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VIDEO: Chinese Hebei Steel Group to boost Serbian steel industry

17 June 2016
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The Smederevo steel mill "Železara" stands a good chance to recover and develop after it was sold to Chinese Hebei Steel Group

Ljubisa Obradovic, secretary of the association of the metal-electro industry, metal mines and metallurgy at the Serbian Chamber of Commerce, said the Serbian metal-electro industry gained a lot by the arrival of Hesteel. "The arrival of Hesteel to Serbia opens huge potential in the metal-electro industry and mining in the sense that the level of production will double," he told Xinhua.

Slobodanka Susa, director of the Serbian Association of the Steel Industry, said the steel mill is an important part of the "infrastructure of the Serbian economy" and new investors will need money to improve technology and offer a wider range of products. "The HBIS is one of the biggest in the world and have the possibility to have cheap raw material to produce steel in Smedervo and that is most important for continuity of production in Smederevo," she said. She explained that the continuation of production in Smederevo means regular delivery to domestic markets and to exports. For Serbia it means it can expect an increase in economic activity.

The Smederevo steel mill was founded in 1913. After it went bankrupt in 2003, it was sold to U.S. Steel for the price of 23 million U.S. dollars.

Serbia became the owner of the steel mill once again in 2012 when the investor from the United States withdrew and the country bought the factory back for 1 U.S. dollar. After the departure of U.S. steel, the country was looking for a new investor, while the company's 5,000 workers were sent on paid leave until April 2013 when the furnaces of the steel mill in Smederevo started operating again with limited capacity.

HBIS was the sole competitor at a tender which finished on April 6, and bought the factory for 46 million euros (51.6 million U.S. dollars).



China's President Looks to Boost Relations With Serbia Visit

Chinese President Xi Jinping arrives in Serbia this week in an effort to further boost relations with the friendly nation and assert China's intention to radically increase its presence in the Balkans and Europe. The first visit by a Chinese president in more than 30 years, Xi's trip to Belgrade has been hailed here as "historic." During his three-day stay starting Friday, Xi will hold meetings with top officials and visit a Serbian steel plant purchased by a Chinese company. The visit is "a significant milestone for consolidating the traditional friendship between China and Serbia, deepening mutual political trust and promoting the practical cooperation between the two countries," Assistant Foreign Minister Liu Xinghai said in Beijing.

Serbia's Prime Minister Aleksandar Vucic said some 20 economic and other agreements will be signed during Xi's stay. "It is a big event for us," Vucic said.

From Serbia, Xi will travel to Poland where he will ink deals on finance, aviation, science and education. Poland has sought to develop trade and business ties with China, where it sees a large market and a counterweight to strictly regulated business ties within the European Union.

sources: Nemanja Cabric and Han Jianjun XINHUA

Jovana Gec, associated press

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