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The Government of the Republic of Serbia

In the service of citizens

Government adopts first package of anti-crisis measures

Belgrade, 30 August 2012

Minister of Finance and Economy Mladjan Dinkic said that the Serbian government adopted at its session today the first package of anti-crisis measures worth approximately €1 billion for the following 12 months which include soft loans for solvency of companies.

Goran Knezevic and Mladjan Dinkic

Speaking at a press conference held after the government session, Dinkic said that the government also decided to allocate RSD 7.5 million for the municipalities of Cacak and Gornji Milanovac for the repair of damage caused by fire.

He said that the state will subsidise interest rates on loans from commercial banks and added that out of €1 billion, more than €300 million in loans will be approved by the end of this year.

The Minister noted that all banks that wish so can participate in this programme and specified that the interest rate will be 3.5% per year for the loans with foreign currency clause, while the loans with Serbian dinar clause will have an annual interest rate equal to the reference rate of the National Bank of Serbia.

The repayment period will be 18 months and the grace period six months, Dinkic said, adding that companies will be able to request loans for refinancing under the same terms.

He stated that it was proposed at the government session to abolish 104 para-fiscal levies and 14 ministries were ordered to propose at the next session which levies should be abolished and whether there should be more. The complete programme of fiscal consolidation will be released to the public on 10 September, Dinkic stated and added that this plan includes a small part of the upcoming budget revision.

Goran Knezevic and Mladjan Dinkic

Minister of Agriculture, Forestry and Water Management Goran Knezevic said that at today’s session the government passed two regulations for help to farmers consisting of reimbursements for diesel fuel and subsidies for farmers.

Knezevic said that already in ten days farmers will be able to purchase diesel fuel at favourable conditions for the coming autumn sowing.

He specified that a total of 70 million litres of diesel fuel will be offered to farmers at a price lower by RSD 76 than the retail price.

The second regulation deals with subsidies for crop and potato production for 2012, consisting of RSD 6,420 per hectare, the Minister said and noted that the sum set aside for subsidies is considerable i.e. RSD 10.5 billion. Knezevic explained that this is realisation of an oral promise made by the previous minister to the farmers and which the current government has put into legal framework.

He underlined that in this way the government will not be able to compensate farmers for the entire damage they suffered during the drought, but will enable them to mitigate the consequences and start new production.

The Minister pointed out that this is one of the biggest interventions in agriculture in the last 20 to 25 years, with the package of measures being worth €160 million.