IMF loan to BiH in jeopardy

SARAJEVO, Bosnia and Herzegovina (BiH)

Federation of BiH (FBiH) Finance Minister Vjekoslav Bevanda admitted on Tuesday (June 23rd) that BiH risks losing a 1.2 billion-euro loan from the IMF because the entity failed to cut its social and welfare budget by 10%.

The entity insisted on finding the savings elsewhere instead. During talks Monday in Vienna, IMF representatives made clear that the loan is possible only if BiH sticks to what was said in the letter of intent, Bevanda added.

The IMF reportedly considered FBiH’s move unprofessional. At the same time, the Fund okayed Republika Srpska’s revised budget, which was trimmed by 4%. It also approved the revised state-level budget that envisions a 10% public sector salary cut, saying they are consistent with the public finance consolidation plan.

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