The Government currently not planning an arrangement with IMF

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At this time, the Government does not plan to make arrangements with International Monetary Fund IMF, although it is an important partner in strengthening Montenegro’s fiscal and financial stability, it was stated in Ministry of Finance.

When asked by Pobjeda whether an arrangement with IMF can be expected due to the growth of public debt and deficit, the Ministry responded saying that have been regularly servicing all of the obligations.

“Such a pace will continue. All foreign and local obligations will be paid out according to the defined pace and there is no question of neglecting our obligations”, they said in the Ministry.

President of Parliament’s Committee for Economy Aleksandar Damjanović said that he does not believe that the Government is considering an IMF arrangement in the electoral year, especially after passing the Law on Wages in Public Sector.

“I am certain, however, that in the fall, maybe even earlier, there will have to be a rebalance of the budget, to regulate the level of expenses. I believe there are significant budgetary reserves in the expenses, especially discretionary. Reserves exist in the revenue side as well – by repression of grey economy, especially during the season, the budget can be balanced without further indebting”, Damjanović said.

He announced that he will try, if the political situation allows, to schedule a session on budget in the first two quarters of this year, after which, he thinks, things would be more clear.

Damjanović said he believes that Montenegro can lead its economic policy by itself, but that as a member of IMF always has a possibility of an arrangement.

“This arrangement has both positive and negative sides. Fallen economies get back on their feet, and some other funds appear as well. The negative side is that it introduces significant limitations in policies of the Government, especially budget policies, especially expenses policies”, Damjanović added.

Economic analyst Predrag Drecun thinks that Montenegro has economic strength to lead its own economy.

“There must be an analysis of positive and negative sides of IMF arrangement before any deals are made. Conditions of debt are better, which is positive, but that discount gets collected in some other, less visible things”, Drecun added.

In this way, IMF creates conditions for managing foreign and internal politics of a country in order to accomplish its own goals, and less the goals of the country that enters the arrangement.

“The state loses a significant part of its sovereignty in this way”, Drecun said.

Economic analyst Vasilije Kostić said that he is not a fan of IMF arrangement, despite the growth in debt. \

“IMF is an option in situations when macroeconomic markers in the country are seriously compromised. Arrangement in these case is a solution that saves the day, but it is also forced upon a country. It is not a choice, but a necessity”, Kostić thinks.

Independent representative Mladen Bojanić said that he is afraid that the Government’s economic politics will lead Montenegro straight into IMF’s hands.

“Our long-term economic policies are not sustainable, especially in public finances, so I am afraid that we will be forced to come to IMF as our supposed saviour”, Bojanić said.

Source: Cafe Del Montenegro