BELGRADE: Serbia said on Thursday it had reached agreement with the International Monetary Fund on a new loan deal designed to reassure investors after months of uncertainty.
Serbia has been seeking a precautionary loan deal to replace a previous arrangement frozen by the lender in early 2012 over broken spending promises.
The IMF wrapped up two weeks of negotiations on Thursday and was due to hold a news conference at 2 p.m. (1300 GMT).
"Today you will be informed that we have reached an agreement with the IMF," Serbian Prime Minister Aleksandar Vucic told reporters.
"That's big news for Serbia," he said.
The dinar strengthened after weeks of sliding against the euro, hitting 119.83 at 10.10 a.m. (0910 GMT).
IMF negotiations had focused on how to bring down Serbia's consolidated budget deficit - over 7 percent of national output - and cap public debt pushing 70 percent of output.
Vucic's government has already cut some pensions and public sector wages from Nov. 1 and is expected to slash subsidies to hundreds of state-run enterprises in its 2015 spending plan.
"Serbia is a country that will be able to earn and provide a normal life for its citizens," Vucic said. But we will need some time to do that. The IMF thinks it will be in 2017; we think it will be sooner."
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