Serbian gov't and company from UAE establish agro-company

BELGRADE - Serbia's government has decided, in accordance with its policy of continuous investment and modernization of agricultural production, to establish a joint business organization with Abu Dhabi-based company Al Rawafed, an official representative of the United Arab Emirates (UAE) government.

An agreement on the joint venture was signed by Serbian Economy Minister Dusan Vujovic and Al Rawafed CEO Mahmoud Ibrahim Al-Mahmoud, the Ministry of Economy has said in a release.

The Republic of Serbia will have a 20 percent stake and no obligation to invest in the joint company, while the UAE partner is under obligation to invest EUR 140 million over the next four years, according to the release.

The first venture of the newly established company will be a EUR 22 million purchase of part of the property of two agricultural enterprises in restructuring - AD Backa, based in Sivac, and Adria AD, based in Nova Gajdobra.

This will ensure repayment of the total debt of the two business entities, saving them from bankruptcy they were to face in November this year, when the suspension of forced collection of these debts expires.

Immediately after its establishment, the new company will employ 80 of the 160 workers currently employed in both agricultural enterprises in restructuring, and also 20 new experts. The remaining employees will be offered a severance pay scheme or the possibility of staying at the old workplace.

According to the investment plan, the company should open 300 more jobs, in the municipalities of Kula and Backa Palanka in the province of Vojvodin, over the next four years.

The investment plan also provides for the construction of facilities for sorting, packing, storing and...