Press Release No. 05/266

Press Release: Statement by IMF Resident Representative in Serbia and Montenegro

December 2, 2005

Statement by IMF Resident Representative in
Serbia and Montenegro

The Office of the Resident Representative in Serbia and Montenegro issued the following statement today in Belgrade:

"Constructive discussions between the Government and the IMF mission were held this week in Belgrade to solve pending issues related to the sixth and final review of the Extended Arrangement.

"The IMF mission reached understandings ad referendum with the authorities. The sixth review can be conducted by the Executive Board of the IMF in late January 2006, provided that a number of prior actions are successfully completed until then.

"The mission commends the adoption of the 2006 budget and the related reforms in health care that should strengthen medium-term fiscal sustainability and improve the composition of expenditures. The cost efficiency of health care will strengthen, while hopefully improving quality and continuing to provide fair access to the entire population.

"The government proposed a solution for the clearance of pension arrears to ensure that the combined programmed fiscal surplus of 3.6 percent of GDP for the two year period 2005-2006 is achieved. The wage bill of public enterprises will increase by about 10.3 percent in 2006."