Fitch Ratings increases Serbia's credit rating

The Ministry of Finance announced this late last week.

According to the statement, the increase of the credit rating of the Republic of Serbia by "Fitch Ratings" reflects the improvement of public finances, supported by the fiscal outcome.

The agency points out that the ratio of public debt to GDP is improving and stable, and after a significant fall in 2017 to 63.6% of GDP, "Fitch Ratings" expects a further decline to 62.1% of GDP in 2018 and to 60.6% of GDP in 2019.

The main drivers of the positive trend are fiscal consolidation that will lead to a further reduction of the public debt to GDP ratio, continuous reduction of net external indebtedness and stable inflow of foreign direct investments.

"Fitch Ratings" also believes that the opening of new chapters in the negotiations for accession to the European Union and the successful completion of the precautionary arrangement, as well as further cooperation with the International Monetary Fund will be important factors for further improvement of the credit rating of the Republic of Serbia.

The agency also notes that the current account deficit (estimated at an average of 4.3 percent of GDP in the period 2017-2019) will be fully covered by net foreign investment, the statement reads.

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