Economic and Political Overview

flag Bosnia and Herzegovina Bosnia and Herzegovina: Economic and Political Overview

In this page: Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline | COVID-19 Country Response


Economic Indicators

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

Nowadays, Bosnia and Herzegovina is considered an upper-middle-income country, achieving great results since 1995, year in which an inter-ethnic conflict - that destroyed much of the Bosnian economy and infrastructure, increased unemployment and decreased production - came to an end. However, the economy still lacks competitiveness and the government launched a structural reforms program for 2019-2021 to boost private investments and exports. Following a recession caused by the outbreak of the COVID-19 pandemic, the economy grew an estimated 2.8% in 2021, mostly driven by household consumption (accounting for around three-quarters of GDP). The IMF forecasts a GDP growth of 3.3% this year, followed by 3% in 2023, although uncertainty persists due to the weak vaccination rollout and political instability.

The general government balance was negative by 2.1% of GDP in 2021; however, the public accounts of the country's three constituent entities (Central State, Federation of Bosnia and Herzegovina and Republika Srpska) are expected to improve markedly in 2022 thanks to a marked economic recovery. Albeit relatively low, the debt-to-GDP ratio increased from a pre-pandemic level of 32.5% to 38.9% in 2021. The ratio is forecast to remain somewhat stable in the short term (at 40.1% in 2023 – IMF). The government does not have access to markets, but it receives financing from several multilateral institutions, including the EBRD (around EUR 105 million in 2021 in partnership with the private sector) and the EU Commission (EUR 250 million in June and EUR 80.5 million in September 2021). Higher energy prices prompted an increase in inflation, which spiked to 1.8% in 2021, the same level it is expected to attain this year (IMF).

Corruption and the high level of unemployment are major hurdles to the country's economic development. The unemployment rate stood at 15.8% in 2021 and is expected to remain stable over the forecast horizon. Addressing bottlenecks causing persistent long-term unemployment, such as enhancing formal labour market participation (especially for women) and reducing skills mismatches for youth will be key. The country’s GDP per capita (PPP) is low, estimated at USD 15,935 in 2021 by the IMF.

Main Indicators 20202021202220232024
GDP (billions USD) 19.9523.3723.6824.5326.25
GDP (Constant Prices, Annual % Change) -
GDP per Capita (USD) 5,7216,7126,8187,0827,598
General Government Balance (in % of GDP) -
General Government Gross Debt (in % of GDP) 36.535.431.829.327.9
Inflation Rate (%) -
Unemployment Rate (% of the Labour Force) 15.917.417.317.217.2
Current Account (billions USD) -0.75-0.49-1.02-0.92-0.95
Current Account (in % of GDP) -3.8-2.1-4.3-3.7-3.6

Source: IMF – World Economic Outlook Database , Latest available data

Note: (e) Estimated Data

Main Sectors of Industry

The agricultural sector accounts for 6.2% of GDP and nearly 18 % of total employment (World Bank, latest data available), with corn, wheat, barley, fruits, vegetables, livestock and poultry being the main agriculture products. The country has approximately 1.6 million hectares of land suitable for cultivation, and most of the farms are small in size and family-owned. Bosnia and Herzegovina is still a net food importer.

The industry sector represents 23.9% of the country’s GDP, employing 31.7% of the workforce. 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, textile and footwear. However, the industry has been shrinking in the last decade due to the global financial crisis and the subsequent fall in both domestic and European demand. The overall value-added of the manufacturing sector is estimated at 12.8% of GDP (World Bank). The industrial output of Bosnia's Federation rose 10% in 2021, after shrinking by 5.9% one year earlier (data from the entity's statistical office). More specifically, industrial output rose by 13% in the manufacturing sector and by 8.4% in the utilities sector, and dropped by 8.2% in the mining sector.

Lastly, the service sector contributes 55.7% of GDP and more than half of total employment (50.3%). The most important service sector of the economy is trade, followed by business services, transport and construction. Tourism had been growing fast in recent years; nevertheless, the impact of the COVID-19-induced crisis was severe. In 2021, the sector has been recovering: a total of 497,474 foreign tourists visited Bosnia and Herzegovina last year, compared with 196,878 in 2020.

Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 18.0 31.7 50.3
Value Added (in % of GDP) 5.2 25.5 54.9
Value Added (Annual % Change) -8.0 8.9 7.7

Source: World Bank - Latest available data.


Find more information about your business sector on our service Market Reports.

Monetary Indicators 20162017201820192020
Bosnian Mark (BAM) - Average Annual Exchange Rate For 1 MUR

Source: World Bank - Latest available data.


Find out all the exchange rates daily on our service Currency Converter.

Indicator of Economic Freedom


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.

World Rank:
Regional Rank:

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation


Country Risk

See the country risk analysis provided by Coface.


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Foreign Trade in Figures

Bosnia and Herzegovina is open to foreign trade and is expanding its global partner network. Its trade-to-GDP ratio is 83.3% (World Bank, latest data available). Overall, trade development is still hampered by low productivity levels, limited access to finance and administrative barriers to trade. 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 subsidised. 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. The country mainly exports seats (4.8%), electrical energy (4.7%), furniture (3.4%), and wood sawn (3.1%); importing petroleum oils (5.7%), motor cars (3.6%), medicaments (3.1%), and coal (1.8% - Comtrade, 2020).


The country's main export partners in 2020 were Germany, Croatia, and Serbia, accounting for respectively 15.5%, 12.9% and 11.6% of total export; followed by Italy (9.7%) and Austria (9.5%). Its main suppliers were Germany (12.3%), Italy (11.5%) Serbia (11.3%), and Croatia (9%). Overall, the EU is the biggest trading partner.

Foreign Trade Indicators 20172018201920202021
Imports of Goods (million USD) 10,50411,63011,1599,87313,029
Exports of Goods (million USD) 6,4027,1826,5786,1528,614
Imports of Services (million USD) 563722758511693
Exports of Services (million USD) 1,8762,2812,3431,3062,250
Imports of Goods and Services (Annual % Change)
Exports of Goods and Services (Annual % Change)
Imports of Goods and Services (in % of GDP) 57.157.355.248.654.6
Exports of Goods and Services (in % of GDP) 40.942.640.634.742.7
Trade Balance (million USD) -4,291-4,536-4,557-3,660-4,326
Trade Balance (Including Service) (million USD) -2,940-2,964-2,957-2,789-2,778
Foreign Trade (in % of GDP) 98.099.995.883.297.2

Source: WTO – World Trade Organisation ; World Bank , Latest Available Data


Main Partner Countries

Main Customers
(% of Exports)
Germany 15.0%
Croatia 13.1%
Serbia 12.7%
Italy 11.3%
Austria 9.0%
See More Countries 38.9%
Main Suppliers
(% of Imports)
Italy 12.0%
Germany 11.9%
Serbia 11.4%
Croatia 8.9%
China 7.9%
See More Countries 47.9%

Source: Comtrade, Latest Available Data


Main Products

8.6 bn USD of products exported in 2021
Electrical energyElectrical energy 5.8%
Seats, whether or not convertible into beds, and...Seats, whether or not convertible into beds, and parts thereof, n.e.s. (excl. medical, surgical, dental or veterinary of heading 9402) 4.1%
Insulated "incl. enamelled or anodised" wire,...Insulated "incl. enamelled or anodised" wire, cable "incl. coaxial cable" and other insulated electric conductors, whether or not fitted with connectors; optical fibre cables, made up of individually sheathed fibres, whether or not assembled with electric conductors or fitted with connectors 3.3%
Structures and parts of structures "e.g., bridges...Structures and parts of structures "e.g., bridges and bridge-sections, lock-gates, towers, lattice masts, roofs, roofing frameworks, doors and windows and their frames and thresholds for doors, shutters, balustrades, pillars and columns", of iron or steel; plates, rods, angles, shapes, sections, tubes and the like, prepared for use in structures, of iron or steel (excl. prefabricated buildings of heading 9406) 3.3%
Wood sawn or chipped lengthwise, sliced or peeled,...Wood sawn or chipped lengthwise, sliced or peeled, whether or not planed, sanded or end-jointed, of a thickness of > 6 mm 3.2%
See More Products 80.3%
13.0 bn USD of products imported in 2021
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 7.3%
Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702) 3.6%
Unwrought aluminiumUnwrought aluminium 2.5%
Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses "incl. those in the form of transdermal administration" or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006) 2.5%
Coal; briquettes, ovoids and similar solid fuels...Coal; briquettes, ovoids and similar solid fuels manufactured from coal 2.2%
See More Products 81.9%

Source: Comtrade, Latest Available Data


To go further, check out our service Import Export Flows.


Main Services

2.0 bn USD of services exported in 2019
0.7 bn USD of services imported in 2019

Source: United Nations Statistics Division, Latest Available Data

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Political Outline

Current Political Leaders
Presidency of Bosnia and Herzegovina (three-member body): Chairman of the Presidency Zeljko KOMSIC (chairman since 20 July 2021; presidency member since 20 November 2018 - Croat seat); Sefik DZAFEROVIC (presidency member since 20 November 2018 - Bosniak seat); Milorad DODIK (presidency member since 20 November 2018 - Serb seat)
Next Election Dates
Presidential: October 2022
Parliamentary Assembly: October 2022
Main Political Parties
Political parties are typically founded on an ethnic basis, these forces often lead to the creation of coalitions. The main parties are:

- Party of Democratic Action (SDA): centre-right, bosniak nationalism, Islamist
- Alliance of Independent Social Democrats (SNSD): Serbian nationalism and social democracy
- Serbian Democratic Party (SDS): centre-right, comprised of Serbian nationalists, Pro-European
- Democratic Front: centre-left, Pro-European, promotes social democratic ideals
- Union for a Better Future of Bosnia and Herzegovina (SBB BiH): centre-right, conservative, pro-European
- Croatian Democratic Union of Bosnia and Herzegovina (HDZ BiH) and its allies: centre-right, Christian democratic
- Social Democratic Party of Bosnia and Herzegovina (SDP): centre-left, influenced by Communism, but promotes social democracy
- Party of a Democratic Progress (PDP): national conservatism
- Our Party (NS): social-liberalism
- Democratic People's Alliance (DNS): serbian nationalism, national conservatism
- Party Of Democratic Activity (A-SDA): bosnian nationalism, islamic democracy
- Independent Bloc (NB): bosnian nationalism, centrist
- Socialist Party (SP): social democracy
- United Srpska (US): serbian nationalism
Type of State
Bosnia and Herzegovina is a parliamentary republic.
As a 'compound' State, it is in line with the General Framework Agreement for Peace in Bosnia and Herzegovina (Dayton, Paris, 1995). It consists of two entities: the Federation of Bosnia and Herzegovina (51% of territory, majority of Croats and Bosnians) and the Republic of Srpska (49% of territory, Serbian majority). Another 'sub-entity' is the District Brcko which was the subject of disputes and international arbitrage. Thus, Bosnia and Herzegovina has two entities plus the Brcko District.
Executive Power
The function of the collective Head of State is performed by the Presidency of Bosnia and Herzegovina. The Presidency is comprised of three members: one Bosniac, one Croat and one Serb, representing the Federation of Bosnia and Herzegovina and the Republic of Srpska. Members of the Presidency, the Croat and Bosniac candidates from the Federation of Bosnia and Herzegovina and the Serb candidate from the Republika Srpska, are elected by direct elections, for a period of four years. The Chairmanship of the Presidency is rotated every eight months amongst the three.

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, 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 the 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.

Legislative Power
The Parliamentary Assembly is the highest legislative authority in Bosnia and Herzegovina. It is composed of the House of Representatives and the House of Peoples. All legislative decisions are made by the adoption in both houses of the Parliamentary Assembly.

The House of Representatives has 42 members elected for four-year terms, two-thirds being elected from the Federation of Bosnia and Herzegovina and one–third from the Republika Srpska.

The House of Peoples has 15 delegates serving a four-year term, two-thirds coming from the Federation of Bosnia and Herzegovina (five Croats and five Bosniaks) and one–third from the Republika Srpska (five Serbs).

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 the ultimate authority in terms of the Peace Agreements' interpretation. The High Representative is authorised to pass laws, if considered necessary, remove officials that obstruct activities from their posts and coordinate activities with other international organisations.


Indicator of Freedom of the Press


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.).

World Rank:

Indicator of Political Freedom


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.

Partly Free
Political Freedom:
Civil Liberties:

Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House


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COVID-19 Country Response

COVID-19 epidemic evolution

To find out about the latest status of the COVID-19 pandemic evolution and the most up-to-date statistics on the COVID-19 disease in Bosnia and Herzegovina, please visit the official portal of the Federal Ministry of Health For statistics concerning the Republic of Srpska, refer to the Public Health Institute website (in Serbian).
For the international outlook you can consult the latest
situation reports published by the World Health Organisation as well as the global daily statistics on the coronavirus pandemic evolution including data on confirmed cases and deaths by country.

Sanitary measures

To find out about the latest public health situation in Bosnia and Herzegovina and the current sanitary measures in vigour, please consult the website of the Public Health Institute of the Republic of Srpska and that of the Federal Ministry of Health of BiH (in Bosnian), including the up-to-date information on the containment measures put in place and public health recommendations.
Click here to consult the resolution of the Council of Ministers declaring the state of emergency.

Travel restrictions

The COVID-19 situation, including the spread of new variants, evolves rapidly and differs from country to country. All travelers need to pay close attention to the conditions at their destination before traveling. Regularly updated information for all countries with regards to Covid-19 related travel restrictions in place including entry regulations, flight bans, test requirements and quarantine is available on TravelDoc Infopage.
It is also highly recommended to consult COVID-19 Travel Regulations Map provided and updated on the daily basis by IATA.
The US government website of Centers of Disease Control and Prevention provides COVID-19 Travel Recommendations by Destination.

The UK Foreign travel advice also provides travelling abroad advice for all countries, including the latest information on coronavirus, safety and security, entry requirements and travel warnings.

Import & export restrictions

The authorities of Bosnia and Herzegovina have not adopted any specific measure applicable to movement of goods during the period of sanitary emergency due to the COVID-19 outbreak. Please consult the portal of the Customs Sector of the Indirect Taxation Authority for further updates.
For a general overview of trade restrictions due to COVID-19 pandemic, please consult the section dedicated to Bosnia and Herzegovina on the
International Trade Centre's COVID-19 Temporary Trade Measures webpage.

Economic recovery plan

To know about the economic measures taken by the national government to address the impact of the COVID-19 pandemic on the economy, please consult the following link and the website of the Council of Ministers of Bosnia and Herzegovina. Further details and updates can be found on the country-specific guide by Deloitte.
For the general overview of the key economic policy responses to the COVID-19 outbreak (fiscal, monetary and macroeconomic) taken by the Bosnian government to limit the socio-economic impact of the COVID-19 pandemic, please consult the section dedicated to Bosnia and Herzegovina in the
IMF’s Policy Tracker platform.

Support plan for businesses

For the information on the local business support scheme and taxation measures established by the government of Bosnia and Herzegovina to help businesses to deal with the economic impacts of the COVID-19 epidemic on their activity, please consult the country-specific guide by Deloitte.
For a general overview of international SME support policy responses to the COVID-19 outbreak refer to the World Bank's Map of SME-Support Measures in Response to COVID-19.

Support plan for exporters
The government of the Federation of Bosnia and Herzegovina established a special fund to support export companies that are facing difficulties due to the effects of the pandemic on their export markets.
For updates, visit the website of the Council of Ministers of Bosnia and Herzegovina.

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Latest Update: March 2023