Italy-Serbia Forum 2024: a challenge especially for Italian companies

The Trieste Forum, which took place on May 24th, demonstrated the radical change of pace in Italy’s orientation toward Western Balkans and Serbia in particular.

Family Photo of the Summit: bottom left the Minister of Construction and Infrastructure Goran Vesić, the Minister of Energy and Mineral Resources Dubravka Djedović Handanovič, the Minister of Agriculture Aleksandar Martinović, the Minister of Trade Tomislav Momirovič, the Minister of Ecology Irena Vujović, Prime Minister Miloš Vučević, Italian Foreign Minister Antonio Tajani, Environment Minister Gilberto Picchetto Fratin, Senator Sandra Savino; above, from left: the director of the Serbian Development Agency Žarko Milićević, the director of FINEST Alessandro Minon, the administrator of SACE Alessandra Ricci, the Director of International Cooperation of CDP Paolo Lombardo, the President of SIMEST Pasquale Salzano, l the CEO of SIMEST Regina Corradini D’Arienzo, the President of the ICE Agency Matteo Zoppas, the Italian Ambassador to Serbia Luca Gori.

The participants of the Italy-Serbia Business Forum were the political actors of both countries and in particular the Italian government, which with the stipulation of the agreements signed by Cassa Depositi e Prestiti, SACE and Simest, provided a concrete form to its strategy of focusing on the Western Balkans, that is providing real funding and not just acting with exhortations and hopes, as it has been done for too long.

Italy brought 500 million euros worth of credit lines to the table. SACE has guaranteed up to 400 million euros, including 200 million euros for the Serbian Ministry of Finance, to support the country’s development plans and boost Italy’s presence in the transport, tourism, telecommunications, IT and energy sectors, as well as 200 million euros for Telekom Srbija to foster cooperation with Italian companies as suppliers of ICT equipment and audiovisual content.

The financing agreement between CDP and EPS was signed by Paolo Lombardo, International Cooperation Director of CDP and Dusan Zivkovic, acting Director General of EPS.

CDP has pledged to provide a 100-million-euro line of credit to Elektroprivreda Srbije (the state electricity enterprise) to support the company’s decarbonization process as it produces much of its power from low-grade coal in plants with a high environmental impact. This is the Italian state’s largest investment in a Serbian state-owned company in two decades.

The dynamic presence of the CDP Group in the country, with offices and local representatives of the parent company as well as of Simest and SACE, is in some ways compensating for the decline of the Italian business presence in Serbia. The data clearly show that in the first five months of 2024, 39 companies were opened in the country, of which only 24 were limited liability companies, followed by five representative offices and nine freelance businesses. Admittedly, this is purely quantitative data, however, lower than last year’s trend, when 105 businesses were opened, a result that is worse than the one recorded in 2022, when 131 businesses were registered.

Faced with the objective decline in the Italian companies’ interest in investing in Serbia, the current Italian government realized that the relevance of the Italian system in Serbia and the Balkans could not just be delegated to the choices of individual entrepreneurs. Thus, in a matter of just a few months, the Cassa Depositi e Prestiti Group opened offices in Serbia and became engaged in negotiations that led to the agreements signed on May 24. After years of absence, Italy once again became an active interlocutor in the economic fabric of this European area and is now able to sit at the table with the other stakeholders in the region’s socio-economic development – from the EBRD to the EIB, from the USAID to the German Kreditanstalt für Wiederaufbau and the French AFD. Italy is no longer just an interlocutor in political terms, but today an investor entitled to indicate and stimulate certain lines of socio-economic evolution in Serbia, Albania, and other countries in the region. This is an undoubted political success for Italy, a sign of the evolution of its regional strategy. From being a donor country in the early 2000s, Italy went on to become a promoter of strategic investments (banks, insurance companies, automotive) and today is a direct investor with a policy-based mechanism, that is, guided by disbursement conditionalities linked to the progressive liberalization of the energy sector in Serbia, to be realized also through concessions and tenders in the renewable sector that will create important opportunities for Italian companies.

From their side, Italian entrepreneurs abroad are accustomed to complaining about the absence of support from national agencies, being forced to do everything on their own, the lack of facilitated finance instruments or institutional representatives being deaf to their demands. These claims today, as far as Serbia and the Balkans are concerned, are groundless. It is up to Italian enterprises to structure themselves to seize the opportunities now available, pursuing a qualitative leap in terms of strategies and skills.

This post is also available in: Italiano

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