Bosnian C-bank Sees Economy Growing 0.5% in 2010 - Reuters

"Next year will remain very difficult for the Bosnian economy. GDP will be at 0.5 percent and further recovery is expected only in 2011," Reuters quoted Kozaric as saying.

Kozaric added he believes the governments of Bosnia's two autonomous regions, the Serb Republic and the Muslim-Croat federation, would meet the International Monetary Fund terms and secure the 95 million euro ($141 million) installment in January.

In July, the IMF approved a 36-month $1.52 billion stand-by loan for Bosnia to help the country mitigate the adverse effects of the global financial crisis. Bosnia already received one tranche from the loan worth $282.37 million.

Last month the global lender delayed the approval of the second installment until the middle of January, saying Bosnia must contain public spending within the target set for 2009.

Under the IMF terms, the regions must pass revised 2009 budgets and draft 2010 budgets, as well as undertake a broad range of measures, particularly to improve the targeting of reform of social benefits and pension funds, Reuters said.

($=0.6776 euro)