Bosnia-Herz. Money (ann. var. of M2 %)

Bosnia-Herz. Economic Forecast

Bosnia-Herz. Economic Outlook

After the slowdown in Q3, the economy likely continued decelerating during Q4 in year-on-year terms. Export growth eased in the quarter amid a weak performance among key trading partners, with softer import growth hinting at more sluggish internal demand. Moreover, industrial production contracted at a faster pace. In contrast, retail sales expanded more quickly in Q4 than in Q3. Turning to 2023, early signs are muted, with export and import growth weakening in January. In other news, the government of the Federation of Bosnia and Herzegovina passed the 2023 budget on 27 January, increasing spending by BAM 1.1 billion to BAM 6.7 billion (around 13% of GDP). Additionally, it passed a law in January that increased the minimum wage to BAM 700 (around EUR 358). Both these developments should support domestic demand ahead.

Bosnia-Herz. Inflation

Inflation came in at 14.1% in January, down from 14.7% in December, due to slower price increases for food and non-alcoholic beverages, housing and utilities, transport and recreation and culture. Inflation is set to recede this year, albeit remaining at high levels.

Bosnia-Herz. Economic Data

2017 2018 2019 2020 2021
Population (million) 3.5 3.5 3.5 3.5 3.5
GDP (USD bn) 19.1 21.1 20.9 20.7 24.1
GDP per capita (USD) 5 6 5 5 6
GDP (EUR bn) 16.9 17.9 18.7 18.1 20.4
GDP per capita (EUR) 4 5 5 5 5
GDP (BAM bn) 33.1 34.9 36.5 35.4 39.8
Economic Growth (Nominal GDP, ann. var. %) 5.0 5.6 4.6 -3.0 12.3
Economic Growth (GDP, ann. var. %) 3.8 4.6 2.3 -3.3 7.1
Domestic Demand (ann. var. %) 3.1 2.9 2.9 -3.7 7.6
Private Consumption (ann. var. %) 1.1 2.6 2.3 -3.5 4.0
Government Consumption (ann. var. %) 1.4 2.2 1.0 1.5 2.9
Total Investment (ann. var. %) 11.4 4.4 6.4 -8.5 22.4
Exports (G&S, ann. var. %) 11.8 7.3 0.5 -15.8 24.6
Imports (G&S, ann. var. %) 7.7 3.9 1.3 -13.4 20.5
Industrial Production (ann. var. %) 3.2 1.7 -5.4 -6.5 9.6
Unemployment (% of active population, aop) 38.4 36.0 33.1 33.8 32.4
Fiscal Balance (% of GDP) 1.8 1.7 1.4 -4.7 0.7
Public Debt (% of GDP) 37.9 34.3 32.5 36.5 35.4
Inflation (CPI, ann. var. %, aop) 0.8 1.4 0.6 -1.1 2.0
Exchange Rate (BAM per USD, eop) 1.63 1.71 1.74 1.60 1.72
Exchange Rate (BAM per EUR, eop) 1.96 1.96 1.96 1.96 1.96
Current Account Balance (EUR bn) -0.8 -0.6 -0.5 -0.6 -0.5
Current Account Balance (% of GDP) -4.6 -3.1 -2.5 -3.2 -2.3
Merchandise Trade Balance (EUR bn) -3.6 -3.8 -4.1 -3.3 -3.7
Merchandise Exports (EUR bn) 5.7 6.1 5.9 5.4 7.3
Merchandise Imports (EUR bn) 9.3 9.9 10.0 8.6 11.0
Merchandise Exports (ann. var. %) 17.4 7.6 -3.4 -8.5 35.7
Merchandise Imports (ann. var. %) 12.5 6.0 1.2 -13.4 27.9
Foreign Direct Investment (EUR bn) 0.4 0.5 0.3 0.3 0.5
International Reserves (EUR bn) 5.4 5.9 6.4 7.1 8.4
International Reserves (months of imports) 7.0 7.2 7.8 9.9 9.1
External Debt (EUR bn) 10.8 11.3 11.3 11.3 11.4
External Debt (% of GDP) 64.1 63.3 60.6 62.5 56.1

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