Bosnia and Herzegovina Fiscal Council meets: IMF loan of 550 million euros to be considered in July

After a multi-day visit by the International Monetary Fund delegation to Bosnia and Herzegovina and meetings with entity and state finance ministries, the 4th session of the Fiscal Council of Bosnia and Herzegovina was held today in Sarajevo, chaired by the Chairman of the Council of Ministers of Bosnia and Herzegovina Denis Zvizdić, at which the Letter of Intent for a new Extended Fund Facility (EFF) arrangement with the IMF was agreed upon, the Council of Ministers of Bosnia and Herzegovina announced, Patria reports.

The session of the Fiscal Council of Bosnia and Herzegovina was attended by the IMF delegation led by the Head of the IMF Mission for Bosnia and Herzegovina, Nadeem Ilahi.

During the meeting, elements of the Letter of Intent regarding the new Extended Arrangement were discussed, and an agreement was reached with the IMF delegation, subject to approval by the Management and the Executive Board, on an economic program that could receive support in the form of a 36-month Extended Arrangement in the amount of about 550 million euros. It is expected that the Board will consider approving the arrangement in July, the statement said.

Representatives of all levels of government emphasized proposals focused on helping businesses and economic development.

- In this regard, the economic program supported under the EFF has three main goals: improving the business environment, creating more jobs in the private sector, and increasing the potential for economic growth; then reducing public debt through gradual fiscal consolidation, while simultaneously reducing the size of the administrative apparatus and improving the quality of public spending; as well as preserving the stability of the financial sector and reviving credit growth.

They agreed that the new arrangement with the IMF will bring financial stability to all levels of government in Bosnia and Herzegovina and that the entire arrangement must be accompanied by reforms, i.e., serve as support for the implementation of the Reform Agenda.

The Extended Arrangement will also act as a catalyst in mobilizing international financial assistance, as the European Union and the World Bank also plan to secure additional financial resources for implementing reforms, clarified in the statement issued by the Council of Ministers of Bosnia and Herzegovina.