IMF Concludes Visit: No New Hires in Public Administration, Excise Taxes to be Adopted, Telecom Operators to be Analyzed

The International Monetary Fund (IMF) mission, led by Nadeem Ilahi, visited Banja Luka and Sarajevo from March 7-17, 2017, to discuss recent economic developments and policies for the first review under the Extended Arrangement with Bosnia and Herzegovina.

- The mission assessed performance against program objectives set for the end of December 2016 and discussed progress on structural reforms. The mission was encouraged by the adoption of reasonable budgets for the entities and BiH Institutions for 2017, the adoption of banking laws in both entities, amendments to the profit tax law and the banking agency law, and the abolition of solidarity contributions in Republika Srpska.

- However, authorities need more time to finalize outstanding issues to meet several remaining prior measures. Specifically, the mission expects the Parliamentary Assembly of BiH to adopt excise tax increases on fuel and amendments to the Deposit Insurance Law, the Council of Ministers to adopt a decision on the limit for new employment for 2017 in BiH Institutions, the FBiH Parliament to adopt amendments to the Banking Agency Law, and the FBiH Government to initiate due diligence for BH Telecom and HT Mostar.

It was emphasized that the Mission hopes for strong progress in implementing these policies in the coming days, including by the parliaments, to create conditions for the IMF Executive Board to consider the first review by the end of April 2017.