Serbian Central Bank Governor Mladjan Dinkic has expressed satisfaction with the talks with the IMF, and said he hoped that the IMF’s board of directors would approve the disbursement of the third tranche under the stand-by programme in late July. Dinkic said that the IMF was also pleased with the implementation of the macroeconomic criteria in Serbia and Montenegro.

Furthermore, IMF officials expressed readiness to provide further assistance by organising a meeting with international donors in late July, expected to secure additionally EUR 190mn for economic reforms. Dinkic commented that the most difficult part of the talks concerned the price of electricity. Refusing to specify the position of the government regarding the matter, Dinkic only said that the price would not go up as much as initially expected. The original estimations spoke of raising once again electricity prices by some 25-30%, but the hike was postponed due to the lack of clarification of the government’s policy in that area.

According to Dinkic, the parties have agreed on all other issues from the memorandum on economic policy and said that all negative economic consequences in the wake of the assassination of Zoran Djindjic would be overcome by increased investment in the second half of the year. Even though we commend Serbia and Montenegro’s performance in meeting the IMF’s criteria, we remain sceptical on the prospects of the country to draw large amount of private investment, as it still lacks the institutional environment and business climate that neighbouring countries have achieved to some extent.

(IntelliNews 02.vi.03)