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Feb 22, 2012, 08.33 AM IST
Bosnia's new central government aims to meet all conditions set by the European Union over the next month and apply for membership of the bloc by the end of June.
The move comes after Muslim, Serb and Croat leaders put an end to the political deadlock that stalled reforms needed for progress towards EU membership and left the economy floundering following an inconclusive election in October 2010.
"I expect that we shall fulfil conditions for submitting the application for EU membership by June 30," Vjekoslav Bevanda, a Bosnian Croat economist who chairs the central cabinet known as the Council of Ministers, said in an interview.
Bosnia's rival ethnic leaders forged a political agreement in December that resulted in the formation of the central government and two new laws seen as key for reviving the EU accession bid.
"Passing the laws on the census and state aid was a great achievement, but we now have to implement them," Bevanda said. Parliament must also complete work on harmonising the constitution with Europan human rights standards, the remaining EU condition, he added.
At the end of the 1992-95 war, Bosnia was split into two autonomous regions linked by a weak central government: the Federation, dominated by Bosniaks (Bosnian Muslims) and Croats, and the Serb Republic.
The reformist Bevanda, who stabilised the Federation's finances during the 2008-2009 crisis when he served as its finance minister, dismissed analysts' predictions of more politicking and obstruction by ethnically divided parties.
"The atmosphere in the Council of Ministers shows a positive will to implement everything that political leaders have agreed upon," he said.
Bosnia is lagging behind its west Balkan neighbours in the queue for EU membership. Croatia is due to join the bloc in 2013, Macedonia has won candidacy status and Montenegro expects to start accession talks in June.
Serbia and Albania have applied for membership but have yet to be granted official candidate status.
The first priority is to adopt a general fiscal framework for 2012-2014 and the state budget for 2012, Bevanda said, referring to key conditions set by the International Monetary Fund and the EU to unfreeze loans halted over reform delays.
"We have set an ambitious goal... and I am confident that we shall have the 2012 budget passed by parliament by March 31," Bevanda said, adding the government wanted to avoid temporary financing in the second quarter.
Bosnia's state institutions had to use interim financing throughout 2011 because of political disagreements over the size of the budget, and last year's budget was formally adopted only last week.
Bevanda, who also chairs the national Fiscal Council, a country-wide body of top officials, said he would ask all stake-holders in the council to decide if Bosnia should return to the IMF financing which it lost in 2010 after failing to meet the terms of the deal.
He said the country risked a further credit rating downgrade if the two regions continued with irresponsible moves such as issuance of short-term debt to cover budget deficits.
"The short-term debt is the worst kind of debt slavery," Bevanda said. "We can easily see a further credit rating downgrade unless the authorities undertake structural reforms."
Standard & Poor's revised Bosnia's outlook last July to negative from positive and in November cut the country's long-term credit rating by one notch to B, sending it further into the highly speculative grade due to political wrangling.
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