Miroljub Labus
Author:
Tanjug
Labus told businesspeople gathered for a conference themed “Economic Policy for 2005” that this year’s GDP growth reached eight percent, while inflation will probably be a little over 12 percent.
According to him, the government expects increased budget revenues by late March 2005, thanks to the introduction of the value added tax (VAT). These revenues, however, will not be used to create a surplus but rather to cut tax rates and maintain the stability of the dinar.
There will be no threat of debt crisis in 2005 because the government has earmarked around 46 billion dinars, or $750 million, to service foreign debt, said Labus and added that this amounts to 3.2 percent of the state budget.
Labus also said that a preliminary agreement has been reached with the European Union on exports of 150,000 tonnes of sugar in 2005, adding that talks are underway on raising the export quotas to 200,000 tonnes of sugar a year. He recommended that domestic producers cut production costs as the current price of €530 per tonne will go down.
Labus recalled that an agreement on textile will be signed by the end of March 2005, freeing Serbia’s products from quotas and import duties when shipped to the EU and thus encouraging foreigners to invest in domestic industry.