The World Bank has adopted a new Country Partnership Framework (CPF) for Bosnia & Herzegovina for 2016-2020, which includes some $750mn of new lending. The funding is intended to support faster implementation of reforms in the country.
Although Bosnia’s economy is expected to post a reasonable growth of between 2.5% and 2.8% this year, GDP per capita remains well below the EU average. According to the latest Eurostat data, Bosnia’s GDP per capita, expressed in purchasing power standards (PPS), stood at 29% of the EU-28 average in 2014, the same as the previous year and the lowest in Europe.
“The overarching objective of this new strategy is to put Bosnia and Herzegovina on a better growth path, and to support job creation in the private sector,” Tatiana Proskuryakova, World Bank country manager for Bosnia, said in a statement on the adoption of the CPF published on December 15.
The global lender will support reforms in three areas: increasing public sector efficiency and effectiveness, creating conditions for accelerated private sector growth, and building resilience to natural shocks.
Apart from the $750mn, the World Bank said that private investors may also receive funding from the International Finance Corporation (IFC) in the range of $70mn-$120mn.
"IFC will be engaged in efforts to improve the business environment, attract private sector participation in infrastructure projects and help to improve access to finance and resolution of non-performing loans,” Thomas Lubeck, IFC regional manager for the Western Balkans, said in the statement.
Currently, the World Bank has an ongoing portfolio of 12 operations in Bosnia worth a combined $576mn, while the IFC has eight private investments for a total of $69mn.
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