The implementation of the Interim Trade Agreement can not begin before changes to the Customs Law are adopted, which is one of the accompanying laws to the 2009 budget.

The adoption of Customs Law amendments was postponed to allow the budget to be adopted before expiry of the legal deadline.

The law, along with six other accompanying budget laws, will be submitted to Parliament again in January. It is expected these laws to be adopted soon, so that the EU agreement could take effect.

The Interim Trade Agreement would be of great benefit to the economy and people of Serbia, despite the fact that customs revenues would fall as a result. Lower customs taxes would reduce the cost of the import of raw materials and encourage competition, which, in turn, would lead to lower prices.

The Interim Trade Agreement envisions the gradual liberalization of trade in industrial and agricultural products over the next six years.

Serbia has two EU integration goals in 2009: meeting the conditions for inclusion on the Schengen white list and receiving candidate status.

In the frame of EUROCHAMBRES' "PARTNERS for INVESTMENT PROMOTION" programme co-funded by the European Union, Chamber of Commerce and Industry Kragujevac has been selected to participate with a project on:

"Establishment of Western Balkans Automotive and Supplier Industry Excellence Center"

Overall goal of this project is raising the level of competitiveness of automotive industry of Western Balkans at the market of foreign direct investments.

The project, which grant is cca 90.000 Euro, in the frame of CCI Kragujevac will be implemented by Agency for Investment Promotion and Business Support of Central Serbia with Europen Union and Western Balkans partners support.

"PARTNERS for INVESTMENT PROMOTION" is EUROCHAMBRES' (European Chamber of Commerce and Industry with central office at Brussels) initiative supported by the European Union under CARDS 2005 Regional funding.

               

At its session held in October 2008, Government of the Republic of Serbia adopted a Conclusion that stipulates that implementation of the Interim Agreement on Trade and Trade-Related Matters between the European Communities, of the one part, and the Republic of Serbia, of the other part, will start as of 01 January 2009. The objective of this measure is to reduce the period of time that needs to expire between the start of application of the Interim Agreement and the granting of the candidate status to Serbia.

Full trade liberalization will be completed within six years, by 01 January 2014. The tempo of liberalization may be accelerated, depending on the economic situation.

Serbia has enjoyed a preferential status regarding exports of goods into the EU as of 2001, due to Autonomous Trade Measures approved by the EU, which allow for completely free exports of goods originating in Serbia to the EU market. This regime will be effective up until 31 December 2010. With coming into force of the Stabilization and Association Agreement, these measures will be translated into measures regulated by the Agreement.

For Serbian economy, this means specifically the possibility to import industrial and agricultural products originating in the EU without paying customs duties or by paying reduced customs duties than those stipulated by the Customs Tariff Law.

Due to importance of agricultural products, they are entitled to a slower tempo of trade liberalization: around 35% of agricultural products will be subject to duty-free imports immediately upon the start of implementation of the agreement, while trade liberalization for other agricultural products will take place in line with the dynamics envisaged by the agreement. Furthermore, no concessions have been made for a number of products (sugar, tobacco and vine).

Degree of liberalization will be higher for industrial products. All industrial products are categorized into four groups by their sensitivity: non-sensitive, sensitive (list A), highly sensitive (list B) and extremely sensitive (list C). In this way, immediately after the start of application of the agreement, some 65% of industrial products will be imported duty-free (non-sensitive products). As regards other industrial products, customs duties will be reduced in line with the dynamics defined by the agreement:

Annex I	2009	2010	2011	2012	2013	2014
List (A)	70%	40%	0%	0%	0%	0%
List (B)	80%	60%	40%	20%	0%	0%
List (C)	85%	70%	55%	40%	20%	0%

In order to claim the right to import duty-free goods or to pay reduced customs duties on goods originating in the EU, it is necessary to submit a proof of origin (EUR.1 certificate) to the relevant customs house at the time of imports.

On 9 September 2008, National Assembly of the Republic of Serbia ratified the Stabilization and Association Agreement (SAA) and Interim Trade Agreement.

This formally marked the end of the process initiated on 10 October 2005, when negotiations for conclusion of this agreement were started between the Republic of Serbia on one side and the European Communities and their member states on another. SAA and Interim Agreement were initialed on 7 November 2007, and they were signed on 29 April 2008.

SAA will enter into force after its ratification by the EU Council of Ministers and the European Parliament and after it is ratified by all signatories i.e. Member States of the EU. The Interim Agreement will enter into force after it is ratified by the EU Council of Ministers and the European Parliament.

Ratification of the SAA is a "historical moment" for Serbia and also for successful continuation of further European integrations, first of all, toward gaining the candidate status.

EU Commission is to encourage every Serbia's move toward association with the EU, such as adjustment of local regulations to the EU standards and laws, followed by the fulfillment of all contracted obligations being part of the SAA and Interim Trade Agreement.

The EBRD is the largest investor in Serbia. Its support covers major infrastructure loans for the transport sector: improving roads, especially in the context of facilitating cross-border transport and trade, is core to the EBRD's drive to back Serbia's overall economic development. Bank investments also support the power sector, small and medium-sized enterprises (SMEs), private companies and new ventures.

On September 1st 2008, EBRD President Thomas Mirow made a three-day trip to Serbia and Bosnia-Herzegovina, his first visit to the EBRD region as head of the Bank. The visit underscores the increasing importance the EBRD attaches to strengthening policy dialogue with the countries in the Western Balkan region and supporting their further development.

The EBRD is the largest institutional investor in the region, having invested more than €4.9 billion in sectors including infrastructure, energy, the financial sector and the private corporate sector, especially small and medium size enterprises.

The EBRD welcomes the progress the region has made in implementing key reforms and the encouraging increase in cross-border cooperation and investment that have bolstered recent growth across the Western Balkans.

In Serbia, Bosnia-Herzegovina and the region, the Bank will continue to play a crucial role by investing alone and together with other foreign investors. Key targets for investment to support the development of the regional economies include transport and municipal infrastructure, energy, as well as the agribusiness and private sectors. The EBRD will continue to stimulate regional economic integration, to help make markets more competitive, to improve quality and to reduce the cost of services, which is the key for integration into the broader European and global markets.

During the visit to Belgrade, Mr Mirow met senior government officials and business partners. He also signed a €10 million loan to RZB Leasing to finance the expansion and growth of small and medium-sized enterprises in all regions of Serbia.

The Bank signed its first project in Serbia in 2001 and has to date invested almost €1.3 billion in 105 projects in the country.

Delegation of "Hessen Agentur GmbH" from German town Wiesbaden, led by director Martin Herkströter and Khaled Snouber, PhD, director of International Affairs and Economic Development in Hessen Agentur, visited Chamber of Commerce and Industry Kragujevac. The main aim of this visit was signing of Contract "Making of Master plan for Central Serbia". The contract signed Martin Herkströter, director of "Hessen Agentur" and in the name of Agency for Investment Promotion and Business Support in Central Serbia, founded in frame of Chamber of Commerce and Industry Kragujevac, contract signed Dušan T. Puača. Signing of this contract enables economy subjects and local authorities in Central Serbia to be in position, after making of Master plan, to apply for financial support in European pre-accession funds and funds in Region Hessen.

Signing of contract supported with their presence Zoran Adžić, Assistant Minister in Ministry for Infrastructure, presidents of regional Chambers of Commerce Kraljevo, Užice and Požarevac, which together with the support of Serbian Chamber of Commerce and representation of Serbian Chamber of Commerce in Germany, in past year, had worked on realization of this project, as well as entrepreneurs form region Central Serbia, representatives of banks, members of CCI Kragujevac Board of management and media.

Some future activities are announced, before all visit of German business delegation which follows in late November, but also some other activities and opportunities for meetings between Serbian and German entrepreneurs. The most recent is visit of Serbian delegation to the Exhibition for the Food Industry, Agriculture and Horticulture- "Grüne Woche" in Berlin.

During their stay in Kragujevac, representatives of Hessen Agentur had reception in City Parliament, where they spoke with Dobrica Milovanovic, PhD president of City Parliament, after that, they visited Municipality Topola and Mausoleum of Dynasty Karadjordjevic on Oplenac.