Bosnia and Herzegovina

Bosnia and Herzegovina (B&H; locally: Bosna i Hercegovina/????? ? ???????????) is a triangular mountainous country in the western Balkans with an estimated population of about 4,000,000 people. The country is the homeland of its three constitutional peoples; Bosniaks, Croats, and Serbs, and is famous for its cultural and religious diversity. A citizen of Bosnia and Herzegovina, regardless of ethnicity, is usually identified as a Bosnian.

Economy

Main article: Economy of Bosnia and Herzegovina

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For the most part, agriculture has been in private hands, but farms have been small and inefficient, and food has traditionally been a net import for the republic. The centrally planned economy has resulted in some legacies in the economy. Industry is greatly overstaffed, reflecting the rigidity of the planned economy. Under Josip Broz Tito, military industries were pushed in the republic; Bosnia hosted a large share of Yugoslavia's defense plants.

Related Topics:
Agriculture - Josip Broz Tito

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Two major export companies in former Yugoslavia had theirs headquarters in the capital Sarajevo; UNIS holding and Energoinvest. During times of the former Yugoslavia, Bosnia and Herzegovina financed many large construction projects in former Yugoslavia and in other former Yugoslav republics. An example of this was the 'Bratstvo i jedinstvo' highway, which linked Ljubljana (Slovenia) - Zagreb (Croatia) - Belgrade (Serbia) - Skoplje (Macedonia). Even though Bosnia did not have anything to gain from this investment, as not even one single kilometer of that highway went through Bosnia and Herzegovina. Further projects, such as the construction of the so-called town of 'New Belgrade' (Serbia), Kosovo financing, and railway tracks near Belgrade - Bar in Serbia and Montenegro. This was due to the fact that the economy of the time was communist; with directives instead of a free economy like that in the West. In 1984, the capital, Sarajevo, was the host of the XIV Winter Olympic Games. A notable fact was that the games were the first 'profitable' games in terms of retrieving investment via profits.

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Three years of war destroyed a large part of the economy and infrastructure in Bosnia and Herzegovina, causing unemployment to soar and production to fall. The war caused a death toll of approx. 102,000 people based on current information from researchers at the International Criminal Tribunal for the former Yugoslavia (ICTY) at the Hague, The Netherlands). Furthermore, it displaced half of the population. Other sources place the figure between 150,000 - 278,000. With an uneasy peace in place (under the Dayton Accord), the economy has started to slowly recover, but the GDP remains below the 1990 level. Today Bosnia and Herzegovina has one of the best banking sectors in former Yugoslavia. The currency (the Convertible Mark KM or Bosnian Mark BAM,

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BAM ratio to the Euro 1: 0,51), which is based on the fixed value of the deutschmark, is also very stable. Also yearly inflation is the lowest compared to other countries which were a part of former Yugoslavia. The inflation rate was 1.9% in 2004 (source: CIA WFB), and international debt was approx. $2 billion; making it the smallest amount of debt owed from the former Yugoslav countries (Serbia and Montenegro's international debt is $15.2 billion). Real GDP growth rate is 5.0% for 2004 according to the Bosnian Central Bank of BiH and Statistical Office of Bosnia and Herzegovina. In 2004 the top foreign investors in Bosnia and Herzegovina were:

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Top Foreign company investors in Bosnia and Herzegovina (1994-2004):

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LNM Holding / KCIC Holland Antilles / Kuwait / Metal processing

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Hypo Alpe Adria Bank / Austria / Banking

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Unicredito / Transmadrid Italia / Spain / Banking

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Petrol / Slovenia / Trade

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Coca Cola Beverages Holdings / Holland / Food industry

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Deutsche Telekom / Germany / Telecommunication

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Heidelberger Zement / Germany / Construction materials

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Dubai I.B., A.I.B. and Islamic Development Bank / UAE and Saudi Arabia / Banking

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Alpha Baumanergement Gesellschaft / Austria / Tourism

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Bosmal / Malaysia-Bosnia and Herzegovina / Construction

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Source: B&H Ministry of Foreign Trade and Economic Relations (2005)

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