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Bosnia and Herzegovina - Financial Services, Economy & Statistics

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Bosnia-Herzegovina may show slight upturn in 2010, EBRD says

Kimberley Ann Music in Sarajevo - 06.11.2009

In a best-case scenario, Bosnia-Herzegovina's economy will see a slight recovery in 2010, the European Bank for Reconstruction and Development (EBRD) said.

Weakness will remain in the short term, as gross domestic product is seen declining by 3% in 2009, with the likelihood next year of a very modest upturn at best, the European lender forecast in its Transition Report 2009.

The government has few options for easing the effects of the crisis, especially in Bosnia's Muslim-Croat federation, which has virtually no funds from planned privatisation efforts this year.

A federation plan adopted in February to privatise 11 companies in sectors including aluminum, construction and telecommunications has shown little progress, and there are doubts that the plan's targets will be met, the bank noted.

Nevertheless, Bosnia's economy is expected to remain stable due to low inflation, strong support from parent banks abroad, and a three-year stand-by loan of 1.15 billion euros from the International Monetary Fund.

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