Trends in BiH's Foreign Trade with the World in 2023

(Patria) - The Foreign Trade Chamber of BiH organized a presentation of BiH's foreign trade with the world in 2023, with a special focus on trade with the most significant trading partners.

The presentation was attended by representatives of the media, the diplomatic corps, BiH institutions, and companies, and the trends in foreign trade were discussed by the President of the Chamber Vjekoslav Vuković, Vice President Zdravko Marinković, and Director of the Macroeconomic System Sector Slaviša Ćeranić.

It was highlighted that the volume of trade in 2023 amounted to 45,413,586,000 KM, which is 4.39% or 2.08 billion KM less compared to 2022.

- Analyses for 2023 show that the key reasons for the deterioration of trade volume lie in the reduced economic activity at the EU level.

The worsening international environment, geopolitical tensions, the fight against inflation, the purchase of more expensive energy sources, the green transition, monetary tightening, etc., have led to a decline in activity at the EU level, which is a key partner for BiH's economy.

In addition, the high benchmark year of 2022, when market imbalances and artificial increases in demand for energy sources occurred, had a significant impact on trade.

By putting the energy market into a realistic framework, demand decreased, and consequently, exports also decreased - said Vuković.

The value of exports in 2023 amounts to 17.2 billion KM, which is 1.20 billion KM or 6.57% less compared to 2022, and goods were imported in a total value of 28.2 billion KM, which is 875.60 million KM or 3.01% less compared to the previous year.

The foreign trade deficit amounted to 11,074,114, while the coverage of imports by exports was 60.8%.

Bosnia and Herzegovina is primarily focused on the EU market, therefore 72.3% of the total exports are placed on the EU market. In 2023, a decrease in exports to the EU market of 6.71% was recorded compared to the previous year.

The most significant BiH foreign trade partners by volume of trade are Croatia with 17.32% share in the total trade volume of Bosnia and Herzegovina, followed by Serbia (13.17%), Germany (11.63%), Slovenia (8.38%), and Italy (7.99%).

By coverage of imports by exports, the most significant partners are Austria (116%) and Germany (106%). At the same time, we record the largest exports to Germany (2.7 billion KM), Croatia (2.6 billion KM), and Serbia (2.1 billion KM), and we import the most from Croatia (5.3 billion KM), Serbia (3.9 billion KM), and Germany (2.6 billion KM).

- Despite the fact that Germany, as the largest export market, was in recession in 2023, an export growth of 20.70 million KM was achieved.

Export growth was also recorded in Austria, where the coverage of exports by imports is 116%, in the amount of 6.72 million KM.

From these indicators, it can be concluded that BiH has managed to maintain continuous export growth to some of the most important markets due to long-term contracts and the success of the private sector, primarily in the metal and wood sectors, and to respond promptly and with quality to contracted orders - stated Vuković.

The leading export products of BiH were electricity (1.1 billion KM), insulated wire (663.9 million KM), and iron or steel structures (613.4 million KM), while we imported the most petroleum oils (2.4 billion KM), automobiles (1.1 billion KM), and medicines (684.2 million KM).

The economy of Bosnia and Herzegovina, as highlighted by the representatives of the FTC BiH, despite all challenges, both external and internal, has shown a high degree of agility, resilience, and flexibility.

Following the presentation, a panel discussion was held on "Improving the Business Environment to Increase Exports in 2024," which discussed, among other things, support for companies to primarily succeed in retaining their customers and expanding their business to other new markets.

The panel included representatives from BiH institutions: Hajrudin Podbićanin (Ministry of Foreign Trade and Economic Relations of BiH), Samir Džaferović (Ministry of Communications and Transport of BiH), Dino Selimović (Ministry of Foreign Affairs of BiH), Marko Kubatlija (Agency for Investment Promotion of BiH), and Miljka Kutić (Indirect Taxation Authority).