1. PROJECT TITLE
Infrastructure construction in Industrial zone 2 (phase 1), Bijeljina
This project is part of the sector of industry and small-and medium-sized enterprises (SMEs)
The city of Bijelјina is located in the northeastern Republic of Srpska, at the junction between BiH, Croatia and Serbia. The city is located in the central part of the Semberija plain. The most prominent natural resources of this area are its fertile land, geothermal water (depth 1,350 m, temperature 75°C), 1,700 sunny hours per year and significant reserves of clay.
Distance from Bijelјina to the border with Serbia is 12 km, and with Croatia (EU) 45 km Bijelјina is only 70 km away from the closest airport Tuzla, and 122 km from Belgrade international airport. The city of Bijelјina is connected by railway with the railway hub in Sid, Serbia (60 km).
4. BRIEF PROJECT DESCRIPTION
The regulation plan of the city of Bijelјina provides for an area of the total of 126 ha for industrial and business purposes. This area is located to the northwest of the center of the city. A feasibility study was prepared for this area providing for the construction of a modern industrial zone on the land of 39.5 ha of area (public ownership), which would represent equipping of the first phase of the Industrial Zone 2 of the total of 126 ha.
The project includes preparatory activities (technical project) and construction of basic infrastructure network, i.e.: internal road network, land development, water supply and sewerage network, electricity supply and telecommunication network.
The investment is expected to result in 48 parcels fully fitted with modern infrastructure of the total area of 346,200 m². The area of individual parcels ranges from 3,900m² to 13,650m², with a possibility to divide the parcels into smaller areas or to merge them into parcels of larger area.
The Industrial Zone 2 in Bijelјina will be primarily focused on larger foreign and domestic investors and export-oriented SMEs seeing growth in food processing or metalworking sector. Additional planned sectors are renewable energy and support services.
Project purpose is to establish infrastructure on an area of 39.5 ha. The basis for launching this initiative is availability of land owned by the city, availability of young labor force, and existing demands of 8 domestic and foreign investors who have expressed interest to start business in the territory of Bijelјina.
Project goal is to attract at least 40 domestic and foreign investors in the field of production and supporting industries and to create 1,200 new jobs by 2022.
The objective is to build an infrastructure network on an area of 39.5 ha of greenfield location and to create a supply for potential investors in the form of 48 parcels of the total area of 346,200 m²
5. PROJECT DETAILS
5.1 What type of project is it?
5.2 Project status
- Prepared feasibility study of infrastructure construction in the Industrial Zone 2,
- Partly prepared project documentation and provided building approvals.
5.3 Reasons to invest in the project
- Location on a junction between three countries: Croatia (EU), Serbia, BiH;
- Natural resources: largest area of fertile agricultural land in the RS, geothermal water springs, clay kaolinite;
- Strong agricultural sector, irrigation systems, greenhouses;
- Proactive and professional local administration and institutions for support;
- Existence of a set of incentives for investors and SMEs;
- Population growth;
- Availability of young labor force;
- Availability of educational institutions at all levels: from vocational schools to universities;
- Implementation of large infrastructure projects: water supply and sewerage, regional landfill;
- Concentration of business and financial services, educational, cultural, sports and housing opportunities.
6. PROJECT FINANCING:
6.1 Estimated project value in €
The total estimated project value is 7,223,538.30 euro (including VAT) and the project can be implemented in phases. The estimated value is based on the data from the feasibility study/investment plan for the Industrial Zone 2. The project provides for the construction and completion of basic infrastructure. The justification of the investment is supported by the economic indicators which indicate that the investment would have a positive impact on a wider social and economic environment.
6.2 Planned sources of financing
- Budget of the city of Bijelјina,
- Financing by EU funds (IPA Instrument for Pre-Accession Assistance),
- Financing by funds of other international donors.
6.3 Inputs by local partner
Types of incentives offered by the city of Bijelјina to potential investors:
Possibility to purchase a development parcel meeting the needs of the investor in terms of form and size, and possibility to pay in 60 (sixty) monthly instalments without interest. Fees discounted by 85% for land development for production facilities.
6.4 Inputs by investor
The Industrial Zone 2 Bijelјina is focused on attracting several groups of investors from different markets and from two main production sectors: food processing and metalworking sectors.
Potential investors are expected only to invest in the construction of production and business facilities, while city administration would provide the land fitted with infrastructure.
- Big investors dependent on the agricultural production in Semberija and adjacent areas,
- Growing small- and medium-sized production enterprises, mainly export-oriented,
- Companies looking for young educated staff at specific market costs of labor,
- Companies looking for locations outside the territory of the EU which are close to the main EU and Western Balkan markets,
- Companies engaged in service providing, in particular support service providers to industrial zone.
7. Has physical location for project implementation been identified
The Industrial Zone 2 is located in the plain in the border area, to the northwest of the city of Bijelјina, close to the roundabout at the entrance into the city.
The area of the zone occupies over 39.5 ha of land, and it is located within a larger complex of 126 ha intended for the Industrial Zone 2. The remaining space will allow future expansion of the Zone.
A road runs along the border of the Zone in the south, and construction of a railway station is planned in the future to the north of the Zone. To the east of the Industrial Zone starts a residential area. The existing Industrial Zone 3 is close, and certain economic entities have already been built along the Stefana Decanskog Street.
In compliance with the Regulation Plan, the area of the Industrial Zone 2 Bijelјina has already been intended for business purposes (Official Gazette no. 23/07 of 01.10.2007).
8. Have the activities on project implementation already started
- Prepared feasibility study/investment plan for the first phase of the Industrial Zone 2,
- Prepared project documentation for a main road within the Industrial Zone 2, in compliance with the Regulation Plan of the Industrial Zone 2,
- Obtained location requirements for the subject road.
- Completion of the financial structure for construction of a part of the above road from the budget and international sources under preparation.
The Industrial Zone 2 is considered the most important instrument for the city of Bijelјina to stimulate economic activities among the existing small, medium and large companies and to attract foreign companies and, by doing so, to enable job creation for more than 14,118 unemployed persons and more than 800 young people entering the labor market each year.
The objective of the city of Bijelјina is to develop an attractive industrial zone which will provide a flexible, fully equipped and functional space for doing business. Proposed amendments to the Regulation Plan will enable a higher level of space flexibility, visual and transport identity, and separation of commercial from residential areas. The Industrial Zone 2 will be recognized as the best location for foreign direct investment growing and export-oriented SMEs, in particular companies engaged in advanced food processing industry and metal production in the northeastern RS.
The preferred sectors for the Industrial Zone 2 are aligned with the social and economic analyses, competitiveness analyses and city of Bijelјina’s development strategy.
- Metal and metalworking industry,
- Food processing industry,
- Services and products for support to agricultural production (e.g. companies for distribution, forage production, agricultural equipment (tools and machines), greenhouse production and making,
- Construction industry, with a focus on building elements made of wood, PVC materials, cement, clay, etc.,
- Other industries of productive nature (wood, electric, textile, etc.)
- Energy (renewable energy) – producers of equipment and companies providing energy supply,
- Service activities such as banks, insurance companies, companies engaged in business consulting, technical inspection and services, gastronomy sector and hospitality industry, kindergartens and/or child care centers (up to 20% of the total capacity of the area).
9. Project applicant and contact information
CITY ADMINISTRATION OF THE CITY OF BIJELЈINA
SECTION FOR LOCAL ECONOMIC DEVELOPMENT AND EUROPEAN INTEGRATION
Bojan Djokic, officer for local economic development and investments
Telephone: 00 387 55 233 169
Fax: 00 387 55 211 922
Mobile: 00 387 65 689 297