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NewsUpdate on the Covid-19 situation in Serbia

07/04/2020


Country Specific Information

  • As of April 6, 2020 at 3 p.m Serbia has confirmed 2,200 cases of COVID-19 and 58 deaths.
  • All commercial flights to and from Serbia are suspended indefinitely.
  • All border crossings (air, land, or river) are closed for travelers.
  • Government of Serbia declared state of emergency with widespread travel restrictions and curfews.

As of April 3, 2020 following measures are in effect:

  • Mandatory curfew for all residents: Mondays through Fridays 5 p.m. – 5 a.m. and Saturdays from 1 p.m. until 5 a.m. on the following Monday.
  • 24 hour curfew for residents over 65 in urban areas and 70 in rural areas, except on Saturday from 3 a.m. to 8 a.m. for the purpose of buying groceries.
  • All Farmer’s markets have been closed. All public transportation is suspended. Taxi services are limited but remain operational. Driving personal vehicles is allowed.
  • Cafes, restaurants and shopping malls are closed for public.
  • All sports related facilities, senior care centers, kindergartens, schools and universities are closed.
  • Barbershops and beauty salons have been closed.
  • Gambling facilities and casinos have been closed.
  • Public gatherings are limited to no more than 2 persons.
  • People should maintain the distance of at least 6.6 ft. between each
  • Occupancy for all Indoor facilities opened for public is limited to one person on an area of 43 sq ft.
  • All public parks and public recreation areas are closed for visitors.
  • Supermarkets, pharmacies, gas stations, post offices, banks and other service providers reduced their working hours to observe the curfew, with most closing by 3

Quarantine Information:

  • Government of Serbia has designated quarantine locations for COVID-19.
  • The Clinics accepts patients with COVID-19 symptoms through a dedicated entrance separate from that used by other patients. If the test results are negative, the patient is released. If the tests results are positive, the patient will remain at the Clinic.
  • The Serbian Ministry of Health established an emergency hotline for individuals who have symptoms or believe they may have come in contact with the virus:
  • The Ministry also has a web page dedicated to COVID-19 in English and in Serbian https://covid19.rs/
  • All community hospitals and medical care centers through Serbia have opened COVID-19 clinics

Economic measures announced by Serbian Government due to COVID-19 crisis

On 31 March 2020, Serbian Minister of Finance and President of Serbian Chamber of Commerce, announced set of measures intended to boost economy in order to ease consequences of the crisis caused by COVID-1:

I. Tax policy measures

This set of measures is related to deferral of tax payment with obligation of repayment of deferred taxes in instalments, not earlier than beginning of fiscal year 2021, and includes the following measures:

  • Deferral of payment of salary tax and social security contributions for the private sector until beginning of fiscal year 2021 with possibility of additional extension. Deferred obligations will subsequentially be repaid, in not more than 24 monthly instalments without calculated late payment interest.
  • Deferral of payment of corporate income tax advance payments for 2nd quarter of 2020.
  • VAT exemption for donation of goods with a goal of motivating donations to the institutions which are involved in implementation of measures for protection from the disease.
  • Respective measures will apply equally to all companies irrespective of their size or economic strength.
  • Total projected value of the measures is RSD 161 billion (cca. EUR 1.37 billion).

II. Measures of direct financial aid to private sector

This set of measures is related to direct payments and aid to the business entities and entrepreneurs with a goal of continuity of salary payments, and includes the following measures:

  • Direct aid to entrepreneurs, micro, small and medium size companies in the amount of minimum net salary for each employee during the state of emergency (cca. RSD 30.00=). It is envisaged that this measure will include payments for up to three minimum monthly salaries per employee.
  • Direct aid to large companies in the amount of 50% of minimum net salary (cca. RSD 15.000) for each employee on paid temporary leave in accordance with Articles 116 and 117 of the Labor law.
  • Listed measures will not limit number of employees who are on paid temporary leave by employer’s decision, nor amount of rights which is determined by employer during the leave.
  • Total projected value of these measures is RSD 97.3 billion (cca. EUR 828 million).

III. Liquidity Measures for private sector

This set of measures is related to financing loans and guarantee scheme which will be provided with a goal of liquidity improvement during and after the state of emergency, and includes the following measures:

1) Financial support through loans for perseverance of liquidity and working capital for entrepreneurs, micro, small, medium entities, agricultural farms and cooperatives. As a part of the Program, Serbian Development Fund will offer loans in the total amount of RSD 24 billion (cca. EUR 200 million). Repayment period will be 36 months with 12 months grace period. Maximum financial support is also envisaged:

  • up to RSD 5 million for entrepreneurs and micro entities,
  • up to RSD 25 million for small entities,
  • up to RSD 50 million for medium entities.

2) Financial support through guarantee scheme provided by the Republic of Serbia to commercial banks which are present in Serbia, for loans in EUR and RSD for perseverance of liquidity and working capital for entrepreneurs, micro, small, medium entities and agricultural farms. Repayment period will be 36 months with 12 months grace period. Maximum value of the loan which can be granted through this program is envisaged to be 25% of revenues in 2019 or EUR 3 million.

Total projected value of the measure is RSD 240 billion (cca. EUR 2 billion).

IV. Other measures

This set of measures is related to stimulation of domestic demand and perseverance of liquidity of business entities, and includes the following measures:

1) Direct aid to Serbian citizens older than 18 year through one-off payment in the amount of EUR 100 for the purpose of stimulation of domestic demand. Total projected value of the measure is RSD 70 billion (cca. EUR 596 million).

2) Moratorium on dividend payments (except for state owned enterprises).[1]

Anti-crisis support from abroad

On March 25 The EU has decided to approve the repurposing of €94 million originally allocated to different projects under the Instrument for Pre-Accession Assistance (IPA), which can now be used to prevent and curb the spread of the new coronavirus.

On March 30, the EU announced nearly €40 million to help Western Balkan countries deal with the coronavirus. In the Western Balkans, €38 million will go to governments to cover the immediate healthcare needs: four million each for Albania and North Macedonia, seven million for Bosnia and Herzegovina, three million for Montenegro and five million for Kosovo. The biggest tranche — €15 million — will go to Serbia, while some €374 million in existing funding packages will be reallocated to help cushion the economic impact of the epidemic. Western Balkans countries will now also be allowed to take part in an EU joint procurement programme to buy protective medical equipment such as face masks for hospital workers.

In addition, on March 20 The European Union has approved 7.5 million Euro of immediate aid to Serbia for coping with the COVID-19 virus infection and Norway has donated five million Euro while Switzerland sent about half million EUR to Serbia for these purposes as well. In addition, the EU has sent medical supplies to Serbia to help the country fight the coronavirus, while China and Russia has sent their doctors in addition to medical supplies.

Companies, public figures, banks and individuals have also made numerous donations.

[1] In addition, on March 18 National Bank of Serbia introduced a moratorium on the repayment of loans in an effort to maintain the stability of the country’s financial system and minimize the potential risks caused by the current health situation in the country. The moratorium pertains to all loan users (natural persons, farmers, small business owners and companies), should they choose so, and it entails the recess in repayment of credit liabilities, which cannot be shorter than 90 days, i.e. the duration of the state of emergency implemented due to the pandemic. In the said period, the debtor will not be obliged to pay the credit or leasing liabilities. Of course, the debtors are not prevented from settling their obligations regularly, even after the implementation of these measures and OBS is currently working on the technical solution for implementation of this measure.