Second, the political, economic and social situation in BiH was very unstable in 1996 and 1997 when the CBBH law was being drafted.
For example, it is possible that as the situation in BiH becomes gradually more stable and the breadth and depth of the financial markets develops, some of the operational restrictions set out in the CBBH law can be relaxed or removed.
Firstly, there are a number of other agencies in BiH that have statutory independence similar to the CBBH, such as the two entity banking supervision agencies.
I had to convince politicians that the CBBH was not legally required to and was not in practice going to take political direction in its day-to-day actions.
For example, the RBNZ reports to Parliament through the Minister of Finance while the CBBH reports to parliament through the state presidency.
The RBNZ law has more clearly specified accountability provisions than the CBBH law: the Governor can be removed for failing to achieve the agreed target.
In the CBBH law there is a clause that says any board member, and the Governor is a board member who can be removed if s/he 'violates the Currency Board rule established in this law' (CBBH, 1997).
Given that the process that was used to develop the CBBH law produced a good outcome, it is worth briefly analysing the process that generated this favourable outcome.
The laws thus become very politically focused rather than technically focused, as was the CBBH law.
That is not a surprise as I set the structures up in the CBBH and in doing so I have applied many of the lessons I learned in New Zealand.
I applied as much of the New Zealand model to the CBBH as I could.
Both the RBNZ and the CBBH have opted for quite detailed and formalised decision-making and performance monitoring structures.