„„Steps on the road to the EU Steps on the road to the EU IntegrationsIntegrations””

European Integrations DepartmentCentral Bank of Bosnia and Herzegovina

2see details

EU Institutional FrameworkEU Institutional Framework

The Treaty establishing the European Community sets the following:

Council of the European Union European Commission European Parliament European Council Court of Justice of the European Community European Court of Auditors

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EU Accession CriteriaEU Accession Criteria

Any European state based on principles of liberty, Any European state based on principles of liberty, democracy, respect for human rights and democracy, respect for human rights and

fundamental freedoms, and rule of law can apply fundamental freedoms, and rule of law can apply for membership for membership to the to the EUEU

(Act 49. Treaty on EU)

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Copenhagen criteriaCopenhagen criteria Criteria established by the Copenhagen European

Council in 1993 and strengthened by the Madrid European Council in 1995

Political: establishing of institutions guaranteeing democracy, the rule of law, human rights and respect for and protection of minorities and acceptance of the EU political objectives;

Economic: functioning of market economy with solid market elements and the capacity to cope with competitive pressure and adjustment to market mechanisms within the Union;

Legal: ability to accept the obligations arising from the EU membership, including acceptance of the EU acquis communautaire

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EEcconomonomic and Monetary Union ic and Monetary Union (EMU) (EMU)

1992, Maastricht, Treaty on the European Union (EU) signed setting the foundation for Economic and Monetary Union (EMU) establishing economic and financial discipline criteria with aim of introducing single European currency

6see details

MaMaaastristricht (Convergence) criteriacht (Convergence) criteria

Article 121, Treaty on EU, criteria for full membership in the EMU: Inflation rate should not be higher than 1.5 % of the average inflation

in the three EU member states with the lowest inflation rates Budget deficit should not exceed 3% of GDP Public debt should not exceed 60% of GDP Average nominal long-term interest rate should not exceed 2

percentage points in respect to interest rates of the three EU countries with lowest inflation rate

Stability of exchange rate and implementation of ERM II (exchange rate mechanism): at least two years before the adoption of EUR, the exchange rate of the currency to EUR must fluctuate within the allowed limits +/-15% in relation to the central parity

7see details

ESCB / EurosESCB / Eurosyystemstem

European Central Bank (ECB) – at the center of the ESCB and Eurosystem

European System of Central Banks (ESCB) – ECB and central banks of all the Member States

Eurosystem: ECB and national central banks of the EU Member States that have introduced euro

Eurosystem and ESCB will coexist until there are Member States outside the euro area

8see details

Euro Area EntryEuro Area Entry

The country's entry into the euro zone is governed by the Treaty Establishing the European Community, specifically in Article 122. The relevant provisions regulate the decision on cancelling the right to derogation for the introduction of euro by the ECOFIN Council at the proposal of the Commission and after consulting the European Parliament and the European Council. The decision depends on the conclusions of Convergence Reports (fulfillment of the Maastricht criteria) as well as the compatibility of national legislation with the EU legislation. After the decision on cancelling the derogation right, the Council of the EU decides on the exact date of euro area entry and on fixing the conversion exchange rate of the national currency vis-à-vis euro.

9see details

European System of Central Banks European System of Central Banks (ESCB)(ESCB)National Central Banks (NCB) of the states outside National Central Banks (NCB) of the states outside

of of eeurouro area area::National Central Banks (NCB) inside the National Central Banks (NCB) inside the eeurouro area area

(Eurosystem):(Eurosystem):

DenmarkSwedenUnited KingdomCzech RepublicBulgariaLatviaLitvaniaHungaryRomaniaPoland

BelgiumGermanyGreeceSpainIrlandItalyLuxemburgNetherlandsAustriaPortugalFinlandSloveniaFranceCyprusMaltaEstoniaSlovakia

European Central Bank (ECB)10

• Last update in August 2012

ESCB / EurosistemESCB / Eurosistem: Main Objectives: Main Objectives

Primary objective: to maintain price stability (Treaty on EU, Article 105 (1))

"Price stability is defined as an annual increase in the Harmonised Index of Consumer Prices (HICP) for the euro area of below 2%.“ (The ECB’s Governing Council, 1998), maintaining inflation below 2% (The ECB’s Governing Council, 2003).

Support to economic policies in the EU

11see details

ESCB / EurosESCB / Eurosyystem:stem: Basic TasksBasic Tasks

According to the Treaty on EU (Article 105(2)) and the Statute of the ESCB (Article 3.1.):

To define and implement the single monetary policy

To conduct foreign exchange operations

To hold and manage official foreign reserves of the participating Member States

To promote smooth operations of payment systems

12*see details

ESCB / EurosESCB / Eurosyystemstem Committees Committees (1/2)(1/2)

International Relations Committee (IRC) Monetary Policy Committee (MPC) Financial Stability Committee (FSC) Committee on Cost Methodology (COMCO) Banknote Committee (BANCO) Eurosystem/ESCB Communications Committee (ECCO) Internal Auditors Committee (IAC) Accounting and Monetary Income Committee (AMICO)

13*see details

ESCB / EurosESCB / Eurosyystemstem Committees Committees (2/2)(2/2)

Legal Committee (LEGCO) Market Operations Committee (MOC) Payment and Settlement Systems Committee (PSSC) Information Technology Committee (ITC) Eurosystem IT Steering Committee (EISC) Statistics Committee (STC) Risk Management Committee (RMC) Budget Committee (BUCOM) Human Resources Conference (HRC)

14*see details

The road to EU/EMU MembershipThe road to EU/EMU Membership

15*see details

CCentral entral BBankank of of Bosn Bosniaia and and HerHerzzegovinegovinaa in the European Integration Processin the European Integration Process (1/3) (1/3) Institutional structures after the entry into force of the

Interim Agreement on Stabilization and Association on 1 July 2008  

Subcommittee for Trade, Industry, Customs and Taxes Subcommittee for Agriculture, Food Safety and Fisheries Subcommittee for Internal Market and Competition Subcommitee for Economic – Financial Issues and Statistics Subcommitee for Judiciary and Internal Affairs Subcommitee for Innovations, Technical Development and Social

Politics Subcommitee for Transport, Environment, Energy and Regional

Development 16*see details

CCentral entral BBankank of of Bosn Bosniaia and and HerHerzzegovinegovinaa in the European Integration Processin the European Integration Process ( (22/3)/3) The CBBH continuously works on the strenghtening of its

institutional capacities in compliance with the EU central banking standards and CBBH participates, within its competences, in preparation of the following documents and reports:

BH Progress Report, which monitors, on a yearly basis, the country’s progress towards the European integration, including:

1. Analysis of the BH political criteria,2. Analysis of the BH economic criteria,3. Analysis of the BH capacity for the implementation of the European

standards (in relation to acquis communautaire, Stabilization and Association Agreement, European Partnership)

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CCentral entral BBankank of of Bosn Bosniaia and and HerHerzzegovinegovinaa in the European Integration Processin the European Integration Process ( (33/3)/3)

Economic-fiscal Programme is considered as a preparation for the Pre-accesion Economic Programme, which is a mandatory document for the candidate countries for the EU Membership, that enables preparation of Convergence Programme after the EU accesion

Action plan for the implementation of IA and SAA Gradual harmonization of the CBBH legislation with the

acquis communautaire Use of the pre-accession financial assistance of the EU Establishment and enhancement of the cooperation with

the EU institutions18

CBBH CCBBH Cooperation ooperation PProgrammes with therogrammes with the

ECB ECB && Eurosystem EurosystemCARDS 2006.

ECB-Eurosystem Needs Analysis Programme (implementation Feb - Sept 2007) involving 7 areas:

1) Banking Supervision (coordianting role); 2) Economic Analysis and Research; 3) Statistics; 4) Financial Stability; 5) Payment Systems; 6) Internal Audit and 7) Monetary Policy under CBA

IPA 2007.Capacity building in the field of HR Management in the CBBH (implementation Sept 2009 – Feb 2010)

IPA 2008.Implementation of the recommendations from Needs Assesment Programme – ECB and CBBH Technical Cooperation(Implementation Apr 2010 – Sept 2011) involving 6 areas:

1) Statistics; 2) Economic Analysis and Research; 3) Financial Stability; 4) Harmonisation of Lagislation with EU; 5) EU Integrations Coordiantion and 6) Improvement of IT Sevices of the CBBH

IPA 2009. Strenghtening macro and micro prodential supervision in EU candidate and potential candidate countries

IPA 2012. – 2013. Multi-Annual Indicative Planning Document provides support for the BH programmes for the area of statistics where CBBH participates actively by contributing to the building of statistics capacities and to the overall better state of statistics in BH

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For more information about the EU Fonds, we recommend the website of the Directorate for European Intergations: http://www.dei.gov.ba/

*see details

2020

Thank you for your attentionThank you for your attention

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