Title Page



June 14, 2013

Prepared By

European Department





Fund Relations

(As of May 31, 2013)

Membership Status: Joined December 14, 1992 (succeeding to membership of the former Socialist Federal Republic of Yugoslavia); accepted Article VIII on May 15, 2002. Serbia continues the membership in the Fund of the former state union of Serbia and Montenegro—previously the Federal Republic of Yugoslavia—since July 2006.

General Resources Account

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SDR Department

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Outstanding Purchases and Loans

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Latest Financial Arrangements

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Projected Obligations to Fund

(In millions of SDR)

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Implementation of HIPC Initiative: Not Applicable.

Implementation of Multilateral Debt Relief Initiative (MDRI): Not Applicable.

Safeguards Assessment: The latest safeguards assessment for the NBS has been completed in December 2011. The assessment found that the NBS has implemented several recommendations of the 2009 assessment that have further strengthened its financial safeguards. Multi-year external auditor appointment has been introduced and an independent external assessment of the internal audit function has been conducted. Governance has been strengthened with the Council’s new role, which provides oversight of external and internal audits, financial reporting, and the system of internal controls. The assessment recommended improvements in external audit procedures, disclosures in financial statements, and data compilation procedures. Subsequent to the assessment completion, amendments to the NBS Law, which included inter-alia dismissal of the Council members, have raised concerns about NBS autonomy. In line with staff’s advice, the authorities subsequently took steps towards restoring NBS autonomy.

Exchange Arrangement: Serbia accepted the obligations under Article VIII, Sections 2, 3, and 4, on May 15, 2002, and maintains a system free of restrictions on payments and transfers for current international transactions, except with respect to blocked pre-1991 foreign currency savings deposits (IMF Country Report No. 02/105). The de jure exchange rate arrangement is a floating system since January 1, 2001. According to the 2009 Monetary Policy Program, the National Bank of Serbia (NBS) implements a managed floating exchange rate regime.

Last Article IV Consultation: Concluded on March 31, 2010 (IMF Country Report No. 10/93).

FSAP Participation: Serbia participated in the Financial Sector Assessment Program in 2005, and the Executive Board discussed the Financial System Stability Assessment in February 2006 (IMF Country Report No. 06/96). An update under the Financial Sector Assessment Program was conducted in 2009 and the Executive Board discussed the Financial System Stability Assessment in March 2010 (IMF Country Report No. 10/147).

Technical Assistance in the Past 12 Months:

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In addition, technical assistance was available through resident advisors covering tax administration, public financial management and real sector statistics.

Resident Representative:

Mr. Bogdan Lissovolik took his position as Resident Representative in April 2009.

World Bank Group Relations

A. Partnership with Serbia’s Development Strategy

The World Bank has been discussing the policy reform agenda with successive governments, and has been actively engaged with the new Government since winning a mandate and assuming office in mid-2012. Support for the government’s development strategy from the World Bank and the IMF follow the agreed upon division of responsibilities between the two institutions.

The Fund takes the lead on macroeconomic policies (fiscal, monetary, and exchange rate) aimed at facilitating sustainable growth, while the Bank takes the lead on structural policy aimed at medium to long-term adjustment. In areas of direct interest to the Fund, the Bank leads the policy dialogue in: (i) public expenditure management; (ii) pension, health, and education; (iii) social safety net reform and the monitoring of the impact of the crisis on the poor; and (iv) reforms with a bearing on the business environment, including labor markets and the performance of publicly owned enterprises. The Bank and the Fund have jointly led the policy dialogue in the financial sector.

The World Bank

Total IDA credits and grants committed to the Republic of Serbia (Serbia) by the Bank since 2001 amount to approximately $740 million, with an additional $846,5 million in IBRD commitments (as of May 2013). The Bank has assisted Serbia to make progress against key objectives set out in the Country Partnership Strategy (CPS) for FY12–15: (i) encouraging a more competitive economy; (ii) and improving the efficiency and outcomes of social spending. The Government has made progress on these two priorities with the support of World Bank financial and analytical products.

The CPS was discussed by the World Bank Board of Executive Directors on November 15, 2011. IBRD financing during the first two years of the CPS was expected to amount to US$340 million. The authorities requested total lending during the CPS period of US$800 million. The lending amount for the final two years of the CPS is to be discussed with Bank management at the time of the CPS Progress Report, scheduled for mid-CY13.

As of May 2013, Serbia has a portfolio of 7 Bank-supported projects under implementation with a total commitment value of $670 million (including IDA, IBRD and GEF). Investment support focuses on (i) transport and energy infrastructure aimed at encouraging regional integration and spurring economic growth; (ii) agricultural, environment, and irrigation investments to improve production and help Serbia meet EU standards; (iii) pension, education and health sector reform to strengthen the quality of service and improve financial sustainability; (iv) strengthened land administration; (v) energy efficiency; and (vi) regional development in the economically depressed former mining region of Bor. The Bank is also preparing policy lending to enhance the contribution of the public enterprise sector to the competitiveness of the Serbian economy.


As of April 2013, the IFC’s committed portfolio in Serbia was US$753 million in 25 projects. Equity investments account for 9% of committed portfolio. IFC has significantly increased its financing in Serbia in FY12-13. In FY12 IFC invested US$ 504 million (including mobilization) in 7 projects and in FY13 is expected to invest $500 million (including mobilization) in 5 projects. In the financial sector, in FY12-13 IFC invested US$375 million at own account and mobilized about US$ 330 million through MIGA supporting the banking sector to expand its financing to MSMEs, agribusiness, trade finance, and housing sectors. Although the financial sector has been the focus, during FY12–13 IFC has also increased its presence in the real sectors investing US$290 million. Through its investments IFC has supported projects in the agribusiness sector, including in meat processing and juice production. Also, to improve private companies’ competitiveness and their exports, IFC invested in one of the largest private companies in Serbia with activities in agribusiness, manufacturing and mining. Also, IFC financed a green-field metal stamping facility. In addition IFC invested about US$100 million in two regional projects in the cement and insurance sectors, with operations in the Balkans including in Serbia. In addition to providing financing, IFC is supporting Serbia through a number of advisory projects with focus on Investment Climate, Corporate Governance and Renewable Energy/Energy Efficiency.


As of May 2013, MIGA’s outstanding portfolio in Serbia consisted of 6 contracts of guarantee with total gross exposure of $176 million. All but one project are in support of foreign banks’ loans to their Serbian subsidiaries, half of them in the aftermath of the 2008-09 global financial crisis. MIGA’s continuing support to these projects signals the Agency’s efforts to continue to underwrite projects in Serbia, encourage inward FDI, and add to the World Bank Group’s strategy of encouraging private sector development in the country.

Prepared by World Bank staff. Questions may be addressed to Anthony Gaeta at (202) 473-1798 or Marina Wes at + 381 11 3023 706.

Statistical Issues

Economic statistics in Serbia have faced many challenges in recent years but data provision is broadly adequate for surveillance. The statistical system has been successfully upgraded in recent years with the assistance of the IMF1 and other bilateral and multilateral institutions. Although international standards are not yet fully met, official data for all sectors are sufficiently good to support key economic analysis and surveillance. In many areas, including monetary, balance of payments, and real sectors, internationally accepted reporting standards have been introduced. A page for the Republic of Serbia was introduced in the October 2006 issue of the International Financial Statistics (IFS).

Serbia participates in the General Data Dissemination System (GDDS) and its metadata were posted on the IMF Data Dissemination Bulletin Board on May 1, 2009. The metadata identify plans for improvement, which are being used to guide further progress.

A. Real Sector Statistics

The real sector data are compiled by the Statistical office of the Republic of Serbia (SORS). Annual and quarterly nominal and volume measures of GDP by activity are available from 1997 onwards. Nominal annual GDP estimates by expenditure are available from 1997, while the respective volume measures estimates have been disseminated only starting with the data for 2003. Quarterly GDP estimates by expenditure both at current prices and in volume measures are available from 2003 onwards.

The national accounts statistics of the Republic of Serbia are based on the conceptual framework of 1993 SNA/ESA 95. Work is progressing on the transition to the most updated international recommendations of the 2008 SNA/ESA 2010. In the last two years significant methodological changes were introduced in the compilation of volume measures of GDP as the SORS adopted a system of chain-linked volume measures, thus replacing the previous estimates with a fixed base. Also the scope of the estimates were recently extended with the compilation of annual volume measures of GDP by expenditures on final uses and the compilation of expenditure-based quarterly GDP, both at current prices and in volume terms. These estimates were disseminated for the first time on March 29, 2013.

Procedures for the compilation of the estimates of annual GDP by production are in line with internationally recommended practices. Estimates for achieving exhaustiveness in the production account estimates are being produced with an adequate methodology and compiled at very detailed levels.

Sources and method for the compilation of GDP by expenditures, are in general adequate but, the adjustment to domestic household consumption expenditure for net expenditures of residents abroad differs from the corresponding estimates in the balance of payments compiled by the National Bank of the Republic of Serbia (NBS) thus implying an internal inconsistency within GDP by expenditure. Weaknesses in the estimates of gross fixed capital formation are due to the lack of coverage of the unincorporated enterprises in the survey on investments, but starting in 2013 these enterprises are included in the survey. Separate estimates of changes in inventories are disseminated from 2007.

Reconciliation between the independent annual GDP estimates based on the production and expenditure approach is being made at aggregate levels, although the original differences are not significant. The gap between the quarterly estimates of GDP by expenditure and GDP by production is closed by a residual covering the statistical discrepancy plus changes in inventories and net acquisition of valuables. There are no reliable independent estimates of changes in inventories on a quarterly basis.

The RSSO compiles and disseminates monthly indices for retail and consumer prices, producer prices, industrial production, as well as unit-value indices for imports and exports. Concepts and methods used to compile the CPI, introduced in 2007, as well as other price statistics, attempt to reflect international standards and best practices.

B. Balance of Payments Statistics

Balance of payments statistics are compiled by the National Bank of Serbia (NBS). The compilation procedures are generally appropriate; however, the source data for compiling various current account transactions could be further improved. In particular, additional programs should be developed to collect data to estimate unrecorded trade, travel, and private transfers (workers’ remittances).

The NBS has improved the source data for estimating transactions relating to direct investment by conducting direct surveys of direct investment enterprises. However, there is a backlog of data to be processed and direct investment transactions in the balance of payments statistics have not been adjusted based on the survey data.

The staff levels are not commensurate with the statistical program and the NBS may face some difficulty in conducting all the requisite data collection exercises and implementing the majority of the recommendations if staffing is not increased.

Serbia reports balance of payments statistics to STA for publication in the IFS and the Balance of Payments Statistics Yearbook.

C. Government Finance Statistics

Government finance statistics are compiled by the Ministry of Finance and reported on a monthly basis. Principal data sources are the Republican Treasury and budgetary execution reports of the spending ministries and first-level budget units.

Since 2001, Serbia has made efforts to bring the existing budget reporting system in line with the Government Finance Statistics Manual 2001 (GFSM 2001) methodology. Full compliance has yet to be achieved as implementation of the new chart of accounts, generally consistent with the classifications of the GFSM 2001, has not been completed. The classification of all expenditure of the “National Investment Plan” as capital needs to be brought in line with international standards. While the data on the clearance of arrears are available on a monthly basis, information on the accumulation of new arrears is not available. The reconciliation of fiscal and monetary data is not conducted on a regular basis.

D. Monetary and Financial Statistics

Monetary and financial statistics are compiled by the NBS, broadly following the methodology set forth in the Monetary and Financial Statistics Manual, 2000 (MFSM), and meeting the GDDS recommendations with respect to periodicity and timeliness for financial sector data. Monetary data are reported to the Fund using Standardized Report Forms.

Some improvements could still be made. The coverage of monetary statistics could be improved by including banks in liquidation (as their data are not available on a timely or comparable, International Accounting Standard-specified, basis).

Table of Common Indicators Required for Surveillance

(As of May 31, 2013)

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Includes reserve assets pledged or otherwise encumbered as well as net derivative positions.

Both market-based and officially-determined, including discount rates, money market rates, rates on treasury bills, notes and bonds.

Including currency and maturity composition.

Daily (D), Weekly (W), Monthly (M), Quarterly (Q), Semi-annually (SA), Annually (A), Irregular (I); or Not Available (NA).

Includes external gross financial asset and liability positions vis-à-vis nonresidents.


Recent examples of STA technical assistance missions include the SDDS assessment and the national accounts missions of FY 2011, as well as national accounts missions in FY 2012 and FY 2013, respectively.