Bosnia and Herzegovina recorded a sharp decline in defense industry exports in the first three months of the year. Total exports stood at 53.2 million BAM, a decrease of 74 million BAM compared to the same period last year, when exports were 127.3 million BAM.
Key Figures
Exports totaled 53.2 million BAM in 2025, compared with 127.3 million BAM a year earlier. This represents a drop of 74 million BAM. The Czech Republic was the main destination, accounting for 30.3 million BAM.
Market Shifts
Even with the overall drop in exports, the structure of the markets has changed.
According to data from the Indirect Taxation Administration of Bosnia and Herzegovina (UIO BiH), the Czech Republic this year became the leading export destination for defense industry exports from Bosnia and Herzegovina, surpassing traditional markets.
Export to Czech Republic
“Weapons worth 30.3 million BAM were exported to the Czech Republic,” UIO BiH reported.
The largest share of exports still consists of products such as bombs, grenades, torpedoes, mines, missiles, and similar military ammunition, including their parts.
In the first three months of this year, the export of these products reached a value of 39.5 million BAM, highlighting continueddemand for this type of goods in the international market.
Other Key Markets
Besides the Czech Republic, other key markets are Poland and Austria, which have represented stable markets for the defense industry of Bosnia and Herzegovina.
According to data from previous years, Bosnia and Herzegovina exported most weapons to the United States, Saudi Arabia, and Serbia.
Defense Industry in Bosnia and Herzegovina Works Closely with Serbia
Dušan Vještica, director of the ‘Kosmos’ company from Banja Luka, told “Nezavisne novine” that the defense industry in Bosnia and Herzegovina works closely with Serbia, and that it is undeniable there has been a decline in the volume of work and, consequently, exports.
“Global disruptions are hurting the defense industry. Partner countries are entering restricted zones, obtaining permits has become more difficult, and political and security risks have increased,” Vještica said.
He stated that companies can easily find themselves in situations where they secure contracts, only to be unable to complete it during implementation.
“In the meantime, due to certain factors, some markets enter the gray zone in terms of security, which can prevent already agreed deals from being carried out,” Vještica explained.
He added that this year the Czech Republic became a leading country in the export of defense industry products from Bosnia and Herzegovina.
What are the key reasons for the decline?
Igor Gavran, an economic analyst, said that one of the key reasons for the decline in exports is the loss of the U.S. market.
“The loss of the U.S. market, amid a one-sided and unjustified increase in tariffs, still negatively affects our exports. However, in the meantime, we have found new markets, such as Iraq, and further strengthened our presence in markets such as the Czech Republic,” Gavran said.
He added that possible logistical factors have affected the temporary decline in exports.
“If a portion of the exports to Iraq was transported by sea through the Strait of Hormuz, potential difficulties or transport delays could have caused temporary delivery postponements,” Gavran explained.
Outlook for Recovery
Despite the current decline, outlook for recovery remainspositive. The global security situation and increasing geopolitical tensions are driving demand for defense industry products worldwide.
“Given the global situation, demand is expected to grow. This means that domestic manufacturers have a real chance not only to offset the current decline but also to significantly increase exports in the period ahead,” Gavran concluded.
He stated that there has certainly been no drop in prices, and the export structure remains almost unchanged, indicating that this is a genuine export decline, not just an apparent one.
“If it were confirmed that transport to Iraq is taking place by sea, it would almost certainly be one of the key reasons for the decline. However, I do not have such information, and I would not be surprised if it is confidential,” Gavran concluded, Nezavisne writes.
