Malta signs readmission and investment agreements with Serbia

Tonio Borg held talks with Serbian Foreign Minister Vuk Jeremic, Serbian Prime Minister Mirko Cvetkovic, with Speaker of the National Assembly Slavica Djukic-Dejanovic, and with Deputy Prime Minister and Minister of Interior Ivica Dacic.

The agreements signed cover a protocol on the readmission of persons residing without authorization and an Investment Guarantee Agreement. The former will facilitate the Readmission of citizens from both Malta and the Republic of Serbia and furthermore honours the commitments set out in the agreement signed between the EU and the Republic of Serbia in 2007.

The Investment Guarantee Agreement will be a major step forward in the Promotion of investments between the two countries. It will promote investment flows and provide a legal framework that clearly sets out investment norms and protection when investing in respective countries.

During the past days, Borg signed the instrument of ratification in respect of the Stabilization and Association Agreement between the European Communities and their Member States and the Republic of Serbia.

During talks, Borg mentioned the visit by Serbian Foreign Minister last year in Malta, and said that the visit marked the beginning of a healthy bilateral relation between the two countries, being the first visit of a Serbian Foreign Minister to Malta.

A double taxation agreement signed during last year’s visit has just entered into force on the 16 of June 2010.

Serbia has a population of over 7 million inhabitants. Its GDP per capita was 7,912 during 2009, which is less than half that of Malta. Serbia had a high unemployment rate in 2009 which reached almost 17% of the labour force. The inflation rate year on year for the same year reached almost 10%, and its economy shrank by 4% in 2009.

Currently there are 25 registered companies in Malta having a Serbian shareholding.

As far as trade and investment is concerned, trade between the two countries fluctuated considerably within a fairly limited range for a number of years. Between 2005 and 2009 trade was limited to a range of €0.6 and €2.0 million. Last year, trade between the two countries more than tripled to €3.5 million from the previous year.

Imports are restricted to just a few items such as machinery and mechanical appliances (37%), cereals (34%), pharmaceuticals (25%), and beverages, printed material and rubber products each (1%) of total imports. Exports are far more constrained and relate largely to pharmaceuticals (75%) and organic chemicals (9%).