November 16, 2005
Embassy of the United States of America
Belgrade

Remarks by Ambassador Michael C. Polt

U.S. – Serbia & Montenegro Trade and Investment Conference
Washington DC, November 14-15, 2005

Good morning, ladies and gentlemen, and best wishes from the U.S. Embassy in Belgrade.

I am pleased to speak to you electronically today on behalf of investment opportunities in Serbia and Montenegro. Our Embassy fully supports this joint Serbian and Montenegrin Trade and Investment Mission. Milan Parivodic, Serbia's Minister of International Economic Relations, together with Serbia's Economics Minister Predrag Bubalo, and Milutin Simovic, Montenegro's Minister of Agriculture, Forestry and Water Management, are leading this team. My thanks to the U.S.-Serbia & Montenegro Business Council for helping in this effort.

All of you are here today to learn about economic opportunities, about possibilities for exporting or importing or investment. I'd like to take just a minute to provide a brief assessment of the political environment investors will find here.

Most of you may already know that Montenegro's leadership intends to exercise its right under the agreement that formed the State Union of Serbia and Montenegro to call a referendum on whether Montenegro should continue as part of that Union, or become independent. This referendum may take place as early as April of next year.

The United States government does not take a position on this referendum or the future political status of Montenegro. This is a matter for Montenegrins to decide in a manner consistent with their Constitutional Charter and European and international norms.

However, no matter what the outcome of this initiative, I see no reason for the common ECONOMIC space of Serbia and Montenegro to be affected in any way by the country's political future. In fact, the U.S. government, together with the European Union and other international partners, will continue to work vigorously with the governments in Belgrade and Podgorica to fully open and harmonize economic ties between the two republics. The strengthening of this common economic space is in their best interest and of course for American investors.

Kosovo also has moved front and center, with the UN Security Council's endorsement of a political process designed to determine its future status. The United States - as part of the Contact Group together with France, Russia, Germany, Italy and the U.K. - has put forward a set of principles on which the process of defining final status should be based. Negotiations will be in full swing next year and they will be tough. Compromise will be the order of the day, and in the end, a successful resolution of Kosovo's future status should provide an economic boost that deserves an added measure of confidence by international investors.

Let's be frank. There are risk factors to investing in Serbia and Montenegro. But the business community is well aware of the issues, and it factors them into decisions to invest and lend. And it's hard to forget the events of the Milosevic regime. The 1990s was a very bad decade for Serbia and Montenegro, and for its neighbors. We all look forward to the day when indicted war criminals Ratko Mladic, Radovan Karadzic and Ante Gotovina arrive at the Hague to face justice, allowing Serbia, Bosnia and Croatia to pass another major milestone in their and the region's recovery.

The United States remains committed to Serbia and Montenegro's economic development as one of our main goals here. Maintaining the current momentum in attracting investment and further, vigorous economic reform should reassure the international investor. Working steadily through tough economic issues will demonstrate that Serbia and Montenegro, no matter what the political winds may bring, is committed to building prosperity through an economy that can compete in the global market.

And there is much happening in Serbia and Montenegro to encourage investors. Since arriving here more than a year ago, I have become an optimist about the future of this country, despite the obvious challenges. And I don't have to look far to find something positive to say on the economic outlook. On September 13, the World Bank named Serbia and Montenegro as the leading global reformer in its annual Doing Business survey.

This report assesses progress on improving the business environment. For example, by transferring the authority over business startups from a court to an administrative agency, Serbia cut the time it takes to start a new business from 51 days to 15. In Montenegro, the time to start a new business is even shorter: as short as one day in some cases, with an average of four days.

This is only one indicator of the commitment of the Governments of Serbia and Montenegro and its constitutent republics to improving the investment climate. Let me give you another one that's pretty impressive: Serbia, as part of its current IMF program, has agreed to a budget plan for 2006 that would produce a surplus of 2.3 percent of GDP. Macroeconomic stability is important to investors, and Montenegro has built a firm foundation for its economy by adopting the Euro and steadily reducing its budget deficits.

This commitment to a stable macroeconomic environment and to upgrading the business climate is very important to those of you considering investing in, or trading with, Serbia and Montenegro.

One of the key commitments Serbia has made under the final review of its IMF program is to privatize a majority stake in the oil refineries of Naftna Industrja Srbije. Sell-off of these assets will by itself help increase the influence of the private sector, a key development for improving productivity and growth.

Montenegro shares this commitment to strengthening the private sector. The government in Podgorica has just completed a tender to sell its controlling stake in the largest and last state-owned bank, Podgoricka Banka, with Societe Generale emerging as the winner. In addition, Montenegro plans to sell its tobacco company, a lottery company, three major hotels, and the largest winery next year.

Serbia has privatized more than 1,000 so-called socially owned enterprises over the past five years, but the process continues. Of a group of some 80 large industrial companies now undergoing restructuring, the government intends to open tenders for 25 by the end of the year. The Privatization Agency will auction more than 400 smaller companies by the end of the year, and the process will continue next year. Share packets in more than 200 other companies will be sold on the Belgrade Stock Exchange.

I urge you to look at this process as a value investor. This term generally is understood to mean investing in an enterprise whose current market value is less than its intrinsic value. I would argue that many, many productive assets in Serbia and Montenegro have been undervalued because of the political risk attached to the region.

I am less nervous about this risk because I live here and I am able each day to talk with successful foreign investors from many countries, American, Austrian, French and others, about the rich rewards they are reaping from their decision to invest in Serbia and Montenegro. They know first-hand the value of investing in a hard-working, well-educated country that is focused on finding its way into full Euro-Atlantic integration.

On November 7, Serbia and Montenegro officially began negotiations with the European Commission that will lead to full membership in the European Union. As we all know, the value of real estate has a lot to do with the neighborhood. I urge you to take a good hard look at investing in Serbia and Montenegro, while there are still many good deals to be had.

I look forward to reports of successful American business ties created at this conference.

Thank you.

16. novembar, 2005
Ambasada Sjedinjenih Američkih Država
Beograd

Izjava Ambasadora Majkla K. Polta

Investiciona i trgovinska konferencija SAD-SCG
Vašington, Novembar 14-15, 2005

Dobro jutro dame i gospodo, želim vam sve najbolje iz Američke ambasade u Beogradu.

Veliko mi je zadovoljstvo da mogu da vam se danas obratim elektronskim putem i govorim u prilog ulaganja u Srbiji i Crnoj Gori. Ambasada u potpunosti podržava ovaj zajednički trgovinsko-investicioni tim. Milan Parivodić, Ministar za međunarodne ekonomske odnose Republike Srbije, Predrag Bubalo, Ministar ekonomije Republike Srbije, i Milutin Simović, Ministar poljoprivrede, šumarstva i vodoprivrede Republike Crne Gore predvode ovaj tim. Zahvaljujem se i Poslovnom savetu SAD-SCG koji je pomogao ovaj događaj.

Danas ste ovde da bi ste saznali nešto više o ekonomskim mogućnostima izvoza, uvoza ili ulaganja. Hteo bih samo na trenutak da vam dam kratku procenu političke klime sa kojom se investitori ovde susreću.

Većina vas sigurno zna da rukovodstvo Crne Gore namerava da iskoristi svoje pravo u okviru sporazuma po kojem je formirana državna zajednica, i da održi referendum na kojem će se odlučivati o tome da li će Crna Gora ostati deo zajednice ili će postati nezavisna. Ovaj referendum može se održati već u aprilu sledeće godine.

Sjedinjene Američke Države nemaju unapred utvrđenu poziciju u vezi ovog referenduma ili budućeg političkog statusa Crne Gore. To je nešto što narod Crne Gore mora odlučiti sam i to na način koji je u skladu sa Ustavnom poveljom kao i evropskim i međunarodnim normama.

Pa ipak, bez obzira kakav će biti ishod ovakve inicijative, ne vidim razlog zbog kojeg bi politička budućnost zemlje uticala na zajednički ekonomski prostor Srbije i Crne Gore. Zapravo, vlada Sjedinjenih Američkih Država, zajedno sa Evropskom unijom i drugim međunarodnim partnerima, nastavlja da snažno sarađuje sa vladama u Beogradu i Podgorici kako bi se potpuno ostvarile i harmonizovale ekonomske veze između dve republike. Jačanje zajedničkog ekonomskog prostora je u njihovom najboljem interesu, a naravno i u najboljem interesu američkih investitora.

Kosovo se, posle odluke Saveta bezbednosti Ujedinjenih nacija o početku političkog procesa koji treba da odluči o njegovom budućem statusu, nameće kao centralno pitanje. Sjedinjene Američke Države - kao deo Kontakt grupe zajedno sa Francuskom, Rusijom, Nemačkom , Italijom i Velikom Britanijom - postavile su niz principa na kojima proces određivanja konačnog statusa treba da se bazira. Naporni pregovori biće u punom zamahu sledeće godine. Kompromis će biti glavna tema ovih pregovora, a uspešno krajnje rešenje budućeg statusa Kosova treba da omogući i ekonomski zamah koji zaslužuje dodatno poverenja međunarodnih investitora.

Budimo iskreni, u Srbiji i Crnoj Gori postoje faktori rizika za investiranje, faktori koji su poslovnoj zajednici dobro poznati i koje ona uzima u obzir kada ulaže i kreditira. Još uvek je teško zaboraviti događaje iz Miloševićevog režima. Devedesete su bile nepovoljna dekada i za Srbiju i Crnu Goru ali i za njene susede. Očekujemo dan kada će optuženi za ratne zločine Ratko Mladić, Radovan Karadžić i Ante Gotovina otići u Hag pred lice pravde i tako dozvoliti Srbiji, Bosni i Hercegovini i Hrvatskoj da pređu još jedan veliki korak ka svom oporavku i oporavku regiona.

Sjedinjene Američke Države ostaju i dalje odlučne u podršci ekonomskom razvoju Srbije i Crne Gore kao jednom od svojih najvažnijih ciljeva u ovoj zemlji. Održanje postojećeg zamaha u privlačenju investicija i dalje, snažne, ekonomske reforme trebalo bi da ohrabre međunarodne investitore. Temeljan rad na teškim ekonomskim pitanjima pokazaće da je Srbija i Crna Gora, bez obzira na to šta će doneti političke promene, odlučna da razvija ekonomiju koja može da bude konkurentna na globalnom tržištu.

Mnogo toga se dešava u Srbiji i Crnoj Gori što predstavlja ohrabrenje za investitore. Od kada sam došao ovde pre više od godinu dana, postao sam optimista kada je u pitanju budućnost ove zemlje i to uprkos očiglednim izazovima. Veoma mi je lako da kažem nešto pozitivno kada je u pitanju budući ekonomski razvoj. 13. septembra Svetska banka je u svom godišnjem izveštaju o globalnom poslovanju proglasila Srbiju i Crnu Goru za vodećeg reformatora.

Ovaj izveštaj ocenjuje koliki je napredak postignut u poboljšanju poslovne klime.
Na primer, transferom ovlašćenja vezanih za registraciju novih preduzeća sa suda na administrativnu agenciju, Srbija je smanjila vreme koje je potrebno da se registruje novo preduzeće sa 51 dan na 15 dana. U Crnoj Gori je vreme koje je potrebno da bi ste registrovali novu firmu čak i kraće, toliko kratko da je za to ponekad potreban samo jedan dan, a prosečan vremenski period je četiri dana.

Ovo samo pokazuje nameru vlada Republike Srbije i Republike Crne Gore da poboljšaju investicionu klimu. Pomenuću nešto što je prilično impresivno: Srbija je pod sadašnjim programom MMF-a prihvatila da planira budžet za sledeću godinu sa suficitom od 2,3 procenta BDP. Makroekonomska stabilnost je važna za investitore i Crna Gora je postavila čvrste temelje za svoju ekonomiju usvajajući evro i lagano smanjujući svoj budžetski deficit.

Ova obaveza za stabilnom makroekonomskom klimom i unapređenjem poslovne klime je veoma važna za one koji razmišljaju da investiraju ili trguju sa Srbijom ili Crnom Gorom.

Jedna od osnovnih obaveza koje je Srbija ispunila posle konačnog izveštaja MMF-a, je da privatizuje većinski deo vlasništva u rafinerijama Naftne Industrije Srbije. Prodaja ove imovine će sama po sebi povećati uticaj privatnog sektora, osnovnog elementa za razvoj i poboljšanje proizvodnje.

Crna Gora takođe želi da osnaži privatni sektor. Vlada u Podgorici je upravo okončala tender na kojem je prodala većinsko vlasništvo poslednje i najveće banke u društvenom vlasništvu, Podgoričke banke. Pobednik ovog tendera je banka Sosiete Ženeral. Crna Gora, pored toga, planira da sledeće godine proda svoju duvansku industriju, lutriju, tri velika hotela i najveću vinariju.

Srbija je privatizovala više od 1000 društvenih preduzeća u poslednjih 5 godina ali je to proces koji se nastavlja. Od ukupno 80 industrijskih preduzeća, takozvanih "preduzeća u procesu restrukturiranja", vlada namerava da raspiše tender za 25 takvih preduzeća do kraja godine. Agencija za privatizaciju će ponuditi putem aukcije više od 400 manjih kompanija do kraja godine, a proces će se nastaviti i sledeće godine. Paketi deonica u više od 200 kompanija prodaće se na Beogradskoj berzi.

Ohrabrujem vas da na ovo gledate kao investitor koji ulaže u vrednost. Ovaj termin obično podrazumeva ulaganje u posao čija je tržišna vrednost manja od njegove stvarne vrednosti. Tvrdim da je vrednost mnogih, mnogih proizvodnih postrojenja u Srbiji i Crnoj Gori potcenjena zbog političkih rizika vezanih za ovaj region.

Nisam toliko zabrinut zbog ovih rizika jer živim ovde i u mogućnosti sam da razgovaram sa uspešnim stranim investitorima iz mnogih zemalja: Amerike, Austrije, Francuske i drugih. Razgovaram sa njima o bogatim plodovima koje ubiru zbog odluke da investiraju u Srbiji i Crnoj Gori. Oni iz prve ruke znaju vrednost investiranja u vrednu i obrazovanu zemlju koja je usredsređena na pronalaženje svog mesta u evro-atlanskim integracijama.

7. novembra Srbija i Crna Gora je i zvanično započela pregovore sa Evropskom komisijom, pregovore koji vode ka punoprvanom članstvu u Evropskoj uniji. Svima nam je dobro poznato da cena nekretnina zavisi od susedstva u kojem se nalazimo. Pozivam vas da dobro razmotrite investiranje u Srbiji i Crnoj Gori dok u njoj još postoji mnogo dobrih prilika za poslovanje.

S nestrpljenjem očekujem izveštaje o uspešnim američkim poslovnim vezama uspostavljenim tokom ove konferencije.

Hvala.

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