MUAMER BANDIĆ Economic Wanderings and Shock Policies: Quo vadis, imposed Government of FBiH?

By: Muamer Bandić, SBiH representative in the KS Assembly

For the imposed Government of the Federation, it is truly difficult to determine when it is worse and has more policy wanderings, whether the Prime Minister is healthy or when he is on sick leave, replaced by a former advisor to Nikola Špirić and a graduate of the Megatrend private university, Vojin Mijatović.

After a year marked by continuous commercial borrowing, just before the end of the year, the imposed government first suddenly gifted us with a "non-working" Sunday, which turned out not to be non-working after all, but rather depending on who and where. Already in the first month of the application of this hasty and populist law, it is evident that the only beneficiary is the smaller BiH entity, into which, thanks to the federal non-working Sunday, the money of our citizens and tourists visiting Sarajevo is flowing.

Let's be clear, I have no doubt that it is necessary to prevent excessive work and allow workers adequate time for rest and personal obligations. Moreover, the Labor Law stipulates that an employee has the right to a weekly rest of at least 24 consecutive hours. Ultimately, these are international standards defined through the recommendations of the International Labor Organization, but free time for an employee does not mean that the company must be closed. Believe it or not, there are also employees who want to work, especially if they are paid extra.

The fact that the Federal Budget is empty and that there is no money is also shown by the sudden sales of FBiH receivables from power companies and commercial banks. The sale of receivables itself would not raise alarms if it were done with "problematic" receivables, which are harder to collect. In this case, when secure revenues from "golden hens" are sold, it indicates either that there is no money or that it is a planned squandering with bankers, who will be the only ones to profit from this.

It is clear to everyone that the imposed Government is in a serious financial crisis, but it is unclear how the Government so easily and without a fight gives up its receivables, while on the other hand, it vigorously fights to secure insufficient funds and, without hesitation, even without any analysis of financial consequences, reaches into the pockets of businessmen who fill the budget.

It would be very interesting if the economic wonderkid Mijatović made available to the citizens of FBiH the data on the money from employers who pay 3.27 KM every month for each employed worker, in addition to other payments, for "compensation for accidents and other natural disasters". When we multiply this amount by the number 546,178, which was the number of employed people in FBiH on April 30, 2024, a simple mathematical operation 546,178 x 3.27 for one month gives 1,786,002.06 KM. Where is that money, would the once honest Trojka members ask? Where is that money, would the once too-smart "analysts" ask? And today they are silent as if sealed by work contracts.


And then, at the very end of the year, another sudden Decision on the minimum wage for 2025 came, in the amount of 1000 KM. At first glance, a commendable decision that benefits workers with the lowest incomes in the Federation of BiH, and there is no doubt that workers need an increase in the minimum wage, but the way it was made is alarming and worrying.

The decision was again made without any analysis and assessment of its impact on the economy, especially on artisans and small businesses, as well as on the budgets of public institutions and companies. Even when we consider that there were no consultations with social partners, with businessmen, nor a period of adjustment for business entities, today we can only guess what the real consequences of this decision will be on the federal economy.

In addition to all this, there were no adjustments to the contribution rates, which are the highest in the region. To say the least, such an approach to this issue is very unserious and extremely amateurish!
It is interesting that the FBiH Government emphasizes future benefits for workers, but if we analyze this Decision analytically, it will be seen that this is not entirely true and that this Decision is not entirely fair.

With this Decision, the imposed Government actually receives the most money, not the workers. The burdens for employers are doubled, so it is not surprising that the imposed Government, facing an empty budget, so desperately defends this New Year's surprise package.

So we have a schizophrenic situation where the imposed Government, in the case of its receivables from power companies, easily gives up its receivables and its money in favor of large banks, while on the other hand, the same Government, under the guise of fighting for workers' rights, takes from the real sector. Some would say that here the mad is riding the confused.

What is certain is that certain employers in the real sector will not survive this Decision of the imposed Government, and the Government will rub its hands with satisfaction because it has satisfied its cronies in large banks and filled its coffers for a new series of luxury purchases.

So, this year we might see a new socially responsible campaign by our worthy, imposed ministers: Bring back the Tuareg, when you have a helicopter!

The imposed Government also announces subsidies for small and medium-sized enterprises, but at this moment we can only talk about it as a "promise, fool's joy" model, because there is still no FBiH budget for 2025, so we can see if and how much funds they have planned for these expenditure items.

Even if they have, I estimate that the only person who will truly rejoice in 2025 will be the Minister of Development, Entrepreneurship and Crafts of FBiH, Vojin Mijatović, whose Ministry will receive significant funds for distribution to the favored, just as the Deputy Prime Minister of FBiH and Federal Minister of Agriculture, Water Management and Forestry, and today's resident of Zenica prison, Jerko Ivanković Lijanović, had in the previous mandate of Nermin Nikšić.

While everyone else is left with a question mark above their heads as to whether workers will truly profit thanks to this Decision, it is certain that budget revenues will profit due to the increased base for taxation of worker income and due to the increased amount of contributions paid by employers.

The other side of this coin is that this New Year's "surprise" orchestrated by the imposed Government will also cause problems for budget users, who will have to harmonize their regulations with this decision, which will lead to an increase in the average salary in FBiH and automatically to the inflation of expenditure balloons for salaries of all public institutions in the coming years, at all levels of government in BiH.

The real question for economic analysts is: Can the already fragile BiH economy and thin fiscal sustainability withstand these sudden, shock policies of "spin after spin" and until when?

According to the initial reactions of experts to this question, for now, no one has an answer, not even the creators of this New Year's "surprise", the imposed Government of the Federation, which shows that they are not entirely sure where their ship is sailing. And what we see from the outside is that the FBiH Government, much like the Flying Dutchman, is drifting aimlessly through economic realities, driven by daily political propaganda spins, rather than market logic.