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The Government of the Republic of Serbia

In the service of citizens

Financing of local self-governments should be harmonised with Serbia's macroeconomic goals

Belgrade, 4 August 2005

Serbian Minister of Finance Mladjan Dinkic said today that the reform of the system of financing local self-governments is in high gear, and that its aim is the establishment of a stable, transparent and just system of financing in order to encourage regional development.

Dinkic said in an interview to the latest issue of the Local Self-Government magazine that the regulation of the transfer of property to local self-governments and development of capacities for property management is currently underway. In addition, the government has submitted to the Serbian parliament a bill on public debt, which regulates the field of debt contraction of local self-governments.

Dinkic pointed out that the government has fostered active cooperation with the Council of Europe, with their experts heavily included in the reform process, the preparation of new regulations and the amendment of existing ones, especially those concerning the improvement of the local self-government. He added that new legal solutions should allow for a decentralisation of local self-government.

The Minister of Finance explained that the basic principles of this reform should be in line with the European Charter on Local Self-Government and the Council of Europe's recommendations, because this reform must support Serbia's strategic goal, that being EU accession.

According to Dinkic, at the Council of Europe's conference, held on February 25 in Budapest, Serbia assumed responsibilities in accordance with the working programme for better local self-government, which envisages improvement of the system of financing, decentralisation and regulation of public debt.