In 2008 Serbia and Fiat created a 700 million euro ($1 billion) joint venture, Fiat Automobili Srbija, in which the Turin-based manufacturer acquired 67 percent of the Zastava carmaker, while the government in Belgrade kept the remainder.
However, Fiat delayed its investment in Zastava last year due to the global financial downturn, leaving it to be run by Serbian government subsidies.
At a meeting with Serbia's President Boris Tadic in Turin on Sunday, Fiat's CEO Sergio Marchionne pledged that the deal with the Belgrade government will be signed this month, said a statement from Tadic's office.
'By the end of the year, Fiat will make its first 100 million euro payment, while the remainder will be paid quarterly,' the statement quoted Tadic as saying.
During a visit to Zastava's facility in the city kf Kragujevac, central Serbia, later on Monday Tadic said that 'with the payment of 100 million euros and another 100 in 2010 Fiat will complete the initial phase of its investment,' the Tanjug news agency said.
While it delayed investments in Zastava this year, Fiat agreed with Belgrade to allow Zastava to assemble its Punto model for sale in Serbia and the Bosnian Serb part of neighboring Bosnia.
According to economy ministry data, in 2009 the Zastava factory will produce a total of 15,000 Fiat Punto cars and earn 27 million euros.
($1=.6978 Euro)
(Reporting by Aleksandar Vasovic; Editing by Zoran Radosavljevic and Jon Loades-Carter) Keywords: SERBIA FIAT/ (aleksandar.vasovic@thomsonreuters.com; +381 113044902) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
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