The head of BiH’s central bank, Kemal Kozaric, told press that he expects to see GDP growth of 2.6 percent in 2015. Though lower than the IMF’s projection of 3 percent, Kozaric’s figure would be a significant improvement over the 0.7% growth experienced in 2014. Kozaric cited high unemployment and foreign debt as the major challenges to the economy.
“The biggest problem BiH faces is still high unemployment rate, which in 2014 stood at 27.5 percent, and in 2015 we expect it to be around 27 percent,” said Kozaric.
The external debt of Bosnia and Herzegovina, according to the Central Bank, hit 8.12 billion KM (4.15 billion Euros), which is 31 percent of GDP.
About 20 percent of this debt is in dollars, so it increased, but did not jeopardize servicing of external debt, said Kozaric adding that it is extremely important to maintain the fixed exchange rate of the KM and euro and prevent serious shocks in financial markets.
As a positive element Kozaric pointed to steady growth of foreign exchange reserves of the Central Bank, which are currently at a level of 7.8 billion KM (3.98 billion Euros), and at the end of 2014 they were 11 percent higher compared to 2013.
“We have the largest foreign reserves since the establishment of the Central Bank,” said Kozaric.
