Bosnia Searching For New Deal with IMF

Bosnia's authorities have launched a new dialogue with the IMF about another future arrangement with the international financial institution.

Continued financial support from IMF is crucial for Bosnia's financial stability, given its poor economic and social situation.

IMF support is also a key element of the EU's new initiative for Bosnia, which - following the green light given for the activation of Bosnia's Stabilization and Association Agreement - plans to use IMF funds to persuade politicians to undertake difficult reforms, a senior international official told Balkan Insight on Tuesday.

"For years, the IMF has been providing financial support to Bosnia under very weak conditions. That time has passed and no more money will be disbursed without very concrete actions being undertaken," this official said.

IMF payments to Bosnia in line with its current Stand-By Arrangement were blocked last September because Bosnia had not undertaken the required reforms.

It is widely accepted that local politicians stalled on reforms, fearing that they would spoil their chances ahead of the general elections last October.

An IMF mission arrived in Bosnia at the end of April and has since met officials from the state government - the Council of Ministers - as well as governments of Bosnia's two entities, the Federation of Bosnia and Herzegovina and Republika Srpska.

The IMF has used the meetings to assess the current state of affairs and discuss conditions for the release of the blocked sum of 150 million euro, as well as to open discussions about future arrangements after Bosnia's current Stand-By Arrangement expires in September.

Following meetings with the Federation entity premier, Fadil Novalic, on Monday...