The International Monetary Fund (IMF) Resident Representative in Bosnia and Herzegovina (BiH), Andreas Tudyk, announced in Sarajevo that BiH's economic growth is projected to reach 2.5% this year and stabilize at around 3% in the medium term. The growth is driven by rising private consumption, wages, and modest investment increases, though recent flood-related developments may prompt a downward revision.

Presenting the IMF’s “Regional Economic Outlook for Europe,” Tudyk highlighted risks such as Europe's economic slowdown, political tensions, and expansionary fiscal policies that could threaten fiscal stability. Inflation in BiH has dropped from 17.4% in October 2022 to 0.8%, with an average of 2.2% expected in 2024, stabilizing at 2% by 2025.

Tudyk noted fiscal challenges, with rising social spending and public sector wages pushing the fiscal deficit to a projected 2.2% in 2024 and 2025. He stressed the need for fiscal reforms, including spending cuts and rebuilding fiscal buffers, while maintaining the currency board and monitoring monetary risks.

Goran Mirascic, economic advisor to the FBiH Prime Minister, emphasized that BiH remains moderately indebted, with most borrowing tied to infrastructure projects. He noted BiH's economic dependence on its major trading partners, including Germany, Italy, Austria, and Hungary, where stagnation and limited growth have impacted industrial production and export demand.

Despite these challenges, Mirascic expects BiH’s economy to grow by 2.5% to 2.8% this year.