Bosnian newspaper Dnevni Avaz reported that the deficit in the Bosnia-Herzegovina Federation treasury has grown to 31 million convertible marks [KM]. Without the envisaged tranche of the IMF [loan], the situation will be disastrous. The biggest debt is owed to coal mine workers - nearly KM20 million. This problem has not been resolved with the funds of the European Commission that were recently transferred to the treasury.

"We do not have sufficient revenues and this is a fact. We received funds from the European Commission, but they were not enough to settle all debts from 2012. We owe KM4 million to the health care sector, and KM5 million to the agricultural sector. Problems might escalate already in this month, because the end of March is the deadline for us to pay for the bonds for prewar foreign savings in the amount of KM36 million," our source in the B-H Federation Government said.

He added that the payment of bonds for prewar foreign savings was the second highest priority, foreign debt being the top priority.

"In order for the Federation budget to receive the IMF tranche, the parliament needs to adopt as soon as possible the law on favourable retirement, which is a precondition set by the IMF," our source said.

Federation Finance Minister Ante Krajina confirmed to Dnevni Avaz the existence of debt to certain budget beneficiaries.

"Now we are not in a situation to have liquidity in a timely fashion [as published]. In order to settle these debts, we would have to take on a loan with interest rate, and then our expenses would grow," Krajina said.
Source BNE