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The Government of the Republic of Serbia

In the service of citizens

Budget revision as agreed with IMF

Belgrade, 23 November 2010

Minister of Finance Diana Dragutinovic said today that the revised budget for 2010 is a result of the government’s wish to make a balance between stimulation of the economy and social cohesion.

Addressing MPs, Dragutinovic noted that the revised budget for 2010 is the only way in which the government can respond to the complexity of the external environment at a time when the economic crisis is not over yet.

The budget revision stipulates a deficit of RSD 120 billion, due to the fact that expenditures amount to RSD 780 billion while revenues total RSD 660 billion, the Minister recalled.

Also the budget revision came as agreement was reached with the International Monetary Fund (IMF) that the state deficit does not surpass 4.8% of GDP for 2010, she specified.

She stated that transfers to the Fund for Pension and Disability Insurance increased by RSD 7 billion for the regular payment of pensions, while RSD 6.5 billion was earmarked for immediate assistance to pensioners in the individual amounts of RSD 5,000.

The Minister explained that the revision of the budget also covers the expenditures of one-time assistance to employees in the public sector amounting to about RSD 2 billion, as well as expenditure for social protection and help to poor municipalities.

RSD 892 million was allocated for education, RSD 2 billion for industry subsidies, while subsidies for agriculture will amount to approximately RSD 650 million, the Minister itemised.

There are unambiguous indications that the economy is recovering, as evidenced by the accelerating rate of economic growth, export growth and the parameters in the field of trade and tourism, she outlined.

Dragutinovic observed that when it comes to negative trends, inflation in October exceeded the upper level of inflation, the main reasons being the growth of the exchange rate and increase in food prices.