Foreign Direct Investments In BH

According to the Central Bank of Bosnia and Herzegovina (CBBH) data, the inflow of foreign direct investments (FDI) in 2010 amounted to KM 339.7 million, or 1.4% GDP, which is approximately the same level as in 2009. These amounts suggest that the investments inflow has continued, but the effects of recession on FDI have not been yet annulled. Also, the BH has not been able to withdraw the investments as at the prior recession level.

In the structure of FDI, KM 36.7 million is the equity, KM 245.1 million is other capital, and the negative retained earnings amounted to KM -269, 2 million, which is caused by consolidated losses in companies with the direct investments, and this happens for the second consecutive year.

In terms of geographical distribution of investments inflow, a significant change is recorded compared to previous years, because most investments were from Switzerland (KM 98 million), Germany (KM 54 million) and Turkey (KM 37 million). At the same time, decrease of investments from some countries which were major investors in previous years, was recorded in 2010. These countries are Slovenia (KM -41 million), Russia (KM -25 million) and Austria (KM -7 million).

The majority of investment is realized in manufacturing industry, especially in production of base metals, where KM 176 million was invested. When it comes to the areas that have attracted the most investments in recent years, the trend is changed, so retail trade area recorded the decrease by KM 32 million, and financial intermediation area recorded decrease by KM 33 million.

Total FDI balance by the end of 2010 amounted to KM 9.54 billion, and the largest amount still refers to Austria (KM 1.88 billion) and Serbia (KM 1.72 billion).

Herein we inform the users of statistics that the new methodology is applied for the statistical treatment of the FDI, which is harmonized with new Manuals for the Balance of Payments Statistics (BPM6). The main change is related to the treatment of the inter companies lending for financial institutions, which is no longer observed as a direct investment, and the changes are made regarding the time of dividends book entry and regarding the treatment of companies with the same foreign investor. In line with above, revisions of the FDI flows and FDI balances were carried out for the previous years, too.

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