Serbia to get USD 1 billion loan from UAE fund as financial support to budget – Maturity date 10 years, interest rate 2.25%

Serbia will get a loan for the Abu Dhabi Fund for Development (ADFD) equivalent to AED 3.773 billion (close to a billion dollars) as financial support to the budget.

According to the Loan Agreement signed by the Government of Serbia and the ADFD in Belgrade on October 4, the maturity date is 10 years, with a grace period of five years and a repayment period of five years and the annual interest rate of 2.25% on the amount withdrawn from the principal amount. The draft law confirming this Loan Agreement has been given to the Assembly of Serbia to adopt on short notice.

The first installment is due on October 5, 2021, and the final one on April 5, 2026. The installments are paid on each April 5 and October 5.

The explanation for the adoption of the law states that Serbia’s 2016 Budget Law envisions direct indebtedness of the state in the amount of up to USD 2 billion towards the Government of the UAE.

– Considering the efforts made by the Government towards maintaining the stability of the public finance system and managing the budget in accordance with the adopted plan under the conditions of limited financial possibilities, the loan support by the Fund will contribute to ameliorating unfavorable influences on the fiscal position and economic and financial stability of the Republic of Serbia – the explanations says.

The current situation obliges the Government to procure, in an adequate and favorable manner, financial means in line with the needs of the public consumption and economic trends throughout 2016 and the coming years, the draft law states.

Vlada Republike Srbije

Aby Dhabi Fund for Development

ADFD

Government of Serbia

Budget Law of the Republic of Serbia

loan

credit

budget