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The Government of the Republic of Serbia

In the service of citizens

Government's Plan for Kosovo binding for all state bodies in Serbia

Belgrade, 7 October 2004

Serbian Prime Minister Vojislav Kostunica said today that the Serbian government will continue with the implementation of its Plan for a political solution to the situation in Kosovo-Metohija so that it could secure institutional guarantees for Serbs in the province.

From left: Mladjan Dinkic, Vojislav Kostunica and Zoran Stojkovic

Following the adoption of a proposal regarding the budget revision at today's government session, Minister of Finance Mladjan Dinkic said that this is one of the rare examples in public finance where public expenses are cut down. The aim is to give more space for private investment, strengthen macroeconomic stability and to reduce the trade deficit.

According to Dinkic, the budget revision proposal projects 329 billion dinars in revenues, which was forecasted in the original Budget Law as well. This year's expenses will total 362 billion dinars; the deficit is projected at 32.7 billion dinars. That sum includes debt payoff to the London Club of Creditors under the arrangement on writing off 62 percent of the debt or $1.7 billion. The repayment should be completed by late October. The budget deficit, excluding the repayment to the London Club of Creditors, would stand at 30 billion dinars.

As opposed to last year, when budget deficit equaled four percent of GDP, this year's deficit will be reduced to 2.2 percent of GDP, said Dinkic. He explained that the major source for covering the deficit is from domestic financing worth 18.3 billion dinars, this comes from the revenues generated by privatization efforts from last year (around 10 billion dinars), issuing of securities and from commercial bank loans.

The other important source for covering the budgetary deficit are loans and donations, whose projected value is 8.9 billion dinars, and from this year's privatisation revenues, projected at 5.5 billion dinars, said Dinkic.

The Minister of Finance stressed that additional funds to local self-government have been increased to 375 million dinars and to the autonomous province of Vojvodina they have increased to 420 million dinars.

Also, additional funds have been secured for projects in southern Serbia carried out in cooperation with international organisations.

Dinkic said that the Serbian government adopted at its session today a decision to only allow the import of used vehicles not over three years old, whose motor complies with the EURO-3 standard and which are not damaged. The aim of this decision is to reduce import expenses, increase road safety and reduce environmental pollution, said Dinkic.

Serbian Minister of Justice Zoran Stojkovic said that the Bill on Enforcement Procedure, adopted at the government session today, will allow for better protection of creditors' rights and for those whose rights have been violated. The Minister said that this law received full support of the Council of Europe and its experts, and is of great importance for the economy and for boosting investment in Serbia.

The adoption of a Bill on Juvenile Delinquency was necessary because juvenile crime has increased over past years and the existing laws do not secure proper protection of minors and their resocialisation, said Minister Stojkovic. The bill was prepared with the assistance of the United Nations and Sweden and contains three segments - preventive measures for keeping juveniles out of courts, court proceedings which should better protect minors and execution of penalties with the aim of full resocialisation.

The Minister said that the bill also contains provisions on offering assistance to minors after they leave penalty institutions. These provisions envisage much better work of social care centres, as well as some parental obligations.