Bosnia and Herzegovina

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Bosnia and Herzegovina Economy 2008

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.
GDP (purchasing power parity): $27.7 billion note: Bosnia has a large informal sector that could also be as much as 50% of official GDP (2007 est.)
GDP (official exchange rate): $14.78 billion (2007 est.)
GDP - real growth rate: 6% (2007 est.)
GDP - per capita (PPP): $6,100 (2007 est.)
GDP - composition by sector: agriculture: 10.2% industry: 23.9% services: 66% (2006 est.)
Labor force: 1.026 million (2001)
Labor force - by occupation: agriculture: NA% industry: NA% services: NA%
Unemployment rate: 45.5% official rate; grey economy may reduce actual unemployment to 25-30% (31 December 2004 est.)
Household income or consumption by percentage share: lowest 10%: 3.9% highest 10%: 21.4% (2001)
Distribution of family income - Gini index: 26.2 (2001)
Budget: revenues: $7.094 billion expenditures: $7.137 billion (2007 est.)
Public debt: 34% of GDP (2007 est.)
Inflation rate (consumer prices): 1.6% (2007 est.)
Commercial bank prime lending rate: 7.17% (31 December 2007)
Stock of money: $5.13 billion (31 December 2007)
Stock of quasi money: $5.597 billion (31 December 2007)
Stock of domestic credit: $8.895 billion (31 December 2007)
Agriculture - products: wheat, corn, fruits, vegetables; livestock
Industries: steel, coal, iron ore, lead, zinc, manganese, bauxite, vehicle assembly, textiles, tobacco products, wooden furniture, tank and aircraft assembly, domestic appliances, oil refining
Industrial production growth rate: 6.7% (2007 est.)
Electricity - production: 12.84 billion kWh (2006 est.)
Electricity - consumption: 8.501 billion kWh (2006 est.)
Electricity - exports: 5.123 billion kWh (2006 est.)
Electricity - imports: 3.015 billion kWh (2006 est.)
Oil - production: 0 bbl/day (2007 est.)
Oil - consumption: 27,590 bbl/day (2006 est.)
Oil - exports: 0 bbl/day (2005)
Oil - imports: 27,370 bbl/day (2005)
Oil - proved reserves: 0 bbl (1 January 2006 est.)
Natural gas - production: 0 cu m (2007 est.)
Natural gas - consumption: 400 million cu m (2006 est.)
Natural gas - exports: 0 cu m (2007 est.)
Natural gas - imports: 0 cu m (2005)
Natural gas - proved reserves: 0 cu m (1 January 2006)
Current account balance: -$1.939 billion (2007 est.)
Exports: $4.243 billion f.o.b. (2007 est.)
Exports - commodities: metals, clothing, wood products
Exports - partners: Croatia 21%, Slovenia 16.5%, Italy 16.1%, Germany 13.3%, Austria 9.6%, Hungary 5.7% (2007)
Imports: $9.947 billion f.o.b. (2007 est.)
Imports - commodities: machinery and equipment, chemicals, fuels, foodstuffs
Imports - partners: Croatia 24.7%, Slovenia 13.3%, Germany 13.1%, Italy 10.4%, Austria 7%, Turkey 6.5%, Hungary 5.4% (2007)
Reserves of foreign exchange and gold: $4.525 billion (31 December 2007 est.)
Debt - external: $6.734 billion (31 December 2007 est.)
Market value of publicly traded shares: $NA
Currency (code): konvertibilna marka (convertible mark) (BAM)
Exchange rates: konvertibilna markas (BAM) per US dollar - 1.4419 (2007), 1.5576 (2006), 1.5727 (2005), 1.5752 (2004), 1.7329 (2003) note: the convertible mark is pegged to the euro

NOTE: The economy information regarding Bosnia and Herzegovina on this page is re-published from the 2008 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of Bosnia and Herzegovina Economy 2008 information contained here. All suggestions for corrections of any errors about Bosnia and Herzegovina Economy 2008 should be addressed to the CIA.