Free Trade Agreements
CEFTA
The Central European Free Trade Agreement (CEFTA) is a trade agreement between countries in Central and South-Eastern Europe. This agreement is to replace the existing bilateral agreements and starting from 1 May 2007 will include the following countries: Albania, Bosnia and Herzegovina, Croatia, FYR Macedonia, Moldova, Montenegro, Serbia and the United Nations Interim Administration Mission in Kosovo. The agreement stipulates that no import customs shall be increased nor the new ones will be imposed other than those prescribed by the existing bilateral free trade agreements between parties of the Agreement. Also, the Agreement stipulates accumulation of products origin, meaning that products exported from Serbia are considered of Serbian origin if integrated materials are originating from any other CEFTA country, European Community, Iceland, Norway, Switzerland (including Liechtenstein) or Turkey, provided that such products have undergone sufficient processing (where the value added there is greater than the value of the materials used) in Serbia.
FTA WITH RUSSIA
A free trade agreement with Russia signed in August 2000 makes Serbia particularly attractive to foreign investors and manufacturers. The agreement stipulates that the importing country regulates the rules of origin, in accordance with WTO principles, meaning that goods produced in Serbia with prevailing value added in Serbia are considered of Serbian origin, thus free of customs when entering Russian market. The list of products not covered by the duty free agreement is updated annually, and it currently includes poultry, sugar, chocolate, alcoholic beverages, soap, cotton, carpets, wooden furniture, household appliances, and motor vehicles. The accord is the first such agreement Russia has signed with any country outside the Commonwealth of Independent States.
EU
European Union’s Stabilization and Accession Process has allowed Serbia exceptional trade measures, enabling export of all products originating from Serbia without customs and other fees, with exception of wine and baby beef. In addition, the EU Agreement abolished customs duties and quantitative limitations for import of Serbian textile products and guarantees to maintain the same policies in the future (based on the EU Autonomous Trade Measures). Using this strategy the Serbian export of mentioned products will become entirely free. In reciprocity, the Republic of Serbia obliges itself to gradually, until 2008, liberalizes customs tariffs for import of EU textile products.
US
The trade with US is pursued under Generalized System of Preferences (GSP). The GSP program currently provides preferential duty-free entry for more than 4,650 products, including most manufactured and intermediate goods and selected agricultural and primary industrial products. Certain sensitive goods are not eligible for duty-free entry under GSP, which generally includes most textile products, leather goods and footwear. The list of eligible goods is reviewed and adjusted twice per year with input from U.S. industries.
WTO
Serbia is not a member of the World Trade Organization, but is anticipating joining WTO before 2008. In December 2005 Serbian authorities have underwent first round of talks with WTO representatives and the next meeting of the working group is expected to be held in May 2006.
