Serbia, The main reason for the increase in the budget deficit is the large losses in the energy sector

, News Serbia Energy

Member of the Fiscal Council Nikola Altiparmakov stated that the main reason for the increase in the budget deficit is the large losses in the energy sector, specifically the losses recorded by Elektroprivreda Srbije (EPS) and Srbijagas.

In an interview with Bloomberg Adria TV, Altiparmakov stated that Srbijagas is recording losses due to the increase in the price of gas on the world market, as well as the government’s decision not to pass that increase on to consumers. On the other hand, it indicates that EPS itself is to blame for losses in EPS.

“EPS has been recording losses due to poor business during the last few years, and the problem was particularly escalated last fall when we had a production stoppage. In total, the losses will be around two billion euros and we will probably have to pay more losses in the next year as well until EPS restores its production”, Altiparmakov said.

Last fall, when problems appeared in EPS, problems also started in Srbijagas, Altimarkmakov said, adding that last year it cost the state 500 million euros. During this year, he adds, the cost is around one and a half billion euros. “It is clear that these costs will not be able to stop and we will have them during the next year as well.”

However, he expects that next year the volume of expenses will be slightly smaller than this year and will amount to perhaps around one billion euros.

In the rebalancing of the budget, about 190 billion dinars more revenue is foreseen, and Altiparmakov explains that one third is the result of tax increases, and two thirds is due to inflation.

When it comes to today’s increase in the interest rate of the National Bank of Serbia (NBS), Altiparmakov says that the NBS does not have many options but to follow the international trend determined by the Federal Reserve and the European Central Bank, Bloomberg Adria writes.