Serbian government announces austerity measures

Serbian finance minister Lazar Krstić has announced six economic measures to address public savings, fiscal stability and to promote growth as well. Wages in the public domain are to be reduced, and lower VAT for “non-existential” products would be raised to 10 per cent from eight, Krstić said on October 8.

Public enterprises restructuring, as well as cutting subventions, borrowing favorable credits and improving business conditions should also contribute to governments objectives.

Krstić said that, according to the government’s assessments, budget revenues in 2013 would be RSD 20 billion (about 50 million euro) lower than had been planned by budget amending. “We have to reduce the spending for that amount,” Krstić said, adding that “in November we will know the results”.

The International Monetary Fund (IMF) mission in Serbia has emphasised, Krstić said, that there were “additional risks with regard to the budget revenues”. In that sense, he said that the economic and fiscal policy in Serbia conducted by the previous government from 2008 to 2012 “was irresponsible and nontransparent”.

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