Stylianos Zakof, President of the Management Board HBA: We are working on improvement the current cooperation

As our countries have been recording better results in bilateral cooperation year-on-year, the HBA will provide all kinds of assistance within its capabilities to overcome obstacles

Greece traditionally represents an important economic and business partner of Serbia as the two countries have always enjoyed excellent bilateral relations reflected through important Greek investments in Serbia over the past 15 years. Unfortunately, the economies of both Serbia and Greece have been severely affected by this emerging crisis. In this fight against the Covid-19 pandemic, both countries struggle for the preservation of their economic systems.

Stylianos Zakof, President of the Management Board HBA

The economies of both Greece and Serbia have been hit by the crisis caused by COVID-19. What are your forecasts for the end of the year?

The Hellenic Business Association of Serbia (HBA) is witnessing an unforeseen period in which all parameters and predictions change from day today. 2020 economic perspectives largely depend on the duration of the pandemic and there is still great uncertainty in terms of more accurate forecasts of economic trends, but the World Bank’s latest projections show that the negative impact on the Serbian economy will be far weaker than in other European countries. As for Greece, the novel coronavirus has caused a nightmare regarding a recession that will possibly rise to 10 percent by the end of this year and perhaps even surpass this percentage. All in all, it is certain for both countries that the most difficult period, that is, the true dimensions of this crisis, will be revealed at the end of 2020.

What do you think of the measures adopted by the Serbian government and do you know to what extent Greek companies in Serbia have been affected by the crisis?

The government of Serbia had a timely and efficient response to the first peak of Covid-19 while addressing the health emergency, and the immediate economic impact. By undertaking sets of measures, it has chosen to take up the burden of sharply rising costs and loss in the private small and medium-sized sector and thus effectively help entrepreneurship. The main idea was to save jobs (as many as possible) and to maintain liquidity within the SME.

“We believe that the engagement of our association has contributed to some extent in the implementation of mentioned measures”

As has been proven so far, the strongest effects caused by the pandemic were illiquidity, lack of contact with clients and working time limitations, and specifically for Greek companies in Serbia, the biggest hit from coronavirus was to those in sectors of foodservice, hospitality, storage industry and real estate.  So, shortly after the declaration of a state of emergency in the country, in cooperation with other business chambers and associations, we requested government support for our member-companies that were most affected by the crisis. Those measures were, in one way or another, implemented in most countries, and businessmen agree that they are the most important ones.

What will the business world look like next year and which sectors will be most affected?

The ramifications of the coronavirus and its global economic impact will be felt for decades to come. While exactly how the pandemic will change the world is still unclear, what is certain is that business as we knew it has changed.

According to our opinion, three elements, in particular, will define the next normal, and businesses will need to come to terms with them in order to survive and thrive. First, there will be more government intervention and therefore greater scrutiny of business. How much, how fast, and in what ways governments will eventually reduce their economic role will be some of the most important questions of the next decade. Second, the world will see the rise of a contact-free economy. Areas, where the pandemic could prove to be a decisive turning point, are digital commerce, telemedicine, and automation. And finally, companies will need to reconsider how they can establish more resilience in the sense of building, or strengthening a backup or safety plan; be it deeper layers of succession planning or significantly expanding work-at-home capabilities for more employees. Under these circumstances, the future will be very harsh on sectors like commercial real estate, tourism, hospitality and retail.

What can be improved in the economic relations between Greece and Serbia?

Many Greek companies have recognised Serbia’s investment potential and have decided to locate and relocate their operations in Serbia. For some of them, Serbia serves as a manufacturing hub that enables duty-free exports to a market of almost a billion people. Others are attracted by the great level of highly skilled and easily trained workforce, an environment of good incentives and a business-friendly tax system. But it should be said that, despite the great interest in Greek investments in Serbia, the two countries have not yet explored opportunities and complementarities in many sectors.

Bilateral cooperation is not equally reflected in the commercial sector, where our overall bilateral trade volume still remains low, despite the huge potential. This can be addressed by jointly exploring opportunities and complementarities in sectors, such as agriculture, food and beverage, building materials, energy, information and communication technologies etc.

“Serbia is one of the few countries in South-Eastern Europe where companies from abroad have found the proper place for development and stability”

 What should the new Serbian government do to improve the business environment and attract new investors?

Our companies operating on the Serbian market are very satisfied with the overall business climate, as the country has already come a long way in adopting measures to stabilize public finances and to create a business friendly environment. During the last few years, consistent application of the ambitious structural reforms program has considerably improved the business and investment climate and has boosted economic activity. The state improved the business climate and worked on conditions related to fast incorporation and a favourable tax regime for foreign investors. Certainly, there are challenges that Greek companies face that need to be addressed to further promote trade and investment, related to modernizing the business legal framework by reducing red tape. Another challenge is harmonizing trade regulations to reduce the administrative costs that remain on certain goods, to eliminate technical barriers to trade and to facilitate the issuance of construction permits etc. Nonetheless, Serbia is one of the few countries in South-Eastern Europe where companies from abroad have found the proper place for development and stability.

“The HBA has adjusted its strategic plan to current conditions so that it can improve its services and adapt them primarily to the needs of its members”

HBA has continued its activities, and you are now organizing online events and seminars. Do you have any indications that the situation in 2021 will improve and that we will return to the old way?

Generally, we believe that next year will not be much different from this one, since it has been announced that the coronavirus vaccine will not be in use until 2022, at least as far as the healthy part of the population is concerned. The HBA has adjusted its strategic plan to current conditions so that it can improve its services and adapt them primarily to the needs of its members, but also to the needs of Greek entrepreneurs interested in the Serbian market during the Covid-19 pandemic. It is clear that segments that have to be addressed to a greater extent are those related to information sharing. Our plans for 2021 are aimed at conducting information seminars, panels and presentations for different sizes and types of companies, providing refined information on certain topics and guidelines on investment and financial opportunities in the country, and, of course, enhancing the existing ongoing dialogue between the association and system’s institutions in Serbia and Greece.

The HBA will certainly continue searching for new opportunities for business cooperation between the two parties and working on improving the current cooperation. As our countries have been recording better results in bilateral cooperation year-on-year, the HBA will provide all kinds of assistance within its capabilities to overcome obstacles. That is why we will boost activities aimed at better acquainting our members with the Serbian legislation, the market and the opportunities for its utilization. We strongly believe that the time has come for Greece and Serbia to make a greater effort by joining forces to overcome problems that hamper their truly great economic potential.

Social Responsibility

How important is it to be socially responsible in times of crisis and to contribute to the community?

This difficult time, if nothing else, brought a new dimension to the term “social responsibility”, both on the private and business level. Corporate social responsibility has become an integral part since companies today are expected to be continuing commitment in protecting the quality of life of the workforce and their families, as well as of the local community and society. We, as representatives of the HBA, are very glad that all our members have shown support to initiatives and activities that contributed to strengthening the traditionally friendly relations between Greece and Serbia, such as recent donations to the Serbian health care system.

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