Making little progress towards the EU
Overview:
The Bosnian economy and financial system have been hit hard by the global economic crisis. Exports and industrial production have fallen sharply while the level of bank deposits came under significant downward pressure last October. The situation is starting to stabilise now on both fronts, helped by the agreement of an IMF program. If appropriate budgets are passed for 2010 the next tranche of the IMF agreement could be disbursed in the next month or so. This would further restore confidence and boost the level of foreign exchange reserves. Unfortunately, there are fewer signs of improvement in terms of completing the reforms necessary to accelerate EU integration. Nationalistic rhetoric has predominated, thwarting efforts to close the Office of the High Representative or achieve wider Constitutional reform.