Govt. plan to borrow for pharmaceutical company criticized
Opposition MPs today criticized the ruling coalition for its plans to vote in favor of bills that would see Serbia borrow more money.
Wednesday, 29.02.2012.
15:00
Opposition MPs today criticized the ruling coalition for its plans to vote in favor of bills that would see Serbia borrow more money. This time, the focus was on a loan meant to save the Galenika pharmaceutical company. Govt. plan to borrow for pharmaceutical company criticized They believe that such a move would have a negative effect on the country's economic stability. Serb Radical Party (SRS) MP Dragan Stevanovic said in parliament on Wednesday that the state should move to collect overdue payments owed to Galenika, instead of borrowing to save the company. "This loan solves nothing, nor will Galenika's insolvency problem go away. You're putting out fire with gasoline," warned Stevanovic, and wondered how it was possible that the State Fund for Health Insurance (RFZO) was among those owing money to Galenika. Another SRS MP, Dejan Mirovic, said the ratio between public debt and GDP "should not reach 80 percent like in some EU countries", and spoke in favor of the Russian model, where the figure is some 12 percent. Deputy SRS leader and MP Zoran Krasic mockingly noted that Serbia's economic troubles and high indebtedness were the result of "many years of work of experts in the government", and asked, "how will the country be governed if SNS President Tomislav Nikolic gains power?". Krasic further stated that he "heard it from Americans" that the his former party colleague Nikolic "had bought his masters degree in economics". Opposition DSS MP Radojko Obradovic focused on the bill on the agenda to say that it would add a further five percent of GDP to Serbia's total debt. "Instead of looking for ways to reduce the existing 45 percent debt, we are borrowing to add five more percent, which is too much," he stated. LDP MP Bojan Djuric believes that Galenika is suffering now because of its bad management "in the past few years", as well as "the catastrophic economic policy" in the same period. "This has nothing to do with the global economic crisis, but with the fact that the health-care system in this country is not functioning. The problem is that a small number of people work and a small number of employers are paying taxes," according to him. But MP of the ruling Democratic Party (DS) Janko Veselinovic told the session that the economic situation was "not as bad as all that", and that Serbia was the leader in attracting FDI, while the exchange rate against the euro was "approximately the same as this time last year". Once the country becomes candidate for EU membership, it will become even more attractive to investors, he asserted. Srdjan Milivojevic, also of the DS, said the opposition's criticism was "unfounded" and that their amendments submitted to the bill "should be rejected". He also denied that new loans would be used to finance "pre-election activities". "There's amnesia here. When the SRS was in power, they left behind a debt of 120 percent of GDP. Where was your love for Serbia then, why didn't you show your love for Serbia when you owed 17 (monthly) pensions," said Milivojevic, and added that new loans "will be used for the citizens' needs". The parliamentary debate today was attended by Education Minister Zarko Obradovic, who spoke to defend the Galenika bill, saying the company would pay back the EUR 70mn loan for which the state would provide guarantees. This pharmaceutical company has strategic importance for Serbia and its normal functioning will enable for regular supply of the market under lower prices, said this minister. Obradovic also told MPs that Galenika in the past borrowed from commercial banks under unfavorable conditions, with high interest rates, in order to secure normal functioning and avoid shortages of drugs. "Drug retailers owe more than EUR 85mn to Galenika. Had that been paid, we would not be discussing this loan now," the minister concluded. (Tanjug) Beta
Govt. plan to borrow for pharmaceutical company criticized
They believe that such a move would have a negative effect on the country's economic stability.Serb Radical Party (SRS) MP Dragan Stevanović said in parliament on Wednesday that the state should move to collect overdue payments owed to Galenika, instead of borrowing to save the company.
"This loan solves nothing, nor will Galenika's insolvency problem go away. You're putting out fire with gasoline," warned Stevanović, and wondered how it was possible that the State Fund for Health Insurance (RFZO) was among those owing money to Galenika.
Another SRS MP, Dejan Mirović, said the ratio between public debt and GDP "should not reach 80 percent like in some EU countries", and spoke in favor of the Russian model, where the figure is some 12 percent.
Deputy SRS leader and MP Zoran Krasić mockingly noted that Serbia's economic troubles and high indebtedness were the result of "many years of work of experts in the government", and asked, "how will the country be governed if SNS President Tomislav Nikolić gains power?".
Krasić further stated that he "heard it from Americans" that the his former party colleague Nikolić "had bought his masters degree in economics".
Opposition DSS MP Radojko Obradović focused on the bill on the agenda to say that it would add a further five percent of GDP to Serbia's total debt.
"Instead of looking for ways to reduce the existing 45 percent debt, we are borrowing to add five more percent, which is too much," he stated.
LDP MP Bojan Đurić believes that Galenika is suffering now because of its bad management "in the past few years", as well as "the catastrophic economic policy" in the same period.
"This has nothing to do with the global economic crisis, but with the fact that the health-care system in this country is not functioning. The problem is that a small number of people work and a small number of employers are paying taxes," according to him.
But MP of the ruling Democratic Party (DS) Janko Veselinović told the session that the economic situation was "not as bad as all that", and that Serbia was the leader in attracting FDI, while the exchange rate against the euro was "approximately the same as this time last year".
Once the country becomes candidate for EU membership, it will become even more attractive to investors, he asserted.
Srđan Milivojević, also of the DS, said the opposition's criticism was "unfounded" and that their amendments submitted to the bill "should be rejected".
He also denied that new loans would be used to finance "pre-election activities".
"There's amnesia here. When the SRS was in power, they left behind a debt of 120 percent of GDP. Where was your love for Serbia then, why didn't you show your love for Serbia when you owed 17 (monthly) pensions," said Milivojević, and added that new loans "will be used for the citizens' needs".
The parliamentary debate today was attended by Education Minister Žarko Obradović, who spoke to defend the Galenika bill, saying the company would pay back the EUR 70mn loan for which the state would provide guarantees.
This pharmaceutical company has strategic importance for Serbia and its normal functioning will enable for regular supply of the market under lower prices, said this minister.
Obradović also told MPs that Galenika in the past borrowed from commercial banks under unfavorable conditions, with high interest rates, in order to secure normal functioning and avoid shortages of drugs.
"Drug retailers owe more than EUR 85mn to Galenika. Had that been paid, we would not be discussing this loan now," the minister concluded.
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