Six EU Recommendations: What Authorities Must Do to Save BiH's Economy

At the presentation of the Agreement for Growth and Employment, six specific problems burdening BiH's economy and its prosperity were listed. This is the result of the recently held Forum for Employment and Prosperity, said Peter Sorensen, Special Representative in BiH and Head of the EU Delegation, reports the BiH news agency Patria.

Identified problems/possible solutions:

• Tax burden on labour (reduction of current government spending, broadening of the tax base, improving efficiency in health and pension systems)
• Labour legislation (regulating wages based on skills and performance instead of seniority, reducing administrative disincentives, integrating youth into the workforce)
• Complicated business environment (shortening procedures for starting a business, speeding up obtaining building permits)
• Companies rely on public support instead of being competitive (better laws, investor protection)
• Corruption (rule of law, creation of electronic registers of procedures for licenses and permits)
• Social protection on the verge of financial collapse, and benefits do not go to those who need them (privileged pensions and early retirement for hazardous occupations, increasing social assistance for the most vulnerable)

Representatives of civil society, youth, officials from all levels of government, experts from neighbouring countries, and international institutions such as the IMF, WB, and other countries participated in the drafting of the Agreement.

Incidentally, before the presentation of the Agreement, Peter Sorensen, Vjekoslav Bevanda, Prime Minister of BiH, and Federica Mogherini, Minister of Foreign Affairs of Italy, addressed the attendees.

In her address, she expressed hope for the changes that BiH needs.

- Italy showed its solidarity during the floods in BiH, but we have not forgotten the February protests and the citizens' demands – said Mogherini, adding that citizens will raise their voices in the upcoming elections.

Given that Italy has taken over the EU presidency for the upcoming period, as Mogherini emphasized, the Western Balkans is a strategic priority of that presidency.

- The problem of economic growth is not only in this country; the whole of Europe has been facing changes for a year. European citizens want change. The floods in BiH have affected the economic picture, so foreign investors, considering all this, are not ready to invest in BiH – said Mogherini.

She added that a signal from BiH is needed, acts that can be valued in Brussels.

Sorensen said that reforms are necessary, but that the authorities must implement them, and that international institutions are there to help.

- The Agreement outlines steps that should benefit the majority of society, especially young people – said Sorensen.

In his address, Bevanda stated that many people's lives stopped after the floods, and that the Council of Ministers has held 19 sessions since then. He also pointed to the necessary reforms, writes Patria.

- A strong fight against corruption, the rule of law, improving the business environment, investing in small and medium-sized enterprises, and better social protection are needed – said Bevanda.

Some state ministers, representatives of political parties, civil society, as well as international institutions, also attended the presentation of the Agreement.

As stated, the authorities would implement the package of reform measures after the October elections. International financial institutions and the European Union have ready plans for assistance. A round table will also be organized with international financial institutions and the new governments after the elections. The European Union will prepare a report covering the implementation of measures, and in the next five years, BiH should make significant progress, otherwise, the country will fall further behind.