PKS chief: No ad hoc measures in economy

The Serbian government should stop taking ad hoc measures in the economy because they only bring short-term results.

Izvor: VIP

Wednesday, 19.12.2012.

11:07

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BELGRADE The Serbian government should stop taking ad hoc measures in the economy because they only bring short-term results. This is according to Serbian Chamber of Commerce (PKS) President Milos Bugarin. PKS chief: No ad hoc measures in economy “The state unfortunately continues to work on how to distribute whatever it has, instead of creating new value. There is a huge disproportion between those working for the government and public companies and those working in the real sector, which in effect supports everyone,” he told daily Vecernje novosti. “Tax burdens and operating expenses are huge, but wages are low. We now have an increased VAT rate (from 18 to 20 percent), which entail price hikes. All this gives us no reason for optimism," he was quoted as saying. When asked whether a projection of Finance and Economy Minister Mladjan Dinkic that we will have a 2.5 percent growth next year was realistic, Bugarin said: “This year, we will register a two percent drop, which means that economic activity would have to grow in the forthcoming period by at least 4.5 percent in order to reach positive ground. I wish this would happen, but it is not a realistic option.” When asked if the government measures for economic recovery yielded the expected results, he said that the measures brought certain results. “Only to a certain extent. For example, in the part related to suspending 138 para-fiscal charges to companies. However, there is still room to lift some burden off the shoulders of the economy. Solvency has slightly increased, but these measures are selective, as loans have been available only to some companies which had positive financial results". “The government should stop enacting ad hoc measures, which produce results only on the short term. We continue to borrow expensively, and this money for the most part serves to cover the budget deficit and public spending. We haven't moved forward with investments, reduced unemployment and increased economic activity. I expected this would happen during the first several months of the new government, but it did not", the PKS president concluded. Milos Bugarin (Beta, file) VIP

PKS chief: No ad hoc measures in economy

“The state unfortunately continues to work on how to distribute whatever it has, instead of creating new value. There is a huge disproportion between those working for the government and public companies and those working in the real sector, which in effect supports everyone,” he told daily Večernje novosti.

“Tax burdens and operating expenses are huge, but wages are low. We now have an increased VAT rate (from 18 to 20 percent), which entail price hikes. All this gives us no reason for optimism," he was quoted as saying.

When asked whether a projection of Finance and Economy Minister Mlađan Dinkić that we will have a 2.5 percent growth next year was realistic, Bugarin said:

“This year, we will register a two percent drop, which means that economic activity would have to grow in the forthcoming period by at least 4.5 percent in order to reach positive ground. I wish this would happen, but it is not a realistic option.”

When asked if the government measures for economic recovery yielded the

expected results, he said that the measures brought certain results.

“Only to a certain extent. For example, in the part related to suspending 138 para-fiscal charges to companies. However, there is still room to lift some burden off the shoulders of the economy. Solvency has slightly increased, but these measures are selective, as loans have been available only to some companies which had positive

financial results".

“The government should stop enacting ad hoc measures, which produce results only

on the short term. We continue to borrow expensively, and this money for the most part serves to cover the budget deficit and public spending. We haven't moved forward with investments, reduced unemployment and increased economic activity. I expected this would happen during the first several months of the new government, but it did not", the PKS president concluded.

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