IMF Likely To Delay Second Loan Tranche to Bosnia – Media

The IMF will probably not disburse in December the second tranche of the $1.57 billion stand-by funding arrangement as planned because the government of Bosnia’s Muslim-Croat Federation has not yet adopted the region's draft budget for next year and has not revised legislation on fiscal spending, news portal Capital.ba quoted the Federation Prime Minister Mustafa Mujezinovic as saying.

The Muslim-Croat Federation and the Serb Republic form post-war Bosnia. The two autonomous regions have separate governments and budgets. The country also has a weaker central government and institutions which have their own budgets.

The Serb Republic Finance Minister Aleksandar Dzombic said the region has fulfilled its part of the pledges to the IMF.

The IMF is expected to discuss on Monday how many of the requirements under the stand-by deal the two regions have met, Capital.ba quoted Dzombic as saying. He also said that if the requirements were not fully met, the disbursement of the second tranche probably would be tied to the third one and the IMF would give Bosnia several months to comply.

The global lender approved the 36-month loan deal designed to help Bosnian authorities mitigate the effects of the global financial crisis in July. The approval made about $282.37 million immediately available and the remainder in installments subject to quarterly reviews.

($=0.6690 euro)