SARAJEVO, March 24 Bosnia will get a 74.5
million-euro ($80.51 million) loan from the World Bank to
support the strained budgets of the country's multiple
governments and allow it to reform its bloated public sector,
the bank said on Friday.
Bosnia, which comprises two autonomous regions linked by a
weak central government, spends nearly 44 percent of its gross
domestic product to finance a sprawling administration.
Under an European Union-sponsored reform programme, which is
also supported by the World Bank and the International Monetary
Fund, Bosnia has pledged to slim down its public sector and cut
spending by 2.3 percent of GDP in the medium term.
"Tackling the legacy of an unwieldy and ineffective public
sector is one of the most important aspects of the country’s
reform agenda, which is designed to transform the economy in
line with European Union criteria and to accelerate growth and
job creation," said Ellen Goldstein, the bank's director for the
Bosnia's two regions, the Bosniak-Croat Federation and the
Serb Republic, face financing problems after failing to meet the
terms for further disbursement of IMF aid under its 533
million-euro loan deal for Bosnia.
The bank's loan supporting fiscal reforms is part of its
partnership programme for Bosnia, which envisages $750 million
in lending for the period 2016-2020, depending on the scope and
pace of reform implementation.
The bank's active portfolio in Bosnia, supporting projects
for transportation, employment, energy efficiency, local
infrastructure, environment, forestry and water management,
totals $497 million.
($1 = 0.9253 euros)
(Reporting by Daria Sito-Sucic; Editing by Larry King)