World Bank Financing to Help Serbia

World Bank Board of Directors approved the private and financial sector policy is based on warranty (PFSPBG) Serbia more than EUR 300 million (more than $ 400 million) in Serbia, the World Bank said that the opinion of the average February 14, 2011.

“This helps to access international markets of Serbia at lower cost and longer maturity, and it also supports the improvement of business climate, strengthen financial discipline in the non-private sector and build a stable financial effective, “said the World Bank.

“Serbia has never accessed international markets independently. Thanks to this policy based guarantee, 10 global banks have had an opportunity to do a due diligence on Serbia, and the Serbian Debt Management Authority has had a chance to get familiar with the legal requirements of international tenders and global banks,” Jane Armitage, the World Bank Country Director and Regional Coordinator for South-East Europe, said.

“Furthermore, the Government has been able to reduce the cost of borrowing and double the maturity of its debt,” Armitage said.

The guarantee and underlying loan has been designed in a way that will enable the government of Serbia to re-finance obligations coming due at reduced cost. This should further strengthen Serbia’s debt profile, according to the World Bank.

The PFSPBG encourages continuation of the reforms supported under the two previous private and financial sector development policy loans. The objectives of the PFSPBG are to improve the business environment, strengthen financial discipline in the non-private enterprise sector, and build a stable and more efficient financial sector.

“This policy based guarantee further advances Serbia’s strong track-record in structural reforms. The guarantee supports policies to improve the business environment, such as reducing compliance costs and making enforcement of court decisions faster and cheaper, and also to facilitate the resolution of unviable socially owned enterprises,” according to Aurora Ferrari, Senior Private Sector Development Specialist and Task Team Leader.

“Moreover, recently introduced legal amendments allow the authorities to resolve banks faster, at a lower cost, while still protecting depositors.”

Policy to ensure the International Bank for Reconstruction and Development Bank (IBRD). The guarantee covers loans of commercial bank loans up to EUR 300 million, equivalent to a maximum of $ 400,000,000 and for a period of six years of basic projectile acceleration.