The novel coronavirus that emerged in China last year and swiftly spread to other countries is already affecting the economy of Bosnia and Herzegovina, according to economic analyst Admir Cavalic.

“Coronavirus brings a negative effect on the global economy, and consequently the one of Bosnia and Herzegovina. If we rule out a general drop in economic activities, air traffic collapse and a series of other (in)direct consequences, maybe the most serious threats on economies is the one concerning the blockage of supply chain businesses. This is exactly what some of the local businesses that relied on import from China relied on,” he said.

It is very likely, according to the expert, that the coronavirus outbreak will lead to reduced growth prognosis for Bosnia.

“Consequently, this reduces the potential of Bosnian economy, in terms of growth, export, employment etc. In line with that, the coronavirus is likely to reduce the economic growth prognosis for our country. Of course, this applies to China and the rest of the world as well,” he explained, adding that this does not necessarily mean a recession.

As for Bosnia's growth viewed regardless of the coronavirus consequences, Cavalic said there was no much room for optimism.

Bosnia's economy greatly depends on developments in the European Union and the world, he said.

“Essential problem of our own and regional economies, in accordance with the World Bank reports, is low productivity, which conditions the inability to achieve higher economic growth rates that are needed to meet satisfactory living standards. It is important to say that domestic economy is open, fragile and absolutely dependant on the EU and global movements, which doesn't leave too much room for interventions that might result in a significant effect,” he added.