Sjednice
Council of Ministers of Bosnia and Herzegovina Holds Its 22nd Session
28.12.2020
The Council of Ministers of BIH took note of an issue with securing remaining funds for procurement of a vaccine against Covid-19 within COVAX mechanism, and raised its concern that a failure to meet the financial obligation might affect the quantities of ordered doses of vaccines for Bosnia and Herzegovina, as well as a stalemate in delivery thereof.
The Council of Ministers of BIH urged the Government of the Federation of BIH to pay as soon as possible the planned part of relevant finances, since both the Governments of Republika Srpska and of the Brčko District of BIH have fulfilled their respective financial obligations.
The Council of Ministers completed is obligations as to procurement of the Covid-19 vaccines for BIH, this September, when procurement of 1,230,000 doses of vaccine was contracted.
GREEN LIGHT FOR EU MACROFINANCIAL ASSSITANCE WORTH EUR 250 MILLION
The Council of Ministers defined both a Proposal Memorandum of Understanding between the European Union, Lender, and Bosnia and Herzegovina, Borrower, on macroeconomic assistance for Bosnia and Herzegovina in amount of EUR 250 million and Proposal Agreement on Credit Line between the European Union, Lender, and Bosnia and Herzegovina, Borrower, and Central Bank of BIH, Borrower Agent, on macro-financial assistance for Bosnia and Herzegovina.
Proceeds of the favourable loan will be allocated to Republika Srpska (37.5%), the Federation of Bosnia and Herzegovina (61.5%), and Brčko District of BIH (1%).
The aim of the proposed macro-financial assistance is to assist Bosnia and Herzegovina, its Entities and the Brčko District of BIH in budget needs that came up as a consequence the corona virus pandemics.
The assistance is a support to BIH for economic stabilisation and reform programme, and will be disbursed in two instalments, EUR 125 million, each.
The first tranche will be disbursed without any prior economic policy measures, and it will be available upon the Memorandum and Loan Agreement taking effect.
The second tranche is expected after fulfilment of defined economic policy measures in Bosnia and Herzegovina, i.e. its Entities and Brčko District, referring to strengthening of institutional framework for macroeconomic analysis and planning, financial sector, good governance and fight against corruption, as well as support to economic recovery and employment.
The Proposals Memorandum and Agreement with platforms for negotiations on them, will be provided to the BIH Presidency for further procedure, and the Minister of Finance and treasury of BIH and Governor of the Central Bank were proposed for the signatories thereof.
BUDGET EXECURION REPORT I-IX 2020 ADOPTED
The Council of Ministers of BIH adopted the Ministry of Finance and Treasury of BIH-tabled Budget Execution Report I-IX 2020.
According to the Report, total revenues, finances and receivables in the reported period of time were KM 767,583,996, and expenditures were KM 645,514,437.
With a decreased employment level, savings continued on receivables and material costs in year 2020, too, including salaries for employees remaining at the same level as in the first half of 2012, except for police officers, whose salary coefficients were increased in the end September 2017, as well as those of military personnel, in half June 2020, in accordance with the Law on Amendments and Supplements to the Law on Salaries and Emoluments in BIH Institutions.
In nine months of 2020, all due obligations as to foreign debt were served timely, and in total amount of KM of 532,234,54.70.
The Ministry of Finance and Treasury will post the Report on its web-site.
FBD TO 2023 ADOPTED
The Council of Ministers of BIH adopted a Framework Budget Document (FBD) of Institutions of Bosnia and Herzegovina for 2021-2023, as a follow-up of earlier adopted Global Framework of Fiscal Balance and Policies of BIH for the relevant period of time.
The FBD for BIH Institutions shows the total level of expenditures of BIH Institutions (including foreign debt servicing) in amount of KM 1 billion and 27.1 million for each year, in addition to withdrawals from the Single Account of the Indirect Taxation Administration in amount of KM 780 million in each year.
The FBD closely follows and supports reforms in BIH and implementation of earlier defined 14 strategic aims, including macroeconomic stability, economic development, even regional development, faster and more effective development of agriculture and rural sector, development of energy capacities, increase of job generation, promotion o inclusiveness in education, and decrease of poverty in BIH.
The Ministry of Finance and Treasury of BIH drafted the document with an active participation of the Council of Ministers Directorate for Economic Planning (DEP) and Indirect Taxation Administration Division for Macroeconomic Analysis (OMA).
DECISION ON TEMPORAY FINANCING
The Council of Ministers of BIH took the Ministry of Finance and Treasury-proposed Decision on Temporary Financing of BIH Institutions and international obligations of Bosnia and Herzegovina for January-March 2021.
For the relevant period of time, the approved financing of BIH Institutions is KM 249,000,000, which represents ¼ of funds approved for financing of BIH Institutions, in accordance with the Law on Budget of BIH Institutions and International Obligations of Bosnia and Herzegovina for 2020.
The financing of multi-annual projects adopted in budgets for previous years, as well as special purposes programmes, will be made from resources transferred in accordance with the Law on Financing of BIH Institutions, or secured by targeted grants and other directed funds.
MEASURES PLAN FOR EFFECTIVE MANAGMENT OF MIGRANT CRISIS
The Council of Ministers adopted a piece of information by the Ministry of Security, together with December 14, 2020 Plan of Measures and Activities for effective management of migrant crisis n Bosnia and Herzegovina, and took relevant conclusions with a view of effective plan implementation.
The up-dated plan of measures and activities of effective migrant crisis management in BIH contains seven priorities, 24 measures and 127 activities, which is an increase in all segments in respect to 2018 plan, covering five priorities, 17 measures and 73 activities.
Some measures planned better cooperation and coordination of all institutions and security agencies, in accordance with their competences concerning protection of BIH border.
The plan of measures was up-dated and improved in a part referring, among other things, to improvement of coordination and cooperation of all key stakeholders included in the process of migration management and suppression of illegal migrations, preserving of public order and security of BIH citizens and their property. Also, a better coordination was planned of all institutions in charge for foreigners illegally entering BIH, specifically for their replacement from inhabited and urban areas to facilities set-up for the purpose of their accommodation.
The plan intends to improve coordination of activities with competent bodies at the level of regional and international cooperation in struggling against illegal migrations, including cooperation with donors and international organisations.
Priorities target improved implementation of readmission agreements and strengthening of readmission and asylum capacities, as well as more intensive combating the smuggling of migrants.
The strengthening of the BIH Border Police and capacities for more effective management of illegal migrations in BIH remain priority of the Council of Ministers of BIH.
Two new priorities refer to support to local communities where temporary accommodation centres were set-up, but also to strengthening of capacities of the Migrations Coordination Body of BIH, i.e. Operative Staff of Migrations in BIH. The realisation of Plan of measures and activities of effective management of migrant crisis in BIH requires KM 2015,253,700, of which KM two million should be provided from the Budget of BIH Institutions, and KM 189,8383,900 is expected from arrive through grants, in order to secure total KM 23,414,800 from the Budget and grants.
International organisations are called to get included more actively in the realisation of the planned activities and secure needed finances for the plan implementation, while BIH Institutions should, in accordance with their competences, take needed activities in order to realise as much as possible of planned measures through donor funds. Institutions and agencies in BHI are tasked to, as activity holders, take immediately needed activities in order to realise measures and activities proposed under the plan.
The piece of information with the accompanying Plan of measures and activities will be provided to all relevant institutions and bodies in BIH for the realisation.
DEFINED PROPOSAL FINANCE CONTRACT BETWEEB BIH NAD EIR FOR CORRIDOR V c
The Council of Ministers of BIH defined a Proposal Finance Contract between Bosnia and Herzegovina and the European Investmetn Bank (EIB) worth EUR 340 million, for Corridor V c, Medakovo - Poprikuše Section.
Teh medakovo-Poporikuše Section consists of Medakovo-Ozimice and Ozimice-Poprikuše sub-sections Construction of several bridges tunnels and resting areas was planned on these sub-sections in tem period from 2021 to 2025.
The total value of the project was estimated at EUR 391, of which the EUR 340 million EIB loan and EUR 51 million of own and other funds. The Loan was allocated to the Federation of BIH, the repayment term is 25 years, including six-year grace period.
The Project refers, in the most part on this section, of 35 km long section of motorway on the Pan-European Corridor V c, connecting Hungary and east Croatia with Bosnia and Herzegovina and the Adriatic Sea. It is a part of major Corridor V c (total 335 km long) construction programme on BIH territory, the aim of which is raising the functionality of the existing road North-South corridor to a higher level, with simultaneous construction of modern infrastructure and increased safety and road capacity.
The Proposal Contract with Platform for its conclusion will be provided to the BIH Presidency for further procedure, and the Minister of Finance and Treasury was proposed for the signatory thereof.
ACTION PLAN ADOPTED FOR CIVIL ADMINISTRATION REFORM
The Council of Ministers took a decision to adopt a Civil Administration Reform Action Plan, under which goals and measures defined in the Strategic Framework for Public Administration Reform to 2022 will be realised.
The adoption of the Action Plan is among 14 priorities aiming further progress in the European integrations process. The aim is to improve overall functioning of the public administration by way of securing professional and depoliticised civil service and though a coordinated approach in policy making in BIH. The Action Plan covers five pillars containing economic interventions, such as development policy and coordination, civil service and human resources management, accountability, service provision and public finance management; it contains total 165 activities to be realised by 2022.
The Coordinator’s Office for Public Administration Reform was tasked to implement all prearrangement activities and secure necessary conditions for a successful implementation of the Action Plan, including smooth continuation of the coordination of public administration reform relevant actors, regular coordination meetings and further strengthening of coordination effectiveness, in addition to opening of talks with donors and reactivation of the Fund for Public Administration reform in order to secure finances for implementation of the activities from the Action Plan.
All state-level institutions, referred in the Action Plan, as activities holders, and tasked to include goals, activities and success indicators into their respective mind-term and annual work plans.
the realisation of action plan activities in 2018-2022 requires KM61,473,895, of which KM 60 million should be grant funds.
RESTRUCTUING OF IBRD LOAN FUNDS UNUSED DUE TO COVID-19
The Council of Ministers defined a Proposal Amendment 2 of a Loan Agreement between Bosnia and Herzegovina and the International Bank for Reconstruction and Development (IBRD) for Banking Sector Strengthening Project, which planned restructuring of unused loan proceeds for assistance in coping with Covid-19 pandemic consequences.
Under the proposed Amendment, EUR 2, 7,960,000 was planned for restructuring in a way that under the project component 1, additional indicators are to be introduced concerning DLI payment, which refers to strengthening of bank regulations and supervision, in accordance with the Basel Principles. Also, planned was restructuring of component 4, which would become Covid-19 component, and it pertains to promotion of approach to finances by enterprises hit by Covid-19, through regulatory measures and liquidity measures, keeping the financial stability and improving management and business model of the Federation of BIH Development Bank. Earlier Amendment 1, signed on July 2, 2020, restructured Republika Srpska loan component in amount of EUR 8,030,000, in a way that a part of proceeds was directed to improvement of bank regulation and supervision via the RS Banking Agency, in addition to restructuring of component 4, which refers to promotion of approach to finances by enterprises hit by Covid-19 pandemics through regulatory and liquidity measures, keeping the financial stability, as well as improvement of management and business model of the Republika Srpska Investment-Development Bank.
The BIH-IBRD loan agreement was signed on October 31, 2017, under which the Federation of BIH and Republika Srpska got 28,300,000, each.
Due to Covid-19 pandemics, Governments of both the Federation of BIH and Republika Srpska adopted respective activity programmes to preserve jobs, maintain and improve companies’ liquidity and maintain banking sector stability. For the aim of realisation of these measures, the restructuring of unused loan funds was proposed.
The Proposal Amendment 2 with its Platform will be provided to the BIH Presidency for further legal procedure, with a proposal for the Minister of Finance and Treasury of BIH as the BIH signatory.
CoM FINANCIALLY SUPPORTED “SPORTSMEN 2020 SELECTION” EVENT
Upon a proposal of the Chairman of the Council of Ministers of BIH, a decision was taken to approve funds from current budget reserve of BIH Institutions and international obligations of Bosnia and Herzegovina for 2020, in amount of KM 10,000, to be allocated to “Nezavisne Novine” daily paper in support to organisation of the “Sportsmen 2020 Selection” event, thus continuing the practice from earlier years.
UN AND BIH CONTINUE SUCCESSFUL COOPERATION
The Council of Ministers of BIH adopted the Ministry of Foreign Affairs-presented piece of information on continuation of cooperation between UN and BIH in the coming five-year period of time, presented in a “Framework Cooperation for Sustainable Development between United Nations and Bosnia and Herzegovina in 2021-2025” document.
The session adopted the document, to be provided to the BIH Presidency by the Ministry of Foreign Affairs, and the Chairman of the Council of Ministers was proposed for the BIH signatory thereof.
The continuation of the previous UN-BIH cooperation represents a joint determination for work in close partnership to the end of reaching the results to help al people in BIH to live longer, healthier and more prosperously and safely.
The document represents a strategic framework for partnership between United Nations and Bosnia and Herzegovina in the coming five-year period of time on problem solving and priorities implementation in the area of sustainable development in BIH.
The finalised Framework Cooperation also pays attention to the on-going crisis caused by Covid-19 pandemics.
CUSTOMS TARIFF FOR 2021 ADOPTED
The Council of Ministers of BIH took the Ministry of Foreign Trade and Economic Relations-proposed decision on defining customs tariffs for year 2021, aligned with the Combined Nomenclature of the European Union.
Thus conditions were created for a more successful foreign trade between economic entities in Bosnia and Herzegovina and those in CEFTA countries, i.e. EU member-countries.
APPOINTED MEMBERS OF JOINT COMMITTEES ON SUCCESSION ISSUES
The Council of Ministers of BIH took the Ministry of Finance and Treasury-proposed decision on appointment of members of joint committees and negotiating team for implementation of an Agreement on succession issues, which enabled the continuation of work of the teams.
It is about the Joint Standing Committee of of senior representatives of successor states, Joint Committee on issues from the Agreement Annex A, Joint Committee on issues from the Agreement Annex B, Joint Committee on issues from the Agreement Annex, Joint Committee on issues from the Agreement Annex D, and Joint Committee on issues from the Agreement Annex G.
Members of these Committees were appointed to the negotiating team for implementation of the Agreement on Succession Issues.
The members of the negotiating teams are obliged to draft a Programme for continuation of activities and negotiations from their respective areas.
The Programme should include activities to result in defining draft platform or basics for continuation of negotiations, and it should be provided to the Council of Ministers for review.
The negotiating team is obliged to report the Council of Ministers of BIH its work annually.
NEW STRATEGY FOR MIGRATIONS AND ASYLUM TO BE DRAFTED
The Council of Ministers of BIH took a decision to set-up a Work Group for drafting strategy for migrations and asylum and a belonging Action Plan for 2021-2025.
Members of the work group are representatives of competent State, Entity and Brčko District institutions. The Strategy and the complementary Action Plan will cover legal regulations and institutional development in the area of migrations and asylum, taking account of relevant international standards and legislation, the EU, in particular.
JOINT PROGRAMME FOR INFRASTRUCTURE STRENGTHENING TO FINANCE CoR
The Council of Ministers of BIH adopted a Joint Programme for strengthening of infrastructure for Financing of Sustainable Development Aims (CoR) in BIH, which the Ministry of Finance and Treasury will send to the BIH Presidency, and the Minister of Finance and Treasury was proposed for the signatory thereof.
The realisation of the Joint Programme will be financed from the approved funds of the Joint Fund for CoR and UN Agencies resources. The total value of the Joint Programme is USD 1,291,861, of which USD 999,861 will be financed by the Joint Fund for CoR, and USD 292,000 will be financed by UN agencies.
Bosnia and Herzegovina, together with other UN members, adopted a Sustainable Development Programme to 2030, at 2016 Sustainable Development Summit, which contains 17 sustainable development aims for the purpose of eradication of poverty, fight against inequality and injustice and solving the climate change issues.
For support to its member states in fulfilling those aims, UN established a Joint Fund for CoR, and UN team in BIH developed a Joint Programme targeting financing of CoR priorities, so that BIH might apply for resources from the Joint Fund. The aim of the Joint Programme is to intensify investments in sustainable development through launching a wide dialogue and support to all-level authorities to set-up basic elements of eco-system for financing CoR.
USE OF CURRENT RESERVES IN I-IX 2020
The Council of Ministers adopted a piece of information on distribution and use of current reserves funds for I-IX 2020, which will be provided to the BIH Parliamentarian Assembly by the Ministry of Finance and Treasury.
According to the piece of information, in the first nine months of this year, approved was KM 200,000 out of total planned 29,880,000 from budget reserves.
The Ministry of Foreign Affairs of BIH got approved KM 50,000 for evacuation of BIH citizens from Italy, who were in need for an organised return trip for the sake of health protection during the corona virus pandemics.
The Ministry of Security of BIH approved KM 100.000 on February 5, 2020, for the purpose of assisting the Republic of Turkey in recovery from effects of an earthquake which hit the country in January this year.
In addition, the Ministry of Civil Affairs of BH got KM 50,000 on September 16, 2020, for storing, clearing and transport of vaccines, under a Contract with Global Alliance for Vaccines (GAVI) against Covid-29 disease, through KOVAX mechanism, and it will be realised in the coming period of time.
POSITIVE TRENDS ON MILK AND DAIRY PRODUCTS MARKET
The Council of Ministers of BIH adopted an Analysis of situation on milk dairy products market in Bosnia and Herzegovina in 2016-2019, which pointed at positive trends in the area.
The positive indicators refer to stability of quantity of produced raw milk, growth f marketing in buy-out of fresh raw milk, increased quantities of produced dairy products, as well as increased export of milk and dairy products.
The value of primary production in the dairy sector is KM 300 million a year, and 13,000 households earn for living from milk production fully or partially.
Positive trends for milk and dairy producers were evident over the last four years by gaining permit for export to the EU market, and conditions for the permission was met by 11 dairies in BIH.
The most important partners of Bosnia and Herzegovina in foreign trade in milk and dairy products are form CEFTA countries, where BIH places about 87% of the products, followed by the European Union, where about 12% of products are placed, 95% of which to the Republic of Croatia market.
One of the significant problems met by the dairy sector in BIH was a decision of Priština authorities to impose 100% customs to all products from BIH, which fully cut the export on that market. However, despite of loss of the Kosovo market, the export to other markets increased, and it was KM 106 million, which is the highest value in terms of placement of milk and dairy products to foreign market.
APPROVED CONSTRUCTION AND EQUIPINNG OF OSOJE AND DOLJANI BORDER-CROSSINGS
The Council of Ministers of BIH took the Indirect Taxation Administration-proposed decision to approve a multi-annual project of construction and equipping of the Osojane border-crossing, estimated at KM 4,200,000.
The session also took a decision to approve multi-annual project of construction and equipping of Doljani border-crossing, estimated at KM 4,200,000.
Under a Contract on border-crossings between Bosnia and Herzegovina and the Republic of Croatia, the Osoje-Vinjani Gornji border-crossing was defined as an international border-crossing for passenger transport, in addition to transport of empty trucks, while Doljani-Metković border-crossing was set to be an international border-crossing for passenger transport.
The construction and equipping of these two border-crossings will be financed from the
Indirect Taxation Administration resources allocated in accordance with the 2020 Law on Budget of BIH institutions and international obligations of BIH.
The Indirect Taxation Administration planned the construction of Osoje and Doljani border-crossings, as the existing infrastructure does not satisfy even minimum conditions set forth under the “Regulation on standards and conditions of construction and equipment of border-crossing in Bosnia and Herzegovina”.
APPROVED CONSTRUCTION AND EQUIPPING OF FACILITY FOR ACCOMODATION OF EMPLOYEES OF INDIRECT TAXATION ADMINISTRATION AND BORDER CROSSING ON BANJA LUKA AIRPORT
The Council of Ministers took a decision to approve a multi-annual Project “Construction and equipping of facility for accommodation of employees of the Indirect Taxation Administration and Border police at the Banja Luka airport”, estimated at KM 3,000,000.
The Indirect Taxation Administration included the project in its expenditures plan for 2020-2022.
The International Airport Banja Luka secured land for construction of the facility.
DEFIEND THE LOWEST QUANTITY OF FINANCES FOR FOREIGNER STAYING IN BIH
The Council of Ministers of BIH took the Ministry of Security-proposed decision on the lowest quantity of funds needed to support foreigner during his intended stay in Bosnia and Herzegovina.
The lowest amount of funds at disposal to foreigner on his entry to BIH for year 2021 is KM 150 for each day of his intended stay in BIH, or equivalent in foreign convertible currency; it is the same amount as in previous years.
APPOINTED BIH INSURANCE AGENCY STEERING BOARD
The Council of Ministers of BIH took the Ministry of Finance and Treasury-proposed decision on appointment of the BIH Insurance Agency Steering Board members, after the term of the current membership expired mid this year.
The Ministry of Finance and Treasury proposed three members, on behalf of the Council of Ministers of BIH, and the Entity Ministries provided their respective proposals for appointment of two members each, in accordance with the Law on BIH Insurance Agency.
President and members of the BIH Insurance Agency Steering Board are to be appointed at a three-year term.
NO CONSENT ON “LIPA”
The Council of Ministers of BIH failed to reach consensus on a proposal decision on setting-up temporary accommodation centre for migrants “Lipa”, so the decision will be on agenda again in the second round of vote.
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