Abstract
Milk shortage is a major problem of the dairy industry, both in Serbia and in neighboring countries. Although there is evidence of a growing demand for these products, there are still a number of limitations that make these resources largely untapped in Serbia. The lack of processing facilities of companies further reduces the economic effect, which could be realized with a greater degree of product finalization. This situation as a result has inefficiency in operations and weak competitiveness in exports. This paper analyses the problems of financing the dairy sector in rural areas of the Republic of Serbia in Pester region and respectively three administrative units belonging to Raska and Zlatibor district. Most enterprises in dairy sector of Pester are small and family ones, which are often classified as micro-enterprises. Survival, growth and development of micro, small and medium enterprises and entrepreneurs, that are the most effective segment of the economy in all world countries, primarily is determined by funding opportunities from favorable sources. The number of available funding sources in Serbia for these companies is small, so the financing is one of the most painful issues. The importance of these businesses for local communities reflects in the creation of employment opportunities, primarily low-skilled workers, women and the young. This contributes to rural development and poverty reduction in national economies.
Highlights
This study includes the dairy sector in the three administrative units belonging to Raška and Zlatibor districts
The method of description was used in order to highlight the role and importance of the dairy sector for development of the analyzed region, which sought to achieve the confirmation of the basic hypothesis that animal husbandry and production of milk and dairy products represent a significant potential for the development of economy in the analyzed region
The survey results clearly show that the Pešter region is characterized by excellent natural predisposition for development of animal husbandry
Summary
This study includes the dairy sector in the three administrative units belonging to Raška and Zlatibor districts. Their placement through the channels of the grey economy. Lack of processing capacity greatly reduces the sector economic potential, which could be much higher with a higher level of product finalization. The low percentage of use of existing capacity, results in inefficiencies in operations and weak competitiveness in exports. A producer with small volume of production does not generate enough profit due to weak bargaining opportunities in the supply chain, and as a result he/she cannot invest in enhancing his/her competitiveness. In relation to foreign producers, who are taking advantage of economies of scale, modern equipment and infrastructure, the Pešter region has exceptional natural resources and relatively low labor costs, and it creates a competitive advantage in the EU market and other international markets in terms of milk and dairy products
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