Europe > Bosnia and Herzegovina > Economy

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Agriculture > products wheat, corn, fruits, vegetables; livestock
Debt > External	$6,734,000,000.00		[86th of 136]
Distribution of family income > Gini index	26.2		[22nd of 43]
Economic freedom	1.2		[140th of 156]
Economy > Overview Bosnia and Herzegovina ranked next to Macedonia as the poorest republic in the old Yugoslav federation. Although agriculture is almost all in private hands, farms are small and inefficient, and the republic traditionally is a net importer of food. The private sector is growing and foreign investment is slowly increasing, but government spending, at nearly 40% of adjusted GDP, remains unreasonably high. The interethnic warfare in Bosnia 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 2003-07 when GDP growth exceeded 5% per year. 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. Implementing privatization, however, has been slow, particularly in the Federation, although more successful in the Republika Srpska. 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 sizeable current account deficit and high unemployment rate remain the two most serious macroeconomic problems. On 1 January 2006 a new value-added tax (VAT) went into effect. The VAT has been successful in capturing much of the gray market economy and has developed into a significant and predictable source of revenues for all layers of government. Bosnia and Herzegovina became a full member of the Central European Free Trade Agreement in September 2007. The country receives substantial reconstruction assistance and humanitarian aid from the international community but will have to prepare for an era of declining assistance.
Exchange rates marka per US dollar - 1.58 (2004), 1.73 (2003), 2.08 (2002), 2.19 (2001), 2.12 (2000)
Exports	$4,243,000,000.00		[104th of 189]
Exports to US	$2,100,000.00		[161st of 224]
GDP	$11,295,700,000.00		[92nd of 203]
GDP > PPP	$27,238,000,000.00		[90th of 163]
GDP > Real growth rate	6%		[83rd of 198]
GDP growth > annual %	5 annual %		[81st of 187]
GINI index	26.15		[19th of 40]
Gross National Income	$5,036,950,000.00		[102nd of 172]
Human Development Index	0.786		[68th of 178]
Income category	Lower middle income
Inflation rate (consumer prices)	1.6%		[166th of 192]
Population below poverty line	25%		[29th of 46]
Public debt	34 % of GDP		[66th of 121]
Tourist arrivals	100,000		[116th of 152]

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