More than 600 Companies closed in BiH during Pandemic

More than 3,000 companies in the Federation of Bosnia and Herzegovina (FBiH) have no employees, and almost 600 of them ceased to exist during the coronavirus pandemic, according to a report by the Financial Information Agency (FIA).

Namely, the FIA ​​has prepared an analysis of the impact of the coronavirus pandemic on the operations of companies in the FBiH. The analysis showed that companies suffered negative consequences due to closure and reduced economic activity.

Thus, at the end of 2020, a total of 23,244 companies operated on the FBiH market, which is 584 less than in 2019. The analysis shows a decrease in the number of employees of 16,704 (4.57 percent) in companies in the Federation of BiH in 2020 compared to the previous year.

“In the business year 2020, 34,744 taxpayers submitted financial reports, while 19,163 did not submit their financial report, and 3,049 companies that fulfilled the legal obligation to submit financial reports for 2020 presented zero employees,” the analysis states.

Economist Faruk Hadzic told "Avaz" that it is clear that the coronavirus pandemic has left serious consequences for BiH. economy. 

“This can be seen without analysis, and according to the number of active companies that have submitted the final account. In this way, in fact, the real state of the economy in BiH is directly shown, which differs greatly from the total number of registered companies, because many companies are not in a position to go out of business,” Hadzic emphasized. 

He added that aggregate indicators do not sometimes have to provide an accurate picture.

“Because according to them, we do not know how many companies were really in difficulties, and how much they improved their business. In any case, the business environment needs to be urgently improved through faster procedures for registration and closure of companies and reduction of tax burdens, in order to further enable investment in our country,” concluded Hadzic. 

Revenue decline by 5 billion BAM

The value of business revenues that companies in the FBiH generated in 2020 by five billion marks is less than in 2019. Revenues generated on the domestic market dominate, while revenues from exports are declining - according to the FIA ​​analysis.

 It is added that companies operating in the hotel and catering industry have suffered the most severe consequences.