IMF Nevertheless Pays Emergency Aid to Bosnia and Herzegovina

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The International Monetary Fund (IMF) is nonetheless providing emergency assistance to Bosnia and Herzegovina to overcome the corona crisis.

The fund previously threatened to withdraw its support if the Balkans were to undermine a significant currency arrangement.

It concerns rapid emergency financing of converted 333 million euros, which even amounts to an increase in previously committed aid.

The aid is intended to assist Bosnia in urgent expenditure related to the virus outbreak. Like other countries, the country is facing a significant economic blow.

The IMF’s recent criticism was that influential Bosnian Serb politicians, including one of the country’s three-headed presidency, had pressured the Bosnian central bank to halve the country’s international reserves. They wanted to use the money to help companies that got into trouble because of the corona crisis.

However, the IMF called the currency arrangement a “pillar of stability in this uncertain time” and felt that the Bosnian government should stay away from it. International reserves with foreign banks are significant for the country’s monetary policy.

After the Bosnian civil war in the 1990s, the home currency, the Bosnian convertible mark, was linked to the German mark at a fixed rate. The currency was later linked to the euro.

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