In 2023, the Development Fund will be focused primarily on micro, small and medium-sized enterprises and development projects
We spoke with Tatjana Matić, the director of the Development Fund, about ways in which the Fund helps the domestic economy, inequalities in society, economic and social development, and the Fund’s plans for this year.
You have had a long and abundant career. You were appointed to important positions in state institutions. To what extent is the position you are currently holding different from previous ones, and how is that previous experience currently benefiting you?
The experience I gained as the Minister of Trade, Tourism and Telecommunications is a huge advantage for me in terms of becoming a successful director of the Development Fund. The jobs I had done before I was appointed a government minister, such as the state secretary and other responsible positions, helped me to acquire great knowledge in terms of managing capital projects and large teams, and cooperating with businesses. Perhaps the greatest experience I have gained during 20 years of working for my country relates to acquiring and developing the skills like long-term planning, forming a clear vision and setting and achieving high goals for the benefit of the economy and society. Although these goals once seemed impossible, due to global upheavals, such as the pandemic-induced crisis, I have managed to find formats that will not only help sensitive economic branches like tourism flourish but also develop them further despite unforeseen and unfavourable circumstances. Since the Fund’s goal is to facilitate entrepreneurship, the implementation of good ideas, and business growth that will generate multiple profits in the economic sense, I am very excited about the opportunity to express myself in this position.
The Fund still provides the best terms and conditions on the financial market both in regard to interest rates and payment terms
How difficult is it to be a woman in Serbian politics and entrepreneurship today?
In my work, I try not to pay attention to discrimination or to fuss about the obvious obstacles that are placed on every woman who tries to express herself professionally. I simply focus on work and try to positively and constructively deal with the prejudices related to the position of women in our society. I have to admit that it would all be impossible if I didn’t have the support of my family and my mentors. In our society, but also European countries and the rest of the world, women in responsible positions, with successful careers, are still an object of astonishment. There has been some progress made, but we need to continue pointing out the need for equal opportunities. I have repeatedly spoken about the fact that equality is also an economic growth factor because women are equally capable of making a profit and contributing to overall social progress, as well as bringing a creative and development-oriented spirit to any job for which they possess skills.
The Development Fund is one of the oldest state institutions in Serbia and has decades of experience in cooperation with businesses. Can you tell us more about the Fund’s activities and plans for 2023?
For many years, the Development Fund has been focusing on economic growth, and when we planned our activities for the next period, our emphasis was on the good practices that the Fund has implemented so far, but also on improving its activities, especially when it comes to digitalization and sustainable development. In 2023, the Development Fund will be focused primarily on micro, small and medium-sized enterprises and development projects. We are continuing to grant loans, both investment-related ones and loans for permanent working capital.
In addition to the loans approved under the Fund Programme, we are continuing to implement the programme in cooperation with the Ministry of Economy, which was launched eight years ago and relates to the allocation of grants provided by the Serbian state budget. This is the programme for beginners in business and young people, the programme for women entrepreneurs and the development programme for business entities that have been in business for a long time. We are also continuing to implement the Recovery and Development Programme, which includes a credit line from EIB funds, which, in turn, ensures the approval of loans for a period of up to 12 years, with a grace period of up to 2 years. This year, we are continuing our long-term cooperation with the Ministry of Tourism and Youth in the implementation of the Regulation on the Conditions and Manner of Granting and Using Credit Funds to Improve the Quality of the Tourist Offer.
Given that business loans are becoming substantially more expensive due to the growing benchmark interest rates, how much has the importance of the Development Fund for investment lending to domestic businesses increased?
The Fund still provides the best terms and conditions on the financial market both in regard to interest rates and payment terms. This will make it even more attractive for domestic businesses this year. Investment loans are approved with a payment term of up to 10 years for companies, or 8 years for small businesses with a grace period of up to one year. Also, interest rates are still far below the current National Bank of Serbia’s benchmark interest rate.
In total, in the past year, the Fund approved 7.3 billion dinars in loans and 627 million dinars in grants
How do you support decentralization and the even development of all parts of Serbia, programme-wise and financially?
The Development Fund has special terms and conditions when approving loans to companies that operate in underdeveloped areas which belong to the third and fourth groups of development. The Fund provides better conditions related to security instruments and for programmes that are implemented with the Ministry of Economy and has a larger amount of available grants.
To what extent can the Development Fund match the subsidies granted by the Serbian government to foreign investors? Have the subsidies granted to domestic companies reached the level of those granted to foreign ones?
The Development Fund approves loans under the same conditions to companies registered in the relevant register on the territory of the Republic of Serbia, regardless of whether their founder is a foreign or domestic legal or natural person.
Will you continue implementing assistance and support programmes for small and medium-sized enterprises in 2023 in order to overcome the consequences of the coronavirus pandemic? What are your assessments regarding the potential for the economy’s return to the pre-pandemic level?
The Fund continues to implement support programmes for micro, small and medium-sized enterprises, including small businesses, both through the implementation of the Fund Programme that provides extremely favourable lending conditions and through the Programme that we implement with the Ministry of Economy. These programmes are ongoing and important especially because segments of certain grants are approved together with loans. All programmes aim to ensure that businesses can overcome pandemic-related consequences much easier. In 2022, the Development Fund of the Republic of Serbia approved a total of 491 applications, namely 58 for investment loans, 136 for start-ups, 87 for development projects, 52 for women’s entrepreneurship, 50 for young people, etc. In total, in the past year, the Fund approved 7.3 billion dinars in loans and 627 million dinars in grants. As all these investments show great results not only in terms of recovery but also in terms of development, we will continue to support both the businesses and capable people.