Even though Bosnia and Herzegovina (BiH), like many other countries, is still facing the consequences of the coronavirus pandemic, the country achieved a significantly better export balance in 2021 than in previous years, reports Anadolu Agency (AA).
According to the BiH Agency for Statistics, in the period January-November 2021, BiH exported goods worth about 12.9 billion BAM, which is 34.8 percent more than in the same period last year.
In that period, imports amounted to 19.4 billion BAM, which is 26.5 percent more than in the first 11 months of last year. The coverage of imports by exports was 66.3 percent, while the foreign trade deficit amounted to 6.55 billion BAM.
Imports are also growing
Over the past decade, BiH has seen a steady increase in exports, but also imports of many products from other countries.
According to the data of the Agency for Statistics of BiH, exports from BiH in 2012 amounted to 7.8 billion BAM, whileimports were around 15.2 billion BAM. The coverage of imports by exports amounted to 51.5 percent, and the foreign trade deficit to 7.4 billion BAM.
The following year, BiH exported goods worth about 8.4 billion BAM and realized imports of 15.2 billion BAM, so the coverage of imports by exports amounted to 55.2 percent, while the foreign trade deficit was about 6.8 billion BAM.
In 2014, exports from BiH amounted to 8.7 billion BAM, and imports 16.2 billion BAM. The coverage of imports by exports amounted to 53.6 percent, and the foreign trade deficit to 7.5 billion BAM.
In 2015, BiH exported goods worth 8.9 billion BAM and imported 15.8 billion BAM, bringing the coverage of imports by exports to 56.7 percent, while the foreign trade deficit amounted to 6.8 billion BAM.
In the following years, the growth of exports increased, as well as imports in BiH. According to official data, in 2016, exports from BiH amounted to 9.4 billion BAM, and imports amounted to 16.1 billion BAM. The coverage of imports by exports amounted to 58.3 percent, while the foreign trade deficit was 6.7 billion BAM.
The following year, BiH exported goods worth 11.05 billion BAM and imported about 18.2 billion BAM, so the coverage of imports by exports amounted to 60.8 percent, and the foreign trade deficit amounted to 7.1 billion BAM.
During 2018, exports from BiH amounted to 11.9 billion BAM, and imports to 19.2 billion BAM. The coverage of imports by exports was 61.7 percent, and the foreign trade deficit was around 7.3 billion BAM.
In 2019, BiH exported goods worth about 11.5 billion BAM and realized imports of 19.5 billion BAM, which covered the coverage of imports by exports was 58.9 percent, while the foreign trade deficit amounted to about eight billion BAM.
In a decade, exports increased by about five billion BAM
But, in 2020, due to the coronavirus pandemic, BiH recorded a decline in exports and imports. According to the data of the Agency for Statistics, last year BiH realized exports of 10.5 billion BAM and imports of 16.9 billion. The coverage of imports by exports was 62.3 percent, and the foreign trade deficit was around 6.3 billion BAM.
Although in previous years, besides exports, imports in BiH also increased, the fact that the foreign trade deficit amounted to 6.5 billion BAM is encouraging, which is, for example, significantly less than in 2012, when it amounted to about 7.4 billion BAM.
Also, if we look only at exports, it is clear that exports have increased significantly over the past decade, since BiH in 2012 achieved exports worth 7.8 billion BAM, in 2015 8.9 billion BAM, in 2018 11.9 billion BAM, and during this year more than 12.8 billion BAM.
Therefore, exports from BiH have increased by about five billion BAM over the past ten years. On the other hand, imports in BiH increased by 4.2 billion BAM in the same period.
Experts believe that several factors have resulted in a significant increase in BiH exports to a number of countries, including overcoming the crisis in the European Union (EU), after the pandemic hit many countries.
Ahmet Egrlic, President of the Foreign Trade Chamber of BiH, told AA that the exit from the crisis caused great demand in the eurozone, after which BiH took market share in the EU, where it exports more than 72 percent of its total exports.
“Also, the construction of domestic capacities, the competitiveness of domestic companies have put us in a position to rank among the priorities in supply chains, of course, we are talking about what we have, and that resulted in over 3.2 billion BAM increased exports in the first 11 months of this year compared to the same period last year. I hope that by the end of the year we will be close to 15 billion BAM, which shows that this is a record year compared to all previous years and it actually exceeded the record 2019,” Egrlic pointed out.
Competitiveness of companies
He noted that the fact that over 72 percent of exports from BiH go to EU countries speaks best about the competitiveness of BiH companies.
“BiH products are first competitive in terms of quality, they are very high quality, and then the price can be imposed on the global market and certainly BiH can be proud of our metal sector, wood sector, because furniture from BiH regularly receives gold medals and plaques at the fairs in Germany. Our leather, textile, and footwear industries are growing steadily, our processing capacities are fully export-oriented and this is what gives us a chance and hope and I urge the authorities to therefore invest more in reforms and create a more favorable business environment to raise our competitiveness, “ he stated.
He emphasized that in this sense it is very important to work even harder on the development of roads and any other infrastructure within BiH.
It is more expensive to reach the border than from the border to a destination for the delivery of goods. Very risky transport, expensive transport causes certain difficulties, but also excessive burdens, taxes, and salary contributions slow us down since it is necessary to provide higher net salaries in companies. We expect that economy will be relieved next year so that the workers will be satisfied with their incomes, ” mentioned Egrlic.
As he explained, the metal sector is traditionally the sector in which BiH has the largest exports to the world.
“About 40 percent of the total exports come from the metal sector. It is also the most promising sector, but I would not ignore all other sectors, which are also very promising, such as the wood industry, furniture production where we achieve better results, then textiles, leather, footwear. These are companies that are widespread throughout BiH and are recording excellentresults. What would be very important to us is to create an environment, to turn to the economy, to see how politicians try to build a better image of BiH in the world, to see how nice messages are sent from here, ” Egrlic pointed out.
Further, he added that it is possible to work on reducing importsso that BiH citizens turned more to buying domestic products.
A chance for BiH
“Our manufacturing industry imports a lot of raw materials. What is important to mention is that cars are in the first place, new, used, and that we can not compensate it with domestic production. But we also import a lot of quality products that we have in sufficient quantities in BiH. We import over 130 million BAM of water, and we have excellent water, etc. In that sense, it is a good message to our consumers to buy domestic, ” said Egrlic, noting that it is necessary to modernize capacities and that the BiH economy needs more incentives and soft loans.
“Now we need to take the opportunity when supply chains are disrupted, when shipping from the Far East has increased five times, when Europe is turning to itself and its neighbors, BiH and the region should now look for a chance to jump into that supply chain, to raise competitiveness and take a more important place in the market of 500 million inhabitants. I believe it is time to turn to ourselves and what we live on. If we do not do that, we will experience that people will leave BiH, “ stressed Egrlic, adding that he expects that 2022 will be an important year in terms of implementing reforms in order to further increase exports and thus further strengthen the domestic economy.