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IMF Approves $620 Million In Loans For Bosnia Tied To Reforms

The International Monetary Fund's executive board on September 7 approved $620 million in loans for Bosnia over the next three years to support the country's economic reform agenda.

The IMF said $88.7 million will be disbursed immediately, with the rest coming in installments that are tied to progress on reforms.

The program replaces a $720 million program that expired in June 2015 after the IMF froze it because of delays in pledged reforms by the government.

Bosnia's two autonomous regions -- the Bosniak-Croat Federation and the Serb Republic -- have budget deficits totaling $573 million and need IMF cash to secure their financing needs. The regions are linked through a weak central government.

IMF is seeking structural economic reforms, including improvement of the business environment, restructuring and privatization of state-owned enterprises, and tax cuts to encourage employment.

Bosnia has also agreed to a gradual fiscal consolidation to reduce public debt and shrink the government.

The measures sought by the IMF are part of a wider program the European Union wants Bosnia to carry out to further its bid to join the bloc.

With reporting by Reuters

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