The state will provide a guarantee for the loan of JP “Srbijagas” in the amount of 225 million euros increased by the amount of interest and costs, it can be seen from the draft law that the Government of Serbia submitted to the assembly for consideration.
Serbia thereby committed itself to pay the debt of Srbijagas if the public company does not settle the debt within a month from the maturity of the loan.
That is why money for paying these potential debts must already be provided in each republic budget.
The government decided to guarantee the debt of “Srbijagas” due to the energy crisis and high prices of imported gas, according to the explanation of the bill.
As stated in the explanation of the proposed law, the Budget Law for 2023 foresees that the Government can decide to issue guarantees “in order to preserve financial stability, prevent the occurrence or eliminate the consequences of extraordinary circumstances” in the amount of 120 billion dinars (more than one billion euros).
Money earmarked in the budget for providing guarantees does not enter the deficit. However, as a rule, public companies previously did not repay such guaranteed loans, so these types of guarantees are likely to be a future expense for taxpayers, as warned by the Fiscal Council.
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