Resolving the issue of coordination mechanism remains the last obstacle before signing the Letter of Intent, according to the International Monetary Fund (IMF), and obtaining the credit arrangement with this financial institution.
On the mechanism of coordination depends the signature of the chairman of the Council of Ministers of BIH Denis Zvizdic and the Prime Minister of FBiH Fadil Novalic on the letter of intent, but the current government in RS, according to recent statements of Prime Minister Zeljka Cvijanovic, does not intend to depart from previous approaches to this issue, and has no intention to, through coordination mechanism, accept a simpler decision-making way on the European path of BiH.
The government of RS demands the realization of the credit arrangement in the amount of 550 million EUR with the IMF, and only after that solving of the issue of the mechanism. However, the budget of this BIH entity does not leave too much space to the Government of RS to keep their attitude due to which they would remain without the corresponding part of the IMF loan.
“Unless we find the funds, the budget will not be able to service current liabilities. It is already on the edge of liquidity and many obligations from the budget are not being carried out. Salaries and pensions will be endangered,” said Dragan Cavic, deputy in the National Assembly of RS.
IMF funds are needed to the Federation as well, but that entity, according to economic analyst Zlatko Hurtic, has better alternatives than RS.
“If the loan does not get implemented, the funds can be taken from domestic banks, which are more favorable at the moment in relation to the IMF. All possible credits that are available to Federation are not available to the RS. What Federation needs, in addition to money, is the support to reforms, so that it goes hand in hand with the arrangement of the IMF”, said Hurtic.
FBiH needs the IMF funds as well, but according to economic analysts Zlatko Hurtic, FBiH has much better alternatives than the RS. The economic power of the FBiH is much greater than in RS and therefore, FBiH is much less dependent on IMF resources.
“When looking at the GDP, the amount of taxes that are collected and the amount of internal debt, then the indicators speak in favor of the FBiH. RS is in a greater deficit, so they have a greater need for this type of loan. RS already privatized everything, while in FBiH there is the possibility to get the necessary resources through the privatization,” explained Hurtic.
The current authorities in the RS have, in recent years, tried to find funds to fill budget holes by borrowing from different funds, and a lot of attention was given to the never realized favorable loans from Russia.
(Source: N. Pobric/Faktor.ba)
