Bosnia’s economy will return to a sluggish 0.5% GDP growth in 2013 after contracting 0.7% the year before, the World Bank said in a June 2013 report on South-East Europe. Bosnia’s government unanimously endorsed a draft legislation allowing ID registrations in the country, following weeks of protest over the governing politicians’ failure to agree on a new legislation on citizens' identity numbers. The IMF’s executive board has completed the third review of the country’s two-year stand-by arrangement, enabling a disbursement of some EUR 38.9mn.

On the economic front, consumer prices in the country edged up 0.4% year on year in May, the same as the month before. The industrial output rose 6.5% year on year in May, weakening from the 10.2% increase in April. The jobless rate retreated to 44.5% at end-April from 46.1% at end-March, according to the country’s labour and employment agency.

The foreign trade gap shrank 12.7% year on year to EUR 1.3bn in January-May, due to a strong exports increase and falling imports. Bosnia’s Q1 current account deficit narrowed 32.5% year on year to EUR 197mn, on the back of narrowing foreign trade gap and better services income, mainly FDI.

The share of non-performing loans in total loans increased to 13.8% in Q1 from 12.1% a year earlier, central bank data showed. Bosnia’s commercial bank assets rose 2.7% year on year to EUR 11.5bn at end-May, easing from a 3.2% rise the month before. Domestic loans grew 3.1% year on year to EUR 8.3bn at end-May, after increasing 3.6% in April, due to slower corporate and household lending growth.
So far in 2013, Bosnia’s loan growth has been largely driven by corporate lending (mainly long-term loans in local currency). Commercial bank deposits increased 4.5% year on year to EUR 6.9b at end-May, easing from the 4.7% rise the month before.

The central bank’s gross foreign reserves climbed 11.7% year on year to EUR 3.3bn at end-May, after a 7.5% rise the month before, due to higher investments in foreign securities.