During January, the Government of Serbia will talk with the representatives of the International Monetary Fund (IMF) about the new arrangement, eKapija reports. Serbia should sign a new arrangement with the IMF because their presence represents security for financiers and foreign investors, economist Ljubomir Savic estimates.
“The IMF is, after all, a multinational financial institution that, above all, protects the interests of rich countries, and whether we like it or not, we have to cooperate with those rich countries, especially in financial terms. That is why it is very important when the IMF gives a positive assessment to our country, and that is important for financiers and foreign investors,” Savic said.
Speaking about the form of the new arrangement, Savic is convinced that this arrangement, like the previous one, will be composed in such a way that the IMF has the role of an advisor, ie that it will also be a “policy house” (Policy Coordination Instrument – PCI).
He added that the arrangement does not imply the withdrawal of funds or any more visible engagement of the IMF, and that it is a “gentleman’s agreement” which is good for both sides, if both fulfill the agreement from the agreement.
“The advice given to us by the IMF within that arrangement was very good for the citizens and the state. Some were implemented by the state, some not completely, but in any case there is no reason for the state not to enter into a new arrangement with the IMF,” said Savic.
However, he does not rule out the possibility that the state, due to the problem it currently has with a high fiscal deficit, may sign a financial arrangement.
Savic explains that Serbia did not have a high fiscal deficit in previous years, and that it appeared in the last year due to the crisis caused by the corona virus, ie due to the aid package with which the Government of Serbia helped citizens and the economy.
On Friday, January 8, the Board of Executive Directors of the IMF made a decision on the successful completion of the fifth, last review of the results of Serbia’s economic program, and Savic says that he absolutely agrees with that assessment of the IMF.
He points out that the Government of Serbia, despite the pandemic, managed to achieve “more or less” what it agreed with the IMF, and the assessment of that international institution, says Savic, is good both from the point of view of our state and from the point of view of citizens.
The previous “guard house” arrangement with the IMF was approved to Serbia in July 2018 for a period of 30 months, it did not envisage the use of financial resources, but was exclusively of an advisory nature, eKapija reports.
