The government’s decision to borrow up to €350m from domestic commercial banks by the end of the year is generally not a good solution for Montenegro, because the interest rates offered are unfavorable for the state, economic analyst Oleg Filipovic has told Pobjeda.
He believes that there were enough positions on the expenditure side of this year’s budget within which a significant part of the projected €350m could have been saved, primarily in the position of public procurement.
“I am sure that by introducing other methodologies, such as a private-public partnership, 30% to 40% of the missing funds could have been saved”, says Filipovic and adds that there was a registered outflow of €130m last year through the business of the IT sector, and that on the principle of public-private partnership, a significant part of that money could have remained in our country.
According to him, savings in the budget could also be made by limiting the growth of salaries in the public sector.
He claims that the Government had an alternative because there was enough money abroad, private capital that could be attracted.
“It is a matter of choosing the people who manage the Ministry of Finance, whether they are conservative or liberal economists. If you are a conservative economist, then it is normal that business with foreign corporations and hedge funds is too risky for you and then you reach the IMF, World Bank and commercial banks. I am not a supporter of that”, says Filipovic.
According to Filipovic, the negotiations between the Ministry of Finance and domestic banks have shown all the weaknesses of our system.
