Macroeconomic Forecast Serbia

We believe that the Serbian government's decision to lower the planned budget deficit to 1.5% of GDP in 2009 by reducing social spending will ensure the IMF approves a Stand-By Agreement with the country in January. That said, we are concerned that in the midst of the financial crisis, Serbia's plans to cover a portion of the deficit through revenues from privatisations is overambitious in the current economic downturn, elevating the risks of a higher budget deficit than planned in 2009.

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