Economy Overview
Bosnia has a transitional economy with limited market reforms. The economy relies heavily on the export of metals, energy, textiles and furniture as well as on remittances and foreign aid. A highly decentralized government hampers economic policy coordination and reform, while excessive bureaucracy and a segmented market discourage foreign investment. Interethnic warfare in Bosnia and Herzegovina caused production to plummet by 80% from 1992 to 1995 and unemployment to soar, but the economy made progress until 2009, when the global economic crisis caused a downturn. Foreign banks, primarily from Austria and Italy, now control most of the banking sector. 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 remained stable. Bosnia's private sector is growing slowly, but foreign investment has dropped sharply since 2007. Government spending - including transfer payments - remains high, at roughly 40% of GDP, because of redundant government offices at the national, sub-national, and municipal level. High unemployment remains the most serious macroeconomic problem. Successful implementation of a value-added tax in 2006 provided a steady source of revenue for the government and helped rein in gray-market activity. National-level statistics have also improved over time but a large share of economic activity remains unofficial and unrecorded. Bosnia and Herzegovina became a full member of the Central European Free Trade Agreement in September 2007. Bosnia and Herzegovina's top economic priorities are: acceleration of integration into the EU; strengthening the fiscal system; public administration reform; World Trade Organization (WTO) membership; and securing economic growth by fostering a dynamic, competitive private sector. Flooding caused significant damage in the spring of 2014, and Bosnia will struggle to recover from it in 2015.
Agriculture Products
wheat, corn, fruits, vegetables; livestock
Industries
steel, coal, iron ore, lead, zinc, manganese, bauxite, aluminum, motor vehicle assembly, textiles, tobacco products, wooden furniture, ammunition, domestic appliances, oil refining
Industrial Production Growth Rate
0% (2014 est.)
Labor Force
1.281 million (2014 est.)
Labor Force by Occupation
Agriculture: 19%
Industry: 30%
Services: 51% (2013)
Unemployment Rate
44.3% (2013 est.)
Population Below Poverty Line
17.2% (2011 est.)
Household Income or Consumption by Percentage Share
Lowest 10%: 2.7%
Highest 10%: 27.3% (2007)
Distribution of Family Income Gini Index
36.2 (2007)
Budget
Revenues: $8.672 billion
Expenditures: $9.363 billion (2014 est.)
Public Debt
44.7% of GDP (2013 est.)
Commercial Bank Prime Lending Rate
Stock of Narrow Money
$4.554 billion (31 December 2013 est.)
Stock of Broad Money
$10.95 billion (31 December 2013 est.)
Stock of Domestic Credit
$11.57 billion (31 December 2013 est.)
Market Value of Publicly Traded Shares
$NA
Reserves of Foreign Exchange and Gold
$4.868 billion (31 December 2013 est.)
Debt External
$11.14 billion (31 December 2013 est.)
Stock of Direct Foreign Investment at Home
$7.721 billion (2013 est.)
Stock of Direct Foreign Investment Abroad
$0 (2014)
Exchange Rates
1.4767 (2010 est.)
