Serbian Govt Approves USD 1B UAE Loan

The government of Serbia approved unanimously the USD 1B loan from the United Arab Emirates late on Wednesday.

Owing to the loan, Serbia will save USD 40M annually, or approximately USD 400M over the period of ten years, Finance Minister Lazar Krstic pointed out, Serbian Tanjug reports.

The loan carries an interest rate of 2%, its repayment begins six months from the date of withdrawal and the grace period for principal repayment is ten years.

The money will be transferred to Serbia after the Serbian parliament ratifies the loan arrangement, probably at the beginning of the second quarter of 2014, Tanjug informs.

The loan arrangement with the UAE will enable Serbia to save around EUR 300M, Serbian First Deputy Prime Minister Aleksandar Vucic has said, noting that he expects at least part of the loan to be invested into production.

Finance Minister Krstic said that the best options for using the loan are being discussed, with particular consideration of refinancing some of the expensive loans, or at least repaying the principal of the loans.

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