DS, URS trade accusations over drop in credit rating

BELGRADE The drop in Serbia’s credit rating has caused the opposition Democratic Party (DS) and ruling United Regions of Serbia (URS) to trade accusations. The DS claims that drop was caused by the concern over the new Serbian government, while the URS says that the Democrats are only trying to “wash their hands”. DS, URS trade accusations over drop in credit rating The DS released on Tuesday that the credit rating was always the reflection of expectations and that it is obvious there is some concern over the new government of Serbia, and added that the assessments of the Finance and Economy Minister and URS leader Mladjan Dinkic who said that Serbia experienced the crash of the loan rating because of the previous government, could not be true. In the release, DS pointed out that during the previous government in which DS headed the coalition early this year, Serbia received a confirmation of its loan rating and added that the drop of the loan rating is the consequence of irresponsible and unfounded statements by officials that the country is facing bankruptcy. “The key reason for the deficit increase and consequent debt increase lies in the implementation of the Law on decentralization, which was the project launched by Mladjan Dinkic as the vice president and economy minister in the previous government, and this is why the deficit increased by RSD 30bn,” the release states. Reflecting on Dinkic's statement that the previous government did not plan the funds for the Fiat factory in Kragujevac, the DS stated that the funds are ensured by the Economy Ministry which has jurisdiction over the support to major investments such as Fiat. “This is why Dinkic has to respond to the question as to why he failed to ensure funds for Fiat, the project he bragged about so much, and say where the money ended up,” DS stated and called on Dinkic to “stop constantly making untrue statements so as to conceal his own responsibility for the economic and financial situation in Serbia.” In the release, the Democrats reminded both the public and URS representatives that Dinkic himself participated in all previous governments in the course of the past 12 years and that he was the creator of the financial and economic policy during all these years and even today. “Instead of offering solutions and tackling the problems of citizens, Mladjan Dinkic is constantly trying to present himself as a new political factor in Serbia who had nothing to do with the policies of previous government,” the DS stated in a release. The URS on Tuesday qualified as scandalous the latest DS’ statement relating to Serbia's lower credit rating, and said the DS was trying to "wash their hands of the drop." “It is absurd to blame the new government, set up only ten days ago, for something that is the result of irresponsible financial management,” the URS stated, qualifying the accusations as an "unscrupulous attempt to manipulate the public." "In the very first sentence of its report, Standard and Poor says that the fiscal and foreign deficit have become worse in the first half of the year. And that is the result of the DS' poor handling the finances and the state as a whole, and Mladjan Dinkic only called things by their right name," the statement reads. On Tuesday, Dinkic said that Serbia had experienced a drop in credit rating completely justifiably, because it had a record budget deficit and a large increase in public debt this year, and announced fiscal consolidation steps for September. He accused the previous government of being largely responsible for the record budget deficit and great increase in public debt. The URS claims that "the DS has ruined public finances and their credibility", and that the main reason for the lower credit rating is "the huge debt and massive budget deficit." “When he stepped down from the post of finance minister in 2006, Dinkic left a two percent surplus in the budget, and now that he is back, he found a deficit of over seven percent and the public debt nearing 55 percent of GDP,” the URS underlines. "The citizens know that it was Dijana Dragutinovic and Mirko Cvetkovic that were in charge of finances when the historic deficit was made," the statement adds. U.S. credit rating agency Standard and Poor's has lowered Serbia's long-term credit rating by one degree, from BB to BB-. Mladjan Dinkic and Boris Tadic (Tanjug) Tanjug

DS, URS trade accusations over drop in credit rating

The DS released on Tuesday that the credit rating was always the reflection of expectations and that it is obvious there is some concern over the new government of Serbia, and added that the assessments of the Finance and Economy Minister and URS leader Mlađan Dinkić who said that Serbia experienced the crash of the loan rating because of the previous government, could not be true.

In the release, DS pointed out that during the previous government in which DS headed the coalition early this year, Serbia received a confirmation of its loan rating and added that the drop of the loan rating is the consequence of irresponsible and unfounded statements by officials that the country is facing bankruptcy.

“The key reason for the deficit increase and consequent debt increase lies in the implementation of the Law on decentralization, which was the project launched by Mlađan Dinkić as the vice president and economy minister in the previous government, and this is why the deficit increased by RSD 30bn,” the release states.

Reflecting on Dinkić's statement that the previous government did not plan the funds for the Fiat factory in Kragujevac, the DS stated that the funds are ensured by the Economy Ministry which has jurisdiction over the support to major investments such as Fiat.

“This is why Dinkić has to respond to the question as to why he failed to ensure funds for Fiat, the project he bragged about so much, and say where the money ended up,” DS stated and called on Dinkić to “stop constantly making untrue statements so as to conceal his own responsibility for the economic and financial situation in Serbia.”

In the release, the Democrats reminded both the public and URS representatives that Dinkić himself participated in all previous governments in the course of the past 12 years and that he was the creator of the financial and economic policy during all these years and even today.

“Instead of offering solutions and tackling the problems of citizens, Mlađan Dinkić is constantly trying to present himself as a new political factor in Serbia who had nothing to do with the policies of previous government,” the DS stated in a release.

The URS on Tuesday qualified as scandalous the latest DS’ statement relating to Serbia's lower credit rating, and said the DS was trying to "wash their hands of the drop."

“It is absurd to blame the new government, set up only ten days ago, for something that is the result of irresponsible financial management,” the URS stated, qualifying the accusations as an "unscrupulous attempt to manipulate the public."

"In the very first sentence of its report, Standard and Poor says that the fiscal and foreign deficit have become worse in the first half of the year. And that is the result of the DS' poor handling the finances and the state as a whole, and Mlađan Dinkić only called things by their right name," the statement reads.

On Tuesday, Dinkić said that Serbia had experienced a drop in credit rating completely justifiably, because it had a record budget deficit and a large increase in public debt this year, and announced fiscal consolidation steps for September.

He accused the previous government of being largely responsible for the record budget deficit and great increase in public debt.

The URS claims that "the DS has ruined public finances and their credibility", and that the main reason for the lower credit rating is "the huge debt and massive budget deficit."

“When he stepped down from the post of finance minister in 2006, Dinkić left a two percent surplus in the budget, and now that he is back, he found a deficit of over seven percent and the public debt nearing 55 percent of GDP,” the URS underlines.

"The citizens know that it was Dijana Dragutinović and Mirko Cvetković that were in charge of finances when the historic deficit was made," the statement adds.

U.S. credit rating agency Standard and Poor's has lowered Serbia's long-term credit rating by one degree, from BB to BB-.