Allo' Expat Bosnia Herzegovina - Connecting Expats in Bosnia H'vina
Main Homepage
Allo' Expat Bosnia Herzegovina Logo


Subscribe to Allo' Expat Newsletter
 
Check our Rates
   Information Center Bosnia Herzegovina
Bosnia Herzegovina General Information
 
History of Bosnia Herzegovina
Bosnia Herzegovina Culture
Bosnia Herzegovina Cuisine
Bosnia Herzegovina Geography
Bosnia Herzegovina Population
Bosnia Herzegovina Government
Bosnia Herzegovina Economy
Bosnia Herzegovina Communications
Bosnia Herzegovina Transportations
Bosnia Herzegovina Military
Bosnia Herzegovina Transnational Issues
Bosnia Herzegovina Healthcare
Bosnia Herzegovina People, Language & Religion
Bosnia Herzegovina Expatriates Handbook
Bosnia Herzegovina and Foreign Government
Bosnia Herzegovina General Listings
Bosnia Herzegovina Useful Tips
Bosnia Herzegovina Education & Medical
Bosnia Herzegovina Travel & Tourism Info
Bosnia Herzegovina Lifestyle & Leisure
Bosnia Herzegovina Business Matters
  Sponsored Links


Check our Rates

Bosnia Herzegovina Economy
 
 
 

General

Bosnia & Herzegovina faces the dual problem of rebuilding a war-torn country and introducing market reforms to its formerly centrally-planned economy. One legacy of the previous era is a greatly overstaffed military industry; under former leader Josip Broz Tito, military industries were promoted in the republic, resulting in the development of a large share of Yugoslavia's defence plants but fewer commercially viable firms. Although agriculture is almost all in private hands, farms are small and inefficient, and the republic traditionally is a net importer of food. Industry remains greatly overstaffed, a holdover from the socialist economic structure of Yugoslavia. Yugoslav President Josip Broz Tito had pushed the development of military industries in the republic with the result that Bosnia & Herzegovina was saddled with a host of industrial firms with little commercial potential. The inter ethnic warfare in Bosnia & Herzegovina caused production to plummet by 80% from 1992 to 1995 and unemployment to soar. With an uneasy peace in place, output recovered in 1996-99 at high percentage rates from a low base; but output growth slowed in 2000-02. Part of the lag in output was made up in 2003-05. National-level statistics are limited and do not capture the large share of black market activity.

The konvertibilna marka (convertible mark or BAM) - the national currency introduced in 1998 - is pegged to the euro, and confidence in the currency and the banking sector has increased. Implementation of privatisation, however, has been slow, and local entities only reluctantly support national-level institutions. Banking reform accelerated in 2001 as all the Communist-era payments bureaus were shut down; foreign banks, primarily from Western Europe, now control most of the banking sector. A sizable current account deficit and high unemployment rate remain the two most serious economic problems. The country receives substantial amounts of reconstruction assistance and humanitarian aid from the international community but will have to prepare for an era of declining assistance.

According to an estimation of the World Tourism Organization, Bosnia & Herzegovina will have the third highest tourism growth rate in the world between 1995 and 2020.Tourism in its capital, Sarajevo, is chiefly focused on historical, religious and cultural aspects. Bosnia has also become an increasingly popular skiing and eco-tourism destination.

Overview

Economy - overview
The interethnic warfare in Bosnia & Herzegovina caused production to plummet by 80% from 1992 to 1995 and unemployment to soar. With an uneasy peace in place, output recovered in 1996-99 at high percentage rates from a low base; but output growth slowed in 2000-02. Part of the lag in output was made up in 2003-08 when GDP growth exceeded 5% per year. Banking reform accelerated in 2001 as all the Communist-era payments bureaus were shut down; foreign banks, primarily from Western Europe, now control most of the banking sector. Bosnia's private sector is growing and foreign investment is slowly increasing, but government spending, at nearly 40% of adjusted GDP, remains high because of redundant government offices at the state, entity and municipal level. Successful implementation of a value-added tax in 2006 provided a predictable source of revenue for the government and helped bring in gray market activity. National-level statistics have also improved over time but a large share of economic activity remains unofficial and unrecorded. Bosnia & Herzegovina became a full member of the Central European Free Trade Agreement in September 2007. Bosnia's economy has been largely sheltered from the global financial downtown although key economic indicators have worsened. Key exporters in the metal, automobile and wood processing industries have reported a worsening performance and have announced layoffs and output reductions.

GDP (purchasing power parity)
$29.9 billion (2008 est.)
$28.32 billion (2007)
$26.51 billion (2006)
note: Bosnia has a large informal sector that could also be as much as 50% of official GDP

GDP (official exchange rate)
$19.36 billion (2008 est.)

GDP - real growth rate
5.6% (2008 est.)

GDP - per capita (PPP)
$6,500 (2008 est.)


See more information on the next page... (next)


 

 
 

   



 


copyrights © AlloExpat.com
2015 | Policy