The economy of the Federation of Bosnia and Herzegovina, despite the unfavorable business environment, recorded some positive steps that can be supported by several economic indicators, told President of the Federation Chamber of Commerce Marko Santic.
According to him, the nominal GDP in BiH at the beginning of the recession of 2009 amounted to 12.7 billion euros, while today it is at the level of about 14.8 billion euros. This would mean that the GDP per capita in 2009 was € 3,300, and today is € 3,900. The growth rate of industrial production in 2009 was negative (-3.3%), and now stands at 2.6%. Foreign direct investment of 2009 were at a level of 180 million euros, and in 2016 they exceeded EUR 300 million.
When it comes to industries in the Federation in the context of their perspective, Santic says that first of all it should be noted metal-processing sector in BiH has several key preconditions for good positioning. These are relatively long tradition, trained staff, knowledge competence, recognized higher education institutions of technical character as well as the ability to form clusters.
There is great potential
Next to this is sector of wood processing industry with a strong competitive advantage when it comes to raw materials, compared to the large industrial countries relatively low cost of labor, and also the possibility Clustering.
Agriculture tourism, said Santic, two promising industry that in our conditions can complement each other with all its comparative advantages of course with the possibility of the formation of clusters. Here is primarily thought to the production processing of medicinal herbs healthy food, and a rich gastronomic offer in tourism.
Finally, as pointed out by Santic, energy IT sector in BiH have very good prospects. The energy sector with regard to hydro, wind solar potential that we have, and the IT sector as a sector where investment in education the fastest return in which we can quickly be globally competitive.
Santic believes that the slow pace of government institutions, their disconnection cumbersome administrative procedures of most problems in our economy.
What are the key problems
He believes that the key issues still low level of production, especially export-competitive, and poor structure of BiH exports, which is characterized by the export of raw materials intermediate products, and less finished, the final products.
– It is unacceptable that the launch of investment or business registration must be 37 days, and for obtaining various other permits even 180 days. Reports suggest that BiH stands significantly lower compared to neighboring countries in terms of competitiveness, the level of corruption in the public sector the level of economic freedom – he said.
One of the biggest problems, he added, is the illiquidity of the BiH economy, or lack of money, the payment of goods services largely reduced to forms of compensation that stimulate shadow economy nontransparent “punching” of debts. Santic says that the main causes of insolvency in general financial indiscipline excessive imports, but also state that, as the largest consumer, owes a tremendous amount of money.
He noted that the interest rates on commercial loans for the purchase of new equipment mostly too high, and the system of procurement of new technologies through leasing still under-represented under-developed. Using capital markets certainly does not exist.
Therefore, in order to ready for the entry into the EU, he stressed, we need all of mikrofirmi, over those of small, medium and large up to the administrative institutions of the country to work together on the implementation of the reform agenda. It is clear that in fact we should have confidence in the government sector, which, despite some “negative points” that will implement these reforms get, if you sincerely wants to take into the EU, need to fully implement the policy of comprehensive reform.