Serbia expects it may be possible to lower the
electricity price hike agreed with the International Monetary Fund (IMF) after
the country's deficit in the first quarter came in sharply below plan, local
media reported on Monday, quoting Serbian prime minister Aleksandar
Vucic.
Serbian state-owned power utility EPS is set to request an
increase in the regulated electricity price for end consumers that, in
combination with a planned excise tax, would result in a total price increase of
15% as of April 1, a memorandum of economic and financial policy submitted by
the government in Belgrade to the IMF indicated in February.
The document
outlines the economic policies that the Serbian government and the country's
central bank intend to implement under a 1.2 billion euro ($1.32 billion)
three-year standby arrangement with the IMF.
Additional adjustments in
the regulated electricity price will follow in April 2016 if necessary, the
document indicated while noting that the planned excise tax on electricity aims
to reduce inefficiency of consumption.
Serbia's deficit in the first
quarter amounted to 21.5 billion dinars ($197 million/179 million euro), below
the 55 billion dinar target agreed with the IMF, newspaper Politika reported,
quoting Vucic.
Serbia’s consolidated budget deficit rose to 187.5 billion
dinars in 2014 from 178.7 billion dinars a year earlier.
In 2014,
Serbia's economy fell into recession for the third time in six years, partially
due to the devastating floods in May. The government expects real gross domestic
product to contract by 0.5% in 2015 due to sizeable fiscal
consolidation.