6th June 2012

Dear Ladies and Gentlemen,

Greetings from the New President of the Cyprus-Serbian Business Association


It is with great honor and pleasure that you invited me here today to preside the Board of Director’s of the Cyprus-Serbia Business Association. I have no doubt that working systematically together we can further promote and develop the objectives of this association.

I first visited Former Yugoslavia in October 1998 as Manager of Cyprus Popular Bank’s then Representative Office in Belgrade and subsequently I worked in various positions in the acquired bank, Marfin Bank Serbia, ranking from vice president of the Board of Directors, Bank’s CEO culminating in my today’s position as Manager of the Bank’s Internal Audit Department. Throughout these years I experienced Serbia’s economic and political upheavals and admittedly a lot of legal and other reforms have been accomplished but still more reforms are needed in combating crime and corruption.

Serbia’s integration into the EU is one of the most important political issues at the moment.

As you are aware, early this year, Serbia got the status of candidate for entering the EU.

The next moves are in Serbia’s hands and I am optimistic. Serbia is a European country and belongs in the EU. A new President has recently been elected in Serbia who committed to continue his predecessor’s orientation for Serbia’s integration with Europe.  All milestones have been reached in response to clear progress and reforms. Recently the EU Commission issued, in my view, a very positive opinion on Serbia. Recognizing the considerable progress made, including praising the closure of The Hague Tribunal list of wanted people. The opinion also pointed to a number of areas where continual and systematic reforms are necessary, such as the judiciary, fight against corruption, structural weaknesses in the economic sector, energy efficiency and environmental protection. The Serbian Government recognizes all of these areas equally as priorities in the further reform process.

Serbia’s future lies within the EU. The overwhelming investment inflow into Serbia has come from EU countries. The EU countries are also by far the largest trading partners for Serbia, with 56% of total trade And when it comes to financial assistance and donations, the EU is the overwhelmingly largest donor with a total of 2.2 Billion Euros since 2001. On top of this comes the sizable bilateral assistance from the individual EU countries, including Cyprus.

There are a lot of similarities between Serbia and Cyprus, like religion, historical background and culture. Serbian cities, public utilities, households can learn from our experiences. Serbia can, so to “skim the cream” speak, and jump straight into taking advantage of our experiences and state of the art technological innovations by Cypriot and foreign Cyprus based companies.

There is a lot of cooperation potential on projects between Cyprus and Serbia.  So we need to better identify areas of business opportunities offering closer cooperation and pursue the same. The intention is to create employment and income in both countries, awareness of what is needed to meet EU standards and to increase the value of products and generate export income. Serbia is already a very good producer of fruit, which is an important export commodity with great potentials in agriculture. Also the well known ’Fiat“ car industry is now up and running in Serbia.

The focus should be on the economy, creating jobs and growth. An improved investment climate and ongoing steps to deal with Serbia’s red tape and cumbersome administrative procedures make it attractive for foreign and national investors. The recent White Book from FIC points to a number of areas that should be addressed. In many ways, Serbia is still suffering from a setback in modernization and economic development. The fight against corruption is also very important.

As for the issues in Serbian society things have changed tremendously since 2000. When I look back on the years I have been in Serbia; it is a positively different society today than fourteen years ago when I first arrived in Serbia. It is visible in the streets, in infrastructure, in political life, in everyday life, in public debate etc.

■ What Cyprus could give to Serbia?

The most amazing thing is that we top the list repeatedly. We have a well-organized society, with a high degree of social security.  In Cyprus, the system (society) takes care of people who cannot take care of themselves. In Serbia, people take care of each other. Which is best? It is difficult to say. I am happy. Why? Well, why not? It is much better to be happy than unhappy. If you have a choice: look at the glass as half full – or use humor: it does not matter if the glass is half full or half empty, as long as it has got Rakija (zivania)

Serbia has a transitional economy mostly dominated by market forces, but the state sector remains large and many institutional reforms are needed. The economy relies on manufacturing and exports, driven largely by foreign investment.

After renewing its membership in the IMF in December 2000, former Yugoslavia continued to reintegrate into the international community by rejoining the World Bank (IBRD) and the European Bank for Reconstruction and Development (EBRD). Belgrade has made progress in trade liberalization and enterprise restructuring and privatization, including telecommunications and small- and medium-size firms. It has made progress towards EU membership, signing a Stabilization and Association Agreement with Brussels in May 2008, and with full implementation of the Interim Trade Agreement with the EU in February 2010.  In addition Serbia has entered into a special bilateral Trade Agreement with Russia under very favorable conditions. Possibilities for a tri-party trade between Serbia-Cyprus-Russia should be exploited.

Serbia is also pursuing membership in the World Trade Organization. Structural economic reforms needed to ensure the country's long-term viability have largely stalled since the onset of the global financial crisis. Serbia, however, is slowly recovering from the crisis. Economic growth in 2011 was 2.9%, following a modest 1.7% increase in 2010 and a 3.1% contraction in 2009. High unemployment and stagnant household incomes are ongoing political and economic problems. Serbia signed a new $1.5 billion Stand-By Arrangement with the IMF in September 2011 that expires in March 2013. IMF conditions on Serbia constrain the use of stimulus efforts to revive the economy, while Serbia's concerns about inflation and exchange rate stability preclude the use of expansionary monetary policy. Serbia adopted a new long-term economic growth plan in 2010 that calls for a quadrupling of exports over ten years and heavy investments in basic infrastructure.

Serbia is still a transitional economy with unfinished privatization and incomplete structural reforms. Major challenges ahead include: high government expenditures for salaries, pensions and unemployment; a growing need for new government borrowing; rising public and private foreign debt; and stagnant levels of foreign direct investment. Privatization revenues have fallen precipitously in recent years, while a high percentage of economic activity remains in the hands of the state. Other serious challenges include an inefficient judicial system, high levels of corruption, and an aging population.

Factors favorable to Serbia's economic growth include a strategic location, a relatively inexpensive and skilled labor force, and a generous package of incentives for foreign investments.


Serbia’s EU accession, as well as access to markets of developing counties offer good opportunities for cooperation with Cyprus. On October 12, 2011 the European Commission recommended granting Serbia candidate status for membership in the European Union (EU). This landmark event on Serbia’s road to the EU reflects the significant progress Serbia has made so far in structural and institutional reforms. These reforms are preparing the country for the opportunities and challenges of join the ranks of European Union.

Cyprus and Serbia have been traditionally trading with numerous developing countries, and needs to explore options for returning also to these markets .This is important given the depth.  and length of the current international economic crisis and state of economies of some of the their major trading partners in the Western Europe. But tapping these opportunities is by no means automatic. Important internal challenges must be overcome and the way to compete with various competitions form the emerging world, primarily from Asia, needs to be found.

The need to success is for our Association to constantly pursue opportunities for business cooperation between Cyprus and Serbia. Cyprus in the light of its current unfavorable economic climate mainly affected by the economic crisis in Greece needs to implement and sustain a series of macroeconomic, sectoral and microeconomic reforms to make its economy much more competitive, productive and especially export-oriented in services and products. Unfortunately as a result of the Greek crisis at this point, 2,800 Greek companies are operating in Bulgaria, 25% of them was registered last year. Greek capital banks, headed by National Bank of Greece and EFG Eurobank are controlling one quarter of the Bulgarian financial sector and have major presence in Romania, Macedonia, Albania and Serbia. Laiki Group’s existence in Serbia lies back to 1997 when its first opened its representative Office in Belgrade and since the beginning of 2006 its subsidiary Marfin Bank as a result of its acquisition of a local bank thus this great expertise in the Serbian market has a lot to offer in boosting further the development and  progress of the Cyprus=Serbian Association for the mutual interest of both countries’ economies and beyond.


Cleovoulos Alexandrou ACIB

The Cyprus – Serbian Business Association is in the pleasant position to welcome with the CCCI at the 21st of May 2010 at 11:30a.m.

the H.E. President of Serbia Mr. Boris Tadic, together with other highly officials and a group of Businessmen for B2B meetings.


Please find enclosed the list of the participating companies from Serbia; you can fill the form with the companies you would like to have a meeting and send it back to CCCI at or fax: 22667593.