The economic growth rate in Bosnia-Herzegovina is projected to be 3.5% this year, 3.6% next year, while the projected economic growth rate for 2022 is 3.8%, according to the BiH’s Economic Planning Directorate Reform Program 2020-2022 year.
This document states that the basic assumptions of economic growth projections should be a more favorable extreme environment and a better domestic business environment, while the key pillar of growth during this period should be domestic demand.
Reference international institutions targeting global economic growth projections such as the International Monetary Fund, World Bank, and European Commission from 2020 to 2022 announce that global economic challenges are being overcome and, according to IMF projections, the global economy is expected to record in the observed period average growth of 3% and EU growth of 2%.
An increase in total economic activity in BiH, with the expected increase in industrial production and construction work, which should be accompanied by an increase in the number of employees, export revenues, as well as an increase in foreign cash inflows, should result in an increase in the disposable income of citizens and thus an increase in private consumption.
Considering the high level of public spending within the Gross Domestic Product (GDP) in BiH and the activities invested through the fiscal consolidation process, it is expected that during this period the gradual stabilization of public finances will be achieved by reducing public expenditures and at the same time increasing public revenues in order to limit growth and public spending, according to the Reform Program.
Investments over the observed period, unlike in previous years, could have a significant growth, and thus a larger contribution to the expected GDP growth, and it is expected that in that period investments could increase at an average annual rate of about 9%, ekapija reports.