Sjednice
Council of Ministers of BIH Holds Its 17th Session
10/01/2020
The Council of Ministers of BIH took a decision on distribution of KM 14,474,000.00 from BIH institutions budget planned for rehabilitation from economic damage caused by Covid-19 pandemics, which will be now directed to the health sector.
The funds will be allocated to the Entities and Brčko District of BIH, namely to the Federation of BIH and tis 10 cantons 61%, to Republika Srpksa 37%, and to Brčko District of BIH 2% of resources.
The Council of Ministers of BIH secured budget savings-made funds to be used by BIH health sector from for recovery from Covid-19 pandemics-caused damage.
EUR 5 MIL. GRANT FOR RECOVERY FROM COVID-19 CAUSED DAMAGE
The Council of Ministers of BIH defined a Proposal Grant Agreement and Amendment 7 to February 27, 2006 Finance Agreement between KfW, Frankfurt am Main and Bosnia and Herzegovina in amount of EUR 5 million for mitigation of Covid-19 pandemics aftermath to micro and SMEs, through the European Fund for BIH.
The first part of the Agreement refers to a financial support of the Federal Republic of Germany, worth EUR five million and intended for mitigation of Covid-19 effects to MSMEs and will be paid to the European Fund for Bosnia and Herzegovina.
The second part represents the Amendment 7 to the from February 27, 2006 Finance Agreement between KfW and BIH, which extends the purpose of the European Fund resources to a credit programme for diminishing Covid-19 consequences. The funds will be available to MSMEs and private households though financial institutions in BIH (micro-credit organisations and banks).
The Amendment 7 also extends the period of time in which KfW administrates BIH participation in the European Fund, till December 31, 2030.
The Proposal Agreement will be provided to the BIH Presidency, and the Minister of Finance and treasury was proposed for the BIH signatory.
GENERAL EXPANDITURES OF BIH INSTITUTIONS DECREASED FOR KM 9.9 MILLION
The Council of Ministers of BIH adopted BIH Institutions Budget and International Obligations Execution Report for Q I-IV 2020, which the Ministry of Finance and Treasury will provide to the BIH Presidency and Parliamentarian Assembly of BIH. The report will be posted at the Council of Ministers of BIH and Ministry of Finance and Treasury web-sites.
The total realised revenues, finances and receivables available to BIH Institutions in the first half of 2020 were KM 472,096,710, and were higher for 3% relative to the planned ones.
Expenditures and costs of the BIH Institutions Budget were KM 417,802,335 in the first six months this year, and were 91% of 2019 semi-annual, without special purpose funds, i.e. 59% in relation to the corrected Budget which includes additional special purpose funds.
In the first half of 2020, as well as in the same period last year, the BIH Institutions were financed based on temporary financing decisions, as the budget had not been adopted, and budget users disposed of ½ of funds planned in the budget year 2019.
Salaries and reimbursements of employees in the BIH Institutions remained at the level of 2012. In the same period of time, total material expenditures were decreased for about KM 9.9 million, relative to the same period in the year before. The major decrease was made in travel costs - for KM 3.9 million or 54% relevant to the same period in previous year.
Also decreased were costs of supplies for about KM 0.7 million or 13%, as well as costs for current maintenance for about KM one million or 17% in relation to the first half 2019. Simultaneously costs were decreased for transport and fuel for about KM 0.7 million, in addition to costs for phone and postal services for about KM 0.3 million relative to the same period in previous year.
In the first half of 2020, increased were costs for insurance and banking services for about 13% relative to the same period in the previous year.
All liabilities due, based on foreign debt, were serviced timely in total amount of KM 360.39 million, of which principal repayment accounted for KM 293.18 million, and interest, service and other fees accounted to KM 67.21 million.
EUR 40 MILLION LOAN FOR RS RAILWAY ŠAMAC-DOBOJ-RJEČICA SECTIONS MODERNISATION AND OVERHAUL PROJECT
The Council of Ministers of BIH adopted the Ministry of Finance and Treasury-proposed Initiative and designated a negotiating team for conclusion of a Loan Contract between Bosnia and Herzegovina and the European Bank for Reconstruction and Development for Railways of Republika Srpska Project - Overhaul and Modernisation of Šamac-Doboj-Rječica Railway Section, worth EUR 40 million.
The loan term is 15 years with three-year grace period, and it is allocated to Republika Srpska.
The aim of the project is the overhaul of railway Corridor V c running through Republika Srpska, and it includes the overhaul of total 99 km long Šamac-Doboj-Rječica railway track.
The total funds needed for financing of the whole railway track section is about EUR 138 million, the half of which is to be secured through grants.
EIB EUR 20 MILLION LOAN FOR RENEWAL OF SARAJEVO CANTON PUBLIC PASSENGER LINE TRANSPORT CAR POOL
The Council of Ministers of BIH adopted the Ministry of Finance and Treasury-proposed Initiative and designated a negotiating team for conclusion of a Finance Contract between Bosnia and Herzegovina and the European Investment Bank for the Reconstruction of Public Passenger Line Transport Car Pool in Sarajevo Canton – Phase II, worth EUR 20 million.
The renewal for the car pool and capacity increase to satisfy the real needs of passengers was planned, thus improving the public line passenger transport in Sarajevo Canton.
The loan term is 25 years, including three year-grace period, with the allocation to the Federation of BIH, specifically to Sarajevo Canton.
Other than EIB proceeds, the project co-financing was planned with EUR 10 million from the European Bank for reconstruction and Development.
REPEATED TARIFF QUOTAS FOR REFINEMENT SUGAR IN BIH
The Council of Ministers of BIH, took a decision, proposed by the Ministry of Foreign Trade and Economic Relations, on repeating quantities of tariff quotas in 2020, referring to the import of 50,000 tonnes of sugar from sugar cane in solid state and raw sugar for refinement.
Under the Law on Customs Tariffs, the Council of Minsters accommodated requests of domestic producers to use the sugar for refinement at capacities installed in Bosnia and Herzegovina.
BIH AND SERBIA BOOST COOPERATION IN IT SECTOR
The Council of Ministers defined a proposal Platform for conclusion of an Agreement between the Council of Ministers of Bosnia and Herzegovina and Government of the Republic of Serbia on mutual recognition of qualified trust services provided in Bosnia and Herzegovina and the Republic of Serbia, making the electronic business-making faster and more effective, thus lowering business costs.
The two states mutually recognise qualified services in accordance with the law, such as qualified electronic signature, stamp and seal, as well as relevant service registers, which largely improves cooperation in the area of IT society.
The Proposal Platform for conclusion of the Agreement will be provided to the BIH Presidency, with a proposal for the Minister of Communications and Transport as the BIH signatory. The initiative for the conclusion of the Agreement was tabled by the Ministry of Tourism, Trade and Telecommunications of the Republic of Serbia.
FOR MAINTENANCE OF FIVE BRIDGES AT BIH-SERBIA BORDER ABOUT KM 4.2 MILLION IN NEXT FIVE YEARS
The Council of Ministers of BIH took the Ministry of Communications and Transport-proposed decision to approve a multi.-year project of maintenance and reconstruction of bridges between Bosnia and Herzegovina and the Republic of Serbia.
The multi-annual project paned for 2021-2025 amounts to KM 4,205,035 and it pertains to maintenance of five bridges at Bosnia and Herzegovina – Republic of Serbia border, namely: bridge over the Sava River at Rača/Sremska Rača (road bridge); bridge over the Sava at Sremska Rača/Rača (road and railway bridge); bridge over the Uvac River at Carevo Polje; and bridge over the Uvac at Uvac. In the time period between 2021 and 2025 Km 850k will be reserved each year from the BIH Institutions budget, except for year 2025, when KM 805,035 was planned for these purposes.
In accordance with earlier signed-to agreement, the Republic of Serbia took over to maintain and reconstruct the rest of six bridges between the two states.
CONDITIONS CREATED FOR DUISTRIBUTION OF ASSISTANCE GRANTED BY STATE OF QATAR
The Council of Ministers took the Ministry of Security-proposed a decision amending a decision on distribution of international assistance for protection and rescue in equipment and other means, thus correcting a mistake relating to the assistance of the Government of the State of Qatar.
The Government of the State of Qatar confirmed in end August this year, via its Embassy in BIH, that the signed quantities of granted equipment, verified by the relevant Ministry of Security committee, matches the quantities of equipment delivered by donor.
This removed a discrepancy in the quantities of equipment, because of which the decision was amended and conditions created for distribution of the equipment, containing of protective masks, gloves, visors, eyeglasses and suits needed fin effort to contain the Covid-19 pandemics.
MIGRANT SITUATION
The Foreigners’ Affairs Service registered in June 2020 total 1.555 illegal migrants, which is a decrease for 25 relative to the same month last year (2,109), but the number is triple higher then this May, when 514 illegal migrants were reported, reads the Ministry of Security report on migrant situation in Bosnia and Herzegovina for June 2020, adopted by the Council of Ministers of BIH, to be provided to the BIH Presidency.
The majority of reported illegal migrants are from Afghanistan (512), Pakistan (348), Bangladesh (255), Morocco (121), and Iraq (93).
In the first half of 2020, out of total 6,614 illegal migrants reported to the Foreigners’ Affairs Service, 5,207 of them stated their intention to apply for asylum, and 162 applied, amongst them citizens of Iraq, Afghanistan and Turkey were the most numerous.
The key challenges in dealing with illegal migrants issue in the coming period of time are the strengthening of BIH institutions, primarily the Border Police, for prevention of illegal entries at the sites where the major migration pressure was spotted, in addition to staff and material-technical capacitating of all security agencies. However, the main focus in the time ahead should be the defining of identity of illegal migrants and misuse of the asylum system, as well as court processing of migrants doing felony or crime.
Bosnia and Herzegovina remains dedicated to strengthening of cooperation with the states along the Western Balkan route, with the improvement of bilateral cooperation between relevant institutions and agencies in BIH and the EU, including continued cooperation with international agencies.
BIH FISCALY SUSTAINABLE, PANDEMICS BRINGS ABOUT CHALENGES
The Council of Ministers adopted a piece of information on fiscal sustainability for Bosnia and Herzegovina, prepared by the Directorate for Economic Planning.
The paper indicates that the level of public debt in BIH of 33.4% GDP proves the sustainability of it and of public finances, as well.
Deficits higher than 2% of GDP in year 2014 were replaced by surplus in recent years, which also makes the BIH fiscal policy sustainable.
The surplus realised and sustainable public debt level led to one more indicator os sustainability, namely a decrease of needs for financing.
Over the coming period of time, from 2020 on, Bosnia and Herzegovina as for all other world economies will encounter challenges, considering the fall of economic activities, decrease of revenue collection and increase of expenditures due to COvid-19 pandemics.
ECONOMIC ACTIVITY DESISTS IN FIRST HALF OF 2020
The Council of Ministers of BIH adopted a piece of information by the Directorate for Economic Planning on January-June 2020 macro-economic trends in Bosnia and Herzegovina, indicating that the economic activity weakened.
The report says that in the first half of 2020, the reported fall of industrial production in BIH was 9.1%, in which the export oriented processing industries experienced a 13% fall. Combined with particularly weakened export demand due to a total lockdown caused by Covid-19 pandemics, this caused a fall of overall foreign exchange in goods for about 1/5, in which the rates of export and import fall reached 15.1% and 18%, respectively.
A fall of employment and salary levels, decreased remittances from abroad, as well as a fall of retail trade for 7.4% and import of consumer goods for 15% undoubtedly prove of a drastic fall of private spending in BIH in Q II. The revenues based on GDP were less for 17.8% in the reported period of time, proving the fall of private spending in the GDP structure. Bosnia and Herzegovina might, in the Q II 2020, report a significant GDP fall, even deeper than that in 2009 global financial crisis.
Data from public finances domain for the first half of the year prove a drastic fall in public revenue collection in BIH. So that the total public revenues dropped for about 8%, in which revenues form indirect taxes dropped for 9.7% and direct taxes for 6%.
The new circumstances, created under Covid-19 pandemics required increased engagement of BIH Institutions by way of providing additional funds for public health protection and rehabilitation from economic consequences of the crisis, which will certainly lead to an increase of public expenditures and public spending.
Also, it is quite certain that investments will mark a fall, considering a notable uncertainty at markets, limited financial resources and pessimistic expectations when in question prospects at both domestic and export markets.
ADOPTED REPORT ON SERIOUS CRIMINAL ACTS COMMITTED IN BIH IN 2019
The Council of Ministers of BIH adopted the Ministry of Justice-tabled report from the central data base on serious criminal acts committed in Bosnia and Herzegovina in 2019, which indicates that over the reported period of time 477 verdicts were taken, 431 of which were about misuse of narcotics.
The criminal acts entered into the central data base refer to preparation and marketing of counterfeit money, unauthorised production, processing and sales of narcotics an poisons, human trafficking, production and distribution of pornographic materials and other criminal acts for with the data centralisation is provided for under relevant international treaties, and in accordance with the BIH Criminal Procedure Code Article 407.
Last year total 477 verdicts were taken against 545 individuals, among which 263 or 48% were those repeating criminal acts.
The major number (41%) are the individuals aged 18-29, followed by those aged 30-39 (34%). About 96% convicts are male. The citizens of IH are 89% (466 individuals, 48 individuals (8%) have dual citizenship and 10 individuals are citizens of other states (three from Croatia and seven from Serbia).
IMPLEMENTATION OF EU “EUROPE FOR CITIZENS 2014-2021” PROGRAMME
The Council of Ministers of BIH adopted a report from the Ministry of Justice of BIH on implementation of the European Union “Europe for citizens 2014-2021” Programme for year 2019.
Within the Programme, three applicants from BIH are holders of the projects of total value of EUR 148,280, while there are 23 participants as partners in 19 projects, with project holders from other countries.
The participation in the programme implies paying an entry ticket, which costs EUR 15,000 annually for Bosnia and Herzegovina, and a part of these funds are covered from the Instrument of Pre-Accession Assistance (IPA), so that EUR 3,750 was paid from the BIH Institutions budget for 2019, while in 2020 EUR 4.500 was planned for the same purpose.
It is about the European Union programme, inciting cooperation among citizens and their organisations in the Programme member-countries, and supporting groups of citizens, among others, and NGOs and local government units.
PROLONGED DEADLINE FOR FULFILEMENT OF TASKS SET BY STATE PROPERTY COMMITTEE
The Council of Ministers of BIH took the Ministry of Justice-proposed decision, amending a decision on setting-up the State Property Committee for regulation of the state property distribution and establishment of rights and obligations of Bosnia and Herzegovina, the Entities, and Brčko District of BIH in managing the state property.
The Decision set new deadline, to March 31, 2021, for fulfilment of tasks delegated to the Committee.
TO HARMONISE LAW ON BORDER CORNTROL WITH EU STANDARDS
The Council of Ministers of BIH took the Ministry of Security-proposed decision to set-up a work group to develop a Law on Border Control, in order to harmonise the area with the relevant European standards.
The Work Group will be comprised of representatives of competent State, Entity ad Brčko District of BIH bodies, and the deadline for the law preparation is December 31, 2020.
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