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Bosnia and Herzegovina

Bosnia and Herzegovina is a small country located in the centre of the Balkan Peninsula. It is characterized by a complex and multi-layered administrative division. The current form of the state was established on the basis of the so-called Dayton Agreement signed in 1995. The most promising areas for exporters and investors are namely technologies for environmental protection (local and regional waste water purification plants, dump management), power engineering, traffic and city infrastructure and high-tech.

SWOT Analysis


Strengths

  • advantageous geographical location reachable from the Czech Republic within one day
  • mutual historical and human closeness, a long-term export tradition, familiarity with the Bosnian-Herzegovinian market, familiarity with needs of local partners
  • high rate of mutual relations on all levels
  • experience of Czech enterprises with the local market

Weaknesses

  • strong political instability with a tendency to deepen
  • complicated administrative multileveled state structure
  • persisting prejudices to market conditions, some previous negative business experience
  • heavy bureaucratic administration system connected with massive corruption
  • almost no or slow privatization of big state-owned enterprises, primarily in the area of transport infrastructure
  • stagnation of industrial production as well as of economic development generally
  • substantial differences in the development of particular regions
  • relatively poorly developed private sector (low number of prospering small and medium-sized enterprises)
  • rather extensive degree of centralization and state or entity monopoly in several economic areas (transport infrastructure, water management)

Opportunities

  • privatization process of many large state-owned enterprises has not started yet and/or has not been finished, which brings opportunities for Czech investors
  • owing to the state monopoly in a large number of branches, intense competition has only started developing
  • most international companies are still limited by a certain concern to invest in the region, which increases opportunities for Czech enterprises
  • as a consequence of political problems, the past twenty years have been characterized by minimum investment in economy, which causes a need of accelerated investment activities
  • there are realistic prerequisites for increased consumption of the public and private sectors in the near future
  • considerable opportunities for Czech enterprises are seen mainly in the areas of railway, road, city and tourist infrastructures
  • necessary improvement of protection of long-time neglected environment will require significant investment in this area
  • opportunity to use cooperation of municipalities and regions for intensification of economic relations
  • opportunity for Czech entrepreneurial entities to participate in projects funded by the EU

Threats

  • political instability
  • not yet quite standard market economic environment
  • overall entrepreneurial climate is not fully standard; however, only improvement can be expected
  • privatization of state-owned enterprises lacks clarity and concept
  • persisting intransparency in placing and assessing government contracts
  • changes in the state administration as well as municipal authorities cause frequent cases of cancellations or modifications of existing contracts or cancellations of planned or already realized projects

Source: http://www.businessinfo.cz