Bosnia and Herzegovina Maintained Credit Rating

The international agency Standard & Poor's Ratings Services affirmed the same credit rating to Bosnia and Herzegovina, B+, with stable outlook.

The affirmation reflects the analysts' view of Bosnia and Herzegovina's (BiH) complex political and institutional structure, fiscal challenges, and monetary and external vulnerabilities. This structure produces intermittent political stalemates, and analysts believe it will continue to do so as a new coalition government has not yet been appointed after the October 2010 general elections.

S&P expects the general government deficit to decrease to about 4% of GDP in 2010, from 5.6% of GDP in 2009, and to continue falling as economic growth resumes.

Creditworthiness could improve if BH continues to progress with its structural budgetary consolidation agenda, improves its institutional framework to accelerate EU integration, and implements growth-stimulating structural reforms.

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