Political crisis is an obstacle to larger foreign investments in BiH as well

SARAJEVO, (Patria) - There are fewer and fewer investors willing to invest in Bosnia and Herzegovina, so we are far from economic development, and thus from new jobs.

The pandemic has also contributed to this situation, but the key factor is political instability, which the foreign business community is fleeing from. Domestic population is also fleeing, so we will soon need imported labor. If we look at the statistics from 2008, when investments were record-high, exceeding one billion euros, the line has been falling erratically. Currently, foreign investments are dominated by companies that have reinvested their profits.

In the first six months of 2021, 766 million KM of foreign investments were registered in Bosnia and Herzegovina, which represents an increase of 66 percent compared to the same period last year. Most of these investments are, in fact, reinvestments by existing investors.

The President of the Employers' Association of FBiH, Adnan Smailbegović, believes that the state should create a stimulating business environment, and then capital will start coming on its own.

- Then people will be employed, then the market will react, salaries will increase. We must also open our market to imported labor; believe me, that will be waiting for us very soon, says Smailbegović.

Direct foreign investments in BiH's GDP are around two, two and a half percent. In the countries of the region, they range between four and five percent; that would be a much more adequate measure, so that we can keep pace with other more developed countries.

- Bosnia and Herzegovina desperately needs capital and jobs. We have a visible negative demographic outflow in BiH, which is the biggest problem of our society, believes Branimir Mujdža.
Bosnia and Herzegovina has great chances to position itself in a higher quality way in the global economic chain. But such opportunities are slipping away from us due to the unstable political situation in the country and the lack of real reform processes aimed at reducing the burden, especially for the real sector, experts point out.