The European Commission (EC) warned the deadlock in the ongoing talks with Bosnia on the adaptation of its bilateral trade regime following Croatia’s accession to the European Union (EU) might result in disturbance of Bosnia’s trade with EU countries. At end-July the EU has suspended funding of EUR 4.5mn allocated for tourism and small and medium enterprises (SMEs) capacity building projects in Bosnia because of the local authorities' failure to agree on the required implementation actions.

On the economic front, consumer prices in the country quickened to 1% year on year in June after edging up 0.4% year on year the month before. The industrial output rose 5.1% year on year in June, slowing down from May's 6.5% year on year increase.

The unemployment rate fell to 27.5% in April 2013 from 28% a year earlier, according to preliminary results of this year's labour force survey carried out by the statistics office.

The foreign trade gap shrank 12.4% year on year to EUR 1.6bn in January-June 2013 on the back of rising energy and manufacturing exports and falling imports.
The unconsolidated profit of Bosnia's banking sector climbed 17% year on year to EUR 28mn in Q1 as expenditures contracted faster than revenue, the government's Directorate for Economic Planning (DEP) said.

Bosnia’s commercial banks assets rose 2.7% year on year to EUR 11.5bn at end-June, broadly unchanged compared to the month before. Domestic loans grew 2.9% year on year to EUR 8.2bn at end-June easing from a 3.1% year on year increase at end-May due to slower corporate lending. Commercial bank deposits increased 3.9% to EUR 6.9bn at end-June, cooling from the 4.5% rise the month before, due to both slower retail and corporate deposit collection.

The central bank gross foreign reserves rose 9.8% year on year to EUR 3.3bn at end-June, slowing from a 11.7% rise the month before.