CURRENT PROBLEMS AND CHALLENGES OF PUBLIC DEBT IN B&H

Abstract

In the period after 1995, Bosnia and Herzegovina has received a comprehensive and substantial international financial assistance and support in order to achieve more rapid economic recovery and economic development, as well as implementation of transitional changes by carrying out socio-economic reforms. Such international assistance required the implementation of consistent and efficient economic policies. They have been represented declaratively, but their implementation was not efficient enough. Delays in implementing the planned reforms, problems in maintaining control of the deficit and insufficient attention paid to the system of public debt have caused the increase in risk to maintain optimal level of external and internal public debt. At the end of 2010, the total level of the country debt reached a level of 34% related to the gross social product with a tendency to increase, while public debt of entities tends to approach the limit values in terms of current regulations in BiH. Establishing a system of project needs management, maintaining the planning approach in the creation of public debt, greater responsibility for the conduct of appropriate and consistent economic policy and an active approach in view of increasing the competitiveness represent important challenges for all levels of BiH government.