VUJOVIC: UAE loan meant for budget deficit and reducing indebtedness expenses

Minister of Finance Dusan Vujovic stated on Monday, October 17, that the loan of around USD 1 billion taken out by Serbia from the Abu Dhabi Fund for Development was meant for financing the budget deficit, refinancing receivables and reducing indebtedness expenses.

– In the past five or six years, we have been incurring debt under less favorable conditions and now we have reduced the risks. The domestic interest rate has been brought down from nine to four percent and is realized in the market a the rate of 3% – Vujovic said to the press at the Serbian Economic Summit in Belgrade.

He pointed out that the ADFD loan is more favorable than the loans Serbia might get in the western market.

– The new loan will be used to finance either receivables due from the existing dollar loans or just to pay the repay the interest or some combination of an early loan repayment and repayment of the interest and the principal amount – Vujovic explained.

The Government of Serbia intends to take out a loan of around USD 1 billion, with an annual interest rate of 2.25%.

The maturity date is 10 years, including a grace period of 5 years, whereas the repayment period is five years.

The draft law on confirming the loan agreement is on the agenda of the session of the Assembly to be held on October 25.

The loan agreement signed on October 4, 2016, envisions the withdrawal in five installments of around USD 200 million, with intervals of at least six months.

Ministarstvo finansija Republike Srbije

Vlada Republike Srbije

Dusan Vujovic

UAE loan

Abu Dhabi Fund for Development

Serbian Economic Summit 2016