Schmidt's morning address: Imposed decisions on Viaduct debt payment and funds for election technologies

(Patria) - High Representative in BiH Christian Schmidt imposed two decisions concerning the payment of Viaduct's debt and election technologies. We are transmitting his address in full.

"Good morning to all citizens of Bosnia and Herzegovina,

I, and probably you too, have noticed for months that serious problems are piling up. As the High Representative for Bosnia and Herzegovina, I have decided to act in the interest of the citizens, in your interest.

Allow me to summarize the biggest problems we are facing:

There is still no state budget for 2025. This limits the ability of state institutions – which serve all citizens of this country – to be fully functional.

An unadopted budget means that, in addition to a number of other needs, there are no funds for implementing reforms to ensure the integrity of elections – which is a key requirement of the EU, Dayton, and OSCE.

Although the House of Representatives adopted the Feasibility Study for the introduction of specific election technologies into the electoral process, so far, as we have seen, no funds for it have been foreseen in the draft budget.

Another serious threat are debts arising from arbitration decisions, especially the so-called Viaduct case. They are a threat to key state institutions, such as the Central Bank of BiH and BHANSA, the Air Navigation Services Agency of BiH. The Public Attorney's Office has pointed out the potential consequences of this case in more than 15 letters sent to BiH institutions, including the competent authorities in the RS.

By a final and binding decision of the Arbitration Court, an international arbitration court from Washington, from April 2022, it was determined that the debt to be paid to Viaduct amounts to almost 80 million KM. Due to daily interest rates, the amount has already increased to over 110 million KM. It continues to grow, day by day, by another 9,000 euros.

There are no serious efforts to resolve these critical issues in a timely manner to avoid negative consequences that will be felt by all citizens of this country, as Viaduct will seek to collect its money from state institutions of BiH, even though the RS is responsible for the debt. The High Representative will act – and although some express doubts about the legitimacy of this, I would like to remind you that Bosnia and Herzegovina is still under Chapter VII of the UN Charter, which the UN Security Council has regularly confirmed for three decades, after the catastrophe and war and genocide between 1991 and 1995. This means that the international community remains engaged. This is why the international community – with two elements – the EUFOR ALTHEA mission and the High Representative – still has ultimate executive responsibility in this country. The UN Security Council has confirmed the use of the so-called Bonn powers, my powers in Bosnia and Herzegovina, with its resolution 1144.

In light of all these facts, I have decided to take the following measures.

Part of the road toll revenue equalization reserves – which have been blocked since 2018 – will be redirected to settle Viaduct's claims. This settlement will be realized using the presumed share of Republika Srpska. This share is not intended for the budget expenditures of the RS and has no impact on the budget stability of the RS. It will not affect any payments or services for the citizens of the RS. The funds will be transferred to the Ministry of Finance and Treasury, and the Ministry can make the payment to Viaduct. Or, if there are other considerations or indications that this should be done through new negotiations, as I have heard, it can be done that way. Excellent, that is their business, but the state is not paying, but Republika Srpska is.

This approach is in line with the principle that whoever incurs a debt must pay it. In June 2017, the then Prime Minister of Republika Srpska, Željka Cvijanović, signed an agreement with the Council of Ministers, at the state level, that the RS would pay the debt for Viaduct. Therefore, there is a clear commitment and obligation of Republika Srpska. But unfortunately, since then, 2017, not a single fening has been paid. I cannot accept that the state repays the debts of the entities. That is not possible.

The BiH Public Attorney's Office, the Central Bank of BiH, and BHANSA must immediately take measures to suspend enforcement proceedings against the financial interests and assets of BiH, so that the Central Bank's facilities are no longer at risk and air traffic controllers can perform their extremely important work without worry.

These institutions are crucial for citizens and must not be endangered by irresponsible behavior.

Institutions that are a key part of the infrastructure, such as the Central Bank and BHANSA, should not be trifled with!

The profit of the Central Bank, according to the law, must be used for state needs, not for entity needs. With this Decision, the Central Bank, as a highly respected central bank internationally, can now make its profit available to state institutions. In this way, it will finance the costs of procuring election technologies for their introduction in the general elections in 2026, which has been expected for a long time. So far, no one has taken care of this in any draft budget.

Any remaining funds from the Central Bank after this, and I have heard that these are quite large amounts, that profit of the Central Bank can only be used to finance the institutions of Bosnia and Herzegovina and pave the way for a good state budget.

Although there is no legal dispute between the Federation of BiH and the state in this regard, funds from road toll reserves are being distributed, and the Federation of BiH will simultaneously receive funds in the same amount.

This Decision, which I am announcing now, will enter into force after its publication on the OHR website.

With these measures, we are protecting the financial stability and functionality of the state, enabling the holding of free and fair elections, and leaving the leaders of Bosnia and Herzegovina the space they need to focus their efforts on BiH's reform agenda for the EU.

I tell the political leadership to adopt the budget for 2025 as soon as possible. Your path is open. The citizens of this country have waited long enough. They have shown patience, the ability to cope with challenges, and an unwavering desire to live in a peaceful, democratic, and prosperous country that is a member of the European Union.

Do not let political games prevent them from having that future. Think of future generations and their right to live in a country that works for them, not against them. In a country where institutions function, where the rule of law is respected, and where young people see a future worth staying for. In a country where state institution employees can expect good salaries for their effort and work. And we should not forget other institutions, such as cultural institutions.

This is the moment to meet expectations and act in the interest of all citizens – not a partisan electorate. Bosnia and Herzegovina can still make up for lost time, but only if those in power choose responsibility over rhetoric, and progress over paralysis.

The path to Europe is open, but you need to start on that path before it closes," Schmidt stated.