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The Government of the Republic of Serbia

In the service of citizens

Serbia needs minimum of $2 billion for sustainable economic growth

Belgrade, 10 March 2006

Serbian Minister of Economy Predrag Bubalo said today that it is realistic that Serbia during this and the upcoming years will annually realise a minimum of $2 billion in foreign direct investments, in order to attain sustainable economic growth.

Speaking at a press conference, held on the occasion of two years of work of the Ministry of Economy, he said that most progress in increasing exports can be made in the automobile and food industry.

He recalled that in the previous two years the Ministry of Economy has resolved the debt issue between “Zastava” from Kragujevac and the Italian “Fiat”, and has done a lot of work on the privatisation of “Zastava”, which once finalised will remain only as “Zastava Automobili” and efforts will be made to secure a strategic partner for it.

He said that the debt issue with Italians has also been resolved concerning the case where “Duferco” demanded payment from Serbian steel maker “Sartid”, so that there are no more obstacles in the relationship of the two countries.

According to Bubalo, there is only one more debt issue to be resolved concerning the debt of the Ministry of Energy and Mining to China, and that will round up the process of resolving the inherited external debts of the Serbian economy.

Bubalo said that because of high public expenditure there will be intervention so that the public sector can go through the process of reforms and rationalisation of jobs, with the aim of achieving profitability, as has been done in the sectors of health and education.

The Minister said that this year it has been planned that work will be done in three key areas- improving the crediting of industrial production, raising employment and controlling inflation.

The Ministry of Economy is planning to prepare four important new laws and four strategies this year, said Bubalo, and added that these are laws on cooperatives, entrepreneurs, equal regional development and agricultural produce exchange.

He also said that it is planned that a strategy will be prepared for privatisation registers, which will resolve the problem of cost free distribution of shares to those over 18 years of age who have not realised that right during their work period.

According to Bubalo, it has also been planned that a strategy will be adopted for the privatisation of public-communal firms, privatisation of city construction land, as well as the national strategy for the economic growth of Serbia from 2006 to 2012.