Serbia Newsflash Week 48

Netherlands Soft Fruit Solutions launch, investment news, economic recovery, cereal price changes, rural development - The week in Serbian agriculture

Picture of a sunflower
Sunflower oil prices are up 10% because of the wholesale price increases of sunflower seed. Sunflower seed prices reached €0.30 - 0.31, a 20% increase compared to last year's prices.

The PIB project Dutch solutions for the Serbian soft fruit sector launched

Due to the Covid-19 pandemic the PIB project Netherlands Soft Fruit Solutions, which was previously scheduled for launch in June, has officially started at the end of November. The Netherlands Embassy, the Ministry for Agriculture of Serbia and the Serbian Chamber of Commerce jointly presented the project to local producers, researchers and advisors. This public-private initiative from The Netherlands is a result of multiannual cooperation between the two countries in the area of soft/berry fruits. The project will present the Dutch approach in a form of the so-called “golden triangle”: cooperation between the governmental sphere, research institutions, and the business sector. Collaboration in this triangle model proved to be a golden formula for the Dutch agro sector. More at info about the project can be found here.  A video of the kick-offwebinar is available here.

Triodos Bank to support Serbian rural economy

The ownership structure of Opportunity Banka Novi Sad has recently changed. The bank used to be  owned entirely by the USA-based Opportunity Transformation Investments, which now has a 22% stake. The bank’s new owners are two foreign banks headquartered in Germany – Umweltbank Nurnberg, with a 30% share, and GLS Gemeinschaftsbank Bochum, with a 19.99% share. These banks specialize in the financing of companies, projects, and financial institutions. Moreover, Triodos Bank from the Netherlands, focusing on sustainability and sustainable banking, purchased 28% of OB. Two legal entities acquired a 14% stake each: Triodos Sicav II, Luxemburg, and Legal Owner Triodos Funds B.V., the Netherlands. “The entry of these reputable investors in the Serbian banking sector is yet another confirmation of the credibility, confidence, and attractiveness of the Serbian banking sector, as well as the result of the National Bank of Serbia’s efforts in ensuring macroeconomic stability achieved in the past period,” the central bank commented.

Foreign Investment Council on Serbia’s moderate progress

The White Book, presented by the Foreign Investors Council (FIC),  states that Serbia has made moderate but steady progress in improving its business climate. The White Book Editor-in-Chief explained that the FIC offered 327 recommendations to 59 sectors in the latest edition. They lay down specific steps that need to be taken to improve the business environment in Serbia amidst the COVID-19 pandemic. The COVID-19 crisis has proven that no country, company, or individual is immune safe from its effects. The FIC expressed its satisfaction that the Council and the Serbian Government have the same priorities. The recommendations for the improvement in food and agro sectors can be found here.   

Picture of workers in a food industry company
©Julio César Velásquez Mejía
All sectors of the economy were affected by the pandemic - but the Foreign Investors Council is convinced that Serbia made moderate but steady progress in dealing with the crisis. The FIC issued a white book with policy recommendations for the further improvement of Serbia's business environment.

Biggest local producers and distributors of frozen products for sale

Frikom operating in Serbia and Ledo, operating in Croatia,  the two largest local manufacturers of industrial ice cream and distributors of frozen foods are members of the Croatian Fortenova Group. They are put up for sale. Whoever buys them, will acquire control over the entire frozen market in the region, stated Mr Munjiza, consultant from Zagreb. “Those companies are the golden goose of the former Croatian concern Agrokor. The group makes frozen products and their products are in over half a million freezers in the region of the former Yugoslavia, which means that whoever buys these two companies will control the entire market, or at least a half of it, if the buyer purchases the frozen products business alone,” Mr. Munjiza stated for local magazin Biznis. He expects the buyer to be an investment fund from the Western EU and/or the US in cooperation with the largest multinational companies, which have expressed an interest in those companies before. “Personally, I would like to see buyers from the region, strong Croatian, Serbian and Slovenian companies such as, for example, Podravka or Polimark”, said the consultant.

Oil prices up due to higher sunflower seed prices 

Certain oil producers in Serbia have raised oil prices by 10% due to higher wholesale prices of sunflower seeds. It is also partially a result of their well-known business policy to slightly increase the price even before previous stocks of raw materials (bought at lower price) are used up, the agriculture expert Mr Prostran explained. Last year, sunflower seeds were bought from producers for €0.26/kg as opposed to this year’s price of €0.30 - 0.31/kg, which is approximately 20% higher. According to Mr. Prostran, consumers can “neutralize” the price increase through more rational consumption. “The agriculture sector sometimes has to charge for its work. This year’s rise in sunflower seed prices due to lower production and the pandemic will motivate producers to increase the area for cultivating sunflowers,” concluded the expert.

High-speed internet in rural areas of Serbia 

Last week, agreements on building a broadband network in Serbia’s rural areas were signed. Based on these agreements, fast and stable internet access will be provided to 5,500 households in 34 villages in the areas of Novi Pazar, Prijepolje, Gornji Milanovac, Vladicin Han, Knjazevac, Valjevo, Loznica, Ljubovija, and Backa Topola. “It means thousands of young people will have the opportunity to get modern education, while businesses in those areas will be able to operate better, with more success,” stated the Serbian Minister for Telecommunication. The agreements were signed with Telekom Srbija, Orion Telekom, SBB, and Sat-Trakt as a result of the first in a series of calls for operators, which closed at the end of September. No operator expressed interest in introducing broadband networks in 15 villages, but the Minister said that the state will provide internet access in those parts of the country as well. The first stage of the project includes a total of 600 villages with around 90 thousand households, and the plan is to complete this stage in 2022.

Michelin postpones revelation of restaurant selection in Serbia

Serbia has recently been included in the prestigious Michelin gastronomic guide and the winners of the famous Michelin stars were supposed be announced in early December. Owing to the developments of the COVID-19 crisis, the Michelin Guide has postponed the unveiling of some restaurant selections for 2021. The initial plan was to publish the selections in late 2020. “Due to the COVID-19 pandemic, the release of the Michelin Guide Belgrade, previously slated for December 11, 2020, will be postponed,” said the International Director of the Michelin Guide. He added that their teams remained in close connection with the National Tourism Organization of Serbia and that their interest in Belgrade`s culinary scene remained intact. “We will regularly survey the situation regarding the Michelin Guide Belgrade selection, and once it is possible, we will determine a later date collegially,” he explained. The postponement does not only refer to Serbia but also the USA (Chicago, Washington DC, New York, and California), as well as the UK and Belgium in Europe. The COVID-19 crisis has also impacted the Guide’s activities in Asia as the release of the 2021 Singaporean selection has also been postponed.