Balance of Payments and Foreign Investments in BH for the First Six Months of 2005

According to the data of the Central Bank of Bosnia and Herzegovina, the current account deficit of the Balance of Payments of BH is KM 1, 327 billion for the first six months of 2005 and it has actually remained at the same level at which it was in the first six months of 2004.

Observed by quarters, the current account deficit in the first quarter was KM 475 million, which is by KM 28 million or by 6, 3% higher than in the first quarter of the previous year, while the current account deficit in the second quarter was KM 852 million, which is almost exactly the same like in the second quarter of 2004.

The current account deficit in the first half of 2005 was, like before, caused by the negative balance of goods exchange (KM 3, 37 billion), even though that the value of exports in the amount of KM one billion, recorded in the second quarter, was largest ever recorded in one quarter. The account of services in the current account of BH has recorded the slight growth (KM 249 million) as the result of the increased inflow from tourism and inflow from construction works abroad and communication services.

The observed period is also characterized by the total drawing of loans abroad in the amount of KM 235 million, so, with the commercial banks, the total new debt was KM 319 million.

Despite the stated deficit of the current account, the increase of foreign reserves was recorded in the CBBH, which, during the first six months of this year increased by KM 136 million.

CBBH Statistical data on foreign investments show that during the first six months of this year direct foreign investments amount to KM 256 million, out of which, KM 117 million in the first and KM 139 million in the second quarter of 2005. The direct foreign investments in the first half of 2005 are by KM 89 million, that is, by 26% lower than in the same period of previous year.

Also noticeable is large concentration of new investments into banks (53%) and production (41%), while all other activities take only 6% of the total amount of the direct foreign investments.

The largest net inflow of the direct foreign investments is coming from Austria in the amount of KM 117 million, followed by Slovenia with KM 34 million and Germany with KM 19 million. These three countries participate with the 66, 4% in the total direct foreign investments over the observed period.

The CBBH performs quarterly survey by collecting the data directly from the companies and banks on foreign investments in accordance with the international methodology. This way it is possible to collect the data on the real volume and value of foreign investments.

More detailed data on the Balance of Payments and foreign investments in BH with the review of the used methodology can be found on the CBBH web page (http://www.cbbh.ba/en/statistics.html).