June 2 (SeeNews) - The two main parties in Bosnia's Federation entity have reached an agreement on how to divide the entity's share of 333 million euro ($372 million) in International Monetary Fund (IMF) emergency funding for the country, local media reported on Tuesday.
The agreement which the Party of Democratic Action (SDA) and the Croatian Democratic Union (HDZ BiH) reached late on Monday with the help of international mediators clears the way for Bosnia's state-level government to put the issue on the agenda of its June 2 cabinet meeting, news agency Patria reported.
The IMF financing was transferred to the accounts of Bosnia's central bank on April 23, but the council of ministers has so far failed to adopt a decision on its withdrawal due to disagreements in the Federation on how the entity's share of the money should be divided among the Federation's government and the governments of its 10 cantons.
The IMF has approved the emergency financing in a fast-track procedure to help Bosnia meet an urgent balance-of-payments need arising from the COVID-19 pandemic.
The IMF said that the near-term economic impact of the pandemic on Bosnia is expected to be substantial, generating a rapid deterioration of external accounts and an urgent balance of payment need.
It expects the country's economy to contract by 5% this year before expanding by 3.5% in 2021.
($=0.8955 euro)