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Implementation of Serbia’s economic programme on track - IMF

Author Radomir Ralev
Implementation of Serbia’s economic programme on track - IMF IMF/Creative Commons

BELGRADE (Serbia), December 19 (SeeNews) - The implementation of Serbia's economic programme is on track and quantitative targets for end-September 2019 were met, the International Monetary Fund (IMF) said.

Fiscal performance remains sound, public debt continues to decline, progress has been made in reforming the tax administration and strengthening public investment management frameworks, and inflation remains close to the lower end of the target band of Serbia's central bank (NBS), the IMF said in a statement on Wednesday, following completion of the third review of the country's economic performance under the Policy Coordination Instrument (PCI).

"Robust FDI inflows have led to dinar appreciation pressures for most of 2019, and the NBS has been a net purchaser of foreign exchange," the global lender noted.

Serbia's 2020 budget targets a deficit equivalent to 0.5% of gross domestic product (GDP), keeping public debt on a declining path while creating some fiscal space for capital investments and a further lowering of the labour tax wedge, the IMF noted.

"The financial sector indicators appear sound, but developing capital markets and continuing to promote dinarisation will be important to further enhance financial stability and support medium-term growth."

The IMF also said that Serbian authorities remain committed to advancing structural reforms in 2020, needed to boost potential growth and improve the private investment climate. These include implementation of delayed reforms of the public wage system and public employment framework, introduction of new fiscal rules for 2021, as well as measures to strengthen state-owned enterprise (SOE) management and corporate governance.

The PCI of Serbia was approved on July 18, 2018, and aims to maintain macroeconomic and financial stability, while advancing an ambitious reform agenda to foster rapid growth, job creation and improved living standards.