Bosnia and Herzegovina has that unique blend of East and West that gives it a competitive edge in an increasingly globalized world economy. Its location at the crossroads of Europe and the Middle East give it a strategic advantage for commerce flowing between the two regions (even though export levels are currently some of the lowest in Europe).
What’s more, Bosnia and Herzegovina also has a diverse landscape, with forests, fertile plains and 23km of coastline along the Adriatic Sea. The country’s economy was valued at 14.6 billion EUR and had growth rates as high as 4.5% in 2015.
Still, the country has a lot of growth and development left to achieve. The Bosnian War from 1992-1995 left its mark on the country. Even venues from the 1984 Winter Olympics were used as Bosnian-Serb artillery strongholds during the war.
In parallel with the reconstruction process, Bosnia and Herzegovina is in the stage of a positive economic development and economic stability. Almost the entire main infrastructure was rebuilt in the previous reconstruction process, as well as a large number of housing units. Besides physical reconstruction, Bosnia and Herzegovina is in the stage of completing the reform process of a legal system and a monetary policy, which will additionally improve the conditions for making foreign investments in the country. Thus, BiH today has a very stable convertible currency “The Convertible Mark (BAM)” which is fully linked to EURO.
Other challenges include a large public sector, low exports, high poverty rates and more consumption than production. However, when I was in Bosnia and Herzegovina two years ago, I wrote about how smart entrepreneurs can use such reputation arbitrage to their advantage and build successful businesses where no one else even considers going.
Plus, BiH’s challenges are part of the reason it’s looking to reform and create a more inviting environment for investors.
Bosnia and Herzegovina has formed the Foreign Investment Promotion Agency (FIPA) to create a stronger investment environment in the country. The agency works directly with investors providing analysis on economic and business trends and helping you navigate BiH’s legal framework.