Select Committee on Foreign Affairs Minutes of Evidence

Annex A


  The UK is supporting economic reform and recovery in Yugoslavia in the following ways:

    —  DfID's bilateral technical assistance programme: following discussions with the Federal and Serbian governments in Yugoslavia last week DfID is pursuing bilateral support in a number of areas such as macro-economic reform, privatisation, public administration reform, health care reform, banking, and legislation on telecommunications. DfID is in close contact with the international financial institutions such as the World Bank and the IMF.

    —  Through UK support and financing for the EU's programme of assistance and trade measures: these include an emergency aid package of 200m euro announced in October (dispersal already underway), Asymmetric Trade Measures (ATMs) extended to the whole FRY (previously only Kosovo and Montenegro) at the October General Affairs Council, and the new 4.65bn euro aid programme for the region—CARDS—from which Yugoslavia will benefit (country strategy now being prepared).

    —  Through UK Support of the IMF's structural adjustment programme: the IMF and Yugoslav government currently negotiating a structural adjustment programme. This is most likely to be a Stand By Agreement (SBA) designed to help plug the finance gap of some 1.5% of GDP that the FRY government has identified.

    —  EBRD lending: FRY joined the EBRD on 15 December with support from the UK. The EBRD have begun initial engagement with the FRY government. The Bank's priority areas for investment are local creditworthy banks. Export orientated enterprises undergoing privatisation, infrastructure, municipal water and environmental projects, and projects that mobilise financial sector reform.

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