Bosnia and Herzegovina has adopted a budget for 2023, which confirmed the functioning of the current ruling coalition in the country after the country often functioned on temporary financing during previous governments because it was not possible to reach a political agreement on the budget.

The budget for this year was adopted on Thursday by a narrow majority in the House of Peoples of the BiH Parliament after it was endorsed by the House of Representatives on Wednesday.

This year's budget was set at a level slightly higher than 1.3 billion convertible marks, approximately €665 million, which is 23% more compared to the 2022 budget.

“The budget will ensure the smooth functioning of all institutions in Bosnia and Herzegovina and at the same time improve the financial position of the employees,” Finance Minister Zoran Tegeltija told MPs, explaining the proposal.

He pointed out that changes in the law after a number of years enabled a significant increase in wages.

The state budget mainly services the external debt of the country, as well as the salaries and material costs of authorities at the BiH level, while all other costs are financed from the budgets of the entities or the cantons in the Federation entity, so the Croat-Bosniak entity budget is therefore significantly higher than the state budget.

The budget of the Federation for this year is set at 6.7 billion convertible marks, about €3.5 billion.

The adoption of the state budget was also the first major test for the coalition that was established after the elections held in October 2022. Along with the HDZ BiH, it consists of Milorad Dodik's Alliance of Independent Social Democrats (SNSD) and six parties that form a unified Bosniak civic bloc led by the Social Democratic Party.

Opposition representatives in the House of Peoples voted against the budget or abstained because the urgent adoption process did not allow them to propose changes, and they also demanded that changes to the law on salaries, which were supposed to stop the growth of salaries for elected officials, be adopted before that.