Mr. Zelenović, after long and thorough analysis world-known Japanese company -Yazaki decided to invest in Šabac. What were the main reasons for their decision?
The location analysis and selection process started in February 2015 and was led by the Serbia Development Agency. After a long and lengthy process which included 8 cities in Serbia and regional competitors – Bulgaria and Romania, Yazaki decided to select our City for their new production facility. Why?
Sabac is a city of 115.000 inhabitants with good skill base and industrial tradition. We host the largest Industrial Zone in Serbia and regionally, over 200ha of it in the Free Zone status, equipped with infrastructure, utilities and with roads. Sabac is logistically well positioned with access to two European transportation Corridors and very close to the capital city of Belgrade and Belgrade Airport.
We have learned a lot about ourselves during the whole process and have faced quite a few challenges. Overcoming these challenges openly helped us build the confidence of Yazaki..
I believe that soft factors also had impact in the selection process – existence of the 4 star Hotel Sloboda with 180 rooms, an active local theatre and rich cultural life, recent construction of the pool, reconstruction of parks and other investments making life easier and more enjoyable for all in Sabac.
Tell us more about Yazaki investment and how will that reflect on the future of Šabac and its economy?
Yazaki decided to invest in the most natural way, by acquiring the land in our Free Zone and will build the production facility worth 25 million euros. More importantly, their goal is to reach 1.700 employees in the next 3 years. The impact of this investment will be tremendous.
This project alone has the potential to reduce the unemployment rate in the wider region of Macva by a staggering 10%. At the same time, the budget of Sabac will have annual income of over 1.2 million euros just from the personal income tax from employees and other income associated with the facility. Yazaki also selected a consortium of local companies led by a local champion for construction of the facility. Not to mention the impact on service providers, from logistics to catering or subcontractors.
Yazaki is a family owned Japanese company with 290.000 employees, present on all continents and with turnover of close to 15 billion euros. They are very conservative in the decision making process and selection of Sabac is a testimony on its own about how we approach investors. We will surely reap other benefits, as our goal – being a reliable partner is now verified by a globally recognizable company.
Besides Yazaki, Šabac already welcomed Vopachel, Royal de Heus, SBE, Camozzi and few other investors. What is your experience with those projects so far? What was their impact on the economy of Šabac?
Indeed, Italian investors were one of the first international tenants of our Zone. We have a great experience with them and all projects are going as planned. They hire local staff even for managerial positions and it gives a lot of opportunity for employees to acquire new skills for the future. Austrian “Mondi” is one of our users for quite some time. At the same time we still have a lot of talent waiting for opportunities.
It should also be mentioned that Šabac is home to a number of home grown companies and that we have a very active entrepreneurial community. This year alone 20 local companies have acquired land in the Industrial Zone, to name a few - "Čedanit", "Slavija", "Lama lumi", "Siti", "Sani", "Dekor luks"...- . We have sold around 120ha of Industrial Land so far.
Šabac has a long history in chemical industry, but also agriculture, metallurgy, etc. What are the most developed sectors in Šabac, and for what do you believe there is a potential for further development?
The chemical and related industries, led by Zorka Holding in previous days were not able to endure the difficulties in the 90’s in previous size and shape. But we were lucky - due to a large part in the previously mentioned local entrepreneurial spirit, we now have a local champion Elixir producing fertilizers important for our other source of income – agriculture. Once a local company and now a part of Stada, pharmaceutical producer Hemofarm also has invested in Sabac. What also started locally as Zorka Color is now a part of the Finnish Tikkurila Group and Austrian Asamer Group owns Zorka Keramika which deals in production of ceramic tiles. So we managed to reduce the impact in that period. Metallurgy sector is represented by local entrepreneurs and the presence of a rolling facility of Hesteel Group, a Chinese company and one of global leaders in the industry.
Macva region, centered in Sabac, is also an important agricultural environment. We have a plan to more than double the income from agriculture. We have invested a lot to clean the canals and supported the construction of irrigation wells which led to over 1.000ha of irrigated land under strawberries. We have 84 active projects in our strategy for development of agriculture.
One of 14 Free Zones in Serbia is located in Šabac. Do you believe that is also an advantage in attracting investors? What are the advantages of operating in Free Zones Šabac?
Even though benefits of operating in Free Zones deserve a second look in terms of advantages of operations, I can say that there is a definite interest in it. This is reflected by the fact that our Free Zone Sabac has extended to encompass a part of Ruma Industrial Zone because that was the request from their users. Currently the main advantages lie in VAT exemption from imported material and components as well as energy used for operations such as electricity or gas and reduced administration – each Zone has a Custom Administration point. Providing a form of fiscal benefits would surely make the status of the Free Zone more interesting to investors.
What would be your message to foreign companies that are planning to do business in Šabac or that are considering Šabac as an investment destination?
As administration we have done a lot to reduce red tape and to speed up procedures. An example of this is that one becomes an owner of the land in just 35 days. We have implemented the ISO management system in the municipality and we own the Business Friendly Certificate issued by NALED. We have one of the lowest ratios of public servants per inhabitant.
Even though our Zone is already attractive we constantly think of improvements. We have invested in the waste water treatment facility with the support of the German Development Bank making our Zone more interesting to specific investors. We are also upgrading our energy offer with EPS.
One can frequently hear expressions such as “No problem” or “Piece of cake”. Business is never a piece of cake nor does it go without problems. Our approach is that good organization, persistence and genuine readiness to listen is the key component of success.
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