|Bosnia and Herzegovina||2015|
|GDP, current US$ billion||15.5|
|GDP per capita, current US$||4078|
|Poverty rate ($2.5/day 2005PPP terms)||2.9|
|Life Expectancy at birth, years||76.1|
The political system in Bosnia and Herzegovina (BiH) is complex, reflecting the provisions of the country’s constitution established to end ethnic conflict and subsequent changes to the system introduced under the guidance of the international community through the Office of the High Representative.
In July 2015, the Council of Ministers of Bosnia and Herzegovina, Government of Republika Srpska, and Government of the Federation of Bosnia and Herzegovina adopted a joint program of structural reforms – known as the Reform Agenda. This Reform Agenda presents a rare window of opportunity for structural reform in BiH, underpinned by a broad national consensus on the country’s critical challenges and priorities and the sustained support of key development partners.
The key economic challenge faced by Bosnia and Herzegovina is the imbalance of the country’s economic model: public policies and incentives are skewed towards the public sector rather than the private sector; consumption rather than investment; and imports rather than exports. BiH needs to unleash the potential of the private sector while at the same time reducing the footprint of the very large and inefficient public sector.
There needs to be a shift towards a business environment that is conducive to private investment that supports both vibrant small- and medium-sized enterprises and the growth of larger companies, that facilitates export performance and productivity improvements, and which can deliver the much-needed private sector employment generation. At the same time as addressing these imbalances in the country’s economic model there is also a need to ensure the sustainability and inclusiveness of future growth.