Economy - overviewThe interethnic warfare in Bosnia and Herzegovina 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 2003-08 when GDP growth exceeded 5% per year. 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. 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. Bosnia's private sector is growing and foreign investment is slowly increasing, but government spending, at nearly 40% of adjusted GDP, remains high because of redundant government offices at the state, entity and municipal level. Implementing privatization, however, has been slow, particularly in the Federation where political division between ethnically-based political parties makes agreement on economic policy more difficult. A sizeable current account deficit and high unemployment rate remain the two most serious macroeconomic problems. Successful implementation of a value-added tax in 2006 provided a predictable 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's economy has been largely sheltered from the global financial downtown although key economic indicators have worsened. Key exporters in the metal, automobile and wood processing industries have reported a worsening performance and have announced layoffs and output reductions. GDP (purchasing power parity)$29.7 billion (2008 est.) GDP (official exchange rate)$18.47 billion (2008 est.) GDP - real growth rate5.5% (2008 est.) GDP - per capita (PPP)$6,500 (2008 est.) GDP - composition by sectoragriculture: 10.2% Population below poverty line25% (2004 est.) Labor force1.863 million (2007) Labor force - by occupationagriculture: 19.8% Unemployment rate29% (2007 est.) Household income or consumption by percentage sharelowest 10%: 2.8% Distribution of family income - Gini index56.2 (2007) Budgetrevenues: $8.516 billion Public debt40% of GDP (2008 est.) Inflation rate (consumer prices)7.3% (2008 est.) Commercial bank prime lending rateNA% (31 December 2008) Stock of money$4.49 billion (31 December 2008) Stock of quasi money$5.614 billion (31 December 2008) Stock of domestic credit$10.26 billion (31 December 2008) Industriessteel, coal, iron ore, lead, zinc, manganese, bauxite, vehicle assembly, textiles, tobacco products, wooden furniture, tank and aircraft assembly, domestic appliances, oil refining Industrial production growth rate11.6% (2008 est.) Electricity - production12.84 billion kWh (2006 est.) Electricity - production by sourcefossil fuel: 53.5% Electricity - consumption8.501 billion kWh (2006 est.) Electricity - exports5.123 billion kWh (2006 est.) Electricity - imports3.015 billion kWh (2006 est.) Oil - production0 bbl/day (2007 est.) Oil - consumption27,590 bbl/day (2006 est.) Oil - imports27,370 bbl/day (2005) Oil - exports0 bbl/day (2005) Oil - proved reserves0 bbl (1 January 2006 est.) Natural gas - production0 cu m (2007 est.) Natural gas - consumption400 million cu m (2006 est.) Natural gas - exports0 cu m (2007 est.) Natural gas - importsNA cu m Natural gas - proved reserves0 cu m (1 January 2006) Current Account Balance$-2.763 billion (2008 est.) Agriculture - productswheat, corn, fruits, vegetables; livestock Exports$5.177 billion (2008 est.) Exports - commoditiesmetals, clothing, wood products Exports - partnersCroatia 20.9%, Slovenia 16.8%, Italy 16.8%, Germany 13.1%, Austria 10.4%, Hungary 4.8% (2008) Imports$12.27 billion (2008 est.) Imports - commoditiesmachinery and equipment, chemicals, fuels, foodstuffs Imports - partnersCroatia 24.8%, Slovenia 12.8%, Germany 12.4%, Italy 10.6%, Hungary 6.6%, Turkey 6.5%, Austria 6.4% (2008) Reserves of foreign exchange and gold$3.516 billion (31 December 2008 est.) Debt - external$7.672 billion (31 December 2008 est.) Market value of publicly traded shares$NA Economic aid - recipient$546.1 million (2005 est.) Currency (code)BAM Currency (code)konvertibilna marka (convertible mark) (BAM) Exchange rateskonvertibilna markas (BAM) per US dollar - 1.3083 (2008 est.), 1.4419 (2007), 1.5576 (2006), 1.5727 (2005), 1.5752 (2004) Fiscal yearcalendar year |
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Source: CIA World Factbook | |