Belgrade, Dec 4, 2009 – A Letter of Intent concerning economic policy measures for 2010, which are in line with IMF recommendations, according to Deputy Prime Minister and Minister of Economy and Regional Development Mladjan Dinkic.
Speaking at a press conference held after the government session, Dinkic said that he is convinced that the IMF executive board will formally approve the arrangement reached with Serbia at its next session, which is to be held in Washington on December 21st.
He said that the IMF’s condition was that the Serbian government should adopt the budget and the Letter of Intent two weeks before the IMF session.
Dinkic said that the Serbian government has also adopted a draft agreement on the recapitalization of Commercial Bank, which envisages increasing the capital of the bank by EUR 120 million through the European Bank for Reconstruction and Development (EBRD) , the International Financial Corporation, Swedish Investment Fund and the German government’s investment fund. Dinkic said that it is expected that the agreement will be signed on December 17.
Commenting about the State’s share in the ownership of Commercial Bank, the Minister said that the agreement specifies that the Serbian Government has three years to follow up the recapitalization in order to maintain its present 42.6% ownership.
Dinkic added that after the recapitalization and payment of the capital sum within a three year time period, Serbia will retain its present 42.6% ownership, while the EBRD, together with other international financial institutions, will increase their share from 25% to 34.6%, while small shareholders will drop out.
Serbia will still hold a majority ownership in Commercial Bank, but the Bank’s capital will increase significantly, and Serbia will have three years to make its share of the payment.
The Minister said that the Government also approved a conclusion on the announcement of a public tender for encouraging interest in the privatization of the pharmaceutical company Galenika, adding that the pre-qualification tender for the factory will be announced on December 15.
The tender will be announced in two parts, adding that in the first phase it will be seen if there are buyers willing to purchase 100% of the company’s capital, at an initial price of not less than EUR 200 million.
The binding tender will be announced later if there are any interested buyers, adding that if no acceptable offers are made the tender will be cancelled. This will not be done before January 2010, when the construction of a new pharmaceutical factory will be completed, in which EUR 60 million has been invested.
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