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Dec 23, 2017 11:43 EEST
SARAJEVO (Bosnia and Herzegovina), December 23 (SeeNews) –The International Monetary Fund said late on Friday it has reached a staff-level agreement with Bosnia and Herzegovina to conclude the first review under its three-year loan deal with the country, which could see it disburse some 76 million euro ($90.2 million) early next year.
An IMF mission visited Sarajevo on December 19-22, 2017, for discussions on the first review under the Extended Fund Facility (EFF) supported program approved in 2016.
“IMF staff and the Bosnia and Herzegovina authorities have reached an agreement, subject to approval by the IMF Executive Board, on policies that would allow IMF staff to recommend completion of the first review under the Extended Fund Facility (EFF) supported program”, IMF mission chief for Bosnia and Herzegovina, Nadeem Ilahi, said in a statement issued by the fund late on Friday.
Consideration by the Executive Board, expected in early 2018, would follow the implementation of a number of conditions, Ilahi explained.
The authorities have already met several conditions over the past few months. More recently, Bosnia’s parliament adopted an increase in the excise duty on fuels, key to unlocking large externally-financed infrastructure investments.
The authorities, however, have to implement the remaining conditions in the coming days, the IMF said.
“The Federation of Bosnia and Herzegovina (FBiH) parliament is expected to adopt the 2018 budget in line with IMF staff recommendations. And, the FBiH government is expected to initiate the due diligence of two FBiH state-owned telecom companies, BH Telecom and HT Mostar”, Ilahi noted.
Following Executive Board approval, the IMF is expected to disburse SDR 63.4125 million (approximately euro 76 million) on completion of the review.
In September last year, the IMF approved a three-year 553.3 million euro loan to Bosnia to support the country's economic reform agenda. However, the IMF delayed the release of the second loan tranche in May, after the Bosnian authorities failed to meet the agreed economic reform targets.
The fund released its first tranche of 79.2 million euro last year, while the remainder was said to be made available in 11 installments subject to quarterly reviews.
Since failing to complete the first review, Bosnia’s two entities, the Federation and the Serb Republic, have been struggling to keep liquid.
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