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Ph.D., Deputy Prime Minister and Minister of Construction, Transport and Infrastructure

Zorana Mihajlović: Construction is Our Development Opportunity

It is important for us to continue investing in infrastructure, to invest in the construction of highways and the modernisation of railways, to renew regional and national roads, because that means higher economic growth during this year, but also the creation of conditions for faster development in the coming years

This year is difficult and challenging in an economic sense for the whole world, including Serbia, says Serbian Deputy Prime Minister and Minister of Construction, Transport and Infrastructure Zorana Mihajlović, summarising the year that is almost coming to an end. “It is very important that our construction sites didn’t grind to a halt even during the state of emergency, which could be seen in particular with the largest infrastructure projects. These results will be seen and reflected in Serbia’s GDP, considering that construction has been the main driver of economic growth over the previous two years.”

Few economies in Europe have had a better result than Serbia when it comes to economic growth this year, but it is important that we maintain that pace until the end of the year, so that we can complete this year, in which many countries will find themselves deep in recession, as painlessly as possible, explains our interlocutor.

What do you consider as being the most important preconditions for maintaining relatively favourable results and returning to the trajectory of normal economic growth in the period ahead?

– It is extremely important that the Government of Serbia is determined to continue investing in infrastructure, both those infrastructure projects that have already commenced and those from the Serbia 2025 programme. We are continuing to construct the Moravian Corridor, the Sremska Rača-Kuzmin highway, the Ruma-Šabac-Loznica highway and expressway, the section of Milos the Great Highway from Preljina to Pozega and the Iverak- Lajkovac expressway. Alongside the highway constructions already launched, we also plan to start the construction of the first section of the Niš-Merdare-Priština highway, from Niš to Pločnik, soon, and we also expect to sign a commercial contract for the Frušk Gora Corridor soon.

When it comes to the railways, we are constructing the high-speed Belgrade-Budapest rail link and preparing to next year launch the modernisation of the Belgrade-Niš railway, in order for us to have a completely modernised rail route of Corridor 10 in a few years. Furthermore, the modernisation of rail tracks from Niš to Dimitrovgrad has been contracted, we are working on project documentation for the continuation of the reconstruction of the Bar railway from Valjevo to the border with Montenegro, and in the coming weeks we will start the construction of the intermodal terminal in Batajnica.

Project design and technical documentation will also be prepared for new hi-speed road links in the next year, such as Vožd Karađorđe, Sombor-Kikinda, Kragujevac-Mrčajevci and Požarevac-Veliko Gradište-Golubac, as well as others.

We are investing a total exceeding 400 million euros in water transport, including the construction of new ports, the reconstruction of shipping locks and the removal of critical sectors on the Sava and Danube rivers.

There are currently more than 64,000 active construction sites in Serbia, and their number has not reduced, but rather – on the contrary – has increased by more than 16,000

In aviation, we are investing in the development of small airports, with works underway on the construction of Rosulje Airport in Kruševac and Pranjana Airport near Gornji Milanovac, while plans also include the reconstruction of Čenej Airport near Novi Sad, analysis is being conducted regarding the construction of a new airport in Bor, and we will invest in Srebrno Jezero [Silver Lake] Airport as a tourist airport…

These are all projects that will enable Serbia to connect with neighbouring countries, but with which we will also link a larger number of cities and districts in Serbia with the main regional transit routes, all of which represent important preconditions for faster and more even development, and the attracting of new investments.

Of course, in addition to conditions regarding economic policy and the preservation of budget stability, everything that Serbia does to preserve political stability is vital, as this is also important for economic growth. As an example, the projects that have been agreed within the economic agreement signed by President Vučić in Washington are worth more than four billion dollars. Likewise, the expansion of the mini-Schengen initiative is important for faster economic development, trade growth and new investments.

Many consider that Serbia will not be able to rely on the arrival of major foreign investments in the period ahead. What is your opinion? What are examples like in the areas that are under your remit?

– Infrastructure is an area in which the world’s largest companies, from practically all over the planet, are already present in Serbia: from European companies to Chinese, American, Russian, Turkish and Azerbaijani companies.

As a result of insufficient investment in infrastructure and delays in the completion of Corridor 10 and other projects, Serbia has long been excluded for main transport flows, but has also been deprived of the latest knowhow that comes with major investments.

That has changed a lot in recent years, and we are today constructing the Moravian Corridor, which will be the most modern highway in Serbia, as it also encompasses telecommunications infrastructure, as well as the first railway in this part of Europe able to handle speeds up to 200 kilometres per hour.

After a gap of several decades, we are investing in the modernisation of ports, introducing a state-of-the-art navigation system for river traffic on the Danube and Sava rivers, investing in airports and the modernisation of air traffic control, including the construction of new control towers in Belgrade and Niš.

These are all investments that lay the foundations for the much faster development of Serbia in the decades ahead.

The Foreign Investors Council is this year commemorating the 18th anniversary of its activities in Serbia. How would you rate your cooperation with the FIC?

– We achieve progress in cooperation every year, sometimes that progress is bigger, while sometimes it is smaller. This year started excellently, with several subgroup meetings held to discuss numerous issues in the field of foreign exchange, construction, agriculture, taxes, inspections, food safety and other important areas, with the aim of updating the Work Plan of the Working Group for implementing the recommendations of the FIC White Book.

Unfortunately, the momentum that we had was broken abruptly by the COVID-19 pandemic, while the FIC itself also went through a phase of internal re-elections, so this year perhaps isn’t as successful as some previous years. On the other hand, I believe we’ve taken all the measures necessary in order to learn to live with this situation, and I’m sure that next year we’ll compensate for everything that may have been missed this year.

Almost without exception, yours is among the best ranked sectors by the White Book when it comes to implemen ting reforms in the domain of transport. What do you see as the key tasks to be undertaken in the coming period?

– What’s most important is to provide continuity in the construction of transport infrastructure, but also to exert additional efforts in the development of intelligent transport systems, and in this area we are recording increasingly better results every year. Among other things, following the introduction of the extremely advanced River Information Service before that was done by EU member states, we also introduced the most modern system for markings in marine transport (AtoNs navigation buoys). Project documentation is also being prepared for the construction of a new, modern dispatch centre on railways, and in the civil aviation sector, which has had “one foot in the EU” according to achieved standards since the previous period, we have continued with investments in order for us to be able to keep pace with the expected increase in the volume of traffic. When it comes to reforms in the transport domain, we mustn’t forget that reform of the railways in Serbia has been praised as being very successful by both international financial institutions and the EU.

The next reform that we are working on is the E-space reform, with which a unified procedure in the process of drafting planning documents will be applied. And thus information about possibilities or restrictions regarding construction will be available for each cadastral parcel

The Permanent Secretariat of the Transport Community in Belgrade was established last year, while its director was appointed recently. That represented an important signal regarding the connecting of the Western Balkans to EU transport flows. How much has been done in this area in the meantime, particularly when it comes to the railways?

– The modernisation of railways is a priority for Serbia, but also an important topic for the Transport Community. At the level of the Transport Community, we are about to adopt the Action Plan for the development of the region’s railway strategy. This is the first step towards developing a common railway strategy for the Western Balkan region. It is essential that we have good, high-quality and safe railways, just as it is important for us to have a healthy and stable railway market at the regional level. It is only in this way that will we be able to connect regionally and contribute jointly to greater environmental protection and the Green Agenda, which we have committed ourselves to as a region.

Serbia has reconstructed more than 550 kilometres of national and regional railways over the past several years. The value of investments in the railway sector, including both current and planned projects, amounts to more than five billion euros, and with their realisation we will improve railway connections to all our neighbouring countries in the region significantly.

We are also about to adopt the Regional Action Plan for Facilitating Transport at the level of the Transport Community. And here Serbia is also very active, because good transport infrastructure does not have a real effect if we don’t solve the problem of being detained at border crossings, or if we don’t accelerate flows of goods and people. There we also expect plenty from the Transport Community, because EU countries also form part of this transport family. It is known that the greatest detaining of haulage vehicles occurs at the borders with neighbours that are EU member states. We believe that regional interconnection will provide support to resolving such open issues.

How widespread is digitalisation in your ministry? Where do you see room for further progress?

– The adoption of the reformist Law on Planning and Construction and the introduction of e-permits were crucial to Serbia advancing from 186th to 9th place on the Ease of Doing Business Index in the field of issuing construction permits over the course of just a few years. This area isn’t only an example when it comes to digitalisation, but also when it comes to showing how possible it is to successfully implement a reform.

This model was also taken as a model for cadastral reform. The next reform that we’re working on, and which is important for improving the business environment, is the E-space reform. With E-space, the process of the unified procedure will be practically applied in the process of drafting planning documents. E-space will enable data from the real estate register to be digitised and updated, and will enable the faster, easier and more efficient processing of that data. Moreover, the procedure of drafting planning documents will be made more efficient, and there will be better quality when it comes to the participation of citizens, because insight into planning documents will also be enabled in a digital way. The end goal is to combine information from the Real Estate Register and planning documents within the scope of E-space, in order this data to be made public and available in electronic form, so that information about possibilities or restrictions regarding construction can be obtained for each cadastral parcel.

SUCCESS

Even during the period of the most severe epidemic, we succeeded in enabling international freight transport to function, so neither imports nor transit traffic were halted

OPPORTUNITY

We not only want to make Serbia an unavoidable transit route, but also a genuine transport hub of this part of Europe

AIM

If we were able to compete with the world’s best economies in terms of issuing construction permits, I believe that Serbia can also reach the top 10 in terms of overall conditions for doing business

 

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