Trade with Bosnia and Herzegovina

BiH has managed to reach a satisfactory level of macro economical stability in many aspects. The currency value is stable and the inflation is low. However, high unemployment rates and a large trade deficit keep posing serious problems. BiH has initiated reforms in order to create a more favourable business climate. For example, the legal framework for establishing companies has been simplified and the trade obstacles between the entities have been diminished. However, further reforms are required in order to attract investments and create more jobs, such as e.g. the creation of a single economic space.

BiH is in need of more productive enterprises as well as foreign direct investments. Today, the constraints on the total GDP by the public sector are way too high , especially considering the ineffectiveness of its structure. The poverty rate is extensive with 19 % of the population living in poverty and another 23 % being close to living in poverty. It should be mentioned, however, that it is difficult to provide reliable data concerning the Bosnian economy since the informal economy is widespread, there has been no national census since 1991 and also because remittances from relatives living abroad keep being substantial.  

The Bosnian market ought to be attractive to foreign investors in many regards. Some examples to be mentioned are well educated labour at low costs, the vicinity and accessibility to the European market as well as advantageous trade agreements with the EU.