June 3 (SeeNews) - Bosnia's central bank said on Wednesday it has received the decision of the state-level government on the allocation of 333 million euro ($372 million) in International Monetary Fund (IMF) emergency financing to the country needed to start the distribution of funds.
This created the conditions for the distribution and remittance of approximately 648 million convertible marks to the sub-accounts of the ministry of finance of the Federation of Bosnia and Herzegovina, the ministry of finance of the Serb Republic and the Brcko District, the central bank, CCBH, said in an e-mailed statement.
The decision provides for Bosnia's Federation entity with its 10 cantons to receive 61.5% of the RFI, the Serb Republic will get 37.5% and the Brcko district will be given the remaining 1%, the CCBH said.
The interest rate on the loan is 1.05%.
The IMF financing was transferred to the central bank's accounts on April 23, but the council of ministers had previously failed to adopt a decision on its withdrawal due to disagreements in the Federation on how the entity's share of the RFI should be divided among the Federation's government and the governments of its 10 cantons.
Local media reported that late on Monday the authorities in the Federation reached a consensus on the issue, with the help of international mediators.
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 Fund has warned 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.
The global lender expects the country's economy to contract by 5% this year before expanding by 3.5% in 2021.