The New Year brought new Price Increases in BiH

As of January 1st, due to the increased wholesale price, gas is also more expensive for households. As of next month, gas users in the Canton Sarajevo (CS) expect bills to increase by about 10 percent, and even 30 percent if the CS government does not continue the subsidy for the price increase from November last year. An increase in the prices is nothing new for citizens. In the year behind us, the prices of food, drinks, fuel, housing, and transport services have risen.

The price increases that officially started on January 1st include changes in the prices of oil and oil products, electricity, gas, and real estate. Unlike previous years, this year the price of cigarettes remains the same. Chain price growth in our country is very noticeable. This is most evident when it comes to basic foodstuffs, especially oil and chicken. Oil went up by 37%, flour and bakery products by 12%, and chicken meat by an incredible 66%. For example, in May, a kilogram of chicken fillet was 6.50 BAM, and in September 9.70 BAM.

The union’s consumer basket for November amounted to 2.190 BAM. The question is how to deal with rising prices while the average salary in the Federation of Bosnia and Herzegovina(FBiH) is 998 BAM. Citizens noted they have nothing left but to fight.

Economic analysts agree that the economy has become a hostage of politics, according to which only political actors have a way out of this bad economic situation.

“For the economic situation in BiH, together with all the political developments in the last six months, we can say that it is very bad. The political crisis, perhaps the biggest after Dayton, is definitely a situation that is not at all stimulating for young people, it is not stimulating for foreign direct investment,” told Hatidza Jahic, a professor at the Sarajevo University (UNSA) Faculty of Economics.

Statistics show how worrying the situation is. Namely, according to the analysis of Eurostat, the agency for statistics of the European Union (EU), BiH is in the penultimate place when it comes to the purchasing power of citizens, with 33% of the EUaverage. But there are some solutions.

“The short-term solution involves activating the commodity reserve system in the sense that these systems – whether at the cantonal or entity levels – try to protect 20-30% of the population, the most vulnerable, those with minimum incomes – pensions, salaries or, for example, some short-term employed or people in a state of social need. Longer-term types of solutions are related to improving the business opportunity – in terms of relieving certain fees, fiscal, in order to free up space for the economy to compensate for them when it comes to offering a lower price of final products and services, “ explained aneconomic analyst Admir Cavalic.

What is certain is that with a better strategy, we can overcome the challenges of rising prices. Improvement happens when we start using the potential we have, commodity and human, and stop importing goods we already own.


Source: Federalna

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