New Serbian governor asserts independence

But, although she has been drawn in from the party ranks, she is adamant that she will not stand for any attempts at bullying the central bank into becoming the government's plaything: "People are waiting to see whether I really succumb to pressure from the government. I do not blame people for wondering, but I know that if anybody put me here for that reason they made a big mistake." She rubbished the notion that the government would have any success in making the central bank to manage reserves in any other way than normal: "Reserves will be managed as reserves, and there is no instrument for the government to try to put pressure on me other than, perhaps, something psychological."

Despite protestations by the senior central bankers that made a sharp exit from the central bank immediately prior to her arrival that the changes being made to the central bank would damage its independence, Udovicki predicts the opposite, albeit for different reasons: "I think there is going to be a boost to the independence and strength of Serbia's central bank in that I plan to have absolutely no political role, no political interest."

This would contrast with Dinkic who was and is intimately involved with the G17 plus party as a founder, who explained, "I entered politics out of necessity, recognising that we cannot transform the economy until we have political backing." He cited his attempt to implement the Yugoslav National Bank Law (rather than the existing one that resulted in his removal), which was dismissed for political reasons.

However, Udovicki intends to "extend and develop" Dinkic's work. As an ex-IMF staffer (she was chief economist for Yugoslavia from 1993 to 2001), she is a believer in the ways of the markets, and to that extent she differs from Dinkic who she labels "interventionist", calling herself "too naive" to have been able to do the job back in October 2000. But, "I am glad to inherit the institution he has created. But my goal - and I think I am more committed to this than he would have been - is to evolve the system with market-based instruments."