Serbian Arms Exports Not Hit By Economic Downturn

Miloradovic did not elaborate on the company`s 2008 earnings but said that in 2007 it `had ongoing deals worth about $400 million`.

Serbia's state-run weapons producer and exporter has defied the global financial crisis due to lucrative deals abroad and is poised this year to boost exports, a top official said on Thursday.

The company has signed weapons contracts with several Middle Eastern states including Iraq and said it hoped new deals in the region would allow it to pass on business to other troubled sectors of the Balkan country's economy.

"Not a single customer so far has cancelled or altered a contract," said Nenad Miloradovic, executive director of Yugoimport SDPR.

Miloradovic, speaking at a promotion for a new armored personnel carrier at a testing ground north of Belgrade, told reporters Yugoimport SDPR hoped to increase exports in 2009.

The company offered its APC to the Iraqi military during a recent visit to Baghdad by Serbian Defence Minister Dragan Sutanovac, and Iraqi officials had expressed interest, he said.

"As many as (local) 15 companies could be included in the production. We are hoping to start serial production in the summer of 2009 in our new assembly facilities," he said.

The company, which last year secured a $235 million deal with Iraq, said it hoped any new contracts would help secure jobs in Serbia's troubled automotive and metal industries.

Recent customers included the United States, Iraq, Libya, Myanmar and Israel, it said.

Serbia's arms export business is a fraction of what it was in the 1980s. Former Yugoslavia's weapons industry generated about $2 billion per year, but virtually ceased to exist during the 1991-99 Balkan wars because of a U.N. weapons embargo.

"There is no way we can reach that level again, but we are hoping to get to the position of a mid-sized exporter," Miloradovic said in an interview.

Weapons exports were restored only after the ouster of former President Slobodan Milosevic in 2000.

Miloradovic did not elaborate on the company's 2008 earnings but said that in 2007 it "had ongoing deals worth about $400 million".