Contacts: In Sarajevo:Goran Tinjic, ++387-33-251 500 gtinjic@worldbank.org In Washington: Michael Jones, (202)473-2588 Mjones2@worldbank.org WASHINGTON D.C., December 14, 2007 – The World Bank Board of Executive Directors today endorsed a new Country Partnership Strategy (CPS) for Bosnia and Herzegovina (BiH) outlining its cooperation with the country over the next four years. The World Bank Board also approved an IDA credit for the Road Infrastructure and Safety Project in the amount of US$ 25 million. The new CPS for BH outlines a lending program of about US$ 200 million in support of the country’s priorities, including integration with the European Union. This program will be further supported by about US$200 million available under projects that have already been approved. Through this program the World Bank will support investments in infrastructure, municipal development, transport and energy sectors, business environment, public sector reform, and social sectors reform. With a mix of financial and non-financial services, the World Bank will support the Government to achieve their development goals of improving infrastructure and the investment climate, increasing the efficiency of public spending, and strengthening service delivery - in particular those directed to the most vulnerable segments of the population. “The World Bank played an important role in the reconstruction and development of this country after the end of the war; we are now looking forward to the next partnership phase of our involvement in the country,” said Orsalia Kalantsopoulos, World Bank Country Director for Bosnia and Herzegovina. “The success of this partnership will be measured by improved infrastructure and services, increased employment opportunities and better quality of life for the people of Bosnia and Herzegovina. Ultimately we hope this will translate into an accelerated integration in Europe.” During the CPS period, the BiH will make a transition from borrowing under soft IDA conditions to more commercial, but still relatively cheap borrowing under IBRD conditions. “The transition to IBRD indicates we have confidence the country is moving in the right direction” said Marco Mantovanelli, Country Manager for BH. The Road Infrastructure and Safety Project, also approved today, is a US$ 25 million operation aimed at accelerating the recovery of the main road network and improving institutional capacity in relation to road safety. This project comes as a response to the governments' request to focus on developing and protecting core transport infrastructure in order to support growth. The project will finance rehabilitation of about 240 kilometers of regional roads in the Federation BH and in Republika Srpska. The project will also help develop a strategy for improving road safety in the country. US$ 25 million of IDA credit by the World Bank is a part of a broader road rehabilitation program financed by the two entity governments, the European Investment Bank, and the European Bank for Reconstruction and Development. The credit from the International Development Association, the World Bank’s concessional lending arm, will be on standard IDA terms, with maturity in 20 years, with a grace period of 10 years. The World Bank Group has played a significant role in the development story of Bosnia and Herzegovina with commitments totaling more than $1.1 billion IDA credits and grants since 1996 and nearly $250 million original commitments from IFC and about $310 million in guarantees from MIGA. The World Bank current portfolio consists of 16 active projects totaling US$301 million. The International Development Association (IDA) is the part of the World Bank Group that helps the world’s poorest countries. IDA provides interest-free loans and grants for programs that boost economic growth. The International Bank for Reconstruction and Development (IBRD) aims to reduce poverty in middle-income and creditworthy poorer countries by promoting sustainable development through loans, guarantees, risk management products, and analytical and advisory services. International Finance Corporation (IFC) provides loans, equity, structured finance and risk management products, and advisory services to build the private sector in developing countries. Multilateral Investment Guarantee Agency (MIGA) offers political risk insurance for foreign investments in developing countries, technical assistance to improve investment climate, and dispute resolution services to remove possible obstacles to future investment. - | 
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