Belgrade, Dec.10th (Source USAID) - The cooperation from key partners the two key partners USAID established Local Economic Development (LED) and the Serbian Investment and Export Promotion Agency (SIEPA) has made a significant contribution to the Serbian job market, and brought a windfall to the residents of Prokuple by bringing in two thousand jobs.
A job fair was held where the applications of approximately 500 people will be chosen to work at a new factory. Five hundred more should be hired by the end of 2010 and then eventually another 1,000.
Leoni, a German manufacturer of automotive cables and wiring, had agreed to invest 15 million Euros in Prokuplje to buy and convert the defunct Fiaz brake factory into a modern car wiring plant. But how Prokuplje managed to come out ahead in competition with other locations in Serbia and the region is one of the best economic development stories of the year.
Leoni’s decision to invest in Serbia, despite strong competition from Bulgaria owes much to the USAID-established (LED) Office of Prokuplje and the (SIEPA).
“SIEPA called in October saying that the German company Leoni is inquiring about locations in Serbia, and said he had referred them to our municipality’s website, on which our office had put all information relevant to potential investors in our municipality. Soon after, representatives at Leoni made its first visit to Prokuplje, and I think that we had an exceptional presentation,” recalls Sveta Budjic, Head of the LED Office at the time, according to a USAID news release.
The LED office in Prokuplje together with the National Alliance for Local Economic Development (NALED), met with the Minister of Economy and Regional Development Mladjan Dinkic. This meeting lead to the government agreeing to offer a significant stimulus “carrot” to ensure that Serbia would not miss out on such a job creation opportunity.
The critical support from LED appears not just to have been the advocacy with Leoni, nor even the financial incentive provided by the government, but some quick response to some deficiencies at the Fiaz plant.
“We got in touch with the State Secretary at the Ministry of the Environment and Spatial Planning and people from USAID’s project. They helped us resolve this issue, which would have cost us the investment. Experts from USAID provided professional and technical support and recommendations, based on which the Ministry invested 300,000 Euros to clean and decontaminate the site”, says Sveta Budjic from LED.
Smaller businesses will be getting a significant shot in the arm the arrival of Leoni. Business Incubator in Prokuplje, which had provided technical assistance to the LED office, has already drawn up a contract with Leoni to lease them some office space and to provide consulting services, a local textile company will supply worker’s uniforms, and a carpentry manufacturer will be involved in replacing doors and windows for the new factory.
This Business Incubator, which opened in 2007, with the support of USAID is one of the most successful in the country – employing about 80 individuals in 15 companies. Almost 70% of the businesses which started there have survived on the market and are now expanding their activities.
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