Serbia to Add New Measures to Ensure 2013 Gap of 3.5% of GDP

Serbia’s government will adopt further measures to ensure the 2013 budget deficit goal of 3.5 percent of gross domestic product is reached, Finance Minister Mladjan Dinkic said.

The Balkan nation needs to find new financing sources to avoid paying high yields on domestic debt and will seek multilateral loans, including an 850 million-euro ($1.1 billion) credit from the Export-Import Bank of China, Dinkic told a conference in Belgrade today.

“We need to change sources of financing because domestic financing is the most expensive and the least productive as it crowds out the private sector,” he said.

Torn apart by the Balkan wars waged by former President Slobodan Milosevic in the 1990s, Serbia is now in a battle to reduce the army of unemployed getting agitated with a jobless rate exceeding the levels of Spain and Greece, home to the longest out-of-work lines in the European Union.

With one in four Serbs out of work, Dinkic said the government will enact measure to increase labor-market flexibility.

To contact the reporter on this story: Gordana Filipovic in Belgrade at gfilipovic@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net

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