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Serbian government determined to reduce fiscal deficit

Autor: half
BELGRADE, June 8 (Hina) - The Serbian government is determined to preserve the stability of the financial system and focus all of its activities on increasing the economy and living standards as well as reducing the fiscal deficit in relation to 2012, but not by having the poorest citizens bear the brunt, a statement said on Friday after ruling coalition leaders reached an agreement.

The government and the ministers are planning significant economies in the public sector but the details of a programme of economic measures will be agreed next week, it was said.

Prime Minister Ivica Dacic said that apart from economising, it was imperative to increase revenues and improve the climate for foreign investment.

Deputy PM Aleksandar Vucic announced a thorough reform of the state administration and dealing with the problems in the public sector over the next year or two.

Finance Minister Mladjan Dinkic said earlier there would be no layoffs in the public sector this year but announced them for 2014. On Friday, he did not speak about concrete measures, except for saying that strict economies and significant cuts to budgetary expenditures were inevitable.

After the ruling coalition parties agree on a plan to pull out of the crisis, consultations are to be held with the state Fiscal Council and the International Monetary Fund.

Fiscal Council president Pavle Petrovic said late last month Serbia would face serious financial problems by the end of 2013 or early 2014 unless it managed to curb the budget deficit. Similar forecasts have been made by the IMF.

Both the Fiscal Council and the IMF recommend cutting pensions and salaries in the public sector as a medium term pillar of fiscal consolidation. According to the Council, between 20,000 and 25,000 people of the 450,000 employed in the public sector are surplus.

(Hina) ha

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