Two billion for the rehabilitation of public debt

#WorldBank #PublicDebt #TheGovernment #FinanceMinister

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Montenegro has serious challenges in the management of public debt, because, in the next five years, we must borrow two billion euros, Finance Minister Rasko Konjevic estimated.

“A huge challenge in debt management is the fact that, in order to pay previous debts, interests and deficits, in the next 5 years, we have to borrow 2 billion. We are already getting serious warnings of the World Bank,” Konjevic warned in the TVCG show “Red phone”.

Although it can’t go into bankrupt, Konjevic added, the government has an obligation to develop a recovery plan after the national debt exceeds 60 percent of GDP. This plan, he says, was done during the mandate of his predecessor Radoje Zugic.

“The proposal of the rehabilitation plan should have the following effect – in the next 5 years the debt should get back below 60 percent.

This would require a very sensitive management of expenditures, while trying to maximize incomes and those are serious challenges,” he said.

Konjević recalled what are the intervention the plan would require.

“The recovery plan proposed by the Minister Žugić includes wage cuts and, as the ultimate measure, tax increases,” said Konjevic.

Source: Radio Television Montenegro