Explore the BalkansBusinessOpportunities in Serbia, Macedonia and MontenegroPertti Ikonen, Ambassador

Igor Madzarevic, Economic Advisor

Embassy of Finland in Belgrade

Serbia• GDP growth in 2017: 2.0% (World Bank; Global Economic Prospects; January 2018)

- Expected to be 3.0% in 2018 and 3.5% in 2019 (from 2.8% in 2016).

• Fitch's credit rating: BB with stable outlook

• World Bank Doing Business Ranking: 43 in 2018 (47 in 2017; 54 in 2016)

• Trade between Finland and Serbia in 2017 (Finnish Customs): 54.5 million EUR- Exports (from FI): 27.9 million EUR (paper; plastics; electrical machinery); 6% increase compared to 2016.- Imports (to FI): 26.6 million EUR (electric machinery; mechanical machinery; footwear); 25% increase

compared to 2016.

Helsinki, 27.3.2018. 2

World Bank Doing Business Ranking (2018)

11. Macedonia

13. Finland

42. Montenegro

43. Serbia

45. Romania

50. Bulgaria

80. Kenya

147. Tanzania

Macedonia

• GDP growth in 2017: 1.5% (World Bank; Global Economic Prospects; January 2018)- Expected to be 3.2% in 2018 and 3.9% in 2019 (from 2.4% in 2016).

• Fitch's credit rating: BB+ with positive outlook

• World Bank Doing Business Ranking: 11 in 2018 (10 in 2017; 16 in 2016)

• Trade between Finland and Macedonia in 2017 (Finnish Customs): 8.6 million EUR- Exports (from FI): 4.7 million EUR (mechanical machinery; plastics; electrical machinery); the same level as

in 2016.- Imports (to FI): 3.9 million EUR (clothing; electrical machinery; footwear); 18% decrease compared to 2016.

Helsinki, 27.3.2018. 3

World Bank Doing Business Ranking (2018)

11. Macedonia

13. Finland

42. Montenegro

43. Serbia

45. Romania

50. Bulgaria

80. Kenya

147. Tanzania

Montenegro• GDP growth in 2017: 4.2% (World Bank; Global Economic Prospects; January 2018)

- Expected to be 2.8% in 2018 and 2.5% in 2019 (from 2.9% in 2016).

• S&P credit rating: B+ with stable outlook (Fitch’s credit rating not available)

• World Bank Doing Business Ranking: 42 in 2018 (51 in 2017; 48 in 2016)

• Trade between Finland and Montenegro in 2017 (Finnish Customs): 3.1 million EUR- Exports (from FI): 2.7 million EUR (mechanical machinery; electrical machinery; medical equipment); 58%

decrease compared to 2016.- Imports (to FI): 0.4 million EUR (iron and steel; rubber; medical equipment); 129% increase compared to

2016.

Helsinki, 27.3.2018. 4

World Bank Doing Business Ranking (2018)

11. Macedonia

13. Finland

42. Montenegro

43. Serbia

45. Romania

50. Bulgaria

80. Kenya

147. Tanzania

Team Finland Activities• Team Finland companies:

- 10 Finnish companies (ABB, Elomatic, Infrakit office, KKM Power, KONE, Lindstrom, Metso office, NOKIA Solutions and Networks, PKC Wiring Systems, Taaleri Energia) - Around 50 distributors of different equipment and solutions (Fiskars, KPA Unicon, Molok, Nokian Tyres, Planmeca, Vaisala, Valtra, etc.)

• Contact establishment and basic advisory services- Country Outlooks on the market opportunities platform: www.marketopportunities.fi

• Team Finland visits to the cities in Serbia (May, September, November) and Nordic Delegation visits in cooperation with the Nordic Business Alliance in Serbia; Seminars: Procurement (29th

May), Digitalization (9th October), “Doing Business with Finland in Macedonia” (25th October).

• Company promotion events; Updating of Team Finland brochure.Helsinki, 27.3.2018. 5

Business Opportunities

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Serbia• Environment: Estimated 15 billion EUR investment needed

- Waste management (5.6 billion); Wastewater treatment (4.9 billion); Industrial pollution and noise reduction.

• Energy: District Heating and power plants modernization- 57 District Heating plants (240 million EUR investment need until 2020).- Power plants (focus on renewables, especially wood biomass; 70% of electricity production comes from coal).

• IT industry: High quality outsourcing opportunities- Export of IT services in 2017: 900 million EUR.- Yearly growth rate: 21.5% in 2017 (more than 20% each year).

• Other industries: Infrastructure, medical sector, automotive industry, food processing, metal processing (machinery), textile industry, tourism (medical tourism included)

Helsinki, 27.3.2018. 7

Macedonia• Environment: Wastewater treatment plants, waste management, air quality

- Modernization of power plants needed (66% of electricity production comes from coal).- Air quality (2nd most polluted country in Europe; Skopje, Bitola, Tetovo- the most polluted cities in Europe).- Twinning project "Strengthening the capacities for effective implementation of the acquis in the field of nature

protection“ by Metsähallitus and SYKE.

• Agribusiness and food processing: Fruits and vegetables, beverages (wine)- 49% of agricultural land; One of the fastest growing industries; EU investment support.

• Manufacturing (outsourcing potential): Textile industry, automotive industry- Textile industry (Over 450 million EUR exports annually; 12.4% of total country exports in 2016).- Automotive industry (Components for automotive industry).

• Other industries: Metal processing, Energy, ICT

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Montenegro• Tourism: Construction of exclusive hotels and infrastructure.

- In 2016 generated 12,000 jobs (6.5% of total employment); contribution of 11% of GDP; 883 million EUR in visitor exports; 88.8% leisure spending; 1.9 million arrivals.

• Environment: Estimated 1.42 billion EUR investment needed- Wastewater treatment (28% of waste water treated in urban areas); Waste management (354.8 million); Air

quality (5th most polluted country in Europe; Pljevlja among the most air polluted cities in Europe).

• Energy: Power plants modernization and construction of small HPP- Reconstruction of Pljevlja power plant (40 million EUR)- Italy’s A2A stepping out from Elektorprivreda Crne Gore

• Other industries: Infrastructure, metal processing, medical sector, nautical, food processing (wine)

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Thank You

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