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The Government of the Republic of Serbia

In the service of citizens

Agreement on termination of first revision of arrangement with IMF reached

Belgrade, 11 May 2015

Minister of Finance Dusan Vujovic and Representative of the International Monetary Fund (IMF) Mission Zuzana Murgasova announced today that this financial institution and the Serbian government reached an agreement on the completion of the first revision of the stand-by arrangement approved to our country.

Murgasova said at a press conference, also attended by Vice Governor of the National Bank of Serbia Veselin Pjescic and representative of the IMF Mission Daehang Kim, that this agreement should now be approved by the management and the Executive Board of the IMF in order to terminate the first revision of the agreement.

Serbia will have access to €146 million, she specified and pointed out that the Serbian government announced that it does not intend to withdraw funds from the stand-by arrangement.

Murgasova said that the economic prospects in Serbia have improved to some extent, and noted that the unrelenting implementation of healthy economic policies and reforms is of crucial importance for achieving economic growth.

According to Murgasova, fiscal results for the first quarter are in line with the objectives set by the programme, with most of the fiscal consolidation measures implemented in accordance with the 2015 budget.

Vujovic stated that the decision on rise in electricity prices will be made in early June, together with the programme of restructuring of the Electric Power Industry of Serbia.

Economically speaking, we should increase electricity prices immediately, but we want to find ways to protect both citizens and the functioning of the Electric Power Industry of Serbia, he explained, adding that the government wants to postpone the increase of electricity prices because every day of delay means a lot to many citizens.

The Minister expressed his hope that until the end of the year Serbia will have a positive economic growth, noting that fiscal consolidation has so far been successfully implemented.

According to the Minister, growth projections have been changed from -0.5 to zero, which opens up a space for relaxation of the monetary situation, financial growth and job creation.

Vujovic said that the IMF supports the Serbian government’s programme, recalling that the state deficit at the end of the first quarter stood below 2%.