KRSTIC: Negotiations with IMF on loan, no fixed dates

Lazar Krstic (Photo: YouTube/screenshot)

Serbia is negotiating with the International Monetary Fund (IMF) on a three-year precautionary loan, but firm dates have not been set yet, Finance Minister Lazar Krstic said Thursday in Saint Gallen.

Krstic noted that Serbia was seeking a sum within twice its IMF quota, suggesting a figure of around USD 1.5 billion, Reuters reports.

- We are in the process of discussions with the IMF and we will go ahead as planned. We are looking for a standby precautionary loan - Krstic told Reuters on the sidelines of a business forum in St Gallen, Switzerland.

To win the deal, seen by investors as a crucial sign the government is committed to curbing the rising budget deficit, the new government needs to reform the bloated public sector and cut subsidies to loss-making state companies. This could mean thousands of job losses.

- Once we have refined the policies to the required level, I think that's the point when we will be able to begin engaging the IMF again to continue the conversation - Krstic said.

An IMF mission visited Serbia in February and said it would continue talks on the arrangement with the EU candidate country after a new government was formed. The Fund froze a previous deal with Serbia in 2012 over our country's failure to restrain spending.