Yesterday, at the proposal of the Ministry of Finance, the government decided to borrow by issuing government bonds in a total amount of up to 900 million euros, "Vijesti" learned.
A source for "Vijesti" from the executive branch said that this was decided yesterday at a session, based on the Budget Law for this year.
"Of this amount, up to 800 million euros will be spent on the foreign market, and up to 100 million euros on the domestic market," said a source for "Vijesti".
He explained that in the domestic market, in addition to banks, citizens will also be able to buy bonds.
"Of the total debt, 500 million is for repaying old debts based on previously issued bonds from 2018, which are due for collection in April," said a source for "Vijesti".
The Government's decision tasks the Ministry of Finance, in cooperation with Bank of America, Citi Group, Intesa Bank, Societe Generale Bank, OTP Bank and law firms, to undertake all necessary activities and prepare all necessary documents required for the implementation of the bond issue.
The Minister of Finance is also authorized Novica Vuković to sign all necessary documents required for the preparation of the bond issue, while the Ministry is tasked with submitting the documents required for the bond issue to the Government for consideration and adoption.
The procedure must be completed by the end of March.
All procedures for issuing bonds must be completed by the end of March, as must their sale on the international stock exchange, so that the Government can repay the debt that matures in early April. The interest rate on this debt will only be known when the bonds are issued and their buyers submit bids stating the amounts of the yield.
The budget proposal and the monthly implementation plan plan for borrowing 700 million euros in March, and another 50 million in April from domestic issuance. They are needed because the state is due to pay installments of old debt of 509 million euros in April.
This new decision slightly changes the monthly borrowing plan. The budget proposal allows the Government to borrow up to 1,14 billion euros in total for financing, debt repayment and creating reserves for the coming year. The Government is to repay 821 million euros of old debts this year.
Another borrowing of 135 million euros is planned for September.
Debt grows to 2027 billion in 5,5
According to the latest information on public debt, its net amount at the end of September last year was 3,84 billion euros, or 51,86 percent of GDP. According to the fiscal strategy, a gradual increase in public debt is foreseen, so that by the end of 2027 it would amount to 63,8 percent of the then GDP, which would be 5,5 billion euros.
The Government's statement, after the meeting, stated that information on the starting points for the implementation of the bond issue on the international market had been adopted, not specifying the amount of the issue but the upper limit of these debts of up to 1,14 billion euros.
"The planned funds are intended exclusively for the repayment of old debts and financing of capital expenditures. The largest part of the debts relates to bonds from 2018, which are due for collection at the beginning of April. The Ministry of Finance and this Government have ensured that the cost of interest on the existing debt, which matures in 2025 and amounts to around 160 million euros, is financed from current revenues, with regular servicing of all current liabilities," the statement said.
Limit up to 1,14 billion
They also said that the Ministry of Finance is intensively monitoring developments on the international and domestic markets and determining the most favorable moment for the implementation of financial arrangements - bonds.
"After detailed analysis and consideration of all market aspects, the Government was proposed to consider the possibility of issuing bonds on the international market, in order to secure part of the funds planned by the Decision on Borrowing for 2025, which was adopted by the Parliament in February, and the Ministry of Finance has repeatedly publicly explained the obligations defined therein. This Decision envisages the possibility of securing funds on the market in 2025 in the amount of 1,14 billion euros, most of which (around 820 million euros) relate to the repayment of debt from the previous period, as well as the financing of capital expenditures. To finance the above needs, the state will use deposits secured in 2024 this year, as well as funds from new financial arrangements," the Government announced.
In addition to the payment of debt on bonds issued in 2018 of 500 million, loans from the World Bank PBG 1 and PBG 2 from 2018 and 2020 in the amount of around 55 million euros are also due by the end of the year, a Chinese loan from Exim Bank for the construction of the Bar-Boljari highway from 2015 of around 60 million euros, a Deutsche Bank loan from 2023 in the amount of 40 million euros, loans from commercial banks of 56 million euros, an IMF loan for financing the budget due to Covid-19 from 2020 of around 19 million euros, as well as repayments on infrastructure and development projects in the amount of around 69 million euros.
In total, old debt in the total amount of around 2025 billion euros, as well as interest of around 2026 million euros, will mature in 2027, 2,1 and 565.
"The decision on borrowing for 2025 leaves the possibility of timely securing additional funds during the current year for the purposes of refinancing the debt and creating a fiscal reserve for 2026 and 2027," the Government announced, stating that the new loans will be used exclusively for the repayment of existing debt, the capital budget and the creation of a fiscal reserve for the coming years.
The state is buying the Institute's children's department, different restrictions on advertising for organizers,...
The government yesterday adopted a decision to respond to the tender of the Simo Milošević Institute with an offer to purchase the children's department for 4,87 million euros. It will be reconstructed for the needs of the new elementary school in Igalo.
This purchase is part of the Institute's Restructuring Plan.
The government also adopted amendments to its earlier proposal, the Law on Games of Chance, which is already in the parliamentary procedure, which specify the norms on the prohibition of advertising. These changes allow advertising of the organizer's brand without mentioning the services and games, while services will be able to be advertised on radio and television from 22 p.m. to 6 a.m., in print media on sports pages, on sports portals and sports pages, but without mentioning the benefits of the games.
Advertising benefits in games of chance (winnings, bonuses, prizes, spins, etc.) will only be allowed on the websites of organizers and sports clubs and organizations sponsored by the organizers.
19 new amendments to the Energy Law were also adopted, enabling the so-called fuel marking, as well as obligations of retailers regarding storage and supply to consumers.
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