International Monetary Fund (IMF) representative in Serbia Bogdan Lissovolik confirmed on Monday that an IMF delegation will visit Belgrade on February 2 to discuss with the Serbian government a review of a precautionary arrangement and he added that the 2012 budget law contained deviations from what had been agreed.

The first review of the arrangement was completed in late December and it was supposed to be evaluated in January, Lissovolik stated, adding that it was postponed because the government had not followed the part of the agreement related to the projected level of public debt, which should not exceed 45 percent of the GDP, and the agreed budget deficit had also been breached.

Lissovolik told a conference entitled Financing Growth in Serbia that deviations from the agreed policy would lead to violations of the principle of fiscal stability, which is reflected in the law and pointed out that the public debt, which stands at 25-30 percent of the GDP, was the highest in the region excluding Hungary and that it is a great burden for a country in transition, like Serbia.

Serbia has to continue its structural reform, because the coming crisis in the EU will bring further risk, because of Serbia's close connections with the EU, he noted.

Lissovolik cited IMF projections on GDP trends in the EU, stating that it could be lower by 3-4 percent compared to the 2012 plan and could then reduce the global GDP by 1-2 percent. The IMF corrected Serbia's 2011 GDP by 1.8 percent and by 1.1 percent at the start of 2012, he said.