Describes how major projects are secured and financed. Explains activities of the multilateral development banks in and other aid-funded projects.
Selling to the Government
Government purchases in Serbia are handled principally through government tenders, although the Serbian government has carried out direct negotiations with other governments for some projects in the past (e.g. with China for the construction of a bridge across the Danube and with the UAE for Etihad’s investment in Air Serbia). Regular military sales are subjected to public tenders, except for cases of foreign military assistance in acquiring sensitive equipment.
The Public Procurement Law, enacted in 2013 and amended in 2015 and 2019, (Serbian Official Gazette: 124/2012; 14/2015; 68/2015; 91/2019), improved the legal framework in this area, introducing a central purchasing body that handles procurements for state bodies, establishing new procedures in centralized public procurement, and shortening the deadlines for specific procedures. Public procurement announcements and contract awarding procedures have been aligned with EU directives.
Amendments to the Public Procurement Law went into effect starting June 30, 2020. The changes are aimed at injecting more transparency into the public procurement process. The main changes are; full transition to electronic procurement (e-procurement); shorter and simpler administrative procedures; introduction of a “Statement of Conformity” issued by the bidder that will replace documents previously needed in the pre-bidding stage; and the use of the “economically most favorable offer” as the sole evaluation criteria. While these changes should improve the procurement system, the U.S. Embassy in Serbia continues to promote best-value determination and life-cycle cost analysis, emphasizing factors such as quality, operation, and maintenance, instead of the prevailing lowest-price criterion used in the Serbian public procurement system that often is more expensive in the long run. This should help make U.S. companies more competitive in Serbian tenders.
Information about public procurement procedures and tender announcements is available at the Public Procurement Portal.
U.S. companies bidding on Government tenders may also qualify for U.S. Government advocacy. A unit of the U.S. Commerce Department’s International Trade Administration, the Advocacy Center coordinates U.S. Government interagency advocacy efforts on behalf of U.S. exporters bidding on public sector contracts with international governments and government agencies. The Advocacy Center works closely with our network of the U.S. Commercial Service worldwide and inter-agency partners to ensure that exporters of U.S. products and services have the best possible chance of winning government contracts. Advocacy assistance can take many forms but often involves the U.S. Embassy or other U.S. Government agencies expressing support for the U.S. bidders directly to the foreign government. Consult Advocacy for Foreign Government Contracts for additional information.
Financing of Projects
Serbian banks are suffering from excess liquidity and shortage of viable projects ready for financing. In spite of this fact, local financing is still substantially more expensive than capital coming from international financing institutions.
The U.S. Export-Import Bank (Exim Bank) and the U.S. International Development Finance Corporation (DFC) offer a variety of trade financing solutions to facilitate U.S. exports and investments that are available to foreign buyers and partners of U.S. investors.
Exim Bank is an export credit agency that provides export credit insurance, working capital guarantees, and guarantees of commercial loans to foreign buyers. The Project Finance Division funds projects that are dependent on the project cash flows for repayment.
DFC supports projects in emerging markets through project loans, loan guarantees, and risk insurance, facilitating medium to long-term funding to ventures that involve significant private equity and/or management participation by U.S. businesses.
The U.S. Trade & Development Agency (USTDA) is an independent U.S. government agency that promotes U.S. exports for major development projects. USTDA funds feasibility studies, training programs, orientation visits, and other project planning services related to U.S. exports. Contracts funded by USTDA grants must be awarded to U.S. companies. U.S. involvement in project planning helps position potential U.S. suppliers at the project implementation stage. USTDA has been active in Serbia with projects in energy, transportation, airport, and telecommunications sectors.
USTDA Contact Information
1101 Wilson Blvd., Suite 1100
Arlington, VA 22209
Phone : +1 (703) 875-4357
Multilateral Development Banks and Financing Government Sales
Price, payment terms, and financing can be a significant factor in winning a government contract. Many governments finance public works projects through borrowing from the Multilateral Development Banks (MDB). A helpful guide for working with the MDBs is the Trade Finance Guide. The U.S. Department of Commerce’s (USDOC) International Trade Administration (ITA) has a Foreign Commercial Service Officer stationed at each of the five different Multilateral Development Banks (MDBs): the African Development Bank; the Asian Development Bank; the European Bank for Reconstruction and Development; the Inter-American Development Bank; and the World Bank.
The European Bank for Reconstruction & Development (EBRD) in Serbia is very active with project and trade finance, with a current portfolio of projects worth approximately €2.5 billion. Its current priorities are agribusiness, the banking sector, support for privatization, financial intermediation, utilities and energy efficiency.
EBRD Contact Information in Belgrade
Mr. Matteo Colangeli
Blue Center Building, Spanskih boraca 3, 6th Floor
11070 Novi Beograd, Serbia
Tel: +381 11 212 0529