IMF launches talks with crisis hit Bosnia

April 14, 2009

, SARAJEVO, April 14 – The International Monetary Fund said it began talks on Tuesday with Bosnian officials on a standby loan to help the Balkan country deal with the global economic crisis.

An IMF delegation headed by Costas Christou was in the northwestern Bosnian town of Banja Luka at the start of a three-week visit, the IMF\’s office in Sarajevo said.

Fund representatives were to hold a series of meetings on technical issues before starting negotiations on the loan in the final week of April, IMF official Sanela Teskeredzic said.

Bosnia is seeking a standby loan of at least one billion euros (1.3 billion dollars) to bridge a budget deficit and stabilise the ex-Yugoslav republic\’s economy.

Central bank governor Kemal Kozaric said earlier this month that Bosnia was on the verge of entering into a recession on the basis of economic indicators from the first two months of 2009.

The IMF has repeatedly stated it is ready to assist Bosnia, but the country had been reluctant to ask for help as any deal would depend on unpopular spending cuts.

Bosnia, whose economy is still recovering from its devastating 1992-1995 war, has not had a formal relationship with IMF since it had two standby loans totalling around 180 million euros in arrangements that ended in 2004.

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