Bosnia and Herzegovina Country Report - April, 2016

May 5, 2016

This report covers the main macroeconomic releases from April 6 until May 5, 2016 as well as the financial and political events that took place in Bosnia during this period.
Bosnia & Herzegovina's prime minister Denis Zvizdic said that the government had reached an agreement with the International Monetary Fund (IMF) that will include a BAM1.05bn (€540mn) financial package.
The World Bank forecasted that rising domestic demand will lift Bosnia & Herzegovina’s economic growth above 3.0% a year in the medium term. GDP is expected to rise by 2.6% this year, down from an estimated 2.8% in 2015, but should accelerate to 3.1% next year and to 3.5% in 2018.
Bosnia & Herzegovina slipped two positions to 68th out of 180 countries in the 2016 Press Freedom Index from Reporters Without Borders (RSF).
The opposition bloc Savez za Promjene (SZP) is planning a national protest in Bosnia & Herzegovina’s smaller entity, Republika Srpska, on May 14 against the authorities’ policies which it says have damaged the economy in the entity.
German development bank KfW plans to provide Bosnia & Herzegovina with €300mn for energy projects in the coming years.
The Bosnian State Investigation and Protection Agency (SIPA) has reportedly launched a probe at Banka Srpske following media reports that the bank had stolen hundreds of millions of Bosnian marka worth of its clients' savings by investing them in fake companies.

Key points:
• CPI deflation worsened to 1.8% y/y in March
• The retail sales, measured at constant prices, increased by 6.6% y/y in March
• The foreign trade gap narrowed 3.7% y/y to BAM1.4bn (€720mn) in the first quarter of 2016

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