Member of the Fiscal Council Nikola Antiparmakov said Serbia is seeing a dangerous trend of rising public debt and unless the state urgently takes measures to reduce spending, it could become unable to make any budget payments.
“According to the government plan, which accompanies the budget balancing bill, certain reforms will be carried out which, under the most optimistic scenario, should stop the rise in debt in 2017. Realistically, with these measures, this will not happen even then,” Antiparmakov said in an interview for the Sunday edition of Blic.
He says finding EUR 2.6 billion to cover this year’s and EUR 4.5 billion for next year’s budget deficit will be a major challenge.
Antiparmakov believes it is very detrimental for the Serbian economy that the country will not enter an arrangement with the International Monetary Fund (IMF), because the planned cooperation with the World Bank, although good news in itself, cannot replace an arrangement with the IMF in the long term, since potential investors look to the IMF’s estimates for a guarantee their investments will be safe.
He said it would be best if Serbia could increase production by ten percent and keep the current living standard, but since this is not possible, the standard will continue to drop by several percent over the next few years.
Antiparmakov said the Fiscal Council proposed to secure EUR 350 million for the state budget next year through a solidarity tax payable by those whose income comes from the budget.
Source Tanjug
