Deputy Prime Minister and Minister of Economy and Regional Development Mladjan Dinkic stated that the pillar of the future Serbian furniture industry will be Austrian company Kronospan SRB.

Opening the Kronospan factory in Lapovo, Dinkic stressed that this is the second largest greenfield investment in Serbia, noting that the furniture produced here will be even more competitive because of the high quality chipboard used in its manufacture.

Bearing in mind the fact that from 1 July Serbia will be able to export products to the Russian market without
customs, the factory’s strategic importance will grow, the Minister noted.

Dinkic also announced the arrival of other foreign furniture producers to Serbia, primarily Italian ones.

The Minister specified that the factory employs 160 workers, while the plan envisages a total of 300. Another 2,000 are hired by suppliers, he added, noting that the investment will be a turning point for the underdeveloped municipality of Lapovo, considering its proximity to Corridor 10.

Investments such as this one are the reason why industrial production in the first four months of 2010 increased by 5% and imports rose by 18% compared to the same period last year.

He recalled that at yesterday’s session, the government adopted amendments to the Decree on conditions and terms of attracting foreign direct investment, which envisages state reimbursement to investors for infrastructure works.

Director-General of Kronospan SRB Petr Nikl said that this is the first stage in the construction of the production plants and confirmed that the investment’s value is €80 million. The share of local supplier companies in the construction is 40%.

Nikl underlined that these production plants are only a quarter of the capacity which this company plans to build over next ten years.

80% of the resources used in the production are local, such as timber, energy, workforce and transport, he declared and added that this factory, which is already operational, makes 50% of its revenue through exports.

President of the Lapovo municipality Dragan Zlatkovic highlighted that this company will boost the economy of
Lapovo because it will encourage other Austrian investors to come and employ workers.

Kronospan SRB set up a factory for the production of chipboard, which is the first stage of their planned
investment in Serbia. The second and third stages of the project are the construction of further production plants for laminate floors and MDF boards respectively.

This company is the world’s leading manufacturer of chipboard, laminate and other similar products. Currently it has 26 large production facilities in 24 countries.