Relations with the International Monetary Fund
Serbia’s Membership in the IMF
The former Socialist Federal Republic of Yugoslavia (SFRY) was one of the participants in the United Nations Monetary and Financial Conference at Bretton Woods (1944), as well as one of the founding countries of the International Monetary Fund (IMF) and the World Bank (WB). On 14 December 1992, the IMF Executive Board recognised the dissolution of the SFRY and terminated its membership in the IMF, while at the same time determining the conditions to be met by successor states in order to join the IMF and succeed the membership of the SFRY. The Federal Republic of Yugoslavia received a 36.52% share in the assets and liabilities of the SFRY in the IMF.
On 20 December 2000, the IMF Executive Board took a decision coming into effect retroactively on 14 December 1992 (Press Release No. 00/75) that the FR Yugoslavia had met the conditions required for joining this institution.
After the Republic of Montenegro seceded, the Republic of Serbia inherited the international legal personality of the former State Union of Serbia and Montenegro and continued its membership in international financial organisations.
On 21 July 2006, the IMF confirmed that the Republic of Serbia is the continuing state of the former State Union of Serbia and Montenegro (Press Release No. 06/161), as well as that it continues its membership with the quota of SDR 467.7 million and retains all rights and obligations stemming from this membership.
The Governor of the NBS serves as the Serbian Governor to the IMF, while a Vice-Governor of the NBS serves as the Alternate Governor to the IMF.
The Republic of Serbia has been a member of the Swiss constituency, a voting group through which it exercises its voting power in the IMF and the WB since December 2000. This constituency is composed of Switzerland, Poland, Serbia, Turkmenistan, Kazakhstan, Azerbaijan, the Kyrgyz Republic and Tajikistan. A meeting of the Swiss constituency members was held in Belgrade in 2009.
Regular cooperation between the Republic of Serbia and the IMF is conducted in the form of annual consultations under Article IV of the IMF Articles of Agreement. These consultations represent a statutory obligation of its members, based on which the IMF assesses the economic situation in a country and the adequacy of its economic policy measures.
Serbian Quota Increase in the IMF
The IMF’s comprehensive quota and governance reforms entered into force on 26 January 2016, which allowed for a doubling of IMF quotas under the 14th General Review of Quotas and a major shift in quota shares of the IMF members (Press Release No.16/25).
On 10 February 2016, Serbia settled its obligations to the IMF arising from its quota increase from SDR 467.7 million to SDR 654.8 million. Owing to this, the amount of potential financial assistance under future arrangements with the IMF has been proportionately expanded.
Financial Cooperation between the Republic of Serbia and the IMF
From 2000, the IMF provided financial support to the Republic of Serbia in the form of the following arrangements:
- 20 December 2000: Emergency Post-Conflict Assistance was approved in the amount of SDR 116.92 mln (around EUR 167.19 mln and 24.99% of the Serbian quota in the IMF) in order to support the country’s economic stabilisation programme and the reconstruction of institutions and administration (Press Release No. 00/75). The FR Yugoslavia channeled those funds to repay the bridge loan (SDR 101.1 mln, or around EUR 144.57 mln) granted by Switzerland and Norway to settle its obligations to the IMF.
- 11 June 2001: a Stand-by Arrangement was concluded in the amount of SDR 200 mln (around EUR 293.7 mln, 42.76% of the quota), as financial support to further macroeconomic and structural reforms (Press Release No. 01/31). These funds were disbursed through four equal tranches, and repaid between March 2004 and May 2006.
- 13 May 2002: a three-year Extended Facility Arrangement was approved in the total amount of SDR 650 mln (around EUR 909.38 mln, 138.98% of the quota) (Press Release No. 02/25), to support the economic programme of stabilisation and reforms. The approved funds were disbursed through 12 tranches, and were repaid ahead of schedule during 2006 and 2007.
The conclusion of this arrangement was especially significant because it paved the way for the implementation of the first stage of write-off of debt to Paris Club creditors in the amount of 51% (around USD 2 bln), while the successful realisation of the arrangement led to an additional 15% debt reduction totalling around USD 700 mln.
- 16 January 2009: a precautionary Stand-by Arrangement in the amount of SDR 350.77 mln (around EUR 400.33 mln, 75% of the quota) (Press Release No. 09/12) was concluded. Due to unexpected negative events in the financial environment, it was increased on 15 May 2009 to SDR 2,619.12 mln (around EUR 2,941.95 mln, 560% of the quota) (Press Release No. 09/169). Of that amount, a total of SDR 1,367.74 mln (EUR 1,536.33 mln, 293% of the quota) was drawn. This arrangement was successfully finished on 8 April 2011.
- 29 Septembar 2011: an eighteen-month precautionary Stand-by Arrangement was approved in the amount of SDR 935.4 mln (around EUR 1,076.75 mln, 200% of the quota). This Arrangement was concluded with a view to maintaining macroeconomic and financial stability in the country and improving the investment climate (Press Release No. 11/353). The first review under the Stand-by Arrangement in February 2012 was not positive because the 2012 budget deviated from the agreed fiscal program, and the approved funds were not drawn.
- 23 February 2015: a new 36-month Stand-by Arrangement was approved in the amount of SDR 935.4 mln (around EUR 1,168.5 mln), to support the agreed economic programme for the period 2015-2017. The Serbian authorities intend to treat the arrangement as precautionary, which means that they do not intend to draw on the funds approved, but retain the option to do so in case of BoP needs (Press Release No. 15/67). The IMF Executive Board also concluded Article IV consultations on this occasion and gave its assessment of the economic situation in Serbia (Press Release No. 15/80).
Three-Year Stand-By Arrangement with the IMF successfully concluded on 22 February 2018