The International Monetary Fund (IMF) has cut Bosnia and Herzegovina’s (BiH) 2018 economic growth forecast to 3.2 percent from previous 3.5 percent. In the report issued after the first review of the agreement with BiH, IMF says that the economic growth forecasts are down, warning that BiH is on the second place in the region regarding emigration.
The slowdown in productivity growth since the global economic crisis and continuous emigration of young and educated population caused by restricted employment opportunities, all affect the economic potential of BiH.
“Demographic downturn of the labor market is a real threat to the long-term BiH growth prospects,” the IMF report says.
The IMF report highlights that BiH should impel on the economic and financial reforms that will enhance the economic growth and employment. The report notes on the lack of job creation in BiH, and on the departure of people that reduces the real potentials of the BiH economy.
Low birth rates, accompanied by a high rate of emigration of young and educated citizens of BiH, create pressure on the labor market and reduce the potential of the BiH economy, the report adds.
BiH is estimated to grow 3.4 percent in 2019, the IMF official website says.
In order to boost its economy, BiH asked for the arrangement with the IMF worth a total of 1,077,908,018 KM (689,359,000 U.S. Dollars). After BiH met key requirements, the second tranche of 145,828,711.65 KM (93,473,317.983 U.S. Dollars) under the Extended Fund Facility (EFF) with the IMF was transferred to the account of the Central Bank of Bosnia and Herzegovina (CBBH) last Friday. The rest of loan will be approved in tranches for a period of three years. (1 U.S. Dollar=1.58 KM)
