The state can borrow up to EUR 600 million this year for the purposes of securing missing funds, refinancing the debt and creating a fiscal reserve for the next one, he predicted with the proposed amendments to the decision on borrowing, which the parliament should consider on Monday.
The state can become indebted by concluding credit arrangements with international financial institutions, domestic and/or foreign banks, through the issuance of government bills and/or bonds on the domestic and/or international market, as well as/or by concluding bilateral or other credit arrangements, the proposal states, which was adopted by the Government on November 9th.
That proposal, together with the proposed rebalancing of the budget, will be considered by the parliament on Monday.
In the proposal for changes to the borrowing decision, it is stated that this year the Government can take on a debt of up to seven million EUR from the Simo Milošević Institute and take a loan from the European Investment Bank (EIB), which will finance the general overhaul of the railway, rehabilitation of steel bridges and tunnels and modernization of depots and workshops.
The missing funds for financing the budget were reduced from EUR 705 million to EUR 537 million.
Already this year, the government of Dritan Abazović borrowed EUR 100 million from Deutsche Bank in March of this year, with an interest rate of 5.9% plus six-month Euribor, which amounts to 4.5%.
– In the course of this year, the Government will take over the Institute’s debt of EUR 7 million towards Jugobanca in bankruptcy, i.e. the competent Deposit Insurance Agency of Serbia, which is in the function of bankruptcy trustee – it was stated in the Government’s explanation of the changes to the decision.
The Government explained that activities were undertaken with the aim of finding a way to settle the Institute’s debt to Jugobanca based on a final court ruling, where the state was an intervenor on the Institute’s side.
– In order to avoid a possible blockade of the Institute, and thus an almost certain bankruptcy, it was agreed between the two governments that the Institute’s debt be reduced by EUR 1.36 million, which is what Serbia owes to Montenegro based on the old foreign currency savings. After that, the rest of the debt of 5.3 million would remain to be paid from the budget – explained the Government.
A special agreement would regulate relations between Montenegro and the Institute, which requires the position of the Agency for the Protection of Competition on the issue of state aid, which has not yet been provided.
Sign up for business news updates & special reports.
