Serbia plans to borrow EUR 3.0bn on the international markets in 2014 in order to service its debt and finance the budget gap that is expected to reach 7.1% of economic output, the head of the public debt administration Branko Drcelic told the Euromoney's Central and Eastern European Forum held on January 14-15 in Vienna . The country plans to auction additional EUR 2.6bn on the domestic market, out of which some 80% will be dinar-denominated, Drcelic underscored. This would bring the total amount of borrowing this year to EUR 5.6bn , up from EUR 5.5bn in 2013. The funding on the international markets will come from Eurobonds issues, multilateral and bilateral loans, Drcelic added. Serbia placed two Eurobonds issues in 2013 worth a combined USD 2.5bn . The government is also considering other options such as issuing Sukuk (Islamic bonds) or Russian ruble debt. Drcelic also noted that borrowing costs are expected to decline in the following three years reflecting improved macroeconomic fundamentals. He added that in the medium-run, Serbia will aim to reduce its financial needs on the international markets to below EUR 1bn per year.
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