April 6 (SeeNews) - The International Monetary Fund (IMF) said on Thursday it expects a significant delay in the completion of the first review under its current three-year loan deal with Bosnia and Herzegovina following parliament's failure to adopt amendments to the law on excise tax and a new law on deposit insurance.
"The IMF took note that the Bosnia's parliament did not adopt the amendments to the law on excise tax and the new law on deposit insurance during a session held on April 5, 2017. This will have implications for mobilizing external financing for much needed infrastructure projects and for the authorities’ efforts to modernize banking sector legislation," Nadeem Ilahi, the mission chief for Bosnia at the IMF, is quoted as saying in a press release of the fund.
The amendments to the excise law and new law on deposit insurance, are key requirements of the authorities’ programme, supported by the IMF under the Extended Fund Facility (EFF), IIahi said.
"We now expect a significant delay in completion of the first review of the programme," he noted.
IIahi commented that in recent months Bosnia's authorities have made good progress in implementing economic reforms supported by the EFF, particularly by strengthening fiscal discipline, safeguarding financial stability, and improving business environment.
"We stand ready to assist the authorities in continuing the implementation of structural reforms to unlock growth potential and maintain macroeconomic stability, including through IMF advice and technical assistance," he said.
IIahi added that Bosnia needs more time to make further progress in a number of major areas of the programme. These include securing financing for key infrastructure projects, revising banking sector legislation, and improving corporate governance of state owned enterprises.
"In the period ahead, we will maintain close dialogue with the authorities and remain committed to assist them in their efforts," he concluded.
In September, the IMF approved a three-year extended arrangement under the EFF with Bosnia for an amount of about 563.3 million euro ($600 million) to support the country’s economic reform agenda.
($=0.9399 euro)