Press Release: ''Investment environment in Western Balkans countries creates important opportunities for Greek enterprises'', October 2, 2007

The advantages accruing from reforms and economic policies as well as the experience of Greek companies were evaluated at a World Bank event with the participation of SEV.

A Conference on the investment environment in the countries of the Western Balkans took place recently in Athens, organised by SEV and the Thessaloniki Chamber of Commerce and Industry (TCCI), with the support of the World Bank, which is implementing a special programme of information and technical assistance for foreign companies seeking investment opportunities.

Within the framework of the Conference, over 40 meetings on investment planning issues took place between the Greek companies participating, World Bank officials and foreign investment organisations.

Representatives to this investment road show  –from organisations for attracting and promoting foreign investments in the countries of FYROM, Serbia, Kosovo, Albania, Croatia, Bosnia-Herzegovina and Montenegro–  set out the basic points of economic policy and reforms, as well as individual incentives.

It arose from the relevant analysis that the emerging advantages common to all of these markets are:

• Greece’s proximity to these markets, which allows products transport at a reduced cost,
• high growth rates, low production costs,
• labour costs 30-70% lower than those in western European countries,
• available executive and labour workforce that is young and, to a great extent, has a satisfactory level of training,
• favourable tax rates,
• political stability in most states, trend towards improving institutions and functioning of the state,
• existence of free trade agreements that facilitate commercial transactions,
• protection of foreign investments and equal treatment with local companies,
• potential for re-exporting of profits,
• strong presence of Greek banks,
• in some cases, low inflation, relatively stable currency, use of euro in transactions,

However, it is also useful to assess the negative parameters noted by experienced Greek companies already active in these countries, such as:

• contradictory elements of tax policy, given that in contrast with the reduced tax rate there are problems with the distribution of dividends, transfer of capital and dealing with corruption,
• obsolete infrastructure, such as difficult road access and power cuts,
• need for persistence and long-term investment in personnel training,
• instances of discrimination against foreign investors,
• poorly functioning court system, with drawn-out procedures for settling differences,
• lower-than-expected productivity,
• failure to provide protection of intellectual rights, particularly regarding brand-name products,
• inability to streamline customs procedures,
• lack of organised logistics systems,
• higher cost of insuring goods and production facilities,
• in general, higher cost of setting up an enterprise or initiating activity.

With a population of 150 million consumers, the countries of the Western Balkans are rightly considered a natural space for the expansion of Greek business activities. These countries are in a phase of gradual economic development and are competing to create an environment that is friendly and attractive to foreign business organisations, endeavouring to increase the influx of private capital.