Invest-in-Serbia: Private FDI Information, Strategic communication and Consulting Service for SEE, Custom Analysis and Reports - Government accepts starting points for negotiations with World Bank

Belgrade - Serbian Minister of Economy Predrag Bubalo said today that it is very important that the Serbian government has accepted the starting points for the technical discussion and negotiations with the World Bank on the first programme loan for development of the private and financial sector.

Speaking at a press conference held following the government's session, Bubalo said that the World Bank has so far supported Serbia in its transition efforts, adding that last year Serbia was approved for $134 million in loans by this bank under most favourable terms.

He said that this bank plans to continue approving loans to Serbia in the period from 2005 to 2007, and that this platform enables the signing and use of a new loan worth $55 million under most favourable conditions. These conditions include a zero percent annual interest rate, with a 20-year repayment period, a 10-year grace period and administrative costs of 0.75 percent annually.

Last week was very important for Serbia, Bubalo said because of the speech of Serbian Prime Minister Vojislav Kostunica gave in the UN Security Council, the talks which Deputy Prime Minister Miroljub Labus held in Brussels concerning negotiations with the EU and because the negotiations with the International Monetary Fund have got off the ground.

Bubalo said that at today's session two decrees have been adopted. The first decree amends the Decree on the method of sale of shares of the banks owned by the Republic of Serbia or by banks currently in the receivership procedure, in which the function of the bankruptcy trustee is being performed by the Deposit Insurance Agency. The decree regulates issues that have not been regulated so far and that is giving the Agency larger powers. The Agency will from now on be allowed to provide services to other shareholders, such as the Pension and Disability Insurance Fund, the Development Fund and the Share Fund.

The other decree is the Decree on the costs of obligatory disinfection of motor vehicles entering Serbia, in line with the Order on taking measures for prevention of the introduction and spreading of the avian influenza.

The Decision on the sale of state-owned capital in the ‘Famfarm’ company from Krusevac was also adopted today, which is in line with the process of restructuring the public sector.

The government, at its session today, accepted a Memorandum on trade-economic, scientific-technological and cultural cooperation between the Serbian government and the government of the Moscow area of the Russian Federation, which will be signed at an exhibition and presentation of Serbian economy themed, “Serbia in Russia 2005”, that will be held from November 30 to December 2. He said that this Memorandum affirms the importance of the Russian market for the Serbian economy.

Bubalo also said that a special session of the Serbian government is to be held on October 28, regarding the budget.

Serbian Minister of Energy and Mining Radomir Naumov recalled that on Tuesday the Agreement on the establishing of a regional South East European energy market was signed. He said that the message of this conference, held in Athens, is that signatories to the agreement have fulfilled all the conditions in the energy sector required to join the EU.

Naumov said today that Serbia will have immediate benefit from this agreement since it will give Serbia access to funds that support development in the energy sector, and also because of the stability and safety of the power supply. The agreement also allows the removal of inter-border barriers so that there are no more duties and other taxation on the trade of energy sources between these countries, and Serbia will have advantage because of the development of its own infrastructure as well.

It has been planned that the future directions of the main gas pipelines will be towards Kosovo-Metohija and Montenegro on one side, towards Leskovac on the other and also towards Bosnia and Herzegovina, which will contribute to making Serbia an important factor in the Balkans.

He said that the construction of the “Nabuko” gas pipeline project, through which oil from the Caspian Sea will be transferred to West Europe, also envisages one branch going through Serbia.

Source: Official web site of Serbian Government