BUSINESS

Borenovic: Republika Srpska has Debt with 15 Times higher Interest Rate than the Real one

Yesterday, the PDP representative in the Parliament of Bosnia and Herzegovina (BiH) and the president of that party spoke about the usurious indebtedness of the Republika Srpska (RS) in comparison with the agreement between BiH and the International Bank for Reconstruction and Development (IBRD) when it comes to the project of recovery and support to business entities in both BiH entities.

“According to the Loan Agreement between BiH and the IBRD in the project of recovery and support to companies/business entities in the RS and Federation of BiH (FBiH), today in the Parliament of BiH a debt of 110 million BAM is ratified at, believe it or not, the interest rate of 0,37%. Given that the RS recently landed money at the London Stock Exchange at an interest rate of 5.02%, it is clear that this is usurious and bandit business,” Borenovic said.

He mentioned that the interest rate at which BiH borrows under the subsidiary agreement, in the amount of 66 million BAM used by the Development Bank of FBiH, and 44 million BAM by the Investment and Development Bank of RS, shows the real market interest rate:

“It means that the interest rate at which RS borrowed money by issuing bonds on the London Stock Exchange is 15 times higher than the market, real one. Not two, but even 15 times higher! Instead of 156 million, with 600 million in principal, how much interest will the people of RS pay, if it was a loan at market value, they would pay about 15 million BAM of interest, which means that someone is provided with an enormous salary of over 140 million BAM just on the basis of unrealistic interest rates. Comparing these two examples of borrowing is an excellent indicator of the complete unscrupulousness of the borrowing policy of the RS Government, ” Borenovic concluded, Klix.ba writes.

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