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The Government of the Republic of Serbia

In the service of citizens

Government reallocates NIP funds

Belgrade, 29 May 2008

Serbian Minister of Trade and Services Predrag Bubalo stated today that the government decided to reallocate funds for the realisation of the National Investment Plan (NIP) from projects which did not begin or cannot be implemented this year to those whose implementation has begun and which require more funds.

Predrag Bubalo at today's press conference

At a press conference following the government session, Bubalo said that funds for the ring road Irig, worth RSD 100 million, will be transferred to the construction and repair of main and regional roads in the northeast industrial zone Indjija. Thus, this fund will be doubled and will amount to RSD 200 million.

He noted that the government also decided to transfer RSD 70 million, originally intended for the Ministry of Telecommunications, to the Office for the National Investment Plan and use them as emergency funds for projects.

The Minister said that the government also adopted the Information on necessary amendments to legal regulations in accordance with World Trade Organisation’s requirements, referring to trade liberalisation.

At the session, the government also gave consent to the allocation of the profit of public air carrier Jat Airways, which last year made a profit of RSD 300 million.

Bubalo said that fuel in Serbia must again increase in price by 12.48%, although the new prices will increase inflation by 0.68%.

He explained that reduction of excise duties was considered but that would decrease budget revenues by RSD 10 billion. Bubalo said that Minister of Finance Mirko Cvetkovic today informed government members that in a study of ten countries in the region, excises are higher in six countries while four have smaller excises for oil. Speaking on D2 fuel, he said Serbia has the lowest tax in the region.

Bubalo explained that the analsysis included Austria, Hungary, Slovenia, Croatia, Bosnia-Herzegovina, Albania, Montenegro, Romania, Bulgaria and Macedonia. The Minister stressed that Bosnia-Herzegovina has been shown to have the lowest excise duties and financial gearing whereas in other countries, the gearing ratio ranges from 50% to 56%.