications submitted by new investors is now better, and the legalization process has been expedited.
How much did the improved construction laws contribute to a more dynamic implementation of the city's plans? — The measures implemented by the Serbian government on amending construction laws and bylaws gave a real impetus to construction of infrastructure. Implementation of the so-called unified procedure (for issuing of building permits) has spurred on both the Agency and investors to realize their investments within clearly defined deadlines. Thanks to new laws and an excellent cooperation with all the departments of the city administration, Belgrade municipalities and public utility enterprises, in just over a year, the Agency has managed to conclude contracts for over 100 projects pertaining to drafting technical documents and opening of 70 new construction sites. Our Supervisory Board, which contributed a lot to accomplishing our tasks, is in charge of monitoring the implementation of these projects. In line with the new construction laws, the Agency has made sure that the property issues relating to projects Belgrade Waterfront, IKEA and the Batajnica Intermodal Terminal are resolved in the shortest possible time. In less than two years, 227 families, that had properties on the territory of the Belgrade Waterfront project, were moved to the flats provided by the Agency, and another 64 to the housing to be provided by the Republic of Serbia. In a very short amount of time, the Agency has managed to solve the property issues relating to almost 600 building plots used by IKEA for construction of its department store, while the owners of the land on which both the Batajnica Intermodal Terminal and IKEA are going to be built were compensated with a total of 758 million dinars.
BELGRADE WATERFRONT MASTERPLAN
interview
MUTUAL BENEFIT AS FOUNDATION FOR COOPERATION H.E. Li Manchang
Ambassador of the People’s Republic of China
The Chinese people, especially Chinese businessmen, know and understand Serbia and the Serbian market. Hence, the foundation for development of concrete cooperation between our two countries is very solid and it relies upon recognizing the advantages of complementarity and mutual benefit
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n the last few years, the cooperation between China and Serbia has signficantly deepen and has a potential to develop even further – says H.E. Mr. Li Manchang, the Ambassador of the People’s Republic of China to Serbia. “The support that we get from the Serbian government and the city of Belgrade for our projects creates even more room for better connection between our two countries to our mutual benefit”, the Ambassador adds.
During the official visit of President Xi Jinping to Serbia, the two sides signed treaties covering construction, infrastructure, telecommunications, economy, defense, media and other. Which of these treaties are important for further development of the cooperation between China and Serbia? — President Xi Jinping had a historically important official visit to Serbia in June. The two countries had forged a comprehensive strategic partnership which raised the bilateral realtions to new heights. Serbia is the first country in Central-Eastern Europe to create a compre-
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hensive strategic partnership with China. Not only did this visit deepen the traditionally good friendship between China and Serbia and brought our two nations even closer, but it has also created a flourishing new situation in the concerete cooperation between China and Serbia. During the President’s visit, the two sides signed over 20 treaties. In the last few years, our versatile bilateral relations have reached a full recognition, but have also presented a clear aspect of diverse development of our future cooperation which has further expanded the areas and the volume of cooperation, in addition to laying a solid foundation for it. We are now expediting the implementation of several previously agreed cooperation projects in transportation, energy and infrastructure, and are strongly supporting new accomplishments of the cooperation between our two countries within the framework of the „One belt, one road“ and the „16+1 cooperation“ initiatives. Furthermore, we have been developing the cooperation in many other areas like agriculture and tourism. I believe that the
Chinese-Serbian cooperation has a growth tendency on several levels and platforms which would bring many benefits to our respective nations.
China is one of the most important creditors of large-scale infrastructure projects in Serbia. What is the main rationale behind China’s assistance to Serbia? — The traditionally good, friendly relations and mutual understanding are the basis of our cooperation. The traditional friendship between China and Serbia is long lasting. The mutual liking between our two nations has been nurtured for a long time. In the 1970s and 1980s, at the onset of the reform policy and China’s opening to the world, we gained a huge and valuable experience by learning from our Serbian friends. In the last few years, the relations between China and Serbia have been continously developing. The visits of the highest state officials and ordinary citizens are becoming more frequent. The Chinese people, especially Chinese businessmen, know and understand Serbia and the Serbian market.
How beneficial are Chinese investments in regional countries to the EU accession process of these countries? — Chinese companies are very interested in investing in Serbia, in projects in agriculture, tourism, processing industry and so on. The relevant ministries and companies from both sides have started networking and communicating. If you are asking what kind of benefit will Chinese investments bring to Serbia, I would like to mention the Smederevo Ironworks, a project implemented by Hesteel Serbia Iron & Steel. Following Hesteel’s acquisition of the Smederevo Ironworks, the plant has slowly started to recover. A lot of effort was invested in improving the management in the company, implementing technological changes and finding better purchasing and distribution routes. The problem with employment of 5,000 workers has been resolved, while the living standard in 5,000 families has improved. The further improvement of working conditions in the Ironworks will play a major part in promoting the local
economic and social development. Serbia is committed to its Euro-integration process. We support Serbian people in independently choosing their development road. China wishes Serbia, as its sincere friend and partner, to continue accomplishing successes in national development.
Are you satisfied with the cooperation with Belgrade authorities? — Chinese companies are currently cooperating with Belgrade authorities on numerous projects like the construction of a waste water processing facility in Belgrade, an industrial park and several others. A good geographical location of Belgrade, the stable system of laws and regulation, the preferential investment policy and the quality workforce have contributed a lot to our cooperation. The open and flexible approach of Belgrade authorities towards sustaining this coop-
THE CHINESE GOVERNMENT WILL CONTINUE ENCOURAGING EVEN MORE RENOWNED CHINESE COMPANIES TO INVEST IN SRBIA. WE WOULD LIKE TO SEE THEM BRING MORE BENEFITS TO YOUR PEOPLE LIKE THE CHINESE BRIDGE
eration and their efficient work are also important factors which have contributed to the success of our cooperation. Chinese companies are currently participating in the implementation of projects in transportation, energy, and infrastructure and are hoping for the promotion of cooperation in the areas like agriculture, commerce, tourism, financial and other. A successful promotion of cooperation is not possible without the support from the Serbian government and city of Belgrade. The Chinese side would like to use this opportunity to express its sincere gratitude hoping that,
in the future, the two sides would cooperate even more.
What can be done to further improve the investment cooperation between China and Serbia? — We need to fully utilize the advantages that come with a high level of political trust between our two countries, and transform good political relations into concrete results of practical cooperation. The comprehensive strategic partnership between China and Serbia should be used as the foundation and the backbone for the “One belt, one road” initiative and “16+1” cooperation platform, as well as for Serbia tying in its own policies with the Chinese. This top level exchange plays the main role in schematic planning of the concrete bilateral cooperation and devising its direction. We need to fully utilize the available potential and initiate cooperation in new
Photo: www.lobi-info.rs
Hence, the foundation for development of concrete cooperation between our two countries is very solid. The advantages of complementarity and mutual benefits are the driving force behind our cooperation. We should continue nurturing this cooperation based on mutual understanding and should strive to find another strong driving force behind it. Serbia is committed to its economic development and raising the living standard of its citizens. The implementation of the projects that would bring us closer together, as well as those pertaining to the living standard of the people like the construction of infrastructure, has begun. China has been developing for over thirty years now and the wealth of experience gained by our enterpreneurs, large capital and advanced technology are further fostering the desire to solidify international cooperation particularly the one with Europe and, specifically, Central and Eastern Europe. Both sides have the advantage of complementarity regarding largescale infrastructure projects from which they can reap mutual benefits. The Chinese government will continue encouraging more renowned Chinese companies to invest in Srbia. We would like to see them bring more benefits to your people like the Chinese bridge.
segments. The two countries currently have a fruitful cooperation in the field of energy, transportation and infrastructure construction. In the next stage, we are going to continue utilizing the potential of our cooperation while focusing on individual developmental advantages, planning and initiating cooperation in new areas. Serbia is located in the heart of the Balkans, has a good geographical location, quality workforce and has concluded free trade agreements with several countries. This creates favourable conditions for the development of our international cooperation based on production capacities. Currently, the Chinese companies are actively considering investing in construction of an industrial park in Serbia. I believe that once this project is launched, more Chinese companies will come to Serbia. INVEST IN BELGRADE
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interview H. E. Christine Moro French Ambassador to Serbia
WE MAY DEVELOP VALUABLE PARTNERSHIPS B France built a strong and constructive working relationship with the Serbian Government, the administrations and the municipality of Belgrade. French businesses are keen to present solutions of quality and tailored to the needs and requests of the future development of the country and the city
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elgrade has ambitious projects in fields like water and sewage, waste management, and transport modernization. France has first-class companies in all these fields, and they closely follow these projects which may contribute to the future of both the city and the country, says H. E. Christine Moro, French Ambassador to Serbia, who prizes reform efforts and the EU accession process of Serbia.
How much did the successful implementation of reforms and the progress in the European integration process affect the interest shown by French companies for investing in Serbia? — Those processes you are refering to are watched carefully by foreign companies. The fiscal and economic consolidation, monitored by the International Monetary Fund, and the progress in the European integration process are for them guatantees of stability and accountability. The entry into force of the SAA (stabilisation and as-
sociation agreement) with the EU, the opening of six chapters of negotiation so far, the fiscal performance which has allowed to start public debt consolidation one year before the initial goal, are good news for companies and investors. In the last years we have seen the amount of trade exchange between France and Serbia increase dramatically, new investors open facilities in Serbia, older ones expanding, and the French-Serbian Chamber of Commerce has seen a significant increase in the number of requests for information from French companies.
How satisfied are French companies with the business environment here and where do you see room for further improvement in conditions for doing business? — The business environment in Serbia is closely linked to the European integration process. The progressive adoption of the acquis communautaire drives Serbia closer to the European standards in crucial
business fields such as right of establishment, competition policy, financial services, etc, a basis for French firms looking for a sound business climate. We welcome the recent opening of negocations to Chapter 5 dealing with public procurement. This field, requiring more transparency, is clearly one in which our companies feel that some improvements are still needed. So is the judiciary, as companies would expect quicker proceedings and a better implementation of the decisions taken.
France is one of the three countries that Serbia has signed a Strategic Partnership and Cooperation Agreement with. How much headway has been made in the implementation of this agreement especially in the area of public-private partnerships and concessions in large-scale infrastructure projects? — The Strategic Partnership and Cooperation Agreement was signed in 2011 to develop the bilateral cooperation while putting it at the service of the European integration of Serbia through cooperation in different fields. We are proud today of having implemented it steadily through all these years, and the exchanges of visits by our respective Prime Ministers in November 2014 and September 2016 have been milestones on that way. As far as the public-private partnerships (PPP) are concerned, a specific agreement has been signed in 2014 and then renewed this September, along which France offers its assistance to align the Serbian legislation with EU directives and give advice on some concrete projects. Belgrade is experiencing an investment boom. How interesting are the capital city's investment plans to French companies? — With 20% of the Serbian population and 40% of the GDP produced, Belgrade is a key actor of the economic and social progress of Serbia. The Municipality has ambitious projects in fields like water and sewage, waste management, transport modernization including metro and airport, energy, infrastructure and real estate development… In September, the Mayor presented them in Paris during the Prime Minister’s visit. These projects offer huge potentials not only for the companies interested but for the future of the country itself. France has first-class companies in all these fields, they follow the projects and some of them have established subsidiaries in Belgrade for some time. Recently the Serbian Chamber
of commerce and the French-Serbian Chamber of commerce co-organized a forum on the French know-how in urban utilities („the city of to-morrow“).
Belgrade has been waiting for a very long time on a decision about subway. How much did France help our capital city in finding an optimal solution for the subway through the transfer of the French know how? — After the signature of the Strategic Partnership and Cooperation Agreement which also included support to the Serbian authorities on this project, France provided a first set of studies, upon which Belgrade reflected for some time. Now, and after some additionnal
IN THE LAST YEARS WE HAVE SEEN THE AMOUNT OF TRADE EXCHANGE BETWEEN FRANCE AND SERBIA INCREASE DRAMATICALLY, NEW INVESTORS OPEN FACILITIES IN SERBIA, WHILE OLDER ONES ARE EXPANDING
studies, the Municipality and the State have decided to go ahead and we will, of course, continue to give them the necessary support to help them figure out and achieve the project best adapted to the needs of the city.
How many French companies are operating in Serbia at the moment and how many of them are focused on Belgrade? — A hundred French companies are operating in Serbia at the moment, employing more than 10 000 workers. They are not all located in Belgrade of course; you know that Michelin/Tigar is in Pirot, and we have several agro-busineses and automotive industry plants in Vojvodina. But Belgrade, as the capital city, hosts a lot of headquarters and its will to remain on the cutting edge also makes it very attractive. For instance, Ubisoft, the famous French video game publisher, has recently opened here a production studio employing 15 persons and already planning to extend its activities. Two companies engaged in maintenance of office space and green areas and HR management, Samsic and Atalian respectively, have started doing business in Belgrade. How much is the development of the real estate market in Belgrade appealing to French investors? — Samsic started some years ago with some activities in Nikola Tesla airport before taking position in a Serbian company specialised in maintenance of office spaces. Atalian, one of the largest European facility management companies, has also recently entered the market of Serbia by acquiring a majority stake in a Belgrade-based company. Both of them think that there is a big potential for developments in those field in Serbia but also in neighbouring countries. Apart the assets of the town and of its skilled workforce, the central position of Belgrade in the region is an additional reason why French firms choose to settle down here. How would you rate your cooperation with the Serbian authorities? — We’ve built a strong and constructive working relationship with the Serbian Government, the administrations and the municipality of Belgrade. The Prime Minister, the members of government, the Mayor, always receive French representatives willingly and with a pragmatic, result-oriented approach. Our businesses are keen to present solutions of quality and tailored to the needs and requests of the client. We have a similar approach in the State-toState cooperation, we try to foster the European integration of Serbia which is, in our eyes, already a reality and anyhow the key for the future. INVEST IN BELGRADE
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interview
IMPROVING THE INVESTMENT CLIMATE
Thomas Lubeck
IFC Regional Manager for the Western Balkans
An agreement signed between the City of Belgrade and IFC is aimed at supporting the City to increase the energy efficiency of its key urban infrastructure and thereby improve the overall living conditions and reduce the harm to the environment
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I
FC, a member of the World Bank Group, is collaborating with cities around the world and supporting them with finding solutions for some of the key challenges they are facing. Some of these challenges relate to optimization of public services for citizens. To date, IFC has invested about $10 billion in city-related projects and managed $260 million in municipal advisory projects in recent years, spanning more than 60 countries.
The IFC and the City of Belgrade have recently signed a contract stipulating the IFC advising the city on improving energy efficiency of its public buildings. Could you tell us more about this contract please? — An agreement signed between the City of Belgrade and IFC is aimed at supporting the City to increase the energy efficiency of its key urban infrastructure and thereby improve the overall living conditions and reduce the harm to the environment in the Capital of Serbia. As part of the agreement, IFC is planning to contribute to Belgrade’s Smart City strategy by developing an Energy Efficiency Action Plan that will identify key investment opportunities for the city
related to buildings, district heating, street lighting and other urban infrastructure. We will also help the city to set up and finance an Energy Efficiency Fund. The particular emphasis will be placed on green buildings, both newly built and renovations. IFC will perform benchmarking and propose an investment plan for refurbishing of public buildings in Belgrade, including hospitals, social housing and schools that can be financed through a sub-national loan. In addition, in order to support privately-owned buildings, IFC will explore the potential for a complementary green mortgages and other Sustainable Energy Finance investments with commercial banks.
What does the IFC's Smart Cities Strategy entail and how is the Strategy going to be implemented in Belgrade? — In Belgrade, we have already been supporting the city to develop a modern waste to energy facility, we are helping the city to structure the transatction and find an appropriate investor and operator. We are now building on this, by helping the city first identify and prioritize the key energy efficiency opportunities, for exhample: refurbishing public
buildings, reducing losses in the district heating network or generting part of it’s heat supply from renewable sources such as solar. We’ll then advise the city on how to get the funding for the resulting projects, for example through the development of an Energy Efficiency Fund.
In which regional cities is the IFC implementing similar projects? — IFC supports City related projects all around the globe. In the region, we recently had projects in Turkey and Romania. IFC helped Istanbul to structure the transaction for the financing of the major expansions of the metro system and Izmir to find financing for new tramway lines and waste and waste water infrastructure. We have also overseen the structuring and financing of upgrades to the district heating networks in the Romanian cities of Timisoara and Botosani. These are very financially tasking endeavours. How can the IFC help Belgrade in devising strategies for attracting investors to provide funding for such projects? — We have been working with the City of Belgrade for some time and one important aspect of the collaboration related to a prudent management of the city’s finances. The city has made major progess in this regard, as demonstrated by the fact that Belgrade recently received it’s first credit rating. On this basis, the key then is two-fold. From a strategic perspective, we can help the city prioritize its project pipeline with respect to financing and other strategic considerations. And from an individual project perspective, we can also help the city to decide whether a project is best realized in partnership with a private investor or whether it is better implemented by the city itself. In either case, IFC can support the city with advice and financing solutions. In which areas should the investment climate in Serbia be improved and are there specific measures in place that Belgrade could apply locally? — Serbia is among the global top 10 improvers in this year’s edition of the World Bank Group’s Doing Business report. Serbia has been steadily improving the business environment over the past decade. This strong commitment needs to continue both in terms of improving legislation and increasing the operational efficiency of government agencies and local authorities.
The process for starting a business was simplified, considerably reducing the time needed to register from 12 days to 7 days. Serbia also implemented an online system and streamlined the process of obtaining building permits. As a result, an entrepreneur in Belgrade can now build a warehouse in 156 days, down from 327 days previously. And, the property transfer process was simplified by the introduction of effective time limits for issuing new property titles. The report also highlights potential areas of improvement. For example, it takes 125 days to get an electricity connection in Belgrade, compared to the
WE HAVE BEEN WORKING WITH THE CITY OF BELGRADE FOR SOME TIME AND ONE IMPORTANT ASPECT OF THE COLLABORATION RELATED TO A PRUDENT MANAGEMENT OF THE CITY’S FINANCES
global average of 93 days. It also takes 226 hours to comply with local tax obligations. As was noted in the recent IMF Executive Board review of their standby arrangement with Serbia, much more needs to be done to improve the judicial process
and the court system. There are problems Serbia must fix to better ensure consistent application of the rule of law in commercial disputes.
The IFC is already advising the City of Belgrade on structuring and implementing public-private partnerships in waste management and waste water treatment which is a part of the IFC's Cities Initiatives. What concrete steps can we expect in this segment in the following period? — Since November 2014, IFC’s team has been advising the City of Belgrade to structure and tender a PPP contract for one of the largest Waste-to-Energy projects in the region. A competitive dialogue with the pre-qualified bidders will be finalized shortly and the Request for Final Proposals is expected to be issued in early 2017. The selection of preferred bidder and contract award are expected later in 2017. The project size could be up to €300 million. In May 2016, IFC PPP Advisory team signed its second mandate with the City of Belgrade to assist in implementing a municipal wastewater investment program. IFC is advising the City on how to structure and finance different components of the municipal wastewater system. The priority is given to development of Belgrade’s central system in which the wastewater treatment plant Veliko Selo is located. The central system will be developed in phases over the next 20 years. The estimated investment of the first phase amounts to €240 million. Investments in energy efficiency and green buildings are synonymous with smart business. How can long-term investments in these segments benefit Belgrade? — We know from many countries we work in how investments in energy efficiency can pay off handsomely. Most directly, the enormous sums of money are saved when the same level of service (e.g. heating and lighting) can be achieved by using less energy. The money saved can then be used productively elsewhere. In addition, the use of smart and efficient technologies typically brings other benefits. For example, LED streetlights are not only much more efficient but they can be integrated with traffic management and security systems. More broadly, higher energy efficiency also means less pollution, better air quality and more livable and attractive cities for both people and businesses. INVEST IN BELGRADE
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interview
GOOD INFRASTRUCTURE LEADS TO NEW INVESTMENTS Dubravka Negre
Head of the Western Balkan Regional Office of the European Investment Bank (EIB)
EIB has been active in Serbia and Belgrade since 2001 and our up to date cooperation with the City of Belgrade authorities has been very successful. In the future we are ready to support City’s development plans, from the landfield in Vinca to waste water treatment plant, as well as further PPP development and the energy efficiency
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e spoke with Dubravka Negre Head of the Western Balkan Regional Office of the European Investment Bank (EIB) about the reform processes in the Western Balkan and Serbia, EIB support to the development of the country’s infrastructure and its cooperation with the City of Belgrade.
How would you define Serbia's role in the region in terms of the pace of the reforms and the EU integration process? — Serbia, as all countries of the Western Balkans, is in the EU integration process and implementation of the structural reforms is of a paramount importance. Over the last two years the Government has stabilized public finances and established a roadmap for restructuring public administration and state owned companies. It would be desirable that the Government looks further at ways to introduce measures to promote growth, in particular paying attention to improve the
business environment which may attract higher levels of FDIs. Opening of the chapter 23 in the negotiation process on the rule of law and completing it will certainly raise confidence amongst investors. It is also needed to further progress in the implementation of the non-performing loan (NLP) resolution strategy adopted in August 2015 which should help to remove barriers to clean banks’ balance sheets and unlock lending. Insolvency framework should be strengthened further and improve secured creditors rights with strengthening of the judiciary system, among other efforts.
How much are other regional countries willing to join the initiatives for infrastructural linking in the region and creating a single market in the Western Balkans? — EIB is supporting the Connectivity Agenda and we already have a lot of regional projects identified some of which are planning to go ahead and start imple-
mentation next year in Bosnia, Montenegro and Serbia mostly in the road and rail sector. Those projects will contribute to connect people and countries of the Western Balkans and are very important from the connectivity and regional cooperation point of view which are also important for the EU integration process.
ongoing projects where significant funds are to be released. In the future, we intend to widen further our lending activities to sectors such as renewable energy and energy efficiency and the environment which have a positive impact on climate change and Serbia’s further economic and social development.
At this moment, Serbia has several pending infrastructure projects. How could these projects contribute to sustainable economic growth? — Well-designed infrastructure is essential for the success of a competitive modern economy. Infrastructure development in transportation, communication, water, and energy networks can raise
EIB is one of the investors in infrastructure. After certain delays, are you now satisfied with how Serbia manages largescale projects? — Serbia is in the EU integration process and several chapters in the negotiation process have been opened and legislation being aligned with the EU acquis which is expected to further facilitate EIB activi-
eksandra, Vojvode Stepe street, etc.) to access roads of the new Sava Bridge and the reconstruction of the Gazela bridge itself. In the future we are ready to support City’s development plans, from the landfield in Vinca* that we are closely following to waste water treatment plant, more infrastructure projects such as bridges reconstruction to further PPP development but also to support projects in the energy efficiency. We also have advisory services inside the Bank (for PPP institutional or project development through epec for example) as well as technical assistance and we are exploring future areas of cooperation together with the City of Belgrade, but also with other municipalities in Serbia.
THE ACCESSIBILITY AND QUALITY OF INFRASTRUCTURE SUCH AS TRANSPORT, ENERGY, MUNICIPAL INFRASTRUCTURE, HEALTH, EDUCATION - DETERMINES THE COUNTRY’S ATTRACTIVENESS TO FOREIGN INVESTORS country's productivity, foster economic growth and consequently improve living standards. The accessibility and quality of infrastructure determines the country’s attractiveness to foreign investors. To that end, the continuation of building up Serbia’s infrastructure, such as transport, energy, municipal infrastructure, health, education are all equally important. The EIB’s support to the country started in 2001 and today we are the largest lender to the economy with EUR 4.7 billion of the committed financing. We are financing the construction of motorways and by-passes, rehabilitating the national road and railway networks, refurbishing and building of new schools, hospitals, judiciary facilities, municipal infrastructure, as well as providing support to the scientific community through our research and development loan programme. Significant funding has already been channeled into those sectors and we still have numerous
ties in Serbia. The EIB operates in the Western Balkans under the mandate from the European Commission. We are a triple AAA credit rating institution and we evaluate risks thoroughly before investments are proposed for approval to our governing bodies. Although there were projects that faced some difficulties during their implementation in the past, we continue to closely monitor our operations and work hand in hand with all project stakeholders to successfuly resolve all project issues.
Belgrade has recently presented its project portfolio that has several largescale infrastructure endeavours. Which of these is the most appealing to the EIB? — The EIB has been cooperating with the City of Belgrade since 2001, and we have financed several municipal investments in Belgrade, from streets and boulevard reconstruction (such as Bulevar Kralja Al-
Do you think that the credit rating that Belgrade got assigned to recently would improve the city's image with investors, and what can be done locally for Belgrade to become an even more interesting investment location? — The credit rating of the City assigned by Moody’s which is equivalent to the sovereign rating is a very positive sign for further investments and especially private sector involvement in the City’s projects. I believe that a development of a well structured PPP as well as further strengthening of ppp institutional framework will allow the City to further explore this type of infrastructure financing which will allow for more sophisticated financial product development and more fiscal space for the future in the City’s budget. * - subject to approval of the EIB Governing bodies
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interview
Arne Gooss
Director, KfW, Office in Belgrade
ASSISTING THE GREENER FUTURE OF THE CITY We are very interested in supporting projects in the area of environmental protection in Belgrade. In particular, we would like to assist in the financing of the waste water collection and treatment system in Belgrade
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lthough KfW has been mostly concerned to help less developed parts of Serbia, from inception of its office in 2001, it is continuously present in some major projects in Belgrade in the areas of the water supply and energy efficiency. KfW is looking forward to support the city in its major projects to establish better ecological footprint, says Mr.Arne Gooss, Director, of the KfW Office in Belgrade.
Out of EUR 1.6 billion of Germany's development assistance in the last 15 years, EUR 1.5 billion was placed via KfW. Which segments in Belgrade have received the biggest investments? — Serbian-German Development Cooperation commenced in 2000. The KfW office in Belgrade was established in the following year. Since then KfW has been responsible for the coordination and implementation of financial cooperation programs and projects in the framework of this bilateral Development Cooperation. Some of the first projects initiated between our countries were actually those in the city of Belgrade and concerned the rehabilitation of water supply and sewerage systems as well as district heating systems. They were financed by grants provided by the German Govern-
ment via the German Ministry for Economic Cooperation and Development. The projects had a volume of some EUR 15 million and were finalized between 2004 and 2007. Currently Germany contributes to the financing of further district heating projects in the city. The construction of the combined heat-power plant Vozdovac and the heat pipeline system alongside Gazela Bridge will be financed through concessional loans via KfW and the project implementation will start 2017. Another very good example for our cooperation is an ongoing project together with EPS. It aims at increasing the thermal efficiency of the Nikola Tesla power plant and shall mitigate environmental impacts by improving the exploitation technology in Kolubara. Project investments of about EUR 182 million are jointly financed by KfW (EUR 74 million), the EBRD (EUR 80 million) and EPS. The project will significantly reduce harmful emissions (SO2, CO2 and NOx). The impact which the project will have on the quality of life - especially in the area of Obrenovac and its surroundings will be definitely “measurable”. KfW-financing of infrastructure projects in Belgrade was and is very effective. However, it is of relatively small volume in relation to KfW’s overall portfolio in Serbia. The reason is that Serbi-
an-German financial cooperation mainly focusses on less developed regions of the country, where we reached more than 30 municipalities covering 3.5 million people. Focal areas of financial cooperation are „Energy and Environment/Municipal Infrastructure“, “Sustainable Economic Development“ (credit-lines for SME and rural development, as well as energy-efficiency investments) and Good Governance (social infrastructure for vulnerable groups and smaller-scale municipal investments). The cross-cutting goal of our cooperation is to contribute to “Sustainable Growth and Employment“.
Belgrade has numerous issues with environmental protection. Which projects in Belgrade could KfW support? — We are very interested in supporting projects in the area of environmental protection in Belgrade, given that environmental protection is one of the cornerstones of our bilateral cooperation. In particular, we would like to assist in the financing of the waste water collection and treatment system in Belgrade. The city is still the only remaining capital at river Danube without having an operating waste water treatment plant. This issue is not only of municipal, but of national importance. The city’s envisaged wastewater project comprising the modernization and extension of the existing system according to EU-water directive standards would have an extremely positive environmental impact on the nature and the people living at large downstream areas of the river. Also, there is the issue with energy efficiency and utilization of green energy resources. What would be the most impor-
tant steps that the city should take in this segment? — The city of Belgrade has been doing a huge job in terms of setting up energy efficiency improvement strategies and envisaging the use of green energy resources. Good practices have also been developed through partnerships and initiatives such as the “Building Efficiency Acceleration“, the “District Energy Initiative“ or the „Energy Efficiency Fund“. In this context, we are convinced that a better, and more intensive, usage of renewable energy sources can be introduced alongside further measures of in-
THE CITY OF BELGRADE HAS BEEN DOING A HUGE JOB IN TERMS OF SETTING UP ENERGY EFFICIENCY IMPROVEMENT STRATEGIES. KFW IS OPEN TO DISCUSS WHETHER WE CAN ASSIST THESE GOALS IN THE FUTURE
creasing the efficient use of energy resources. Particularly in district heating, such might involve solar heating, heating pumps, waste-to-energy and biomass usage in combined heat-power plants.
Do you think that the afore-mentioned issues have been given due consideration in Belgrade's planning process? — The city management, as well as the communal utilities for district heating
(“Beogradske elektrane”) and for water management (“Beogradski vodovod i kanalizacija”), have put much effort into the conceptualisation and planning of the afore-mentioned measures. They have drawn clear plans about further steps that are to be taken. Also, we expect a lot of achievements from the “Energy Efficiency Fund”. KfW is open to discuss whether we can assist the fund in the future.
In the past, Serbia was sometimes quite slow in withdrawing the approved funds and even had to pay penalties for that.
How efficient is Belgrade today in drawing funds from KfW? — Project implementation in the city of Belgrade and the related disbursement of funds has always been swift. However, based on our experience in working with smaller municipalities, we acknowledged that it is not an easy task to implement municipal investments “in an exactly calculated time“, regardless of a very good preparation of each single project. Reasons for such delays can be various, ranging from administrative procedures up to mitigating public and private concerns. However, KfW not „only“ financially supports projects but also assists project partners in the moderation of related procedures and processes. KfW deals with projects in-depth providing assistance in project preparation, implementation and accompanying measures. This is why our projects are generally efficiently implemented. As a result, about 85% of the Serbian-German financial cooperation commitments approved since 2001 (amounting to some EUR 1.5 billion) have been disbursed. INVEST IN BELGRADE
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interview
TIGHTLY CONTROLLED FINANCES GOOD FOR THE CITY
Gjorgji Josifov
Assistant Vice President, Analyst of Moody's
On October 25th, Moody's Public Sector Europe (MPSE) assigned a B1 issuer rating to the City of Belgrade. The role that Belgrade plays in the Serbia’s economy and the city’s prudent budgetary management supported its assigned credit rating and the positive outlook
M
oody's rating agency has recently assigned Belgrade with the B1 credit rating with positive outlook. We spoke with Mr. Gjorgji Josifov, Assistant Vice President/Analyst of Moody's about the key factors that were in Belgrade favor, possible risks for city’s finances and opportunities for the upgrade of the credit rating.
What contributed to such decision? — The rating reflects Belgrade’s track record of prudent budgetary management mirrored in sound double-digit operating surpluses and positive financing results, as well as liquidity levels that are above the median for its peer group. The rating is also supported by the important role that the City of Belgrade plays in the national economy as Serbia’s capital and most developed city. These credit strengths are offset by higher debt and debt-service level in excess of the peer group median. What does the positive outlook on the rating mean? Will it be improved soon? What does the improvement depend on? — The rating outlook on the city’s rating mirrors the positive outlook on the B1 sovereign rating, reflecting the macroeconomic, institutional and financial linkages between the state and the City of Belgrade.
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Therefore an upgrade of the City of Belgrade’s rating would require an upgrade of the sovereign rating, associated with maintenance of sound operating margin, sustained balanced financial performance and reduction of its debt. Significant change in the city’s revenue and expenditure flexibility and ability to raise an additional own-source revenues would also have positive implications on the rating.
In the same context, how would you rate the existing and announced national reforms and Belgrade's efforts in reducing its debt? — Moody’s expects slight negative implications on the city’s finances due to the changes in the Law on Local Government Finance effective from January 2017. However, the lower proceeds from the Personal Income Tax, expected to represent 2% of operating revenues projected for next year will be offset by the positive national economic growth prospects, which will translate into growing proceeds of shared taxes and own-source revenues that constitute around 40% and 50% of operating revenues respectively. Moody’s regards the city’s direct debt as relatively high, but manageable. In addition, the high proportion of foreign-currency denominated debt adds foreign-ex-
revenues could also have negative implications on the rating.
How important is for the investors and for the city that a city has been assigned a credit rating? — Moody’s Public Sector Europe provides the same globally comparable ratings across industry and geography. Moody’s rating is an independent opinion on the future ability of an issuer to make fully and timely payments on its financial commitments. It provides lenders/investors with quick and reliable comparisons of issuers and debt instruments in any market, and it also defines the risk of default and expected loss. At the same time the assigned credit rating provides the city with wider access to the capital markets. It also increases transparency and accountability of city’s operations and corresponding increases in confidence by citizens and other levels of government in the ability of the city to provide sustained good governance.
change risk to its debt repayment profile. However, Moody’s expects that the city’s debt will further decline to around 51% of operating revenues by year-end 2017 from 76% in 2015 and 87% in 2014. This declining trend is driven by the city’s improving financial performance and tightly controlled operating expenditures. It also reflects the Belgrade’s plan to fund most of its capital investment in 2016-17 from its own revenues, asset sales, or central government transfers avoiding as much as possible recourse to new debt.
AN UPGRADE OF THE CITY OF BELGRADE’S RATING WOULD REQUIRE AN UPGRADE OF THE SOVEREIGN RATING, ASSOCIATED WITH MAINTENANCE OF SOUND OPERATING MARGIN, SUSTAINED BALANCED FINANCIAL PERFORMANCE AND REDUCTION OF ITS DEBT
What are the key risk factors that could jeopardize the city's rating? — Any downward movement in the sovereign rating could exert downward pressure on the Belgrade’s rating due to the close macroeconomic, institutional and operational linkages with the central government. Downward pressure on the rating could also occur if the city further materially increases its debt burden and/ or suffers a deterioration in its operating and financial performance. In addition, any significant change in the institutional framework under which the Serbian local governments operate, which would severely affect the city’s revenue and expenditure flexibility and ability to raise an additional own-source INVEST IN BELGRADE
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interview
SUCCESSFUL RESULTS IN SERBIA AND ABROAD Vladimir Milovanović CEO of Energoprojekt Holding a.d., Belgrade
The value of new contracts concluded in 2016 and the value of the contracts which are currently being implemented means that Energoprojekt will enter 2017 with just under half a billion Euros worth of contracted business deals
A
ll of our projects are significant and we treat every single of our investors as the biggest and most important. Of course, we have to underline large-scale infrastructure and commercial projects that we are implementing in Serbia because we have been waiting for a long time to prove ourselves in that segment domestically – says Vladimira Milovanović, Director General of Energoprojekt Holding.
You are one of the very few companies that have survived the transition from socialism to capitalism, and today you are celebrating 65 years of successful operations. What is the secret of your survival? — The goal of the privatizations that happened during the transitional period was fast turnover of invested capital, or buying cheaply, take out loans with company assets as collateral and selling off everything else. There are very few examples of successful privatization. People who worked in privatized companies were the ultimate victims, as were the banks that never got the loaned money back and the state budget that did not get privatization revenue. The projects that Energoprojekt implements and the market on which we operate require a lot of hard work, knowhow and professional conduct. We generate our profit by meticulously implementing our contract and carefully supervising our costs while also taking care of our staff and assets. We have successfully realized our contracts which is the reason why we have lasted for such a long time, and have been operating in over twenty countries, on four continents. After a long period of stagnation in Serbia and Belgrade, construction activity has
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now significantly picked up. Which of your company’s projects would you like to single out? — In early 2016, we completed the first phase of the last segment of the construction of the Prokop railway station. Now, the station has 11 tracks and the latest signaling and control system. Also, the Šarani tunnel has been recently opened, which is one of our projects, while the construction of the Lajkovac-Ljig section on the Corridor 11, on which we are building the Brančići tunnel, is going according to plan for the most part despite the fact that pre-design phase and the approval of changes done to some parts of the project have been going on for too long. Of course, I should mention the construction of two residential towers which are a part of the Belgrade Waterfront project. These are the first of a few buildings that will definitely change the face of Belgrade. We are also building a beautiful real estate complex called Sunnyville in Višnjica, the municipality of Palilula, which we are funding ourselves. All of these projects have rejuvenated our company, and made it possible for our staff to gain the needed experience, for us to expand our projects abroad and conquer new foreign markets. In regard to our activities abroad, we are participating in the construction of the Ritz Carlton hotel in Astana, Kazakhstan, as well as building Energocentre in Minsk. This year, the Prime Minister of Kazakhstan officially opened the building of Forte Bank that we had built in Astana, while the President of Ghana opened the cargo centre at Kotoka Airport in capital Accra which is the best cargo facility in Africa. There are far too many projects to be mentioned here.
You are involved in the Belgrade Waterfront project. How significant is this project for the Serbian construction industry bearing in mind that we are talking about a very complex endavour? — The investments made in the Belgrade Waterfront projects gave a significant impetus to the construction sector in our country and hope that our construction companies will be given an opportunity to recover and develop. Growing investments in the construction, energy and industry sector can contribute to a gradual recovery of construction sector, and boost revenue, profitability and wages in this sector. While implementing its activities on the Belgrade Waterfront project, Energoprojekt has been validating the trust that in-
GROWING INVESTMENTS IN THE CONSTRUCTION, ENERGY AND INDUSTRY SECTOR CAN CONTRIBUTE TO A GRADUAL RECOVERY OF CONSTRUCTION SECTOR, AND BOOST REVENUE, PROFITABILITY AND WAGES IN THIS SECTOR
vestors have placed in us and I believe that this project will be our best reference for hiring us to work on future projects in the same location.
Residentialbusiness Complex "Sunnyville" (Belgrade, Serbia)
would contribute to gradual elimination of shadow economy that has been creating unhealthy and unfair competition. By doing so, the entire construction sector would be able to apply a better pricing policy and the wages of construction workers would increase. When everybody is given a chance to bid at tenders and operate under the same conditions, the results could only be positive – growing employment, more revenue for the state budget and better quality of construction works. When domestic companies receive good references in their own country, then they can plan on working abroad where they could implement turnkey projects rather than just exporting its workforce which is a very precious resource in Serbia.
What are your plans for 2017?
— The value of new contracts concluded in 2016 and the value of the contracts which are currently being implemented means that Energoprojekt will enter 2017 with just under half a billion Euros worth of contracted business deals. In Serbia, our plan is to moderately increase our revenue and profit next year, but this will largely depend on how efficient the implementation of the upcoming election is going to be. In the future, our biggest business opportunities are abroad, particularly in developing countries in Africa and the Middle East, as well as in Russia, Kazakhstan and other countries of the Eurasian Union. With Serbia getting closer to the EU membership, maybe that market will open up for us too. Also, our plan for next year is to accomplish business results to the satisfaction of our employees and our shareholders.
Ghana Airport Cargo Center (Accra, Ghana)
Bearing in mind your expertise, what are the most important prerequisites for the construction sector to again become the driving force behind sustainable economic growth which could be fulfilled in the current market situation? — One of the problems of Serbian construction companies is their chronic illiquidity, exacerbated by the fact that even construction sector has its shadow economy. The state should be continuously applying measures that would sustain, revitalize and boost the resources of the domestic construction sector, and to establish institutions and mechanisms that INVEST IN BELGRADE
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interview
BEST OF THE BEST FOR DEVELOPMENT OF BELGRADE Belgrade Waterfront is a project that has assembled the best of the best in architecture, design, construction, interior decoration, and landscape architecture
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elgrade Waterfront has brought many novelties to our capital city, both in the living concept and in construction methods. We are confident that this will give us and future investors enough wind in sails to launch similar projects.
The Belgrade Waterfront Company is already advertising the sale of apartments in its new building – BW Vista. How satisfied are you with the interest shown for purchasing in BW? — So far, we have been offering the apartments in the BW Residences residential building, and, as of recently, we have started selling the apartments in BW Vista which will be more family orientated considering the apartment structure and the surroundings. Families would be pleased to know that there is a kindergarten in the building, while the building’s yard, with gardens, will also have a children playground, café bars, restaurants, and various service providers in order for the residents to have everything required for a comfortable life. By doing so, we will complement our existing offer. We have a great product at hand, and the interest shown for these apartments just proves that. Are you satisfied with the overall progress of the project works? — The works are progressing excellently and every single construction site has met its deadlines. Currently, we have several
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Nikola Nedeljković General Manager of Belgrade Waterfront
active construction sites with the gross buildable area of around 300,000 square metres. In mid-December, the Tower A of BW Residences has grown to be ten-storey tall, while the Tower B now stands at eight-storey high. We have also opened a construction site for BW Vista. We are currently setting the foundation, and we are going to simultaneously work on the building and the infrastructure for BW Vista. The first residents can move in in the first half of 2019. We have also done test piles for BW Gallery, the biggest shopping mall in the region, and we are about to start the work on the facility’s foundation. The same is also being done on the construction site of Kula Beograd (The Belgrade Tower) which will house St. Regis Belgrade. I think there are plenty of reasons to be happy about the upcoming year and we are ready to commence more work in the following period.
well as in Zurich and Stockholm, plus the huge interest shown for the project, has contributed to Belgrade being promoted as a place for investments and has demonstrated that Belgrade has enough potential for further development of the real estate market.
How much did the construction of Belgrade Waterfront contribute to Belgrade being recognized as the place to be for investors in luxury real estate? — Belgrade has a huge growth potential. Belgrade Waterfront has brought many novelties to our capital city, both in the living concept and in construction methods. We are confident that this will give us and future investors enough wind in sails to launch similar projects. Our presentation at Harrods in London, as
Many regional companies have expressed their interest in getting involved in the construction of Belgrade Waterfront. How open are you to such options? — Belgrade Waterfront is a project that has assembled the best of the best in architecture, design, construction, interior decoration, and landscape architecture, or rather all segments that could be a part of such a large-scale project. Therefore, I can say that we are open to new proposals and ideas.
How many Serbian companies are currently involved in construction of Belgrade Waterfront? — Kickstarting the Serbian construction industry and supporting our economy and small investors are things that add special value to this proejct. Numerous domestic companies are already working on the project which will prove to be a great reference in their portfolios. We are very careful of using mainly domestically sourced raw materials on the project, because that is also our contribution to the revival of the Serbian economy.
BELGRADE WATERFRONT TOWER
interview
MORE THAN JUST A DEPARTMENT STORE I Vladislav Lalić
Property and Expansion Manager, IKEA South East Europe
When IKEA opens its department store next summer, the quality of life in Bubanj Potok will change for better because the company is also investing money in access roads and the infrastructure in the location of the department store
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KEA believes that, along with 3 million shoppers that are estimated to visit the department store in its first year, will make the entire area appealing to future investors. Construction of IKEA department store in Belgrade has become the Litmus test for the series of reforms pertaining to the institutional framework regulating investments. Now, when the construction of the department store is ahead of the schedule, it has become a good example for other investors – says Vladislav Lalić, Regional Director at IKEA.
Are you satisfied with how the construction is progressing and do you know the date of the official opening of IKEA’s department store? — We are very satisfied. The construction of the first IKEA department store in Bubanj Potok and the ancillary infrastructure are ahead of schedule and we plan to open next summer. For the first time in this part of the world, certain construction techniques will be used in construction in accordance with the sustainable development principles, energy efficiency and utilization of renewable energy resources. Simultaneously with the construction of the department store, we have been cooperating with our partners from the Belgrade government and line ministries, and we have been closely monitoring the pace of implementation of infrastructure projects which are closely tied to the normal functioning of our department store like relocating the toll booth in Bubanj Potok and a very important project of finishing the works on the Makiš Mladenovac water supply grid. These infrastructure works will improve the quality of life in this part of the town and will provide a permanent solution to water supply, as well as reduce traffic jams on the motorway.
How much has the institutional framework and the work that the administration does in the real estate segment improved since this project started? — We have been waiting for a long time for IKEA to come here. This process was finalized in the last few years thanks to, among other things, various measures that have significantly improved the business environment. We have participated in some of these processes as a pilot project, like the unified procedure. IKEA is also the first big investment where permits were issue via the new e-permit system. The advantages of this system are numerous, transparency is better, investors have a better overview of the permit issues process, can check the status of its application at any given moment, and check whether the procedure is being executed within the deadlines stipulated in the relevant regulation.
FOR THE FIRST TIME IN THIS PART OF THE WORLD, CERTAIN CONSTRUCTION TECHNIQUES WILL BE USED IN CONSTRUCTION IN ACCORDANCE WITH THE SUSTAINABLE DEVELOPMENT PRINCIPLES, ENERGY EFFICIENCY AND UTILIZATION OF RENEWABLE ENERGY RESOURCES
In the meantime, opening of IKEA department store has become a symbol of economic recovery of both Belgrade and Serbia. What are your expectations in terms of the expected number of shoppers, turnover and creating new jobs? — IKEA’s vision is to secure better life for as many people as possible. Our range of 9,500 home products are of high quality, have an appealing design and affordable prices, and they are intended for people who don’t have much money on their disposal. We believe that this should not stop them from creating a beautiful and functional living space for themselves. We have invested a lot of money in access roads and infrastructure for the location in Bubanj Potok. We believe that these investments, coupled with 3 million expected shoppers in the first year of the department store, are going to make the entire Bubanj Potok area appealing to future investors. Several thousand people have applied for job at IKEA. What do you think of the quality of the Serbian workforce? — IKEA’s arrival to Serbia was long expected so I cannot really say that we were surprised by a huge number of job applications. We are certainly very happy with the fact that so many people in Serbia want to work with us. We believe that this is a result of the positive image that we have managed to create. IKEA has also been recognized globally as a very desirable employer and has been ranked high on all the best employer lists. We have no trouble in finding excellent candidates for our positions, and it is up to IKEA to support them in their further professional development. What are your plans in terms of expanding the network of your suppliers in Serbia? — So far, IKEA has been cooperating with only one supplier in Serbia which products are being sold in department stores worldwide. The potential is much bigger and market analysis and talks with many Serbian furniture companies are currently being conducted.
IKEA STORE
interview
WE ARE SETTING NEW STANDARDS
Nebojša Vasilić Dušica Gaković
Project Development Managers of „A Blok“
'A Blok' has made it possible for new standards to emerge in construction of residential and office buildings on the Belgrade market. Once finished, by the end of 2018, this contemporary complex will span 140,000 square metres gross
T
he time has come for healthy competition to enter the design sector, and for the quality to become the most important prerequisite –Nebojša Vasilić and Dušica Gaković, project development managers of 'A Blok' say.
What novelties did A Blok bring to property offer in Novi Beograd? — A Blok has been created on the back of the idea to offer new quality of residential and office space in Novi Beograd in accordance with the best global practices of sustainable construction. The entire complex has been designed to comply with the construction rules for energy efficient buildings – from saving energy and natural resources to a huge green area which spans over 9,000 square metrs. Such format of construction requires top notch materials which means that each and every material used had to be accompanied by a certificate proving its meets environmental standards. This is the case with all the materials that have been used for the building fronts and exterior decoration, as well as for the building's interior.
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You have finished and sold the apartments from the first and second project stage. When are the third and fourth stage going to be completed? — All the apartments (799) from the three combined construction stages have been sold, with the apartments from the first and second stage getting tennats even before the deadline. The third stage is pending and the works are supposed to be completed in September 2017. During the fourth stage of the development of this complex, we are going to build a business building which will span a total of 39,100 square metres. The tennats in this building will have the best possible working conditions thanks to the way in which the building is being constructed and additional facilities that will be at their disposal. The construction is supposed to finish by the end of 2018. After all the construction stages are completed, A Blok will stretch across 140,000 square metres gross. How willing are domestic real estate developers to offer properties that have been built in accordance with the latest
construction standards? — It is a well-known fact that construction industry cannot develop if there are no large-scale infrastructure projects and capable people with a vision who are willing to apply the best construction practices on the domestic turf. It is encouraging to see that domestic real estate developers now have an opportunity to build good reputation for themselves while relying on the domestically produced construction materials with several new 'players' emerging in certain segments. We have invested a lot in building up our brand, including the fact that all laboratories across the country and the region that do quality control know us very well. Recovery of production and Serbia's gradual exit from the financial crisis are both wind in the sails of new infrastructure projects. The construction of retail facilities worth a billion Euros is expected to start within a next year. The proof that construction has been growing at a tremendous rate can be seen in the fact that it has become very difficult to find available workers.
interview
Dragan Lazarević Belaga doo
TOP QUALITY OFFER IN THE HEART OF THE CITY W After almost thirty years, Belgrade is going to have the first new, luxury, fivestar-hotel that bears the name of a famous brand – Hilton. Once this happens, our capital city will further solidify its position on the map of both conference tourism and tourist destinations
e are talking to the Representative of investor Hilton Hotel in Belgrade, Dragan Lazarević about the construction of the first ever Hilton hotel in Belgrade.
When is the opening of the Hilton Hotel planned for? — The completion of construction and the opening of the Hilton Complex, which apart from the hotel with 242 rooms and apartments, is going to have over 1,000 square metres of conference and meeting premises, two restaurants, an underground garage with 300 parking
places and a retail facility, is expected in the first half of 2018. The construction of underground levels is almost finished plus we have built two storeys so far.
How important is this hotel for the hospitality offer of our capital city? — Opening of this hotel means that, after almost thirty years, Belgrade is going to get the first new, luxury, fivestar-hotel that bears the name of a famous brand which will further solidify the city’s position on the map of both conference tourism and tourist destinations. INVEST IN BELGRADE
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interview
SHOPPING PLEASURE IN THE HEART OF THE CITY Tsahi Boneh
Director of ABD
Rajićeva Shopping Center and future hotel will be adorned by specific interior and exterior, which will preserve the glamour of the old part of the city and Knez Mihailova Street, as the favorite place of Belgraders. At the same time, it will offer the most diverse shopping experience and entertainment
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A
s one of the leading construction and real estate companies in Israel, Ashtrom International and its subsidiary ABD, had recognized the huge potential of the Serbian capital. Its investment in the Rajićeva Shopping Center and the future hotel in the heart of the city will be a feast for both domestic and foreign visitors, says Tsahi Boneh, director of ABD.
When do you expect the first stage in construction of the complex in the Rajiceva Street to be completed? — The works on the Rajićeva Shopping Center and future hotel, have been significantly progressed in the last year. We will complete the construction works of the shopping center by the summer of 2017, and we intend to open it in September 2017. In these days we are concluding an agreement with our hotel brand and we intend to open the hotel within a short while after the opening of the shopping center. How is this complex going to enrich the existing offer in downtown Belgrade? — Rajićeva Shopping Center is the sole shopping center in the city located in the central pedestrian zone. Combined with the planned hotel and its parking levels, it will cover the area of approximately 60,000 square metres, offering Belgraders, visitors and guests of the capital the best-quality fashion brands and the most diverse offering of shopping experience, entertainment and other elements. The Shopping Center will contain up to 80 shops and more than 70% of its area has already been leased at this moment. The greatness of this complex lies in its unique concept, specific interior and exterior, which will preserve the glamour of the old
part of the city and Knez Mihailova Street, as the favorite place of Belgraders.
This is the biggest Israeli investment at the moment. Why did you decide to invest in this complex? — Our investment in the complex in Rajićeva is approximately EUR80mn. As one of the leading construction and real estate companies in Israel, known for its expertise and experience worldwide, we recognized the huge potential that Belgrade has to offer, both to its citizens and its visitors. We believe that this potential will grow and develop in the future and we hope that by using our knowledge, expertise and know-how we will contribute to making Belgrade more popular as a destination in this part of the region. How beneficial is this investment going to be for employment? — In this stage of the project, we have provided jobs for more than 300 employees. Once we will open the shopping center and the hotel we will introduce more than 600 new jobs, most of it as direct employees in the shops and the hotel and some through sub-contractors for services such as cleaning, security and maintenance for the different parts of the project. How certain is the implementation of the project's second stage - doubling of the hotel capacity? — At this moment, we are completely focusing our resources on finalizing the works on construction of the first phase of the project and the opening of it in the 3rd quarter of 2017. We will deal with the second stage once it will be relevant, in due time.
RAJIĆEVA SHOPPING CENTER
interview James Gunn
Director Poseidon Group
Belgrade is soon to get a new retail park - Capitol Park Rakovica, one of three of the Capitol Parks in Serbia to be built until 2018, while two others are already operating in Sombor and Sabac. These developments testify the growing interest of investors in real estate sector in the country
WE APPRECIATE SERBIA’S POTENTIALS S erbia is becoming more and more attractive for investors in real estate. Good example are series of Capitol Parks of which two are already built in Sombor and Sabac, while three are the process of development, and are to be finished in 2018. „ Serbia still has much potential in real estate sector“, says James Gunn, Director of the Poseidon Group, adding that the company looks excitedly to the future. We spoke with Mr Gunn about the development of the Capitol Park Rakovica which will change dramatically the overall quality of life of its inhabitants, once when the shopping park is finished and other plans the company has.
What makes the former industrial facilities in the Belgrade suburbs so appealing to investors? — Capitol Parks are strategically located in close proximity to inhabitants, with good public transport links and car connectivity. Capitol Park Rakovica is visible among its catchment of people who can see it from the surrounding hills, has tram, bus and train stops, and numerous access points for the car. How much money is going to be invested in Capital Park in Rakovica, and how is the facility going to contribute to the shopping offer in this part of the town? — Rakovica has a pedestrian zone and the Capitol Park is within walking distance of the centre. Working in close proximity with the municipality, we have designed a shopping park with a realm of green public
spaces, and a tenant mix catering for all age groups and tastes. Currently there is a limited retail offer available to residents. This will change dramatically with the opening of Capitol Park Rakovica. You have retail parks in Šabac and Sombor too. What makes retail parks such an attractive investment in Serbia? — We have Sombor and Sabac as well, plus three parks to open in 2018. We are committed to extending the Capitol Parks platform in Serbia so customers can buy the goods they want at affordable prices.
WE ARE COMMITTED TO EXTENDING THE CAPITOL PARKS PLATFORM IN SERBIA SO CUSTOMERS CAN BUY THE GOODS THEY WANT AT AFFORDABLE PRICES
How important is it to find tenants from the get go, and why are stores drawn to the concept of retail parks? — Retail parks provide locations for retailers to sell their goods at more affordable prices due to the commercial conditions we provide being more appealing to them. A wider variety of retailers locate in our retail parks due to them having their shops all on one floor and trading better in many instances on a turnover per square metre compared with shopping centres. What development potential does the Serbian real estate market have? — Serbia still has much potential. We have been in Serbia for some years and look excitedly to the future.
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BRANKO'S BRIDGE
INTO THE NEW YEAR WITH A NEW MALL Ada Mall will be located in Radnička Street, will cover an area of over 34,000m2, will have 1,000 parking spaces and will be built in accordance with the highest international standards
G
lobe Trade Centre SA (GTC), one of the leading commercial real estate companies in Central, Eastern and Southern Europe, this year celebrated 15 years of successfully doing business in Serbia and announced the construction of a new shopping centre – Ada Mall! GTC has built more than 80,000 square metres of Class A office space in New Belgrade’s central business district, which today house the headquarters of the largest domestic and international companies. To date, the company has opened four complexes in Belgrade – GTC House, GTC Square, 19th Avenue and FortyOne. And GTC enters 2017 ready to start another new project in Belgrade – the construction of an exclusive shopping centre near Ada Ciganilja that will be called Ada Mall. Ada Mall will be located in Radnička Street, will cover an area of over 34,000m2,
GTC GROUP GTC Group is one of the leading commercial real estate companies in Central, Eastern and Southern Europe. Since 1994 the Group has been building modern office and retail spaces that meet the high standards required in the region of Central and Eastern Europe. GTC today actively manages a portfolio that includes 36 projects for commercial properties and leases out around 593,000 square metres of office and retail space to very demanding tenants and customers in Poland, Serbia, Hungary, Romania, Croatia and Bulgaria. GTC S.A. is listed on the index of the Warsaw and Johannesburg stock exchanges, including the WIG 30 index. The company's shares are also listed on the international index Dow Jones STOXX Eastern Europe 300.
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Predrag Petronijević, Siniša Mali and Tomas Kurcman
will have 1,000 parking spaces and will be built in accordance with the highest international standards. The opening of this modern shopping centre is planned for autumn 2018. According to GTC Serbia CEO Mr Peđa Petronijević, through constant investment and development, GTC is turning Belgrade into a modern city focused on the future and the new era of doing business, introducing the highest environmental standards and the international spirit of the business lifestyle to the heart of Belgrade. ”Company GTC has been investing for 15 years in Belgrade, a city of inexhaustible energy and unique people, growing with it and improving itself – and it plans to continue doing that in its future operations. This year we celebrated a very important anniversary, with a lot of hard work behind us, and I am very proud of the whole team because of everything that we have achieved. For 15 years we have been building Belgrade on the principles of expertise and knowhow, but also with the great love and dedication that we offer to this city and to each project individually. And that always returns well,” said Mr Petronijević. GTC is also the proud holder of GOLD LEED certificates for GTC House and FortyOne, which became the first commercial buildings in Belgrade to be awarded with this prestigious recognition, and which is awarded on the basis of the highest international standards of green construction.
ADA MALL