Eurasia Press & News
Serbia hopes to reach an agreement with the International Monetary Fund, IMF, on a new stand by loan arrangement worth up to 3 billion euros by the end of this week.
Deputy Prime Minister Bozidar Djelic on Monday stated that he expects talks with the IMF to end by late next week and said that the arrangement will apply for 2009 and 2010. “I expect this round of talks to end next Thursday or Friday,” Djelic told reporters.
Serbia’s Minister of Economy and Regional Development Mladjan Dinkic stated that he expects the two-year arrangement to be worth approximately three billion euros. “I expect an arrangement to be attained with the IMF on two billion euros loan for strengthening Serbia’s foreign currency reserves in 2009 and another billion for 2010,” Dinkić said at a roundtable titled: “Serbia in 2009 – Recession, Growth or Stagnation”. He added that this will be more than enough money for Serbia to maintain currency stability.
The IMF mission began talks with Serbian officials on Monday, aimed at supporting Serbia’s worsening balance of payments as well as its currency.
Dinkic pointed out that, having spoken to the IMF representatives, both the government and IMF officials share the same view regarding the effect that the current global economic crisis is having on Serbia, as well as measures that should be taken.
He warned that ”this year will not be easy one for Serbia, but it will be far from catastrophic”.
The government said that that new stand-by arrangement will replace the existing one made between Serbia and IMF, in a statement.
According to the statement, the Serbian government’s platform for negotiations is based on increasing budget deficit and reducing public spending.
The Serbian dinar has lost more than 25 per cent of its value since the global financial crisis began to bite in late 2008. Belgrade has slashed its gross domestic product growth forecast to between 0.5 and 1.0 per cent for 2009, compared with the 6.0 per cent predicted before the crisis.
The International Monetary Fund’s executive board has already approved a 530-million-dollar stand-by loan in January to help Serbia cope with the downturn.
