It looks like Serbia's economy is in for some trouble. With imports of 18 bln US$ and exports of only 9 bln it is things look a bit out of balance - even if you take into account that Serbia is fastly developping. Half of the hole is plugged with foreign investment, aid and transfers of emigrant, but the other half is not covered and might on the long term result in the same kind of meltdown that happened in Argentina in 1999.
The IMF has asked Serbia to "adopt a restrictive 2009 budget to prevent the widening of its current account gap". But the cutting the government budget in order to correct the balance of payments is a very indirect method that only the Friedman-style neo-liberals advocate. Unfortunately they still dominate the IMF. They hate every kind of government involvement in the economy. On the other hand they don't care if an economy crashes (like Argentina did in 1999) because it gives them the tools to pressure for more privatisations.
A more sensible approach in such circumstances is lower the exchange rate. Velimir Ilic is advocating this and I think he is totally right to say that Serbia needs a more export driven economic growth model. Unfortunately he packs his ideas in some anti-EU rethorics what may cause some people to overlook them.
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