Vujovic - Decision of Moody's to upgrade Serbia's long-term issuer and senior unsecured ratings to Ba3 from B1 is a good sign to investors
BELGRADE (Serbia), March 20 - Serbia's finance minister Dusan Vujovic said he expects the general government fiscal deficit to stand at 1.7% of GDP in 2017, well below the Maastricht criterion of 3.0%.
The deficit-to-GDP ratio could even fall to 1.4% this year, Vujovic told public broadcaster Radio Televizija Srbije (RTS) on Saturday, according to a statement issued by the finance ministry.
Vujovic said the decision of Moody's to upgrade Serbia's long-term issuer and senior unsecured ratings to Ba3 from B1 is a good sign to investors and will allow the country to borrow and refinance debt more cheaply.
"This will lead to additional reduction of interest rates and cheaper borrowing, cheaper refinancing of Serbia's debt as well as cheaper access of all our banks to financing sources," Vujovic said.
Moody's said on Friday it has upgraded Serbia's long-term issuer and senior unsecured ratings to Ba3 from B1 and changed their outlook to "stable" from "positive", due to the country's notable fiscal consolidation which has halted the increase in debt burden and reduces risks to the fiscal position.
Moreover, the recent structural reforms have increased the resilience of the country's economy, supporting potential growth, the credit agency said.
Earlier this month, the International Monetary Fund (IMF) said Serbia's general government deficit narrowed to 1.4% of GDP in 2016, the lowest level since 2005, and general government debt declined to 74% of GDP.