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. Foreign Direct Investment (EUR bn) Data
| 2017 | 2018 | 2019 | 2020 | 2021 | |
|---|---|---|---|---|---|
| Foreign Direct Investment (EUR bn) | 0.4 | 0.5 | 0.3 | 0.3 | 0.5 |