Serbia gets yet more loans from World Bank
The World Bank has approved a 200-million-dollar (133-million-euros) loan to Serbia to support its budget, Serbian Economy Minister Mladjan Dinkic said Tuesday.
It is the first instalment of the 400-million-dollar loan agreed at a meeting with the World Bank’s vice president for Europe and Central Asia, Philippe Le Houerou in October, Dinkic was quoted as saying by Tanjug news agency.
The remaining 200 million dollars were aimed at supporting the 2010 budget, Dinkic said.
The World Bank representative in Serbia Simon Gray earlier said the loan was aimed at reducing public administration and improvement of the business climate in Serbia, Tanjug reported.
Serbia has been severely hit by the global economic crisis and the International Monetary Fund (IMF) said in September its economy would shrink by 4.0 percent in 2009.
Earlier this month, Serbia and a visiting IMF mission reached an agreement allowing Belgrade to draw a second instalment of a 2.9-billion-euro (4.3-billion-dollar) loan, up to 700 million euros on condition of further cost cuts.
The deal will result in a freeze on public sector wages and pensions extended into 2010 and the start of pensions reform next year, along with a half-a-percentage point cut in the budget deficit next year.
The IMF allowed Serbia to run a 2010 budget deficit of four percent of gross domestic product (GDP), despite initial request that it be 3.5 percent.
The accord is subject to approval by the IMF management and executive board, expected to meet on December 21.
Serbia’s Finance Minister Diana Dragutinovic however said that Serbia needs to tighten its fiscal policy and will try to achieve this by cutting current expenditure for public sector wages and pensions,
“There is a consensus among economists that loose monetary policy may be appropriate but that fiscal policy needs to be tightened,” Dragutinovic told a conference in Vienna.
“We will try to achieve fiscal adjustment through cuts in current expenditure, and one possibility is to continue with equal burden sharing betwen public wages and pensions.”
Dragutinovic said mechanisms to ensure fiscal discipline remain in place included a special law or installation of a council that oversees the budgetary process.
She also urged that Serbia move towards a model of export-led growth by boosting the private sector’s role in the former Yugoslav republic’s economy.
“Serbia has to move to an export-led growth model,” she said. This means “the share of the private sector has to go up, which means substantial downsizing of the public sector, including much more discipline of public enterprises.”
November 18, 2009
AFP | Reuters
Loans? Loans? The money should be gifts for what the criminals did to Serbia in 1999!
Dusko.
The Vietnamese are still waiting for reparations from 1975 from those Genocidal gangsters.
dony, but we have paid in the lives of young, mostly poor men and the hundreds of thousands of jobs leaving the USA and going to places like Vietnam.
Yes, the criminal US businessmen have built factories in Vietnam and are importing goods here.
Dusko.
Yes you are right those worms don’t care how many people die as long as they make a profit,another problem is generation on generation of Americans are stupid enough to wage war on other people just because there political masters tell them to and that has resulted in millions of deaths since the end of WW2.
How much is the interest on this loan? It has got to be at least twice the principal, if it is compound interest. The World Bank does not make loans to help countries, but rather to enslave them. Serbia will be forced to do the bidding of this bank, which is controlled by the U.S. In order to extract the interest, Serbia may have to cut back on important items such as medical care, pensions and other social services.
Going into debt to international banks is like playing poker with a country’s welfare. The Serbs should create their own internal monetary system and barter for goods and services that they cannot produce or acquire in Serbia proper.
WOW Stric Simo.. barter!
Barter happened the evening after the monkeys got off the tree.
Humans like you now barter money for goods so why force other Serbs to be guinie pigs for your unbalanced emotional recomendations which, I am sure, you don’t even follow.
To Draza,
Barter works. That is what Venezuela, Cuba and the left leaning Latin American countries are doing. And that is what the Axis powers did during the 1930’s and since international finance could not cope with it they decided to provoke a world war to get rid of it. In fact, Yugoslavia at that time had a very effective barter arrangement with Germany in which the Yugoslavs sent agricultural products to Germany in exchange for industrial products. Do the research and dispense with the personal attack.
Barter on a personal or individual level is not very practical; however on a national or international level it can be very effective.
I am not talking about on an individual level. You misinterpreted my assertion.
Yugoslav barter trade with Germany you cite was a result of Yugoslav sanctions against Italy for its invasion of Ethiopia, and barter with Nazi Germany was the best it could do to replace the lost trade.
Nazi Germany signed loads of barter agreements with weak eastern Europeans, including a big one with Stalin, and all of those agreements came from a Nazi premise that advocated autarchy that sought to secure raw materials from politically weak.
So barter, as we see, is a necessity to which weak nations are forced into, hardly a model for Serbia today.
As for the mismanaged ones in Latin America today that use barter, just compare their economic growth numbers with non-barter ones like Brazil, Chile or Colombia and it is clear that barter is leads nowhere.