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IMF delays decision on Bosnia stand-by loan

SARAJEVO: The International Monetary Fund said on Thursday it would postpone until March 17 its decision on a $15 million tranche of a stand-by loan to Bosnia after the government said it would meet IMF's conditions.

The fund's executive board on Wednesday held back on earlier threats to delay the third tranche of the $104 million credit due to the Balkan country's failure to meet all IMF requests, said the fund's resident representative, Bruno de Schaetzen.

"We just could not continue playing this game further and had to draw a line," de Schatzen told Reuters. "There has been much exasperation and frustration at these delays in the board," he said referring to a completion of the loan's second review.

On Wednesday, Edhem Bicakcic, prime minister of Bosnia's Muslim-Croat federation, sent a letter to the head of the IMF Bosnia mission, Juan Jose Fernandez-Ansola, assuring him that all remaining issues would be considered by the parliament at the March 13 session.

IMF has so far disbursed two tranches of the stand-by loan: $32.8 million in June 1998 and $40 million in June 1999.

The third tranche of $15 million would be released at the end of March if Bosnia's two entities, primarily the Muslim-Croat federation but also the Serb republic - fulfil the remaining conditions, said De Schaetzen.

Federation Deputy Finance Minister Mehmed Alijagic said he believed that parliamentary deputies would adopt next week all necessary legislative changes to please the IMF.

He said that the federation parliament was set to approve the 2000 budget of 940 million marka, including transfers to the state for both administrative and debt services.

He also said that the parliament was due to harmonise with the Serb republic a legislation on excise taxes on tobacco, and amend the law on sales taxes.

"There is no reason for the parliament deputies to reject these laws," Alijagic said.-Reuters