Serbian Deputy Prime Minister for Economic and Regional Development Verica Kalanovic and head of the International Monetary Fund (IMF) Mission to Serbia Albert Jaeger agreed Monday on the need for a new precautionary arrangement between Serbia and the IMF in order to continue reforms in the country.

The new arrangement would involve two components - one of fiscal responsibility, and the other of infrastructure projects aimed at improving the investment climate

The meeting also focused on models of management of projects to be funded from the capital part of the budget.

Kalanovic and Jaeger also agreed that a small percentage of budget is being spent presently on infrastructure projects that contribute to increased investments and that a new model would be aimed at increasing allocations for infrastructure, Kalanovic's office said.

The IMF mission will stay in Serbia until May 27 to conduct technical talks with Serbian officials as part of the groundwork for a new precautionary arrangement.