Serbian Finance Minister Mladjan Dinkic told state-run power monopoly EPS on Thursday to restructure or face bankruptcy, refusing it any financial help and offering only "moral support", Reuters reported.
EPS is owed 120 billion dinars ($1.46bn) by customers and losses last year were 33 billion, mainly because the company is forced to absorb the cost of subsidised tariffs, Acting General Manager Aleksandar Obradovic said on Thursday. The previous day, EPS officials warned the utility could face bankruptcy in March or April unless it secures an emergency loan by the end of next month to meet immediate funding needs and extend debt maturities.
But the finance minister told reporters that the government could offer EPS only indirect moral support. "EPS must first help itself as it has capabilities to be stable with its own resources and activities on restructuring," he said. "EPS could get rescued if, by some magic, citizens and industry decide to pay their bills but such a scenario is quite unlikely."
Dinkic told Tanjug state news agency that the government would not approve guarantees for a 300 million euros loan to help EPS avert bankruptcy. "The government will not approve loan guarantees for any state-run company, unless the borrowing is needed for development or new investments," Dinkic said.
Source: bne