BiH cannot make any significant Progress without a Growth Rate of 7 %

December 20, 2017 12:30 PM

While discussing the importance of the diversification of the credit-deposit system in BiH, the economic expert Vjekoslav Domljan warned on the imbalance of the economy in BiH and noted that an increase in savings of citizens and investments will be necessary in order to move forward in the economic sense.

He also added that high unemployment rate is present in BiH (over 20 %), and deficits of current account in BiH have been below 4 % of GDP since 1995.

Domljan believes that we can achieve internal and external balance, but at the cost of decrease of the production. According to economic theories, we would have to produce the devaluation, and we cannot do that because of the currency board. Now, the question is how to establish the foreign trade balance?

Domljan also noted that according to the latest survey on labour force, a total of 480,000 people are employed in the FBiH, of which 423,000 are productively employed. Statistics show that at these 423,000 come children under 14 and other dependent citizens, and 57,000 are unproductive. Statistics show that on one employee in the FBiH comes 3.3 persons, which is not sustainable.

He noted that we can often hear that our goal is to become part of the EU. However, he believes that this should not be our primary goal, but to become a country of high income, whether in the EU or not, it is important for our citizens to live well.

“We have to be aware of how important that is. The sooner we become aware, the better it will be for us. This can be achieved. Just take a look at the countries of Eastern Europe. They all have gone through the process of transition, and now they are countries of high income,” stated Domljan.

He also added that we need growth rate of at least 7 % per year in order to make a progress.

Domljan believes that the growth rate below 7 % should be considered as unacceptable.

(Source: akta.ba)

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