Eurasia Press & News
The chief of the International Monetary Fund’s mission in Serbia Albert Jagger confirmed today at a press conference that the IMF will approve the loan arrangement with Serbia, but said the Serbian goverment must fulfill some conditions first.
“These conditions are: rebalancing the budget, changes in tax regulations, and getting confirmation from international creditors and guarantees that the number of loans for firms in the private sector will not be decreased,” he said.
Jagger did not say when the IMF will approve the agreement.
He said that this year Serbia can expect a fall in Gross Domestic Product, GDP, instead of a previously projected increase of 3.5 percent.
“The Serbian Government will have to readjust budget outlays to the GDP fall”, he said.
Negotiations between the Serbian Government and the IMF started on March 16.
On Wednesday Economy Minister Mladjan Dinkic announced that an agreement had been reached with the IMF for a loan worth three billion Euros over the next two years.
The agreement will help Serbia cope with the economic and financial crisis and encourage foreign investors, Dinkic said.
Local media reported earlier that raising income tax and cutting subsidies to local authorities are some of the measures the government is considering in order to meet the IMF`s conditions for the loan. There have also been reports that the government is still thinking about the idea of reducing pensions and public sector wages and decreasing the number of ministries in order to reduce public spending. Government officials have not confirmed any of these reports.
