Enterprise To Come First In Serbia's 2009 Budget

by Ulrika Lomas, Tax-News.com, Brussels

11 December 2008

The Serbian budget was unveiled on December 9 by Serbia’s Deputy Prime Minister Mladjan Dinkic. Expenditure remained relatively unchanged with investment being channelled into small and medium enterprises (SMEs) and improving employment opportunities nationwide.

According to Dinkic RSD20bn (EUR238m) will be earmarked for the SME Development Fund, RSD11bn for employment and RSD3.5bn for the equipping of industrial zones.

Dinkic said he aimed to reduce public expenditure from 44% to 43% of GDP. Dinkic implied that it would be achieved by a reduction of government subsidies by 27% and announced that he would seek to revise salary levels in publicly-owned companies.

Serbian Prime Minister Mirko Cvetkovic speaking on the same day stated that the government would under no conditions allow hyperinflation and instability in the country, adding that political unity would be necessary to overcome the impact of the global financial crisis.

"In 2009 we will not live better than this year, but the measures the government intends to take will make sure that we do not live any worse off either," said the Prime Minister.

As for the government’s measures to alleviate the effects of the global financial crisis, he said that they not only imply making savings, but also include incentives for the Serbian economy to reach 3.5% economic growth and pledged continued structural reforms in 2009.

The proposed budget for 2009 envisages a deficit of 1.5% of GDP.

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