Interview: Dušan Vujović, Serbian Minister Of Finance: Building a Business Friendly Economic Environment

In the interview for the International Business Sector Guide for 2015, Serbian Minister of Finance, Dušan Vujović, spooked about key recommendations of the European Commission, what will be done on the broader fiscal front and which structural reforms are critical for improved business environment and better investment climate.

He also apointed to three pillars of structural reforms:

Restructuring/privatization of state-owned enterprises – the often quoted group of 500+ companies in the portfolio of the Privatization agency. Due to many legal, administrative and process difficulties, the process has not been completed by the end of May deadline. An extension of up to one year will be sought to complete an orderly privatization process for viable companies.

Public companies (energy, infrastructure, utilities): The Government is resolved to improve corporate governance and promote organizational and financial restructuring of large public companies. Restructuring programs for EPS and Railways will soon be approved by the Government and implemented with the technical and financial support from the World Bank and EBRD.
Similar programs are expected for other major public companies.
Public administration reform is the last pillar of structural reforms. It seeks to modernize and right size public administration and improve the quality of public services through e-government, efficient health, education and other public services. The reform will introduce a new system of public wages which will be transparent, fair and anchored in the wages prevailing on the market.
As previously announced, we will aim to continuously assess and dynamically rebalance macro-economic policies. Advances in fiscal consolidation will be used to introduce a more accommodative monetary policy stance (with greater pace of credit expansion). At the same time increased efforts will be made to address the high burden of non-performing loans. In combination, both measures will lead to improved resilience of the financial sector and greater availability of financing for new investment, jobs and economic growth.

On a related issue, our joint effort is to use the long prevailing low inflation environment to confirm Government commitment to macroeconomic stability, cement the central bank’s anti-inflationary credentials, and anchor medium term inflation expectations among consumers and businesses. Along with the measures to reduce inflation volatility this could create a stable and yet accommodating macro-monetary environment.

Finally, in line with our plans and EC recommendations we will use the fiscal space created by better deficit outcomes to further reduce public debt, complete high return investment projects and enhance the implementation of planned structural reforms, Minister said.

The whole interview is available at: