Serbia Mulls McKinsey’s Krstic for Finance Chief in New Cabinet

Serbia is in talks with Lazar Krstic, an associate at McKinsey & Co., to be the Balkan country’s next finance minister, the second time the government has tapped the New York-based consultancy to fill key posts.

Krstic, a graduate of Yale University, is being considered to replace Finance Minister Mladjan Dinkic on Prime Minister Ivica Dacic’s shuffled cabinet, said Sinisa Mali, an economic adviser to Deputy Prime Minister Aleksandar Vucic in a phone interview in Belgrade today.

“Talks with Krstic continue, but he is just one of the candidates,” Mali said.

The biggest former Yugoslav republic averted early elections on July 31 after Vucic’s dominant Serbian Progressive Party agreed with Dacic to oust Mladic and his political party from the cabinet and name new ministers by the end of August. With the changes, the Progressives will have control over the Finance and Economy ministries, as well as the central bank, whose governor is a member of Vucic’s party.

Yields on Serbian 10-year Eurobonds maturing in 2021 fell 8 basis points, or 0.08 percent, to 6.92 percent by 4:13 p.m. in Belgrade yesterday, according to data compiled by Bloomberg.

Serbia went to McKinsey employees in 2000, after the ouster of former strongman Slobodan Milosevic, appointing Bozidar Djelic as the head of finances and Radovan Jelasic as a central bank vice governor. Prior to his appointment, Djelic had advised the Russian and Polish governments on macroeconomic policies and asset sales.

The new cabinet’s focus will be to secure state financing and gradually cut borrowing needs over the medium term as well as narrow the budget deficit, the central bank’s chief economist, Branko Hinic, said in Belgrade today.

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