Ahmet Egrlić: We expect the continuation of export growth in all sectors of the economy

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Ahmet Egrlić

The trends of B&H’s foreign trade exchange in the past year are more than encouraging. The volume of trade with foreign countries reached almost 30 billion BAM, while the coverage of imports by exports reached a record of 61.71 percent. Positive trends are quite visible, which is proof that the stumbled economy of B&H, slowly but surely, stands on its feet. We talked about positive developments in B&H economy and expectations in the upcoming period with Ahmet Egrlić, President of the Foreign Trade Chamber of Bosnia and Herzegovina.

How do you evaluate trends in B&H’s foreign trade in the past year?

– We can be satisfied with positive trends in the foreign trade of Bosnia and Herzegovina in 2017, whose total volume increased by 14.61 percent and its value amounts to 29,832,114,000 BAM. Exports amounted to 11,384,774,000 BAM, which is an increase of 16.54% over the previous year. Imports to B&H amounted to 18,447,340,000 BAM, which is 13.44% more than in the previous year, so that the foreign trade deficit amounted to 7.062.566.000 BAM. It is especially important to point out that Bosnia and Herzegovina achieved a record export coverage of import by 61.71 percent, which is 2.73 percent more than last year.

Positive results have been achieved in almost all-important branches of the economy. One of them is the wood industry and furniture production. How important is this sector?

– It is one of the most important branches of the economy since forests are our important resource. The fact that B&H exports the most to Germany, Austria, Italy, the Netherlands, Switzerland, Sweden and France, but also other countries, talks about the quality and potential of the BH wood industry. First, it is necessary to ensure safety in the supply of raw materials for processors of higher stages of wood processing. B&H has a good wood industry, with a long tradition and knowledge needed for the production of furniture, but export could be higher, especially if we take into account the interest of Germany and other European countries to import BH furniture, as well as the fact that we have good prerequisites that imply our own high quality wood raw material, qualified labor force, relatively modern technology and the necessary certificates for export to the market of the countries of the European Union. The wood industry recorded an increase in exports from year to year and surplus, and thus, in 2017, export growth was 9.2 percent higher than in 2016.

Positive information come from the metal sector. Every day we hear that BH companies are concluding new contracts for foreign customers, and new plants in the metal sector are opening?

– The metal sector in B&H, with basic metal production is traditionally the strongest and most successful industrial and export sector, which on average makes up about 32 percent of the country’s total exports. Last year, the total export of metal industry amounted to 3,961,614,433 BAM, which is 19.25 percent more than in 2016. The development of the metal processing sector in B&H is enabled due to the natural environment, or resources such as coal, iron ore, bauxite, human capital, and to a certain extent technological resources and knowledge from the pre-war period. The metal processing sector generates one-fourth of total production, and more than one third of exports. The sector has the potential to significantly increase sales, exports and employment. The current structure of the metal sector is characterized by a large number of small companies making products of higher added value. Such an environment provides great opportunities for foreign investors to integrate existing primary producers and launch production with a higher degree of added value. In addition, there are opportunities to use existing production facilities and capacity to increase production. Here I must especially highlight the excellent results achieved by the dedicated industry. Revitalization of production capacities, increased demand in the world market, as well as improved business conditions in the domestic market led to a significant increase in exports. Thus, in 2017, the industry realized exports of 193,864,023 BAM, which is 13,24 percent more than in 2016. According to the current trend, there are still good results ahead of the target industry.

Significant export potentials are also in the branches of the agro-industrial sector. How much B&H can offer in this field?

– B&H has great potential in the dairy industry. With export, which was about 23,000 tons higher than imports in 2017, BH dairy industry registered a record surplus in foreign trade (we exported 1.5 kilograms of dairy products per kilogram of imports), and in the following period we need to further improve the product palette. In this respect, more products and added value products (butter, cheese, fruit yoghurts, etc.) should be produced on the market, which entails the reduction of production and exports of UHT sterilized milk that has the lowest market value. B&H is definitely the leader when it comes to the poultry sector. In 2017, this sectoe exported 55.5 million BAM, which is five percent more than in 2016. Poultry companies deserve all praise and congratulations on the excellent structure of the exchange, because the poultry meat products, in total exports, account for 72 percent of the value. The jump in the number of markets, which rose from 10 to 21, confirms the competitiveness and quality of BH products from the poultry sector, which can now be bought on the markets of Europe, Asia and Australia. A positive trend was also noted in the fruit and vegetable sector. Despite a significant decline in the price of raspberry on the international market, the value of raspberry exports has increased by 28 percent compared to the previous year. It is important to point out that after five years of intensive growth, exports to the Russian Federation market increased from 1.2 million to 47.4 million BAM, making this market the leading export market in 2017. Therefore, it is of the utmost importance to solve the problem of banning the export of apples to the Russian Federation as soon as possible. Exports of medicinal herbs, forest fruits and honey also increased, which is 11 percent compared to 2016. So, trends are positive, data encouraging, there is a need to create agrarian policy and introduce instruments that will allow dynamic restructuring of the agricultural sector.

What are the plans of the Foreign Trade Chamber of Bosnia and Herzegovina this year?

– We will do our best to make our sectors and services more active and to continue building our image and trust. We plan to strengthen the organization of the performances of BH economies at international trade fairs and connecting business people at various B2B meetings that have proven to be very effective and through which a significant number of our companies have opened the way to significant markets. Through the work of associations this year, we will continue our activities in proposing the abolition of non-tariff barriers and improving the legal framework in which our members operate, with the aim of raising their competitiveness and facilitating business conditions.

At the beginning of the year, you opened the Foreign Trade Chamber Office in Turkey. How important step is this for establishing better cooperation between economies of the two countries?

– Considering the importance of the Turkish market, the Representation will play a major role in strengthening and intensifying mutual cooperation between B&H and Turkey, and it will help the businessmen of the two countries in quicker and easier establishment of contacts and contracting jobs, as well as in resolving the problems that have arisen. It is rightly expected that with the help of the Open Representative, BH businessmen will be able to market their products not only in Turkish but also in new markets. In addition to placement of products, the Representative Office is also tasked to promote the potential of Bosnia and Herzegovina and attract more investors from Turkey through direct contacts, as well as organizing meetings, presentations and roundtables in the best possible way.