The authorities of Bosnia and Herzegovina (BiH) very much appreciate the informative and constructive dialogue with the Fund. They would like to express their gratitude to the IMF team, headed by Mr. van Rooden, for its dedicated work and good advice in the recent years. The authorities broadly agree with the staff’s assessment and policy recommendations provided in the report and accompanying selected issues paper. These, together with the substantial technical assistance by the Fund and other donors, have contributed to the adoption by the authorities of a comprehensive Reform Agenda earlier this year.
Continuous discussions with the international community have helped the authorities to steadily frame the adequate policy measures needed to boost the growth and resilience of the economy, and safeguard the macro-financial stability and fiscal sustainability going forward. The external and internal imbalances have been gradually reduced in the recent years, mainly through fiscal consolidation and some progress in structural reforms. A firm budget deficit reduction under the recent Fund-supported program was achieved despite a worsened external economic environment, a complex domestic institutional setup and political situation, and last year’s devastating floods. The economic recovery is under way, and growth is expected to rebound to over 2 percent this year, and to reach 3 percent in 2016.
The authorities stand ready to use every window of opportunity and further progress with the necessary reforms to unleash the economic potential of the country. They have been working on a possible successor arrangement with the Fund. The new governments keep focusing on structural reforms to support private sector development and job creation, while its near-term plan includes two main pillars: (1) sustainable further fiscal consolidation and a more efficient management of public finance resources; and (2) strengthening financial stability through system-wide legal amendments and institutional enhancements in line with the recent FSAP recommendations.