Bloomberg News

Serbia Must Adopt Program to Avoid Bankruptcy, Dinkic Says

July 10, 2012

Serbia must approve a program by the end of the third quarter to stave off bankruptcy amid a record- high budget deficit, Finance Minister-Designate Mladjan Dinkic said.

The Balkan nation’s fiscal position is “very difficult” and the government needs to embark on fiscal consolidation, draw up anti-crisis measures to safeguard liquidity and investment and speak with international lenders, Dinkic told reporters today in the capital, Belgrade.

Serbia has been struggling to dodge a new recession and attract outside investment after inconclusive elections May 6 triggered a two-month stalemate over the make-up of a coalition government. The country may need to ask the International Monetary Fund to allow it to reschedule or write off debts, Stojan Stamenkovic, the chief economist at the state Economics Institute, said today.

“We need to prepare a program which will enable Serbia to avoid the situation of bankruptcy,” Dinkic said. “We will certainly adopt the program before the end of September and talk with the IMF and the World Bank but we’ll try to work out measures on our own.”

Three Serbian political groups signed a pact today that paves the way for a new coalition government to take office later this month.

To contact the reporter on this story: Gordana Filipovic in Belgrade at gfilipovic@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net


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