In this page: Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline
Nowadays, Bosnia and Herzegovina is considered an upper-middle-income country, achieving great results since 1995, the year in which the inter-ethnic conflict that destroyed much of the Bosnian economy and infrastructure, increased unemployment and decreased production, came to an end. After growing 1.7% in 2023, an improved EU economic landscape, along with higher private consumption and investment driven by construction activities, contributed to a 2.8% increase in real GDP in 2024, with a similar pace expected for 2025. In 2026, stronger external demand and recovery from flood damages are expected to drive higher output growth (World Bank). However, several structural challenges limit output growth. Productivity is hindered by the large presence of state-owned enterprises, which employ much of the educated labour force. Population ageing, driven by outmigration, also reduces productivity and strains public services, particularly healthcare.
The general government maintained a near-balanced fiscal position in 2022 and 2023, benefiting from stronger-than-expected revenue growth, although planned investments were hindered by administrative and political obstacles. In 2024, significant permanent spending increases (e.g., wages and pensions) contributed to a rise in the fiscal deficit, with additional spending pressures from flood repairs expected in 2025, slowing the reduction of the public debt ratio. According to official governmental figures, Bosnia and Herzegovina's foreign debt reached BAM 9.23 billion (USD 4.95 billion) at the end of 2024. The Federation's external debt rose to BAM 5.08 billion by December, while the Serb Republic's foreign debt increased to BAM 4.06 billion from BAM 3.93 billion. Overall, the debt-to-GDP ratio of the Federation was estimated at around 34.5% at the end of 2024, with an upward trajectory expected over the forecast period. Meanwhile, the annual average inflation stood at 1.4% in 2024, down from 5.1% one year earlier and 14.9% in 2022 (National Statistics Office).
Registered employment growth slowed from 1.4% in 2023 to 0.4% year-on-year in the first eight months of 2024, while the LFS unemployment rate remained just above 13%. Trade and tourism saw the largest employment gains, but ongoing outflows of skilled labour are causing shortages in sectors like construction and healthcare. This is likely to lead to wage pressures outpacing productivity growth, negatively affecting competitiveness (EU Commission data). Despite macroeconomic stability and resilience, real income growth in Bosnia and Herzegovina has averaged only 2% per year from 2009 to 2023, resulting in stagnant living standards. The country’s GDP per capita (PPP) is low, estimated at USD 21,498 in 2024 by the IMF, and real per capita consumption remains at just 40% of the EU27 average.
Main Indicators | 2023 (E) | 2024 (E) | 2025 (E) | 2026 (E) | 2027 (E) |
---|---|---|---|---|---|
GDP (billions USD) | 27.06 | 28.40 | 29.86 | 31.50 | 33.05 |
GDP (Constant Prices, Annual % Change) | 1.7 | 2.5 | 3.0 | 3.0 | 3.0 |
GDP per Capita (USD) | 7,810 | 8,221 | 8,668 | 9,167 | 9,645 |
General Government Balance (in % of GDP) | -1.9 | -2.5 | -2.5 | -2.2 | -1.8 |
General Government Gross Debt (in % of GDP) | 32.2 | 34.5 | 35.7 | 36.7 | 37.5 |
Inflation Rate (%) | 6.1 | 2.2 | 2.0 | 2.0 | 2.0 |
Unemployment Rate (% of the Labour Force) | 13.2 | 13.2 | 13.2 | 13.2 | 13.2 |
Current Account (billions USD) | -0.76 | -1.37 | -1.48 | -1.46 | -1.43 |
Current Account (in % of GDP) | -2.8 | -4.8 | -4.9 | -4.6 | -4.3 |
Source: IMF – World Economic Outlook Database , Latest available data
Note: (e) Estimated Data
The agricultural sector accounts for 4.7% of the country’s GDP and nearly 17.6% of total employment (World Bank, latest data available). Bosnia and Herzegovina has approximately 2.2 million hectares of agricultural land (43.2% of its total land area - FAO), and most of the farms are small in size and family-owned, so that the country remains a net food importer. The most resource-rich and productive sectors domestically are fruits and vegetables, livestock, and poultry. Corn is the most widely cultivated crop, followed by wheat and potatoes. The country is still a net food importer. According to the latest figures from the National Statistical Office, in 2024, agricultural product prices rose by 44.9% compared to 2020. Crop prices increased by 40.7%, while animal production prices went up by 50.8%. Input I (goods and services used in agriculture) saw a 29.4% rise over the same period.
The industrial sector employs 30.6% of the workforce and constitutes nearly one-fourth of the GDP. Bosnia and Herzegovina mainly produces raw materials such as steel, coal, iron ore, lead, zinc, and aluminium. Additionally, wood is a significant sector and export commodity. Other important production sectors are mineral and chemical products, machinery, mechanical appliances, textiles, and footwear. The overall value-added of the manufacturing sector is estimated at 13% of GDP (World Bank). Bosnia and Herzegovina's industrial output fell by 4.2% in 2024, according to the country's statistical office. The largest annual decline was in the manufacture of leather and related products, which dropped by 22.4%, while the biggest increase of 21.7% was seen in the production of electrical equipment.
Lastly, the service sector contributes 55.8% of GDP and 51.8% of total employment. The most important tertiary sector of the economy is trade, followed by business services, transport, and construction. Tourism has been growing fast in recent years, and although it was impacted by the pandemic, it showed resilience: in 2024, Bosnia and Herzegovina saw nearly 2 million tourist arrivals, a 10.3% increase from the previous year. Overnight stays surpassed 4 million, rising by 8.5% year-on-year. Notably, foreign visitors accounted for 70.5% of total overnight stays. As per the banking sector, it is primarily dominated by commercial banks, with 21 operating alongside 2 investment banks. The country is made up of two entities — the Federation of BiH and the Republic of Srpska — each with its own banking regulator: the Banking Agency of the Federation of BiH and the Banking Agency of the Republic of Srpska.
Breakdown of Economic Activity By Sector | Agriculture | Industry | Services |
---|---|---|---|
Employment By Sector (in % of Total Employment) | 17.6 | 30.6 | 51.8 |
Value Added (in % of GDP) | 4.7 | 23.8 | 55.8 |
Value Added (Annual % Change) | -1.3 | -0.5 | 4.0 |
Source: World Bank - Latest available data.
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Monetary Indicators | 2016 | 2017 | 2018 | 2019 | 2020 |
---|---|---|---|---|---|
Bosnian Mark (BAM) - Average Annual Exchange Rate For 1 MUR | 0.05 | 0.05 | 0.05 | 0.05 | 0.04 |
Source: World Bank - Latest available data.
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The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.
Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation
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Bosnia and Herzegovina is open to foreign trade and is expanding its global partner network. Its trade-to-GDP ratio is 100% (World Bank, latest data available), but trade development is still hampered by low productivity levels, limited access to finance, and administrative barriers. Custom duties are relatively low for most products, but various non-tariff barriers are in place. Anti-dumping and countervailing duties are sometimes imposed to protect the local industry if the price of the merchandise is below the domestic market price or if it is subsidized. Bosnia and Herzegovina seeks to attract higher foreign investment through Free Trade Zones within the country that allow investors to invest capital in specific areas, transfer their profits, and re-transfer capital. Customs duties and tariffs are not payable on imports into these zones. Furthermore, equipment (except passenger vehicles, slots, and gambling machines) imported as part of share capital is exempt from customs duties. Moreover, BiH is actively pursuing World Trade Organization membership. The country mainly imports mineral fuels, mineral oils and products of their distillation; bituminous substances; mineral waxes (13.2%), nuclear reactors, boilers, machinery and mechanical appliances; parts thereof (8.6%), vehicles (7.5%), electrical machinery and equipment (6.9%), plastics and articles thereof (5.2%), and iron and steel (3.8%); whereas exports are led by mineral fuels (9.5%), electrical machinery (8.5%), nuclear reactors (7.9%), furniture (7.8%), and articles of iron or steel (7.3% - data national statistical agency for 2023).
The country's main export partners in 2023 were Germany (16.0%), Croatia (15.3%), and Serbia (12.5%), followed by Austria (10.3%), Italy (8.7%), and Slovenia (8.1%); while the main suppliers were Italy (13.9%), Germany (12.0%), Serbia (10.2%), China (9.5%), Croatia (7.5%), Turkey (5.6%), and Slovenia (3.9% - data national statistical agency). Overall, the EU was the biggest trading partner.
The country has a structural trade deficit: in 2022, the World Bank estimated the external balance on goods and services to be negative by 11.8% of GDP (from 13.6% one year earlier). In the same period, the Federation exported USD 9.23 billion worth of goods and USD 3.28 billion in services, importing USD 15.3 billion and 1.1 billion, respectively (data WTO). According to preliminary official data, in 2024, Bosnia and Herzegovina's trade deficit rose to BAM 12.58 billion (USD 6.72 billion), a 13.6% increase from BAM 11.07 billion in 2023, as exports fell by 3.7% to BAM 16.07 billion, while imports rose by 3.2% to BAM 28.65 billion.
Foreign Trade Indicators | 2019 | 2020 | 2021 | 2022 | 2023 |
---|---|---|---|---|---|
Imports of Goods (million USD) | 11,159 | 9,873 | 13,029 | 15,377 | 15,355 |
Exports of Goods (million USD) | 6,578 | 6,155 | 8,614 | 9,674 | 9,232 |
Imports of Services (million USD) | 773 | 558 | 739 | 898 | 1,105 |
Exports of Services (million USD) | 2,373 | 1,511 | 2,385 | 2,982 | 3,283 |
Imports of Goods and Services (Annual % Change) | 1.3 | -13.4 | 20.6 | 6.2 | -1.3 |
Exports of Goods and Services (Annual % Change) | 0.5 | -15.8 | 26.1 | 12.0 | -1.2 |
Imports of Goods and Services (in % of GDP) | 54.5 | 47.9 | 53.9 | 61.9 | 55.8 |
Exports of Goods and Services (in % of GDP) | 40.0 | 34.2 | 42.6 | 48.3 | 44.1 |
Trade Balance (million USD) | -4,557 | -3,660 | -4,326 | -5,453 | -5,674 |
Trade Balance (Including Service) (million USD) | -2,957 | -2,706 | -2,623 | -3,329 | -3,244 |
Foreign Trade (in % of GDP) | 94.5 | 82.1 | 96.5 | 110.2 | 99.9 |
Source: WTO – World Trade Organisation ; World Bank , Latest Available Data
Main Customers (% of Exports) |
2023 |
---|---|
Germany | 16.0% |
Croatia | 15.3% |
Serbia | 13.2% |
Austria | 10.3% |
Italy | 8.7% |
See More Countries | 36.5% |
Main Suppliers (% of Imports) |
2023 |
---|---|
Italy | 13.9% |
Germany | 12.0% |
Serbia | 10.3% |
China | 9.5% |
Croatia | 7.5% |
See More Countries | 46.7% |
Source: Comtrade, Latest Available Data
Source: Comtrade, Latest Available Data
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2.9 bn USD of services exported in 2023 | |
---|---|
56.11% | |
23.70% | |
14.89% | |
2.30% | |
1.73% | |
Miscellaneous business,...Miscellaneous business, professional, and technical services | 1.66% |
Research and developmentResearch and development | 0.08% |
0.66% | |
0.22% | |
0.17% | |
0.12% | |
0.09% |
1.1 bn USD of services imported in 2023 | |
---|---|
38.84% | |
35.27% | |
7.78% | |
7.07% | |
Miscellaneous business,...Miscellaneous business, professional, and technical services | 7.00% |
Research and developmentResearch and development | 0.07% |
5.73% | |
2.14% | |
1.36% | |
0.86% | |
0.70% | |
0.25% |
Source: United Nations Statistics Division, Latest Available Data
The Council of Ministers of Bosnia and Herzegovina is responsible for various government functions such as 'harmonising the constitutional relations of the Council of Ministers with the work of the President and parliamentary assembly'. After a new structure defined by the High Representative in 2002, the Council of Ministers of Bosnia and Herzegovina has a Chairman, and two Vice-Chairmen also serving as ministers, plus other ministers. The Chairman and members of the Council of Ministers hold a four-year mandate, and each minister has a deputy. The function of the Secretary of the Ministry has also been introduced. Candidates are elected to these functions in line with the ethnic criterion to ensure that all nationalities are represented.
The Chairman of the Presidency appoints the Chairman of the Council of Ministers, who takes over the duties after the House of Representatives of the Parliamentary Assembly of Bosnia and Herzegovina confirms the appointment. The Chairman of the Council of Ministers proposes candidates for ministers, to be appointed by the House of Representatives. The ministries cover the following areas: foreign affairs, foreign trade and economic relations, civil affairs, finance and treasury, human rights and refugees, justice, communications and transport, security and defence.
The House of Representatives has 42 members elected for four-year terms, with 28 members elected from the Federation of Bosnia and Herzegovina and 14 from Republika Srpska.
The House of Peoples has 15 delegates serving a four-year term, with ten delegates from the Federation of Bosnia and Herzegovina (five Bosniaks and five Croats) and five delegates from Republika Srpska (Serbs).
Republika Srpska’s unicameral legislature is the National Assembly, consisting of 83 members directly elected for four-year terms.
The leading international civil agency in Bosnia and Herzegovina is the Office of the High Representative, which is responsible for overseeing the implementation of the civil aspects of the Dayton Peace Agreement (1995). The High Representative—who is also the EU Special Representative—holds ultimate authority in terms of interpreting the Peace Agreement. The High Representative is authorized to pass laws if deemed necessary, remove officials obstructing activities from their positions, and coordinate activities with other international organizations.
The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).
The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.
Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House
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