Liberalized Trade
Logistics and FTA’s are only some of the reasons to locate your business.
As a logistics base, Serbia is a perfect place for a company to locate its operations if wanting to closely and most efficiently serve its EU, SEE or Middle Eastern customers. It borders the EU, at the Hungarian state line, offering a possibility of production outside the European Union. At the same time, businesses can enjoy all the benefits of working outside the EU, while being able to provide services and transport goods in projected and flexible time frames.
Externally, Serbia can serve as a manufacturing hub for duty-free exports to a market of 1 billion people. It includes the European Union, the United States of America, Russia, South East Europe, and Belarus.
This customs-free regime covers most key industrial products, with only a few exceptions and annual quotas for a limited number of goods.
The recently signed Free Trade Agreement with Turkey became effective starting May 2010, while the FTA with EFTA members (Norway, Switzerland, Iceland, and Liechtenstein) was concluded in December 2009 and will be active starting April 2010.
Read in more detail about:
European Union Market
United States Market
Russian Market
CEFTA Market
Belarus Market
EFTA Market
Local Market
The European Union has granted Serbia exceptional trade measures, enabling exports of all products originating from Serbia without customs and other fees. For a limited number of products (baby beef, sugar, and wine), annual import quotas remain in effect.
Trade with the United States is pursued under the Generalized System of Preferences (GSP). U.S. trade benefits provide for a preferential duty-free entry for app. 4,650 products, including most finished and semi-finished goods and selected agricultural and primary industrial products. Certain sensitive goods (e.g. most textile products, leather goods, and footwear) are not eligible for duty-free exports. The list of eligible goods is reviewed and adjusted twice per year, with input from U.S. industries.
For the full list of goods eligible for GSP treatment click here.
The Free Trade Agreement with Russia, signed in August 2000, makes Serbia particularly attractive to foreign investors in the manufacturing sector. The Agreement stipulates that goods produced in Serbia, with over 50% value added in the country, are considered to be of the Serbian origin. For exports to Russia, the FORM A Certificate is required as a proof of goods origin. The only tariff charged is the customs record keeping tariff, amounting to 1%.
The list of products, excluded from the Free Trade Agreement, is revised annually. In April 2009, duty-free regime was extended to the following goods: all drugs, confectionery products, apple juice, malt beer, fresh grape wines, all soaps, wool clothing, refrigerators, freezers and all refrigerating devices, washing and drying machines, wooden upholstered seats, wooden office furniture, sleeping bags, sheets, and similar goods.
For the complete list click here and for the full version of the Agreement click here.
The Central European Free Trade Agreement (CEFTA) is the trade agreement between countries in Central and South East Europe, which has replaced bilateral agreements between the following countries in the region: Albania, Bosnia and Herzegovina, Croatia, FYR Macedonia, Moldova, Montenegro, Serbia, and the United Nations Interim Administration Mission (UNMIK) in Kosovo. The Agreement has been in effect as of July 2007, providing companies in Serbia with an opportunity to reach the 29 million people market free-of-customs.
CEFTA envisages the abolishment of customs restrictions for industrial and agricultural products in the CEE countries by 2010. In addition, the Agreement stipulates accumulation of products origin, meaning that products exported from Serbia are considered of the Serbian origin if integrated materials originate from any other CEFTA country, the European Union, Iceland, Norway, Switzerland (including Liechtenstein) or Turkey, provided that such products have undergone sufficient processing (if the value added there is greater than the value of the materials used in Serbia). For exports to the member countries of CEFTA, the EUR 1 Certificate is required as a proof of goods origin.
For the full version of the Agreement click here.
The Free Trade Agreement with Belarus envisages mutual abolishment of customs and non-customs duties in trade between the two countries. There are only a few exceptions to the Agreement, including sugar, alcohol, cigarettes, as well as used cars, buses, and tires.
The Free Trade Agreement with the European Free Trade Association (EFTA) will be active starting April 2010. EFTA is an intergovernmental organization set up for the promotion of free trade and economic integration to the benefit of its four member states: Iceland, Liechtenstein, Norway and Switzerland. The agreement will enable export of Serbian products customs free to a market of 13 million people.
Internally, with 7.5 million people, the Serbian market is the 2nd largest in South East Europe. The average net monthly salary rose from merely €194 in 2004 to €402 in 2008. Coupled with rapid consumer loan expansion, this fueled a sharp increase in local demand. It was particularly reflected in a double-digit surge of retail trade turnover on an annual basis.
A consumption pattern indicates a shift towards durable consumer goods. In 2007, food and beverages accounted for 40.3% of an average household budget, while e.g. furniture, apparel, and footwear made up 10.6%.
In response to expanding local demand, international retail chains have opened up dozens of new stores across the country. By illustration, from 2004 to 2008 total retail and wholesale foreign investment reached more than €1.4 billion.
