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Azza El-Abd, USAID’s Mission Director For Serbia

Helping Serbian Businesses To Thrive

USAID assistance during the past five years has helped Serbia adopt and implement regulations that make it easier for businesses to operate and prosper in Serbia. We intend to continue promoting this kind of initiative

We spoke with USAID Mission Director for Serbia Azza El-Abd about USAID support to reforms in Serbia.

Which areas of intervention were addressed, and what achievements have been made during the five-year cooperation cycle that ended in 2017?

– Working with the government of Serbia, the private sector and civil society, USAID supported reforms that made it easier for businesses to obtain construction permits, hire the employees they need, and comply with business inspections. It also made these processes more transparent. This has resulted in increased construction activity and construction-related jobs; it has moved companies out of the shadow economy, decreased opportunities for corruption, and, according to the World Bank’s 2018 Doing Busi-ness Report, made Serbia the tenth best country in the world for ease of obtaining a construction permit. Prior to these reforms, Serbia was ranked 186th on the Doing Business Report when it came to obtaining construction permits.

USAID has also worked with Serbian institutions to support and strengthen small and medium enterprises (SMEs). This assistance has helped businesses expand and resulted in the creation of 487 full-time and 159 part-time jobs in 12 municipalities in these regions during the period of 2013-2018. Opportunity Bank of Serbia, which USAID helped to capitalise, has provided over €472 million since 2007 in loans to micro-enterprises, small agricultural producers, and others who cannot access loans otherwise.

How much is this progress visible to the ordinary citizen?

– Since 2001, the United States has provided nearly $1 billion in assistance to Serbia. Recently, we launched an interactive map on the Embassy website that shows how widespread our assistance has been.

There are more than 1,850 points on this map. Each point represents an activity that U.S. assistance supported — from renovating schools, to paving roads, or to restoring places of cultural significance. I encourage the Serbian public to visit the site to see how U.S. assistance has benefited their communities and their country. The map captures only that infrastructure which we’ve supported. Other programs have provided technical assistance to the governmental, private sector and civil society institutions to advance reforms that boost the economy and strengthen the rule of law for the benefit of Serbia’s citizens.

For instance, our rule of law support has helped the Serbian government adopt and implement its first Whistleblower Protection Law, making it safer for individuals to report corruption and fraud. As part of our support, USAID set up a hotline by which people can safely report the abuse of public resources, and we have also trained more than 1,200 judges and judicial staff on how to adjudicate whistleblowing cases. Four court decisions have already been rendered in favour of whistleblowers — often providing financial compensation and restoring their positions, thus proving that the law is already protecting whistleblowers. More than 25 whistleblowers have been provided temporary protection as their cases move forward.

What is your focus today now that the new cycle of support to the Serbian economy has started?

– Currently, USAID is helping to strengthen Serbia’s economy through programmes that bolster the competitiveness of the private sector. We are working with the Serbian public and private sector to increase the competitiveness of the food processing industry, particularly the fruit and vegetable sectors by connecting producers to finance, marketing, and research and development institutions that can help them increase the value of their products and successfully expand to new markets.

For seven consecutive years, the USAID Business Enabling Project (BEP) has surveyed Serbian businesses to determine their views about the quality of the business environment. What progress if any have you noticed over the years?

– USAID BEP’s annual survey steadily grew into a nationally recognized tool for mapping the key challenges to Serbia’s economic development and establishing priorities for economic reform. More importantly, it has become a tool to assist policymakers in resolving key obstacles to sustainable growth in the Serbian economy. The seventh edition published in October 2017 was no exception.

I encourage the Serbian public to visit the Embassy website with an interactive map representing activities that U.S. assistance supported

The effects of recent economic reforms on Serbia’s private sector are evident. The companies taking part in the survey say they spend three times less money and time on paperwork than they did in 2011. In last year’s survey, we saw that more than half of businesses believed their earnings would be higher next year, and nearly one-third of them planned to hire more workers.

Furthermore, we see the positive impact that the Law on Inspection Oversight, developed with USAID assistance, is having on Serbian businesses.

Public administration reform is one of the key areas in EU accession negotiations. What does the Grey Book of Public Ser-vices says about the most pressing challenges that have to be addressed?

Recently, USAID supported the European Movement in Serbia in developing the Gray Book of Public Services, which contains research findings of Serbia’s public services and recommendations for improving their quality, efficiency, and accessibility. The goal is to improve the responsiveness and accountability of the Serbian government and the quality of services in three specific areas: health, education, and the administration of personal documents.

In terms of promoting better administration, which are the areas of support that Serbia can count on?

Much of your intervention in the past, both at the national and local levels, evolved from digitalisation. Would this be an area of future engagement? – As already mentioned, in the area of business regulation, we found that automating procedures in construction permitting and business inspections increased the transparency of these processes. Similarly, an e-inspector system is being developed, which will further standardize processes so that businesses know what to expect. Furthermore, the changes to the inspections regime provide incentives for Serbian businesses to exit the shadow economy and legally register.

For more than a decade, USAID worked to improve access to justice, case management, and court efficiency. In partnership with the Serbian government, USAID assistance has helped renovate misdemeanour courts throughout Serbia and improved court operations through case management systems and electronic registries. We intend to continue promoting similar initiatives as part of our efforts to support Serbia’s public administration reforms.

As a result of USAID supported reforms, over two thirds of Serbian businesses now claim inspectors are well trained and polite

Speaking of digital, the ICT Hub was launched as part of a public-private partnership with USAID in 2014 as a one-of-a-kind incubator for Serbia’s technology entrepreneurs. When you think of that initiative today, how would you assess its major accomplishments?

– USAID has worked extensively to support the development of Serbia’s IT sector through projects in Belgrade, Nis and Novi Sad. As you mention, we provided initial support to establish the ICT Hub in 2014. We have been very impressed to note the ICT Hub’s impact in helping young, highly-skilled individuals, and talented software developers to grow as technology entrepreneurs and project managers. USAID renewed its partnership with the ICT Hub in March 2018 and will continue to support young technology entrepreneurs.

A joint Balkan Media Assistance Program launched this year has to help journalists regain their positions in society. How can the program help them to sustain media freedom in digital times?

– Globally, USAID has seen that as digital media has replaced more traditional communication methods, media outlets need to adjust their business models to survive. Our assistance here in Serbia and in the region is helping interested outlets develop viable financial models, ensuring that Serbs can access quality, professional journalism on digital platforms.

In 2017, USAID launched a joint Balkan Media Assistance Program that works in five countries in the Balkan region to help develop online media. It will provide outlets and media partners with more substantial and stable resources to operate as viable enterprises, engage wider audiences, and expand their reach within the region.

Past interventions also were directed toward communities affected by the migration crisis…

– Since 2016, USAID provided $2 million to Serbian communities affected by the migrant crisis. This assistance has helped municipalities improve social and health services, positioning them to respond to the crisis and improve services to all their citizens. This support included a new reservoir in Preševo to provide a reliable source of potable water to residents, a new emergency care centre at the Bosilegrad health clinic, medical equipment in Subotica, and new school facilities in Kikinda, as well as other upgrades.