Next year will be uncertain, and Serbia’s 2021 budget should be more restrictive, Serbia’s Fiscal Council (FC) has said on Tuesday.
The Government planned deficit of 178.5 billion Dinars, assuming that in 2021, economic growth will be six per cent while the Fiscal Council said the forecast was “optimistic” and that “it can easily be wrong.”
If the Council were right, the revenues in the budget would be lower, so the deficit of the state coffers would be three per cent higher than planned.
According to the Council, that also means, the share of public debt in GDP will continue to grow and will exceed 60 per cent.
It also said that if the coronavirus epidemic crisis continued, the economy would need a new set of aid measures, which would additionally burden the state treasury.
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The Council recommended that the planned deficits should not be less than two per cent, and that could be achieved by freezing or minimal growth of civil servants’ salaries and by delaying the projects that are “not urgent”.
The Council listed the measures and projects which could be postponed during the epidemic as: “very high costs of equipping the security sector, construction of the airport in Trebinje (Bosnia and Herzegovina’s Serb entity), subsidies for electronic fiscal cash registers, subsidies for taxis, increased allocations for attracting investors, etc.”
“Therefore, we recommend the Government to start implementing projects from 2021, which are not a priority, only when the economy recovers,” the Council said.
It added the most significant structural problems within the budget were excessive amounts for subsidies and public sector’s salaries.
This post is also available in: Italiano