Novalić: We proposed the largest budget in the history of FBiH, there are reasons for optimism

SARAJEVO, (Patria) - After the pandemic, globalization has caused events in one country to affect the economy of BiH, and therefore it is up to all of us to influence and strive for everyone to be better, said the Prime Minister of FBiH Fadil Novalić, explaining the budget for this year. 

The budget of the Federation of BiH for 2022 has been proposed in the amount of KM 5,597,618,777 and is 2 percent higher than the budget of the Federation of BiH for 2021, or KM 116.4 million higher. 

"The entire burden is on fiscal policy, i.e., on the BiH budget. Regardless of the challenges we face, we have reasons for optimism. Today, I have the opportunity to propose the largest budget in the history of FBiH. Positive macroeconomic trends, the resilience of our economy, and government measures have contributed to positive effects. Real GDP growth will be between 6 and 7 percent. A certain growth was expected, but the recorded growth last year was very good. Our economy has never produced more products than last year," added Novalić.

He adds that they have almost managed to restore all jobs lost during the pandemic. 

"We expect this year to be a record year for FBiH. In 2020 and 2021, about KM 850 million was allocated to mitigate the negative consequences of the pandemic, to which about KM 100 million made available to the Development Bank for securing a guarantee fund should be added. We helped vulnerable segments of the economy with more than 270 million. We also increased salaries and pensions," he adds. 

According to him, it has never happened that we had two pension increases in the same year. 

"In the coming months, we will have the results of a new household consumption survey, which we haven't had since 2015, and it will provide a better insight into needs. Inflation currently represents one of the biggest challenges and is a direct consequence of the war in Ukraine and the pandemic. Inflationary pressures could continue in the coming period, but there should be a easing as demand for energy will decrease due to the summer. We are making efforts to control prices as much as is within our power. It is up to the State Parliament to do everything it can regarding fuel prices," Novalić adds. 

He adds that budget revenues have increased by 12 percent compared to the previous year. On the other hand, profit tax is lower, and contributions for PIO are higher, amounting to about KM 2.2 billion. 

"Net revenues paid into the budget have increased by KM 30 million, and non-tax revenues have decreased. Budget expenditures have increased by KM 194 million. Current expenditures are the most represented in the structure of budget expenditures, and the largest part of them falls on capital transfers. Expenditures for interest are lower in expenditures," Novalić points out.

According to him, due to the recovery of the BiH economy, the need for borrowing in this fiscal year compared to the previous one has significantly decreased.