Council of Ministers of BiH: Increased salary base in 2025, 16.7 million KM for helicopters, 30,000 KM for Christmas reception

(Patria) - The 65th session of the Council of Ministers of Bosnia and Herzegovina was held today in Sarajevo.

Funds secured for the procurement of new helicopters for the Ministry of Defence and Armed Forces of BiH

The Council of Ministers of BiH, at the proposal of the Ministry of Defence, adopted two decisions securing 16,740,000 KM for a multi-year project to procure helicopters for the Ministry of Defence and the Armed Forces of Bosnia and Herzegovina.

By adopting the Decision on the status of the Decision on the multi-year project for helicopter overhaul for the period 2013-2014, this decision was repealed, and funds in the amount of 7,480,000 KM were directed to the multi-year project for the procurement of helicopters for the Ministry of Defence and the Armed Forces of Bosnia and Herzegovina.

At the same time, a Decision on amendments and additions to the Decision on the multi-year project for the procurement of helicopters for the Ministry of Defence of Bosnia and Herzegovina and the Armed Forces of Bosnia and Herzegovina was adopted.

In this way, through the restructuring of funds in the Law on the Budget of Institutions of Bosnia and Herzegovina and International Obligations of Bosnia and Herzegovina for 2024, 9,260,000 KM has been secured.

These funds were secured through savings from several budget positions and will be used for the procurement of multi-purpose firefighting helicopters.

Salary base aligned with the law

The Council of Ministers of BiH, at the proposal of the Ministry of Finance and Treasury, adopted the Decision on the amount of the salary base for 2025, which will amount to 631.50 KM, compared to 600 KM in 2024.

This fulfills the obligation from the Law on Salaries and Benefits in BiH Institutions, which stipulates that the salary base is determined at 50% of the average monthly net salary in Bosnia and Herzegovina, expressed on an annual level for the calendar year that precedes the year in which the base will be applied by two fiscal years.

The Agency for Statistics of BiH published data showing that the average monthly net salary in Bosnia and Herzegovina for 2023 was 1,263 KM.

The decision should apply from January 1 to December 31, 2025, and if the budget for the next fiscal year is not adopted by the end of this year, the new salary base will apply from the month following the adoption of the budget.

Proposal for a social security agreement between BiH and Montenegro

The Council of Ministers of BiH adopted the Report on Negotiations and determined the Proposal for an Agreement between Bosnia and Herzegovina and Montenegro on Social Security, with the accompanying Administrative Agreement.

As stated in the Report on Negotiations, the delegations of the contracting states held six rounds of negotiations and agreed on the text of the Agreement between Bosnia and Herzegovina and Montenegro on Social Security and the text of the Administrative Agreement for its implementation.

The Ministry of Civil Affairs is tasked with submitting the Report on Negotiations and the Proposal for an Agreement to the Presidency of BiH for further procedure, and the Minister of Civil Affairs has been proposed as the BiH signatory.

On the introduction of 5G mobile networks in BiH

The Council of Ministers of BiH adopted the Information from the Ministry of Communications and Transport on the necessary preparatory activities for the implementation of 5G mobile networks in Bosnia and Herzegovina.

The Communications Regulatory Agency (RAK), the Agency for Identification Documents, Registers and Data Exchange (IDDEEA), and the Ministry of Security are tasked with reviewing and agreeing on the redistribution of the 3.5 GHz and 26 GHz radio frequency spectrum, with the aim of freeing up these parts of the spectrum for the needs of introducing 5G mobile networks.

Based on the agreement, RAK, IDDEEA, and the Ministry of Security are obliged to prepare and submit to the Ministry of Communications and Transport a Project for the redistribution of the 3.5 GHz and 26 GHz radio frequency spectrum with a detailed action plan, including activity holders, specified equipment, financial resources and funding sources, and deadlines for carrying out activities, in order to ensure the prerequisites for the implementation of 5G networks.

The Ministry of Communications and Transport is tasked with preparing and submitting to the Council of Ministers of BiH a proposal for a decision that secures the missing financial resources necessary for the realization of this project, based on the Project for the redistribution of the 3.5 GHz and 26 GHz radio frequency spectrum.

BiH's public debt decreased last year

The Council of Ministers of BiH adopted the Information from the Ministry of Finance and Treasury on the state of public debt of Bosnia and Herzegovina as of December 31, 2023, which amounted to 12 billion and 951.72 million KM and decreased by 65.05 million KM compared to 2022.

Of this, external debt amounted to 8 billion and 921.08 million KM or 68.88%, and internal debt amounted to 4 billion and 30.46 million KM or 31.12% of the public debt.

The share of BiH's public debt in gross domestic product (GDP) at the end of last year was 26.40%.

The Federation of Bosnia and Herzegovina participates with 50.97% in the total public debt, Republika Srpska with 48.21%, BiH institutions with 0.47%, and Brčko District BiH with 0.35%.

The servicing of BiH's external debt last year amounted to 1 billion and 685.50 million KM, of which 1 billion and 402.54 million KM was principal, and 282.96 million KM was interest.

At the proposal of the Ministry of Finance and Treasury, the Analysis of the Sustainability of Public Debt of Bosnia and Herzegovina for the period 2023-2026 was adopted, which was prepared in accordance with the methodology developed by the International Monetary Fund.

The analysis, according to the baseline scenario for the period 2023-2026, indicates that Bosnia and Herzegovina is a country with medium-term sustainable public debt, with projected real growth ranging from 2.0% to 3.4%, inflation from 2.0% to 4.4%, a primary balance from -0.8% to 0.8%, and an effective interest rate of 2.8% to 5.0%.

The analysis of the sustainability of BiH's public debt helps in the effective management of public finances and macroeconomic stability by showing the effects and consequences of public debt.

Traditional Christmas reception

The Council of Ministers of BiH adopted the Decision on approving funds from the current budget reserve of the budget of institutions of Bosnia and Herzegovina and international obligations of Bosnia and Herzegovina for 2024.

The decision approved 30,000 KM to the Service for Joint Affairs of Institutions of Bosnia and Herzegovina for organizing the traditional reception on the occasion of Christmas holidays in the building of the Parliamentary Assembly of Bosnia and Herzegovina on December 19, 2024.

On European integration

The Council of Ministers of BiH adopted the Report on the implementation of the multi-year project of the Directorate for European Integration "Support to the European Integration Process of Bosnia and Herzegovina for the period 2015-2017," worth one million KM.

Within this multi-year project, the Directorate for European Integration carried out preparations for answering questions from the European Commission's (EC) Questionnaire, responding to additional questions from the EC Questionnaire, and preparing the Program for the Integration of Bosnia and Herzegovina into the European Union.

Activities included, among others, translation services for answers to the Questionnaire after a publicly announced call, and the development and improvement of an information system to support the European integration process.

The multi-year project of the Directorate for European Integration "Support to the European Integration Process of Bosnia and Herzegovina for the period 2015-2017" was completed in early March 2024, when the working version of the Integration Program was finalized and submitted to the European Commission for comments, in accordance with the Stabilization and Association Agreement.

Unrealized funds of the multi-year project in the total amount of 5,435.26 KM will be transferred to the Single Account of the Ministry of Finance and Treasury of Bosnia and Herzegovina.

Agriculture, Food and Rural Development

The Council of Ministers of BiH considered the Annual Report in the field of Agriculture, Food and Rural Development of Bosnia and Herzegovina for 2023, which the Ministry of Foreign Trade and Economic Relations will submit to the Parliamentary Assembly of BiH for adoption.

The report is a comprehensive document that presents the state of the agricultural and food sector and the implemented agricultural policy measures in BiH. It includes the level of financial resources allocated as support for increasing productivity and strengthening the competitiveness of domestic agriculture, as well as activities carried out in this area in the context of European integration and international cooperation.

According to the Report, the most significant implemented activity in the agricultural sector during 2023 was the adoption of the Law on the Organization of the Wine Market in Bosnia and Herzegovina, which enables the establishment of a vineyard and winery register, which is the foundation for the revival and further development of this sector in Bosnia and Herzegovina.

As of December 2023, activities on the development of a new strategic framework for rural development of Bosnia and Herzegovina for the period 2023-2027 have been completed. This framework has been submitted by the Ministry of Foreign Trade and Economic Relations to the competent institutions for their opinion, after which this framework document will be sent for adoption to the Council of Ministers and the Parliamentary Assembly of BiH.

Pan-Euro-Mediterranean Preferential Rules of Origin

The Council of Ministers of Bosnia and Herzegovina adopted the Information from the Ministry of Foreign Trade and Economic Relations on the revised Regional Convention on Pan-Euro-Mediterranean Preferential Rules of Origin, with the aim of introducing the revised Regional Convention on Pan-Euro-Mediterranean Preferential Rules of Origin into the free trade agreements concluded by Bosnia and Herzegovina, and adopted appropriate conclusions to protect the interests of BiH entrepreneurs.

These include the previously concluded Stabilization and Association Agreement between the European Communities and their Member States, on the one hand, and Bosnia and Herzegovina, on the other hand, the Central European Free Trade Agreement - CEFTA 2006, the Free Trade Agreement with EFTA countries, and the Free Trade Agreement with the Republic of Turkey.

The Ministry of Foreign Trade and Economic Relations of Bosnia and Herzegovina is obliged to take the necessary actions for the revised Regional Convention on Pan-Euro-Mediterranean Preferential Rules of Origin to be published in the Official Gazette of Bosnia and Herzegovina.

The Minister of Foreign Trade and Economic Relations of Bosnia and Herzegovina, Staša Košarac, has been appointed as the representative of Bosnia and Herzegovina to participate in the PEM Joint Committee meeting.

The Ministry of Foreign Trade and Economic Relations of Bosnia and Herzegovina is obliged to complete internal procedures as soon as possible in order to implement the transitional arrangements from January 1, 2025.