The international rating agency Standard and Poor’s (S&P) maintained the credit rating of Bosnia and Herzegovina, ‘B+’ with a stable outlook.
In the report for Bosnia and Herzegovina, S&P analysts state that, despite internal and external influences, the BH economy showed resilience in the first half of 2024, and that they expect that increased consumption, supported by lower inflation and rising real wages, will raise real growth in BH to 2.8% this year. They also expect that from 2025, there will be somewhat stronger investment, especially in the field of energy and road construction, and an increase in external demand, due to the economic recovery of key trade partners in the euro area, which will result in real growth of almost 3% in the period 2025-2027.
The net debt of Bosnia and Herzegovina is below 20% of GDP, which is a moderate debt for developing countries. About 65% of the consolidated gross debt of the general government refers to bilateral and multilateral creditors with longer maturities and favorable interest rates.
Analysts further expect that the current account deficit will remain low over the next four years, at slightly above 3%, and that Bosnia and Herzegovina will maintain the currency board arrangement.
According to analysts, an increase in the credit rating can occur if consensus-based political decisions are reached, which could speed up structural reforms, including those related to the country’s accession to the European Union, as well as economic growth.
