Daily Survey

Belgrade, August 20, 2012

SERBIA

BULGARIA'S DEPUTY PRIME MINISTER CONGRATULATED IVICA DACIC

BELGRADE, Aug 17 (Tanjug) - Bulgaria's Deputy Prime Minister and Interior Minister Tsvetan Tsvetanov congratulated his colleague Ivica Dacic on becoming Serbia's prime minister, and added he believed the cooperation would continue to improve for better security in the region and Europe.Tsvetanov congratulated Dacic on becoming prime minister and interior minister, adding that he hoped the two positions would help improve the dialogue the two had led in resent years.Tsvetanov is convinced he will continue working with Dacic to strengthen the bilateral cooperation in interior affairs and constantly improve modern ways of cooperation in order to reach a common goal, better security in the region and Europe, the government office for media relations released.Bulgaria is willing to share its experience with its partners in Serbia when it comes to meeting the EU standards of law enforcement, Tsvetanov said, wishing Dacic plenty of success in his work.

PAJEVIC: SERBIA SHOULD TAKE PART IN REGIONAL FORA

BELGRADE, Aug 18 (Tanjug) - Serbia should take part in the regional fora at which representatives of Pristina are present, director of the Serbian government's EU Integration Office Milan Pajevic said."That is in the interest of our country. Self-exclusion is counterproductive, and would continue to put us in the passive position, and a country which has the capacity to be the main regional actor should not allow itself that," Pajevic said for the daily Danas.The presence of our representatives in international meetings has nothing to do with the recognition of Kosovo's independence, he said."Those who might level criticism at this stand should persuade the public that it is good for Serbia that it did not secure EUR 3 million for two projects from the Western Balkans Investment Framework, because our representatives did not appear at the meeting held in Vienna in June due to the absence of the footnote (saying that Kosovo is represented without prejudice to positions on status, and in line with UN SC Resolution 1244, and the ICJ Opinion). Similar examples abound," Pajevic said.Asked to voice expectation as to when Serbia might obtain a date for the start of EU entry talks, he said that Serbia would get the date after the EU ascertained that all criteria laid down by the Council in December, 2011, had been met, taking also into account this year's annual progress report, which would be released in October."Having in mind the job scope, it is not reasonable to expect that will happen by the end of 2012, but on the other side, it has to happen before the next summer," Pajevic said.

GRUBJESIC: SUPPORT FOR EU WEAKENS DUE TO LACK OF REFORMS

BELGRADE, Aug 18 (Tanjug) - The support for Serbia's EU integration has slightly declined, since there have been no real internal reforms or results the citizens can feel in the everyday life, Deputy Prime Minister for European Integration Suzana Grubjesic said.

KOSOVO

VULIN: CRIMINALS MUST BE PUNISHED

ORAHOVAC, Aug 18 (Tanjug) - Director of the Serbian government's Office for Kosovo-Metohija Aleksandar Vulin honoured the victims at the monument devoted to the memory of murdered and kidnapped Serbs in Orahovac, and stated that the individuals who committed the crimes have to be punished or the crimes would happen again.The list of the murdered and kidnapped Serbs and the crimes nobody was charged with, held responsible or punished for are the best testimony of what Serbs in the province are facing, Vulin said and added that the biggest issue of them all is that responsible individuals need to be identified and that there has to be a punishment for every crime, or else it would happen again, Vulin said.He asked for how long the crimes in Kosovo-Metohija would go on repeating, and underscored that Serbs have the right to live without the risk of getting murdered.In front of the monument commemorating murdered and kidnapped Serbs which contains the names of 67 Serb victims in the period from 1998 to 2000, Vulin reiterated that Serbs in Kosovo will hear only the truth, no matter its nature.The truth on grants, talks and the truth about the attitude of Serbia and the international community toward them, Vulin noted.He said that the truth regarding Kosovo now is currently difficult, but that it is not hopeless.A total of 85 Serbs were killed in the territory of Orahovac in the period from 1998 to 2012.After Orahovac, Vulin visited Serbs in Velika Hoca with whom he discussed the problems the local Serb population is facing.He also met with Bishop Teodosije of Raska and Prizren.Vulin will end his two-day stay in Kosovo-Metohija by a visit to the Zociste Monastery.

COJA: WIDER POLITICAL PROCESS TO OPEN IN DIALOGUE

BELGRADE, Aug 18 (Tanjug) - Austrian Ambassador in Belgrade Clemens Coja stated that a wider political process will have to open in the Belgrade-Pristina dialogue.After the talks on electricity and telecommunications, which will hopefully be successful, a wider political process will have to be launched so as to tackle the remaining political issues such as the right of Serbs in northern Kosovo, protection of the Serbian cultural heritage and returnees, Coja said in an interview for the weekend edition of the Belgrade-based daily Danas, ahead of his approaching shift to the position of the Slovenian ambassador.Coja noted that the Ahtisaari Plan contains adequate solutions for these issues, but competent bodies need to find a way to make them acceptable for both sides, and added that the EU respects the intention of Serbian President Tomislav Nikolic to raise the dialogue to the political level.When asked whether Serbia can launch EU accession talks by the end of the year, Coja said that chances remain the same and that the European Council clearly stated which conditions need to be fulfilled, most of which refer to the relations between Belgrade and Pristina.The EU will not set any new conditions, the Austrian ambassador said.

EULEX: RULE OF LAW MUST BE RESTORED IN KOSOVO NORTH

KOSOVSKA MITROVICA, Aug 18 (Tanjug) - EULEX Spokesperson Irina Gudeljevic has said on Friday that there is an urgent need to restore the rule of law in northern Kosovo, and ensure that citizens have full and timely access to justice."If lengthy delays of trials and lack of access to justice occurred, that might lead to the infringement of human rights. Therefore, there is an urgent need to restore the rule of law in northern Kosovo, and ensure full and timely access to justice for all citizens," the EULEX spokesperson said.Gudeljevic told Tanjug that since December 2008, EULEX judges and prosecutors at the district court in Kosovska Mitrovica, with the support of multi-ethnic team of jurists, delivered 50 verdicts in criminal proceedings.Asked about the laws on which these verdicts were based, she said that independent judges decide about the application of the laws."Different laws were implemented based on the decision of an independent judge. The independence of judges is of key importance in every democratic society," she said.The Mission would like to see the return of local judges and prosecutors, Kosovo Albanians and Kosovo Serbs to the court in Kosovska Mitrovica as soon as possible, Gudeljevic said.That would benefit all communities, and EULEX has put in tremendous efforts to make that happen, but a long-term solution could only be reached in close cooperation with all relevant actors, she said.Commenting on the fact that Serb courts are still operating in the northern part of Kosovo, Gudeljevic said that Kosovo is a single legal space (even under UN SC Resolution 1244), she said.

SERBIA – ECONOMY

MINISTER OF ENERGY & ENVIR.: RATING DROPPED BECAUSE OF FORMER GOVT

BELGRADE, Aug 17 (Tanjug) - Serbia's credit rating was not dropped because of the amendments to the law on the central bank, but because of the legacy of the former government, Serbian Progressive Party (SNS) official Zorana Mihajlovic said on Friday.Mihajlovic, who is also minister of energy, development and environment, says the amendments are the least possible reason for the rating cut when all the other reasons are considered.Those reasons are the constant deterioration of the economic situation, budget deficit, monopoly, lack of investments, large bureaucracy and administration, she told a news conference at an SNS office."The credit rating was not lowered because of this government, but because of the legacy of the former government. It does not mean that things cannot improve," Mihajlovic stated, pointing out that the new government came into power less than a month ago.U.S. credit rating agency Fitch released on Thursday that it had reduced Serbia's rating forecast to negative and at the same time asserted the long-term sovereign credit rating in both foreign and local currency to BB- level.The negative projection reflects the aggravation of Serbia's fiscal position and its external funding, and apparently its low economic growth, the agency explained.Instead of focusing on the correction of the growing fiscal deficit and public debt, the new government amended the law on the central bank in a way that jeopardised the investors' trust, which can cause complications concerning the agreement on the new loan from the International Monetary Fund (IMF), the release states.

MINISTER OF FINANCE AND ECONOMY: SERBIA IS READY FOR TALKS WITH IMF

BELGRADE, Aug 17 (Tanjug) - Minister of Finance and Economy Mladjan Dinkic has said that the draft proposal for 2012 budget revision will be drawn up by September 1 the latest, adding that the deadline for ministries to submit plans for achieving savings in expenditure expires Friday.The ministries in charge of economic matters have told Tanjug that they will forward their proposals for savings to the Ministry of Finance in time, but it is still not known whether they have all done that.A total of 17 bills should be adopted to reduce expenditures and increase revenue to state coffers and they will be in legislative procedure in September. Most of the measures therein should enter into force in October, Dinkic said at the beginning of August.The 2012 budget, drafted with the aim of countering negative impacts of the economic crisis, plans expenditures of about RSD 890 billion, RSD 750 billion revenue and a deficit of about RSD 140 billion.The deficit, however, has already exceeded the planned 4.25 percent of gross domestic product (GDP) to hit seven percent or the record sum of around RSD 235 billion, or EUR 2.2 billion.This year's budget deficit forecast was made targeting the inflation rate at below six percent and growth at 1.5 percent GDP, but according to the latest National Bank of Serbia (NBS) data, Serbia might have a double-digit inflation and economic contraction of 0.5 percent by the end of 2012.Advisor to the Minister of Finance for the tax system and tax administration Milica Bisic has told Tanjug earlier that it is hard to expect a reduction in budgetary expenditure without limiting the growth of public sector salaries and pensions, stressing that it requires a political and social agreement.Dinkic stated on Friday that Serbia is ready to conduct talks with the International Monetary Fund (IMF) and underscored that IMF representatives can come and visit Serbia whenever it suits them.Speaking about the continuation of cooperation with IMF, Dinkic said that when he took over the office of the minister in the government headed by Ivica Dacic, he immediately sent a letter to the IMF European department director, in which he said that the organisation's representatives can visit Serbia whenever it suits them.We are already willing to conduct the talks, Dinkic underscored and noted that the activities connected to the drafting of the budget review and the 2013 budget are in the final stages.The aim is to cut some indirect expenses in the budget while at the same time helping the economy get going and thus increasing the revenues.IMF Permanent Representative in Belgrade Bogdan Lissovolik confirmed on August 8 that the request by the Serbian Ministry of Finance and Economy has arrived, in which the Ministry calls for a visit of the IMF mission to Serbia with a view to assessment of the situation in the field, and added that the decision on the matter is yet to be adopted.In an interview for Tanjug, Lissovolik noted that it is too early to discuss the details of the potential arrangement which may be reached with Serbia.Replying to the question as to whether the amendments to the Law on NBS would affect the negotiations with Serbia and whether certain conditions would be imposed as regards this point, Lissovolik underscored that IMF attaches great importance to the issues of the central bank autonomy and implementation of the monetary policy.No one in Serbia could rejoice at the news that the international credit rating agencies Standard & Poor's and Fitch revised Serbia's outlook to negative from stable, Serbian Minister of Finance and Economy Mladjan Dinkic said on Friday.He is of the opinion that the decision does contain an element of political pressure on the new Serbian government, which comes as no surprise to him.Asked whether he felt responsible for this downgrade, Dinkic said that he could do a lot, but he "is no Superman", underlining that he had held the office for only three weeks."If someone expects from me to deliver something that the previous government did not manage to do in the domain of finance for three years, then it is too much," Dinkic said, indicating that the outlook reflects the achievement of the previous government."Everyone should do their job. My job is to put the economy back on its feet, and I am convinced that we will manage to secure additional foreign investments, and soft loans," Dinkic told journalists in Smederevska Palanka (central Serbia).Dinkic expects that all these international rating agencies will review their forecasts, once they see that Serbia has turned the corner.On Thursday, U.S. credit rating agency Fitch revised Serbia's outlook to negative, while at the same time affirming its long-term foreign and local currency Issuer Default Ratings (IDRs) at "BB-"."The negative outlook reflects the deterioration in the country's fiscal and external financing position and weak economic growth outlook," Fitch said in a statement."Rather than focusing on correcting a rising fiscal deficit and public debt ratio, the new government has amended the central bank law in a manner which has dented investor confidence and might complicate the agreement of a new IMF deal," the release adds.