Inflation in our country has been on the rise again in the past two months, which was reflected in the increase in prices. Almost everything has become more expensive. Food items and drinks have risen in price by 13 percent this year.
Inflation is slowing, but not abating. Prices rise automatically. Officials claim that in this and the next month, that is, until the end of the year, even a drop in inflation can be expected.
“For the first time, the Central Bank of Europe did not raise interest rates, which means that inflation is stopping. The growth of interest is stopped, which is very good, and we expect this year in the Republic of Srpska an average annual inflation growth of around 6 percent”, says Zora Vidovic, Minister of Finance of the RS.
The banking sector partly contributed to curbing inflation, in which, although Euribor rose from a negative value to four percent, there was no significant increase in interest rates.
“With us, the average growth of interest rates compared to the period last year when we measured it is below one percent, which is significant when we look at banks in Serbia, Croatia or the EU, where the growth of interest rates was between 3 and 4 percent compared to last year”, explains Srdjan Suput, director of the RS Banking Agency.
Monetary policy in Bosnia and Herzegovina is limited compared to other countries. We can neither print money nor reduce it in circulation. In fact, the only way our authorities can mitigate the negative effects of inflation is to increase wages, pensions and financial aid to the most vulnerable citizens.
“Through the increase of pensions and the constant struggle to increase the minimum wage in some way to help those vulnerable categories to overcome this very unfavorable situation. Especially from the aspect of the much greater increase in the prices of food and energy, which affect the poorest much more. In that sense, this aid was necessary,” says Sasa Grabovac from Association of Economists “SWOT”.
Although a large number of citizens will probably disagree, the numbers are undeniable. Earnings, however, grew at a higher percentage than inflation. For the first time since the war, two average salaries can cover the trade union consumer basket, which is around 2,500 marks. However, the question arises as to how the real sector will handle political promises about the lowest salary of one thousand marks.
“I am afraid that some low-productivity and low-efficiency economic activities will not be able to survive this and that these jobs will be threatened to a greater extent in BiH”.
Inflation is imported, and the local authorities are doing what they can to alleviate it. Could it be more? It sure is.
