The First Coronavirus After-Event in Serbia
How did small horticulture companies in urban greening manage in the last two months? What are the hopes of fruit tree nursery for the coming period? How did Heineken in Serbia manage through the lock down period? What did Corona pandemic did to Philips’ business operations? In every other situation we would have met in person with the Dutch business community in Serbia to discuss the latest developments. But not nowadays! The new reality is we should all meet virtually. So we did. A video conference with 36 participants active in Serbia was organized by the Agro and Economic Departments of the Embassy, chaired by the Ambassador Gilles Plug.
The Dutch business community is one of the main pillars of Dutch-Serbian relations. Contacts with the sector enable the Embassy to feel the pulse of the economy and enhance business cooperation between the two countries by providing support where it is needed. Therefore the Embassy organizes and supports regular gatherings of the NL-SRB business community. It would be an understatement to say that this business gathering was no different than previous ones, but for sure this first “virtual after-corona” gathering was very well-received and appreciated by all. During the session, experiences of how COVID-19 struck on the businesses were exchanged; updated on economic and political outlook in the country. It was agreed to have a follow up session with relevant decision makers in the future.
The Serbian and Dutch responses to the coronavirus crisis were both different and similar, in many ways. The percieved main difference was that the Serbian measures were stricter and more heavy-handed. Overall, they seem to be efficient and successful since the worst case scenario was averted and the country has a relatively low amount of cases and casualties. On the other hand, it had a tougher impact on businesses. Curfew times and the closing down of gastronomy shut down the market for many. The role of the Embassy throughout the crisis was acknowledged by participants, support was provided to the companies in various ways: in facilitating receiving permits for working outside curfew hours, updates on border crossings and latest requirements for consignments and drivers, information on entering the country etc.
Participating companies were eager to hear the Ambassador’s presentation on the current situation in the country, governmental/ state aid measures, projections of the IMF, WB and EBRD on the pace of the country’s recovery. Very interesting were the presentations of companies explaining their views and experiences on impact of the crisis, as well as plans for the near future. Sharing experiences by smaller, as well as by larger companies were appreciated. It was clear that all faced similar challenges. Impressed by activities Dutch companies do in Serbia, the Ambassador complimented them on not choosing big lay-offs, for their responsible reactions and working conditions.
Vita Verde, a small horticultural company engaged in urban greening was just making progress in the Serbian market with a booming construction sector investing more and more in greening (See also our article on urban greening in Serbia here). During the crisis, the company was mainly busy with maintaining plants in malls and at other locations they maintained in the past period. However, this was not easy, as the importance of maintaining these greening projects was at first not recognized. The company hopes that in the future, the building of prestige condominium complexes in Belgrade and shopping centers throughout the country will pick up the speed and that gradually, they will be back to normal business operations, but with an expected economic slowdown, this is not guaranteed. The upcoming elections will also have an effect on economic recovery policy measures and market perspectives; investors will carefully plan their investments which might limit future market development.
Fleunerra, a fruit tree nursery, faced several difficulties in the last two months, having a curfew in place and no possibility to spray, irrigate or nurse the plants. The company has recently extended their production in Serbia with a new orchard and is looking to the East Asian markets and RF to sell. The COVID-19 crisis put their investment of €1.5 mil at risk .
It was a blow below the waist for Heineken when all hotels, restaurants and cafes were closed. Sales dropped significantly and storage quantities increased. Heineken decreased local production and prevented lay-offs. The first days were difficult but then some sale restructuring was noticed between gastronomy and retail chains. An increase of sales was noted in connection with the relaxation of measures and the management of Heineken hope that with the summer period ahead and people mostly staying within the country, consumption of local beers and well-known brands will increase. Due their international orientation and activities, awareness and action was increased fast, separated personal shifts were introduced in order to keep business operations rolling during the crisis and risk of infection. Also, attention was given to cashflow as being part of a production chain, it was important that suppliers stayed financially operational.
Philips had different experiences since medical equipment was one of the most wanted goods in the previous period. Shifting from lighting to medical equipment proved to be beneficial during the crisis. It brought mainly supply chain challenges, with questions of how to organize distribution in an ethical and fair way. At the same time, the crisis also caused an imbalance in demand, as regular investments on medical technology were delayed due to higher priorities caused by COVID-19. Currently, they are focusing on how to proceed and secure their position in the coming period.
Regardless of whether they are as big as Heineken of Philips, or whether they are a small scale horticulture company involved in a urban greening or fruit tree cultivation, all companies unanimous agreed about the outcome of the recent period: The crises has shut some doors but at the same time, it definitely opened others. Upon the request of the companies, similar virtual gatherings will be organized again until we will be able to meet and greet in person again.