Serb PM takes on banker

BELGRADE (Reuters) – New Serbian Prime Minister Zoran Zivkovic hinted yesterday he planned to replace central bank governor Mladjan Dinkic with a «non-partisan» figure, even suggesting the body Dinkic headed was not legally constituted. Zivkovic, who took the post after the assassination of late Prime Minister Zoran Djindjic on March 12, said lawmakers were drafting a new law on the National Bank of Serbia. «We need a new law on the National Bank of Serbia. The governor will have to be a non-partisan figure. The National Bank of Serbia does not exist. Those who say they represent the National Bank of Serbia are doing it illegally,» Zivkovic said. «Those who print money in the name of the National Bank of Serbia are printing fake money,» Zivkovic told Belgrade Radio B-92. Zivkovic is a member of the Democratic Party while Dinkic, who has resisted political pressure for a lower level for the dinar, is vice president of the G17 Plus political party, which currently has no seats in Parliament. According to recent public opinion polls, the popularity of G17 Plus, led by former Yugoslav Deputy Prime Minister Miroljub Labus, has been on the rise. Dinkic disputed Zivkovic’s claimed that the National Bank of Serbia was not a legal entity, saying in an open letter to the prime minister that under a law defining relations between Serbia and Montenegro, it had succeeded the National Bank of Yugoslavia. A week ago Zivkovic slammed the central bank for making sudden policy changes, without informing banks in advance of a recently hiked reserve requirement and for keeping the dinar too strong for the weak economy. The mandatory reserve rose to 23 from 20 percent early in March to curb the banks’ burgeoning liquidity. Djindjic himself had been at odds with Dinkic and frequently engaged in media debates about the level of the dinar exchange rate.