FINANCING THE DAIRY SECTOR IN RURAL AREAS OF THE REPUBLIC OF SERBIA: PEŠTER REGION EXAMPLE

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 Pešter region and respectively three administrative units belonging to Raška and Zlatibor district. Most enterprises in dairy sector of Pešter 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.