n creating the correct labour force which will lead to a collapse to any stabilisation program while having a tight fiscal and monetary policies being steadily undermined by increasing public subsidies and credit taxation to state enterprise. Fiscal policy is decisions about spending, taxes and borrowing of the government. Monetary policy is the attempt by government or a central bank to manipulate the money supply, the supply credit, interest rates or any other monetary variable to achieve the policy goal such as price stability.
             Micro-economic stabilisation and with domestic price liberalisation comprises the main element of transition phase. The need for it rose back in end of socialism and from the implications for inflation where prices are liberalised . Inflation is the rate of change of average prices in an economy. In many planned economies the price was set to an extent not to clear the market. The tendency of former communist countries was to generate excess demand in the economy. Although prices were fixed which left all for the individuals markets with excess demand. Resulting from this illegal markets started to emerge. From this situation it lead to higher wages and excess demand which resulted in shortages in socialist countries. Besides that it was also happening from decrease in demand but no change in supply. Excess demand reflected the parallel market prices which generated large surpluses
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