Bosnia passes delayed law to unlock $1.1bn of IMF, EU funds

(L to R) Macedonia's Prime Minister Zoran Zaev, Serbia's Prime Minister Ana Brnabic, Montenegro's President Filip Vujanovic, Chief Executive Officer of the World Bank Kristalina Georgieva, Bulgarian Prime Minister Boyko Borisov, Bosnia and Herzegovina's Minister of Foreign Trade and Economic Relations Marko Sarovic, Albania's Prime Minister Edi Rama and Kosovo President Hasim Taci pose for a photo during a summit to support regional integration in the Western Balkans region in Sofia, in this December 7, 2017 photo. (AFP)
Updated 15 December 2017
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Bosnia passes delayed law to unlock $1.1bn of IMF, EU funds

SARAJEVO: Bosnia’s national Parliament passed a long-delayed law on Friday that should unlock about €1 billion ($1.18 billion) of funding from the International Monetary Fund, the EU and other international lenders. The law raising road-toll fees and excise taxes on bio-fuel was passed by 22 votes to 20 by the 42-seat Parliament.
Opposition parties voted against, saying it would raise other costs for citizens. They had blocked a previous draft law last year that would have increased excise taxes on fuel to pay for road-building, demanding more transparency in the allocation of monies raised so that the government could not channel them into general budget spending.
Addressing the opposition concerns, the government made changes to the legislation lifting road-toll fees and excise taxes just on bio-fuel and bio-liquid, and clarifying that proceeds will be used exclusively for road construction.
EU Enlargement Commissioner Johannes Hahn praised the adoption of the law in a tweet as a “critical step to secure infrastructure investment and international aid.”
“I applaud those who voted in favor. They have shown courage and commitment to move their country forward on the EU path,” he wrote.
The failure to pass the law, which was among key conditions set for Bosnia by the IMF under a €553 million aid deal approved last year, had prompted the Washington-based lender to freeze further loan disbursements. The IMF sees the law as a pre-condition for the launch of large-scale infrastructure projects that would boost growth and create new jobs in the impoverished Balkan country.
Its program is part of a wider reform package devised by the EU to guide Bosnia toward faster integration with the bloc.
The passage of the law will unblock €220 million approved by the European Bank for Reconstruction and Development (EBRD) for infrastructure projects in Bosnia plus another €250 million of loans from the same lender.
The EBRD considers proceeds from increased road tolls as a safeguard for repayment of the debts. The European Commission has also made its €250 million of loans for infrastructure in Bosnia conditional on the passage of the law.
— REUTERS


Porsche first German carmaker to abandon diesel engines

Updated 44 min 40 sec ago
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Porsche first German carmaker to abandon diesel engines

  • The company would concentrate on its core strength, ‘powerful petrol, hybrid and, from 2019, purely electric vehicles’
  • But Porsche promised it would keep servicing diesel models on the road now

BERLIN: Sports car maker Porsche said Sunday it would become the first German auto giant to abandon the diesel engine, reacting to parent company Volkswagen’s emissions cheating scandal and resulting urban driving bans.
“There won’t be any Porsche diesels in the future,” CEO Oliver Blume told the newspaper Bild am Sonntag.
Instead, the company would concentrate on what he called its core strength, “powerful petrol, hybrid and, from 2019, purely electric vehicles.”
The Porsche chief conceded the step was a result of the three-year-old “dieselgate” scandal at auto giant Volkswagen, the group to which the luxury sports car brand belongs.
VW in 2015 admitted to US regulators to having installed so-called “defeat devices” in 11 million cars worldwide to dupe emissions tests.
It has so far paid out more than €27 billion in fines, vehicle buybacks, recalls and legal costs and remains mired in legal woes at home and abroad.
Diesel car sales have dropped sharply as several German cities have banned them to bring down air pollution — a trend that Chancellor Angela Merkel was due to discuss with car company chiefs in Berlin later Sunday.
Stuttgart-based Porsche in February stopped taking orders for diesel models, which it had sold for nearly a decade.
Blume said Porsche had “never developed and produced diesel engines,” having used Audi motors, yet the image of the brand had suffered.
“The diesel crisis has caused us a lot of trouble,” he said, months after Germany’s Federal Transport Authority ordered the recall of nearly 60,000 Porsche SUVs in Europe.
Blume promised that the company would keep servicing diesel models on the road now.
According to the paper, Porsche also faces claims of having manipulated engines to produce a more powerful sound with a technique that was deactivated during testing.
Blume acknowledged that German regulators had found irregularities in the 8-cylinder Cayenne EU5, affecting some 13,500 units.
Merkel, Transport Minister Andreas Scheuer and heads of German auto companies were due to meet in Berlin later Sunday to discuss steps to avoid more city driving bans.
The German government hopes to see one million fully electric and hybrid vehicles on the road by 2022, up from fewer than 100,000 at the start of this year.