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The Government of the Republic of Serbia

In the service of citizens

Fiscal Policy Memorandum adopted

Belgrade, 4 June 2009

Serbian Deputy Prime Minister for EU integration and Minister of Science and Technological Development Bozidar Djelic said that the Serbian government adopted today a Memorandum on Fiscal and Economic Policy for the period 2009–2012.

Verica Kalanovic and Bozidar Djelic

Speaking at a press conference Djelic said that the budget deficit, which is expected to be 3% of the GDP this year, will be reduced to 2.6% of GDP in 2010 and further reduced to 1.2% of GDP in 2012.

He said that the Memorandum establishes continued macroeconomic stability as the key aim.

The Memorandum will be finalised and made part of next year’s budget, said Djelic.

He said he expects that the macroeconomic situation will be discussed with the IMF mission in August.

The government also adopted a set of measures for dealing with the effects of the global economic crisis and a sum of RSD 190 billion has been set aside for supporting the economy in 2009, said Djelic, adding that an additional sum of €480 million will be provided by international financial institutions.

The Deputy Prime Minister said that the government will adopt measures for supporting the media in Serbia within 15 days, adding that a meeting with the Prime Minister will be held next week regarding this matter.

He said that despite a tight budget the government will examine all possibilities for doing its utmost to help.

The Deputy Prime Minister said that the financial state of the media is difficult, adding that according to estimates the advertising market fell by 30–50%.

He said the government today endorsed the stance that pressure on the media is unacceptable, adding that relevant organs will deal with every such attempt.

Minister for the National Investment Plan Verica Kalanovic said that the government today adopted the bill on regional development, envisaging the formation of seven economic regions.

Kalanovic noted that this implies the formation of the Vojvodina, Kosovo-Metohija, Belgrade and Western, Eastern, Central and Southern Regions.

She said this does not define the administrative division of the state, but simply a division into units which will facilitate a more evenly balanced development and reduce existing differences.

The bill will be forwarded to parliament for emergency adoption, Kalanovic said, adding that this is a systemic law which has been subjected to a painstakingly long public debate by all interested parties.

Djelic added that the bill aims not only to reduce the large discrepancies in development amongst regions but also to open possibilities to apply for EU development funds.

This law will not divide Serbia as it is simply a document whose goal is to introduce statistical and not administrative regions where we will be able to monitor the level of development and reduce the economic and social discrepancies in Serbia, Djelic reiterated.

He said the bill will grant citizens greater freedom in making important decisions in their local communities and enable them better cooperation with regions in the EU.

The proclaimed goals are overall social and economic development, reduction of regional disparities and negative demographic trends, developing competitiveness and a knowledge-based economy, as well as encouraging inter-municipal, inter-regional and cross-border cooperation, Djelic stressed.