 Investments |
 The investment climate |
The privatization in state-owned enterprises is an ongoing process, giving an incentive to investments. In post-war Bosnia and Herzegovina, there are obstacles to such operation as a weak economy, previously complex bureaucratic registration procedures, and generally, inefficient judicial system. International Agency for Promotion of Investments, in co-operation with the international institutions such as the OHR, is working hard to overcome these obstacles. In spite of the difficulties, the interest of foreign investors has increased. The positive indicators relate to the beginning of the privatization of the state owned companies and stable currency with a very low inflation rate. Furthermore, the hope comes from the Stability Pact for South East Europe, which is supported by the international community. The recommended elimination of customs barriers between the Balkans countries is inspiring as well, giving Bosnia and Herzegovina a chance to become a very attractive regional export base, taking into account its very low labour price.
Since direct foreign investments are relatively low in relation to the total economic capacities of the country, the State authorities, at all levels, have been trying to create better conditions for investments. In that sense, it is estimated that in the privatization of the state-owned enterprises the major block of shares or major part in, so called, strategic enterprises are to be sold trough tenders primarily to foreign strategic investors. The aim is to ensure the additional investments, particularly in industrial sector, and strengthen export capacities of domestic enterprises. Simultaneously, reconstructing of enterprises aimed to make them capable for efficient and profitable business operations is likely to be done.
The most attractive sectors for foreign investment are wood production (production of furniture); production of raw materials for the cellulose industry; textiles; food and beverages (incl. tobacco production); tourism, particularly hotel business; cement industry; metal processing; and software development.
| Wood production |
This industry has a long tradition in B&H and it is known for its export orientation. B&H has almost 300 million cubic meters of forest (53% of the total territory), of which about one third is deciduous (beech and oak) and the rest coniferous. B&H has also production capacities of raw materials and products in the cellulose industry (pulp, craft paper, tissue paper, paper confectionary, cellophane).
| Textile |
Before the war, B&H clothes and footwear producers used to export their products to all continents: cotton yarn, fabric textile, woven, confection, row and processed leather and leather products.
| | Food and beverage(incl. Tobacco prod.) |
There are here high potential for fruit (plumb, apple, berrylike fruit) and vegetable growing, grape-wine in Herzegovina, and wheat, corn, sugarcane along the river Sava. The tobacco industry is also developed in B&H.
| Construction materials (cement) |
B&H has 22 construction material manufacturers, out of which the largest are the Kakanj and Lukavac cement plants. They cover 35% of the country's cement consumption and produces composite cements.
| Metal Processing |
The most valuable nonferrous resource in B&H is bauxite, with estimated reserves of 41 million tones.
Aluminium plants are: Birac Zvornik, Aluminijum Mostar.
| Tourism |
B&H is a fine winter-sports destination. The country can provide explorers, exclusivity tourists and nature lovers with unique travel experience in an "unexplored destination" (see Tourism)
| Telecommunications |
Before the war, B&H had a relatively modern telecommunications network. There were about 750,000 subscribers or 15,5 lines per inhabitant. They were seriously damaged during the war. We find three major operators in B&H: BH Telecom with 409.000 fixed line subscribers and 110.000 GSM subscribers, HPT Mostar with 110.000 fixed line subscribers and Telecom Srpske which has 266.000 fixed line subscribers and 75.000 GSM subscribers. The three fixed line operators do not compete with one another and have monopolies in their set area.
| Energy |
There are a great numbers of rivers in B&H suitable for the constructions of hydropower plants. There are 13 hydropower plants in B&H with a total capacity of 2,034 MW. There are also 13 thermal power plants with 1,957 MW of installed capacity This makes B&H an important producer and exporter of electric energy in the region.
| Major municipal infrastructure projects |
They have been initiated in the reconstruction of the gas system; heating system, water, sanitation and solid waste, water system and electric power network. |
