Not all of us should take up politics. I don’t have time for it. The problem arises as we are permanently in a kind of political instability, and it takes away time and energy and then we disregard economy. Primarily, we need politically stable state and region, and we need clear projects that would incite economic boost of the state.
Ana Krajnc Source: Nova ekonomijaNot all of us should take up politics. I don’t have time for it. The problem arises as we are permanently in a kind of political instability, and it takes away time and energy and then we disregard economy. Primarily, we need politically stable state and region, and we need clear projects that would incite economic boost of the state.
Ana Krajnc Source: Nova ekonomijaClose the entire text of the article here
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Zorica Popovic is one of rare women heading a big local company in Serbia. She had entered agrobusiness 20 years ago, when together with her brother Stanko Popovic, former co-owner of Victoria Group, she established company Elixir, which she has been leading for the last 15 years. They had started with trading components for animal feed, only to continue with the production of it, including purchasing and processing of fruits. The biggest growth the company achieved five years ago, when Elixir Group had bought off two factories in bankruptcy, Zorka Sabac and IHP Prahovo. For the last five years, they had invested in its development and construction EUR 120 million, while in the last year alone, they had consolidated their profit on the level of all five companies in the value of around EUR 300 million. Export makes half of their revenues from sales. They deal with the production of phosphoric acid, as well as fertilizers that they place on the local market, as well as on the regional market and EU market. Elixir Group is in the same time one of the biggest purchaser and exporter of frozen fruit and vegetable from Serbia.
As a company that is active in agricultural business for a long time, how do you perceive the way in which agricultural policy has been led in Serbia, and what do you consider that needs to change?
ZORICA POPOVIC: What we need in the first place is political stability within the country and the region in general, we need clear projects that will boost economic progress of the country, along with its agriculture. We need to first identify poorly used potentials in the agricultural field, and then to take care of the mechanisms that we can use to launch it. Agricultural policy, founded by well prepared, thorough analysis had to be accompanied by constant support through program of subsidies that is based on such defined agricultural policy.
Fertilizers are being used in Serbia uncontrollably for many years, which make the soil impoverished. Who should take blame for that?
ZORICA POPOVIC: At one point in time, Serbia had turned from the exporter into the importer of fertilizers, so the importer offered two or three formulas that was mainly imported and being placed later for all the cultures and types of soils, regardless of whether the soil needed it. This probably led to some of the active components significant for the plants feed to get exhausted, while others prevailed. Now, we have completely different situation, as Serbia for the last four years has its own production of fertilizers and large assortment and range of formulas applied.
Are you traying to say that the problem is no longer present in Sebia, i.e. that the standards pertaining to the soil fertilization are being observed in practice?
ZORICA POPOVIC: I believe that they are being observed more and more, as we produce around 20 formulas, while the largest part of assortment is present on the local market.
How well are agricultural experts educated in this particular field?
ZORICA POPOVIC: Our company works on this aspect, we organize round tables, events, meetings during off-seasons with agricultural producers. We recommend formulas to them which are adequate for certain kinds of soils and the plants they want to cultivate.
As an experienced export-oriented company, how you plan to contribute to the growth of agricultural export in Serbia?
ZORICA POPOVIC: We need larger investments into manufacturing sector, along with higher level of processing. Serbia has developed primary agricultural production, while its next phase should be processing sector. It also pertains to crop and livestock breeding. Then again, prior to this, we need to know what we want to export. If we want to export raw materials, then we do that. If we want to export some of the products from the higher manufacturing process, we need to look at the potentials, and launch them and make use of them.
Are you, given that you export frozen fruits and vegetables, interested in investing into the higher degree of processing?
ZORICA POPOVIC: We had considered such investments, but they are not our priority for now. For the time being, our development is directed towards raising the level of producing fertilizers and chemical industry’s segments, and we are quite busy in doing so.
How much our agriculture benefits from the free trade agreement that Serbia signed with Russia, Turkey?
ZORICA POPOVIC: Those agreements haven’t been fully put to use and this is the biggest problem. On the one hand, we have agreements, and on the other, we don’t have anything to offer. We need to work on it.
How do you perceive the policy of subsidies that the state leads, and whether foreign investors has privileged position compared to the local investors?
ZORICA POPOVIC: We cannot say that there is no support to the local investors. As local investors, we had been supported through the volume of investments and employments. We had fulfilled those conditions and achieved the right to subsidies that we were entitled to. Moreover, the state offers the same tax reliefs to all, so we cannot say that it doesn’t offer support.
Serbia, on the other hand, needs foreign investments, as otherwise we cannot launch economic developmet. Local investors, our company among others, make investments, but Serbia needs more of it in order to feel positive effects.
So, local investors are not without support, maybe the scale is too high, so large number of local investors cannot meet all requests, so maybe this scale needs to be taken down a bit, making different balance.
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Is foreign investment the only solution by making special concessions, while raising the level of subsidies compared to other offers within the region?
ZORICA POPOVIC: Is Serbia in the equal negotiating position as the investor whose investment is necessary for us and who has its own requests? No, it’s not. We need to measure the benefits of the investment vs those concessions. I believe this is perceived in such a way, that benefits are minor compared to the concessions. Maybe we simply do not get better offers.
Many people say that one of the reasons for this is poor business environment in Serbia. What do you perceive as the biggest problem of the business environment?
ZORICA POPOVIC: In our field of business, in industrial sector, I don’t see any problems in the business environment. Generally speaking, the biggest problems are those that we need big investors and investments for creating good environment, that will contribute to employment opportunities and therefore launch of economic activities, while on the other hand, we need bigger support for small and medium-sized entrepeneurs that would rely on bigger business entities.
Do you agree with some economists that claim that there are two sides of economy, one enjoying privileged position, and gets subsidies, tax reliefs, and the other, that are being visited by inspection every now and then?
ZORICA POPOVIC: We hadn’t experienced this. Judging by our experience, some of the problems go down to the local and individual level. Those are sporadic cases on the local level, meaning that tax administration in Sabac or Negotin has different approaches, I stated the cities where we have business activities. But we did not face with any major problems, hindrances in business dealings, this did not happen.
Do you think that it is possible to have successful business in Serbia without political ties?
ZORICA POPOVIC: Absolutely. Not all of us should take up politics. I don’t have time for it. The problem arises as we are permanently in a kind of political instability, and it takes away time and energy and then we disregard economy. I do not want to deal with politics, I only want to perform my job.
You had bought off two factories in bankruptcy. What is your experience with this purchase and how much money have you invested in eliminating ecological points in Sabac and Prahovo?
ZORICA POPOVIC: We had dealt with this seriously in both factories after taking over. We had faced with historical pollution on those locations, and as a rule, a state is obliged to take care of this. However, the state cannot solve all our problems, as it doesn’t have unlimited budget for it, so we are here now, and if we want to continue to do our job, and to make profit, we have to organize on our own. We had the support of the competent ministry, some of the things were financed by the ministry, while for others, we took care on our own.
In Sabac, there were no unresolved issues, but the factory was completely devastated, and the technology outdated, so we decided to tear it down and build a new factory.
In Prahovo, we had inherited larger ecological problems, primarily there were two landfills and we took care of the one right from the start, we had found buyer, and we had exported more than two million tons to China, we had sold it to the Chinese steel plants, solving this problem permanently. In the same time, we had made economic achievement with this export, as the situation on the steel market was still in our favor.
Do you use the loans of commercial banks and whether those loans had really become more advantageous for the economy?
ZORICA POPOVIC: Bank loans were never more favorable. We use long term loans of commercial banks, we invested partly from the loan, partly from our revenue, so we have correct cooperation with banks. If we compare this with the circumstances five years ago, when the banks had withdrawn due to accumulated bad loans, nowadays, it is much easier to be granted a loan. Back then, it was really hard to gain the trust of the banks. Today, it is totally different, as we already have confirmed success of our project, so we have no problem with this regard.
Many companies in Serbia face with insolvency. How to solve the problem of heavily indebted economy?
ZORICA POPOVIC: How we end up being heavily indebted in the first place? I believe it is a chronical situation of bad judgement on the part of the banks or the companies that got indebted. If the loans are going to be used, they are used primarily for the sake of financing development. As for small and medium-sized companies, it is all about the fact that those companies relied on big ones who went under, so they had sunk with them.
Are there potentials for future development of big local companies?
ZORICA POPOVIC: I believe that in industrial segment, we had fairly made use of local potentials of big economic entities and that it is now inevitable to attract foreign investments. That is why, unfortunately, special concessions are being offered to the foreign investors.
We hear all the time from the Serbian government that Serbia is experiencing economic growth and progress. Does the economy feel this progress that the government officials refer to?
ZORICA POPOVIC: Economic growth in Serbia is still limited. Something did change, but in order for that well being to be felt in the business environment, we need more intense growth, we need new investment projects in order to initiate critical mass, and in order to feel improvement on all levels. However, it is important that something is happening, but still we need to have consistency to get things done till the end.
According to brain drain, Serbia is ranked very low generally, while on the other hand, economy complains that we lack trained staff. What can economy do exactly when it comes to this?
ZORICA POPOVIC: This problem might have been resolved partially, and it surely can be alleviated, but discrepancy that exists between average income in Serbia and European Union is such a problem that all developing countries had faced, that lose qualified personnel. Economy is, on the other hand, linked with Universities in a part where there is mutual interest for it. We lack industrial profiles, engineers, high quality tecnologists, but also qualified industrial workers.
Would you in your company offer to a young talented engineer better salary and chances for further advancement in order to stay here?
ZORICA POPOVIC: We had already done that. For the last three years, we had hired more than a hundred young engineers. We need that profile, and our next move would be to offer scholarships to the young talents on the faculties, involving them during the studies into the industry practice.
In Serbia, only five percent of women holds general manager positions in the big companies. To what extent are women equal in the business world in Serbia, what is your experience?
ZORICA POPOVIC: I haven’t met with such hindrances in business as a woman, and I don’t see any difference. I believe that the main challenge in occupying such positions, for male or female, is in the fact that this job requires lots of commitments, high devotion, and it is hard to adjust it with family responsibilities.
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