In recent days, Serbian officials have been assuring the public that Serbia has the funds to buy the Russian stake in the Oil Industry of Serbia (NIS). However, experts argue that such a purchase would require taking on additional debt, with plans to issue over one billion euros in dinar government bonds, further fueling the speculation.
A month ago, President Aleksandar Vučić revealed that the United States was considering sanctions on NIS due to its majority ownership by Russia’s Gazprom. While this claim has not been officially confirmed by the U.S. government, the potential sanctions have sparked public discussion about purchasing the Russian share or even nationalizing NIS. Finance Minister Siniša Mali and Vučić have stated that Serbia is prepared financially, though Mali acknowledged concerns about the budget structure and suggested a solution through borrowing.
The Serbian government is set to issue a 120 billion dinar (over one billion euros) bond, with a coupon rate of 5.25%, which will mature in 2035. Economist Dragovan Milićević supports borrowing for the purchase, viewing NIS as a strategic, profitable company. However, he cautions about the quality of management and the potential risks of repeating past mistakes. He also raised questions about whether Serbia intends to acquire a majority, dominant, or full stake in NIS, and whether sanctions would persist if Gazprom retains a minor share.
Nenad Gujaničić, a broker, suggests that much of the NIS speculation is political, with the West aiming to reduce Russian influence in the Balkans. He believes sanctions on NIS would only hurt Serbia by limiting crude oil imports but would not force the Russians to sell their majority stake. Gujaničić also argues that the bond issuance is unrelated to NIS, as it is meant to cover the budget deficit and bond payments.
Furthermore, Gujaničić believes it is better for Serbia not to be the majority owner of NIS, as state-owned companies often suffer from poor management and political control, leading to losses. He points out that NIS was in poor condition before being taken over by Russia, and its current success is largely due to the Russian ownership, with the state holding nearly 30% of shares. NIS is valued at around one billion euros on the stock market, though Gujaničić believes its true value could be much higher if sold in a transparent international tender.
