Recommendation:Continue to Safeguard the Integrity of the Currency Board and Independence of CBBH

The Council of the European Union published a document entitled Joint conclusions of the Economic and Financial Dialogue with Regional Partners (https://data.consilium.europa.eu/doc/document/ST-8819-2025-INIT/en/pdf). For each of the Western Balkan countries, Moldova and Turkey, the following are provided: a review of the main messages from the latest submitted Economic Reform Programmes; the European Commission's view regarding the assessment of the effects of the implemented programmes and the degree of fulfilment of previous recommendations, and additional recommendations from the European Union institutions (primarily the European Commission, the European Central Bank and Eurostat), which should result in a higher degree of convergence towards the EU.

The first paragraph in a part of Joint Conclusions related to Bosnia and Herzegovina (page 8) reads: “Bosnia and Herzegovina submitted its Economic Reform Programme 2025–2027 on 18 March 2025, i.e. for the fourth year in a row with a very significant delay of more than 2 months. The late submission has strongly impeded the assessment of the programme and the formulation of the policy guidance. Participants invite Bosnia and Herzegovina to redouble efforts to comply with commitments under the ERP process. The implementation of the policy guidance set out in the conclusions of the Economic and Financial Dialogue of 14 May 2024 has been limited. Participants call for a quick resolution of the current political crisis which impedes the necessary reforms and delays the accession process, and for the finalisation of the country's Reform agenda under the Growth Plan.”

The Central Bank is identified as an institution that makes efforts to adequately monitor price dynamics, which is a consequence not only of analytical reports and the publication of nowcasts and inflation projections, but also of the publication of the core and service inflation estimates on the CBBH website for analytical purposes. It was assessed that monetary policy is appropriate for a currency board arrangement, which enjoys a high level of credibility and is a fundamental pillar of monetary stability. Among the recommendations for the country, there are no recommendations for actions from the CBBH mandate, except that the integrity of the currency board arrangement and the independence of the Central Bank should continue to be preserved.

The recommendation on the necessity of preserving the integrity of the currency board arrangement and the independence of the Central Bank was additionally emphasised at the 8th meeting of the Subcommittee on Economic and Financial Issues and Statistics, within the EU-BH Stabilisation and Association Agreement. The Central Bank participates in the preparation of a document for this Subcommittee, which is adopted by the Council of Ministers of BH. Chief Economist, Belma Čolaković, Ph.D. and Head of the Statistics and Publications Department, Ervin Zolić, M.Sc., participated in the meeting, providing additional information to additional inquiries of the European Commission related to: macroeconomic trends and projections, the financial system stability, progress in processes related to the application for accessing the SEPA geographical area, and statistical reporting from the competence of the CBBH.

The European Union will provide the recommendations for the country from the meeting in the coming weeks, when Bosnia and Herzegovina submits written responses to additional questions. The information shared at the meeting, as well as any information that will be subsequently submitted to the European Commission by formal channels, will affect the content of the next Country Progress Report, which will be published by the EU in the autumn. The CBBH will publish any recommendations from the Subcommittee meeting for our institution.