AGP Executive Report

Financial Security: Bosnia and Herzegovina’s Central Bank signed an anti-counterfeiting agreement with the European Central Bank, aimed at protecting euro cash transactions and reinforcing confidence in the currency. EU Integration: The European Commission’s latest report says BiH’s accession process is stagnating, with economic convergence among the reforms shaping progress. Investment & Industry: The EBRD is providing a €15 million loan to expand automotive production in BiH. Federation industrial product sales reached BAM 14.8 billion, while Sarajevo Brewery reported a strong export increase but lower net profits. Economic Pressures: Reports point to a sharp rise in businesses with blocked accounts, heavy reliance on food imports and mounting losses at power utilities, with mines nearing collapse. Bank deposits of up to BAM 100,000 are now insured.

EU Accession: The European Commission says Bosnia and Herzegovina is lagging on EU reforms, while Montenegro could complete accession talks this year and join the bloc in 2028. The report links reform progress to economic convergence, raising the stakes for BiH’s investment climate. Investment: The EBRD is providing a €15 million loan to expand automotive production in Bosnia and Herzegovina. Sarajevo Brewery also reported a strong export surge, though net profits fell. Business Conditions: Industrial product sales in the Federation reached BAM 14.8 billion, but the number of businesses with blocked accounts has risen sharply. Trade and Energy: Bosnia imports about 80% of its food as domestic production falls short of market needs; mines are nearing collapse and power utilities are running losses. Finance and Travel: Deposits of up to BAM 100,000 are now insured, while Federation airports handled more than one million passengers in three months and generated BAM 7.91 million in revenue.

Banking: Raiffeisen expects to retain Addiko’s businesses in Bosnia and Herzegovina after Serbia revoked Alta Bank’s licence, abandoning plans to sell the regional units to Alta. Republika Srpska’s banking regulator said the Serbian case would not affect local operations. Investment: The EBRD is providing a €15 million loan to expand automotive production in Bosnia and Herzegovina. Economic pressures: The number of business entities with blocked accounts has risen sharply, while domestic producers meet only a fraction of food demand, leaving the country reliant on imports for 80% of its food. Industry: Industrial product sales in the Federation of BiH reached 14.8 billion BAM; Sarajevo Brewery reported a strong export increase, though net profits fell. Deposits in BiH are now insured up to 100,000 BAM.

Green Investment: EBRD and Green Climate Fund financing for greener cities has doubled to €174 million across 15 countries, including Bosnia and Herzegovina. Banking: Raiffeisen expects to retain Addiko’s Bosnia operations after Serbia revoked Alta Banka’s licence; Addiko says the move has no impact on clients, funds or services. Manufacturing: The EBRD is lending Selzer Automotive Bosnia €15 million to expand production of electric- and hybrid-vehicle components, with at least 100 jobs and training opportunities planned. Business Conditions: BiH recorded 109,545 blocked business accounts, up 414 in a month; 59,799 companies had at least one blocked account. Food Security: Imports meet nearly 80% of domestic food demand, with more than BAM 720 million spent on food and livestock imports in the first half of the year. Energy Costs: An energy consultant warns prices could rise again from January, as reliance on imported oil and gas leaves households exposed to global market shocks. Corporate Results: Sarajevo Brewery’s revenue rose 12.6% to BAM 23.89 million, but net profit fell 66% to BAM 701,000 as costs increased.

Banking: Raiffeisen expects to retain Addiko’s Bosnian operations after Serbia revoked Alta Banka’s licence; Addiko says the move has not affected its services. Business Climate: BiH recorded 109,545 blocked business accounts, up 414 from the previous month, with 59,799 companies affected. Green Investment: EBRD and the Green Climate Fund doubled concessional financing for their cities programme to €174 million, available to municipalities in BiH and other countries. Manufacturing: EBRD is lending Selzer Automotive Bosnia €15 million to expand production of electric- and hybrid-vehicle components, with at least 100 jobs planned. Energy: Experts warn that struggling mines and power utilities face mounting losses, while import dependence leaves households exposed to possible price increases from January. Economic Indicators: FBiH industrial product sales rose 3.3% in 2025 to 14.8 billion BAM; Sarajevo Brewery’s revenue grew 12.6%, but net profit fell 66%. Depositors: BiH’s insured deposit limit has increased to 100,000 BAM per depositor, per bank.

Manufacturing Investment: The EBRD is lending Selzer Automotive Bosnia €15 million to expand production of electric- and hybrid-vehicle components, with plans to create at least 100 jobs and provide vocational training. Business Results: Sarajevo Brewery’s customer revenue rose 12.6% to 23.89 million BAM, but net profit fell 66% to about 701,000 BAM as expenses grew faster. Industry: Industrial product sales in the Federation of BiH reached 14.8 billion BAM in 2025, up 3.3%; foreign markets accounted for 49% of sales. Energy Pressures: Experts warn that ageing mines and power plants, mounting losses and rising reliance on electricity imports are deepening risks for the sector. Banking: BiH’s insured deposit limit rose from 70,000 to 100,000 BAM per depositor, per bank, from November 1.

Automotive Investment: EBRD is lending €15 million to Selzer Automotive Bosnia to expand production, including electric- and hybrid-vehicle components. The project aims to add at least 100 jobs and provide training. Corporate Results: Sarajevo Brewery revenue rose 12.6% to BAM 23.89 million, but expenses climbed faster and net profit fell 66% to BAM 701,000, despite a surge in exports. Industry & Trade: FBiH industrial sales reached BAM 14.8 billion in 2025, up 3.3%; foreign markets accounted for 49% of the total. Energy: Experts warn that mines and power utilities face mounting losses as coal output hits lows and electricity imports exceed exports. Banking: Deposit insurance coverage increased from BAM 70,000 to BAM 100,000 per depositor per bank, effective November 1. Transport: FBiH airports handled 2.33 million passengers in the first nine months, up 12% year on year, while cargo volumes fell 10.1%.

Industry: Industrial product sales in the Federation of Bosnia and Herzegovina rose 3.3% in 2025 to BAM 14.8 billion. Foreign markets accounted for nearly half of sales, with manufacturing the largest contributor. Air Travel: FBiH airports handled 1.06 million passengers in the third quarter, up 8.5% year on year; passenger numbers for January–September climbed 12%, while cargo volumes fell. Energy: BiH’s power sector faces mounting strain, with coal production at a record low, mines in crisis and utilities reporting losses. Experts warn electricity imports now exceed exports. Infrastructure: A 20-kilometre section of the Zenica North–Golubinja highway on Corridor Vc has opened, advancing a key transport link through the country.

Transport Costs: Bosnia and Herzegovina’s transport firms say drivers and companies are leaving over Schengen stay limits, threatening higher freight and living costs. A Croatian visa programme could ease pressure on the sector by 10–15%. Infrastructure: A new 20-kilometre stretch of Corridor Vc, built by Azvirt and Hering, has opened, advancing a key link through the country. EU Integration: A Sarajevo workshop focused on bringing BiH’s roaming rules into line with EU law, a step toward joining the “Roam Like at Home” area. Business Results: M:tel BH reported year-to-date profits up 50%, while Tuzla Airport’s passenger numbers rose and revenues reached 7.91 million BAM. Public Funding: Bosnia’s Council of Ministers approved a salary base and EBRD funding. Sarajevo Services: The capital is facing water-pressure cuts, while officials have yet to set out a contingency plan if supplies worsen.

Corridor Vc: A new 20-kilometre Zenica North–Golubinja highway section has opened, built by Azvirt and BiH’s Hering. The route includes technically demanding bridges, tunnels and viaducts. EU Roaming: A Sarajevo workshop is helping prepare BiH’s laws and regulators for alignment with EU roaming rules, a step toward “Roam Like at Home.” Business Results: M:tel BH reported year-to-date profits up 50%, while Tuzla Airport recorded passenger growth and revenues of 7.91 million BAM. Transport Costs: Firms warn that drivers and transport companies are leaving BiH over Schengen stay limits. A continued exodus could raise freight and living costs; a Croatian visa scheme may offer some relief. Competitiveness: An EU-supported OECD report says BiH needs stronger policies for small businesses, while high trade costs across the Western Balkans threaten jobs and exports.

Transport Costs: Communications Minister Edin Forto warned that companies and drivers leaving Bosnia and Herzegovina could push up freight and living costs. A Croatian visa scheme may ease pressure, but administrative delays remain. Sarajevo’s Water Supply: Night-time pressure cuts are already affecting parts of the city, while officials have yet to outline a drought contingency plan—raising concerns for residents and businesses alike. Telecoms: M:tel reported profits nearly 50% higher in the first nine months of 2026 and expects 2.5 million service users by year-end; it says it is ready to launch 5G once regulations allow. Regional Trade: The World Bank sees Western Balkans growth reaching 3.1% in 2026, but costly regulations, complex procedures and barriers to cross-border services threaten exports, jobs and business competitiveness.

Transport Costs: Minister Edin Forto warned that companies and drivers leaving Bosnia and Herzegovina could drive up freight and living costs. A Croatian visa scheme may ease pressure on the sector, but only by an estimated 10–15%. M:tel: The telecom operator reported nearly 50% higher profit in the first nine months of 2026 and expects 2.5 million users by year-end. It says it is ready to launch 5G once regulations allow. Growth and Trade: The World Bank forecasts 2.4% growth for BiH in 2026, below the Western Balkans average of 3.1%, and warns that red tape and other trade costs are holding back exports and jobs. Infrastructure: A newly completed 20-kilometre Corridor Vc section brings the total built length to 125 kilometres. Tuzla Airport: Passenger numbers rose 63.5% in 2025 to 338,481, while revenues reached 7.91 million BAM.

Corporate Earnings: M:tel BH says its profit rose nearly 50% in the first nine months of 2026. The telecom expects 2.5 million users by year-end and says it is ready to launch 5G once regulations allow. Trade and Growth: The World Bank forecasts Bosnia and Herzegovina’s economy to grow 2.4% this year, while costly procedures and cross-border restrictions continue to hold back Western Balkan businesses, exports and jobs. Transport Links: A 20-kilometre section between Zenica North and Golubinja is complete, bringing the built length of Corridor Vc to 125 kilometres. The Gradiška–Stara Gradiška crossing is also reopening, but only passenger vehicles, buses and empty trucks can use it—not commercial freight. Tuzla Airport: Passenger numbers reached 338,481 in 2025, up 63.5% year on year, and flights rose 35.5%; subsidies and airline partnerships supported the recovery.

Infrastructure: Bosnia and Herzegovina has completed a roughly 20-kilometre section of Corridor Vc between Zenica North and Golubinja, bringing the motorway’s completed length to 125 kilometres. Development Finance: The Council of Ministers approved an increase in BiH’s capital in international financial institutions, adding BAM 12.819 million over three years, including an initial BAM 500,000 payment, to support development projects in roads and energy. Growth and Trade: The World Bank forecasts Western Balkans growth of 3.1% in 2026 and 3.4% in 2027, but expects BiH to grow by 2.4% this year. It says reducing border and domestic regulatory costs could help businesses compete, export and create jobs. Energy: FBiH produced 534 GWh of electricity in September, up from 463 GWh a year earlier; thermal plants generated 59.9% of the total.

Infrastructure: A newly completed 20-kilometre section between Zenica North and Golubinja brings the constructed length of Corridor Vc to 125 kilometres, including major tunnels, bridges and viaducts. Finance: Bosnia and Herzegovina’s Council of Ministers approved an increase in the country’s capital contribution to the EBRD, worth 12.819 million KM over three years, with an initial payment of 500,000 KM. Regional Outlook: The World Bank projects Western Balkans growth will rise to 3.1% in 2026, but says lower trade costs and more predictable rules are needed to help businesses compete and create jobs. Business: TempraMed signed an exclusive distribution agreement covering Bosnia and Herzegovina, Croatia and Serbia; minimum purchases could total about $550,000 over three years, depending on sales and approvals. Energy: FBiH gross electricity production rose to 534 GWh in September, up from 463 GWh a year earlier, while brown coal and lignite output fell.

Regional Growth: The World Bank expects Western Balkans growth to rise from 2.6% in 2025 to 3.1% in 2026, but says high trade costs and domestic red tape are holding back business competitiveness and job creation. Energy: Gross electricity production in the Federation of BiH reached 534 GWh in September, up from 463 GWh a year earlier; meanwhile, a report on the Buk Bijela hydropower project questions opaque ownership changes paid for with public funds. Business: Canadian firm TempraMed signed an exclusive distribution deal covering Bosnia and Herzegovina, Croatia and Serbia, with minimum product purchases estimated at about US$550,000 over three years, depending on product mix and performance. Transport: BiH’s transport businesses warn that Schengen restrictions on drivers are hurting not only carriers but also freight forwarders, repair shops, insurers and other local suppliers.