On Thursday and Friday, 16-17 February 2005, a delegation of EFG Eurobank Ergasias officials met with political leaders and businesspeople in Belgrade, on the occasion of the first anniversary of operation of EFG Eurobank AD Beograd.
On Thursday and Friday, 16-17 February 2005, a delegation of EFG Eurobank Ergasias officials met with political leaders and businesspeople in Belgrade, on the occasion of the first anniversary of operation of EFG Eurobank AD Beograd. Upon the first year of its operations in Belgrade, EFG Eurobank already has 11 branches, which will rise to 15 by the summer of 2005, and employs 258 people. The EFG Eurobank Group has a 93.5% stake in EFG Eurobank AD Belgrade. The Group’sCEO, Mr Nicholas Nanopoulos, the Deputy CEO, Mr Byron Ballis, Advisor and Head of the International Division Mr David Watson, and a number of high-ranking bank officials had meetings with the Serbian President, Mr Boris Tadic, the Deputy Premier, Mr Miroljub Labus, the Defence Minister, Mr Prvoslav Davinic, the Finance Minister, Mr Mladjan Dinkic, the Economy Minister, Mr Predrag Bubalo, and other members of the Government, as well as with the Governor of the Central Bank, Mr Radovan Jelasic. During these discussions, economic relations between the two countries were examined, as well as the European and world economic situations in general, and it was ascertained that there are ample prospects and opportunities for further cooperation.
EFG Eurobank is implementing a wide-ranging investments programme as a part of its strategy for developing its activities in Southeastern Europe. Specifically, in Serbia-Montenegro, alongside the growth of its autonomous EFG Eurobank AD Beograd network, it is negotiating with the privatisation authorities the potential acquisition of one of two banks now being privatised, Novosadska Banka and Continental Banka.
General Greek interest in investing in Serbia-Montenegro has intensified, as approximately 230 companies are already active in the region, which places Greece in the position of fourth biggest foreign investor in the country. With its significant presence in the Balkans, Eurobank is the connecting link for the growth of Greek businesses. In the context of this policy, and through invitation of EFG Eurobank, representatives of about 40 Greek businesses in industry, tourism and trade have established contacts in Belgrade with business partners and competent public officials. They also had the opportunity to meet members of the Government, who asked them to undertake investment projects in Serbia, which offers powerful tax incentives.
EFG Eurobank’s strategy aims at establishing a leading position in the wider Southeastern European region, a market of more than 50 million people. Eurobank has already carved out a strategic presence in Serbia-Montenegro, Bulgaria and Romania, while it is looking for opportunities for further expansion. The aim is that activities in Southeastern Europe account for 20% of the Group’s net profits, on a consolidated basis, by 2009.
The two-day meetings and contacts included the formal inauguration ceremony of the EFG Eurobank AD Beograd network on Wednesday, 16 February. On behalf of the Group, the Head of the International Division, Mr David Watson, said the bank offered a wide range of services on both the corporate and private individual banking levels, thanks to which it had been gaining ever bigger market share. HRH Crown Prince Alexander II said that his country was proud of the presence of so many foreign investors, including the EFG Eurobank Group, adding that Greece was very important for the future of Serbian economic development. The Deputy Mayor of Belgrade, Radmila Hrustanovic, hailed EFG Eurobank’s initiative and welcomed the Greek businesspeople to Belgrade.
A working luncheon was held for Greek businesspeople and members of the Serbian Government, in order to examine issues connected with Serbia’s economy and foreign investment. As Serbian Deputy Premier Miroljub Labus pointed out, “Investments in Serbia carry much less risk than most people think. Serbia’s gross domestic product increased by 8% in 2004.” He added that more investment is required in the sectors of telecommunications, including mobile telephony and the Internet. “In recent years, Greece has been one of the biggest foreign investors in Serbia,” he said. “It is characteristic that Greek companies have created about 18,000 jobs in Serbia-Montenegro in the past four years.” He added, “President Boris Tadic recently called on Greek investors to assume a more active role in Serbia by exploiting the favorable tax regime. In particular, the tax rate on business profits is 10%, the lowest in Europe. For investments of 8 million euros or more, businesses are exempt from tax for a ten-year period.” As Mr Labus pointed out, Serbia hopes to initiate negotiations on accession with the European Union as of 2006, with the aim of fully-fledged membership by 2012.
On the occasion of the inauguration, a special event was organised on Wednesday evening, hosting members of the Serbian government, as well as Greek and Serbian businesspeople. Serbian President Boris Tadic gave an address praising the contribution of Greek business to his country’s investment strategy. He said opportunities are on the rise, especially now with prospects of EU membership.
The CEO of the EFG Eurobank Group, Mr Nicholas Nanopoulos, said, among other things, that next month a positive feasibility report by the EU on prospects for launching Serbian-Montenegrin membership negotiations could be expected, and this was cause for satisfaction. “The prospect of further EU enlargement has encouraged a large number of successful Greek companies to seize quite early on the burgeoning opportunities offered by your reforming economies. Greek investors as a whole are now among the largest investors in the region, and in some countries they are the largest investors. In Serbia and Montenegro about 230 firms of all sizes have been established – out of which 150 are joint ventures and 80 are wholly-owned by Greek entrepreneurs. These enterprises include most major banks, making Greece the fourth largest investor in your country, behind the US, Germany and Italy. An interesting fact is that, starting from the year 2000, direct foreign investments, worldwide, have been on a downward trend, a trend that only recently has shown signs of partly reversing itself. Despite this, SE Europe, and particularly Serbia & Montenegro, in the same period have recorded strong growth in inward FDI. Also expected soon is the implementation of Greece’s National Plan for the Economic Reconstruction of the Balkans, worth 550 million euro, a plan that covers six countries in the Balkan region. For these reasons, we believe that this is the right moment to intensify our economic cooperation, to take full part in the reconstruction process and to strengthen our economic and trade relations.”
During the two-day visit of EFG Eurobank executives and other Greek businesspeople to Belgrade, contacts with economic and other officials continued on Thursday, 17 February, followed by a press conference. Mr Nanopoulos said, “Our Balkan strategy is not motivated only by considerations of geographical proximity, but also by a firm belief in the longer-term economic prospects of the region as a whole. It is also based on our confidence that we possess the capabilities, know-how and experience to make a positive contribution to the transformation process in the countries of the region. All countries have come a long way since the early – very difficult – days of transition, following the demise of the previous regimes. In the case of Serbia-Montenegro, of course, you had to contend with an extra, extremely painful, “lost” decade, the 1990s.
“Thanks to the experience acquired from Greece’s nominal convergence process and its membership of EMU, Eurobank possesses important know-how which we aspire to transfer to Serbia through EFG Eurobank AD Beograd. Our aim is to transform the Bank into a modern organisation comparable with the best in Europe. Serbia’s EU membership prospects will require full alignment with Single Market rules as well as preparations for adoption of the euro. With our experience, we hope to contribute to the adaptation and development of the Serbian economy and, thereby, to Serbia’s joining the family of advanced European economies. Our vision for EFG Eurobank is for it to become one of the country’s most dynamic banks patterned on the successful development model of Eurobank in Greece. We hope that in ten years the Bank will have established a leading position in the Serbian market, not just in size, but also in the breadth of its products, the quality of its services and its recognisability among the public at large”.
Particular plans for the growth of EFG Eurobank were presented by Mr David Watson, who said that modern products and services would be available for all sectors of the market, not just the retail sector, including investment advisory services and capital-market services for major businesses, both domestic and foreign. In this way, he said, a bridge will be built between Belgrade’s new capital market and potential investors in Greece and other countries where the Group maintains a strong presence. EFG Eurobank already provides services to small- and medium-sized enterprises and will concentrate more on this sector. To achieve these aims, two crucial factors will be involved – human resources and systems. The EFG Eurobank Group, he said, will support as a matter of priority the transfer of technical know-how through training and close cooperation between EFG Eurobank personnel in Greece and the affiliate’s personnel in Belgrade. As regards systems, it is vital that the bank continue investing in information technology to secure a safe environment as well as friendly and effective customer service.