The Republic of Srpska is becoming a very attractive market for foreign investors, owing to the efforts made by the authorities at the Republic and local levels to create a favorable business environment.
Foreign direct investment (FDI) in the Republic of Srpska in 2007 grew significantly compared to the past period. Compared to 2006, when foreign direct investment amounted to 68 million euros, in 2007 they grew 14 times and amounted to 998 million euros. The lion’s share of that amount, 644 million euros or 64.7%, is related to the privatization of Telecom of the Republic of Srpska by Telecom Serbia.
The level of FDI per capita in the Republic of Srpska in 2007 amounted to 671 euros.
During the coming period, an inflow of over 800 million euros in FDI is expected (privatization of Oil Refinery Brod, Oil Refinery Modrica, Petrol Banja Luka, construction of thermal power plant Stanari).
Facilities for foreign investors
- They enjoy national treatment, meaning that they have equal rights and obligations as nationals:
- They are free to acquire and dispose of movable and immovable property,
- They are exempted from the payment of customs duties on equipment representing investment by foreign person,
- They are free to transfer their profits abroad.
Foreign Investor Support Fund
Bosnia and Herzegovina provides financial support to foreign investors for projects in the fields of production, research and development, by means of the Foreign Investor Support Fund. The resources of this Fund are approved depending on the volume of investment, number of jobs created, investment in underdeveloped areas, environmental requirements, and share of export in total sales.
Foreign Investment Insurance
Foreign investments in Bosnia and Herzegovina may be insured against transfer restrictions, expropriation, war and civil disorder, and contract breach, by means of the European Union Investment Guarantee Fund, managed by the Multilateral Investment Guarantee Agency (MIGA), member of the World Bank Group.
It is also possible to receive support from the US Overseas Private Investment Corporation (OPIC), for investor insurance against political risk.
In order to promote and protect investments, Bosnia and Herzegovina has signed agreements with the following countries:
Investment Improvement and Protection Agreements
- USA
- United Kingdom
- Sweden
- Netherlands
- Macedonia
- Spain
- Switzerland
- Serbia
- Montenegro
- Pakistan
- Finland
- Lithuania
- Austria
- Ukraine
- Belgium
- Luxembourg
- Denmark
- Belarus
- Iran
- Egypt
- Croatia
- Germany
- Romania
- Portugal
- Slovakia
- Hungary
- Slovenia
- Turkey
- Check Republic
- Jordan
- Qatar
- Greece
- Kuwait
- China
- India
- Italy
- France
- Moldova
- Malaysia
- Albania
Agreements with Libya and United Arab Emirates are also going to be signed soon.