The International Monetary Fund (IMF) mission and its new head Donal McGettigan is due to arrive in Belgrade where they will meet with the representatives of the government and the National Bank of Serbia.
The reason for the meeting is the implementation of a new financial arrangement worth 2.4 billion euros, and according to the announcement of the Minister of Finance, Siniša Mali, fiscal policy and the reform agenda will be discussed too.
Economist Mihailo Gajić says that the IMF’s focus is on reforming the Serbian energy sector and assesses that the mission will not turn a blind eye to the transformation of the Electric Power Industry of Serbia (EPS) and Srbijagas.
“The IMF mission will discuss the stand-by arrangement worth around 2.4 billion euros, as well as the fiscal position of our country, macroeconomic stability, the fiscal outlook for this year and the structural reforms,” Minister Mali said.
Although the minister did not explicitly state that the consolidation of the operations of two key energy companies – EPS and Srbijagas – will be discussed, this is expected to be one of the most important topics of the first meeting.
“We can say that 90 percent of the agreement refers to EPS and Srbijagas, be it price policy or the reform of their operations. And that’s why we shouldn’t expect the IMF to turn a blind eye to these issues, but rather that it will be the main thing they will check,” reminds Gajić.
The arrangement with the IMF foresees a gradual increase in electricity and gas prices both for individuals and businesses. In order to limit the negative social and economic impacts, the state budget will provide financial support for the most vulnerable consumers.
A document published on the IMF’s website states that along with the 8 percent electricity and 11 percent gas price increases respectively in January, there will be additional price increases.
“In the case of electricity, it is estimated that a combined tariff adjustment of around 15 percent is sufficient to achieve cost recovery. This will be achieved through an increase of 8 percent effective in January 2023 and 8 percent in May 2023,” the IMF document states.
(Biznis.rs, 23.03,.2023)
https://biznis.rs/vesti/srbija/nova-misija-mmf-nece-zaboraviti-eps-i-srbijagas/