Economist Ljubodrag Savić commented on the recent U.S. sanctions imposed on the Serbian oil company, Naftna Industrija Srbije (NIS), suggesting that the best solution for all parties involved would be to reach an agreement with Russia for Serbia to become the majority owner of the company. He argued that this arrangement would require minimal financial investment from Serbia. While he agrees with the U.S. stance that the sanctions are primarily aimed at Russia and not directly at Serbia, Savić noted that Serbia will still bear the consequences.
According to Savić, these sanctions exert pressure on Serbia, as the issue could be resolved if Serbia were able to impose sanctions on Russia, but Serbia has no intention of doing so due to its geopolitical and historical interests. He added that one possible solution could be for Russia to divest its ownership, although he doubts that Russia would easily agree to this. “We have a budget problem in Serbia, but we received a good credit rating. One of the factors for this rating was Serbia’s sound monetary and fiscal policies,” Savić explained.
He further mentioned that the planned fiscal deficit of 3% for this year could be at risk if Serbia had to pay €600 million to acquire NIS. This payment would likely exceed the fiscal deficit and force Serbia to abandon some large infrastructure projects.
Savić emphasized that the only solution that would fully satisfy U.S. interests would be to eliminate Russian ownership in NIS. While this could be a possible outcome, he argued that it would not be favorable for Serbia in the long term. “We may have to accept the fact that we will need to buy out Russia’s entire stake. People are talking about €600 million, based on the current share value, but when you buy something in this context, especially when the West is pushing Russia to exit, it could cost more,” Savić said.
Savić also pointed out that with the election of Donald Trump as the new U.S. president, it is unlikely that sanctions on NIS would be lifted or softened, as sanctions are difficult to reverse, and part of this decision lies with the U.S. Congress.
“With the new administration, I do not expect the sanctions to be lifted, and especially not within a few months. If it happens, it will take some time, but regardless, these are partial solutions that complicate the situation,” Savić noted.
On the other hand, Savić believes that the only viable solution for Serbia would be to take full control of NIS by removing Russian ownership. However, he acknowledged that this would have both political and economic ramifications for Serbia’s relationship with Russia.
According to Savić, if Serbia is forced to take this route, it will face two significant challenges: securing the necessary funds and managing the potential strain on relations with Russia. He suggested that Russia would need to understand that such a decision is not one Serbia wishes to make but is rather a requirement imposed by the U.S., which Serbia must follow due to its own national interests.
