Flag of Bosnia and Herzegovina

Bosnia and Herzegovina country brief

Overview

Bosnia and Herzegovina (BiH) lies at the heart of the Balkans.  It shares its northern, western and southern borders with the Republic of Croatia and borders Montenegro and Serbia to the east. With a territory of 51,129 square kilometres, Bosnia and Herzegovina is slightly smaller than Tasmania.  Its population of 3.9 million (2013) comprises three main ethnic groups - Bosniaks, Croats and Serbs. The capital is Sarajevo.

Bilateral relations

Australia recognised Bosnia and Herzegovina in May 1992, soon after independence.  Bosnia and Herzegovina established resident diplomatic representation in Australia in late 1994 under a Chargé d'Affaires, and the first Ambassador presented credentials in 2000.  The first Australian Ambassador to Bosnia and Herzegovina, resident in Vienna, presented credentials in Sarajevo in November 1995.  Australia opened an Honorary Consulate in Sarajevo in January 2005.

Australia has a continuing interest in efforts to maintain peace and build prosperity in Bosnia and Herzegovina. Since 1993-94, Australia has contributed humanitarian assistance to the region, including to Bosnia and Herzegovina.  As a member of the United Nations Security Council, Australia seeks to make a useful contribution to reconciliation and stability in Bosnia and Herzegovina.

Bilateral trade and investment

Bilateral trade with Bosnia and Herzegovina is modest, with a total two-way merchandise trade of $4.6 million in 2013. Australian exports in 2013 were worth approximately $1 million while imports amounted to almost $3.6 million. Principal exports include meat (excluding beef) and computer parts and accessories. The main imports from Bosnia and Herzegovina were footwear, clothing and furniture.

High Level Visits

The then Minister of Foreign Affairs of Bosnia and Herzegovina, HE Mr Sven Alkalaj, visited Australia as a Guest of Government in February 2011 and met with senior members of the then Government.  

An Australian parliamentary delegation led by the then President of the Senate, Senator John Hogg, visited Bosnia and Herzegovina in October 2008. A return visit by a parliamentary delegation from Bosnia and Herzegovina took place in October 2009.

Political overview

Previously a constituent republic of the Socialist Federal Republic of Yugoslavia, Bosnia and Herzegovina proclaimed independence in March 1992. This triggered a three-year conflict during which the three ethnic groups were at war with each other in varying alliances. The Dayton Peace Agreement, signed on 21 November 1995, put an official end to the fighting.

The Dayton Agreement endorsed the principle that Bosnia and Herzegovina would remain a single state within existing borders. It divided the country into two entities: the Federation of Bosnia and Herzegovina (the Federation), populated mainly by Bosniaks and Croats and comprising 51 per cent of the country; and the Republika Srpska (RS), with a predominantly Serb population, holding 49 per cent of the territory. Dayton set up a federal government with the following elements:

The Federation and the Republika Srpska both have their own parliamentary assemblies.

The Dayton Agreement also established the Office of the High Representative (OHR) as the highest authority with powers to impose legislation and, where appropriate, remove officials.  The High Representative holds wide-ranging powers to impose laws and binding decisions in cases where the Government is unable to agree, or where it is deemed to be in the interest of the economic and political development of the country.

The most recent parliamentary and presidential elections in Bosnia and Herzegovina took place on 3 October 2010. The results for the Tripartite Presidency were as follows: HE Mr Željko Komšić (Croat) of the Social Democratic Party with 60.61%; HE Mr Nebojša Radmanović (Serb) of the Alliance of Independent Social Democrats with 48.92%; and HE Mr Bakir Izetbegović (Bosniak) of the Party for Democratic Action with 34.86%. Chairmanship of the Presidency rotates every eight months.

After 16 months of negotiations, Bosnia and Herzegovina’s parliament confirmed Mr Vjekoslav Bevanda (Croat) as Chair of the Council of Ministers and the country’s new Prime Minister on 12 January 2012, bringing to an end the country’s protracted political crisis.  On 10 February 2012, the new government was officially formed. Mr Zlatko Lagumdžija (Bosniak) was confirmed as Minister of Foreign Affairs and Deputy Prime Minister. Mr Boris Tucic  (Serb) was appointed Minister of Foreign Trade and Economic Relations on 11 December 2013.

International presence in Bosnia and Herzegovina

A NATO-led Stabilisation Force (SFOR) had the task of maintaining peace on the ground in Bosnia and Herzegovina from the end of the war in 1995, when troops totalled 60,000, to early December 2004. As the situation in Bosnia and Herzegovina improved, the focus of its activities shifted from peacekeeping to crime prevention, principally targeting the trafficking of people, weapons and drugs. SFOR was replaced in late 2004 when the Council of the European Union agreed to undertake a military operation in Bosnia and Herzegovina under the framework of the European Security and Defence Policy. EUFOR aims to build a stable, viable and multi-ethnic country which cooperates peacefully with its neighbours and progresses towards EU membership. NATO maintains a small headquarters in Sarajevo with the task of providing advice on defence reform and certain operational tasks such as counter terrorism, supporting the International Criminal Tribunal for the Former Yugoslavia (ICTY) and intelligence sharing with the EU.

Foreign Policy

In 2006, Bosnia and Herzegovina joined the Partnership for Peace program, an important step towards joining NATO.

In February 2008, Bosnia and Herzegovina became a member of the Regional Cooperation Council (RCC). The RCC is intended to sustain focused regional cooperation in South East Europe through a regionally owned and led framework that also supports European and Euro-Atlantic integration. Its headquarters are in Sarajevo.

Bosnia and Herzegovina was accepted as a member of the Council of Europe in April 2002, a significant achievement in terms of Bosnia and Herzegovina's desire to be part of European integration.

In June 2008, Bosnia and Herzegovina signed a Stabilisation and Association Agreement (SAA) with the EU. Bosnia and Herzegovina has not yet formally applied for EU membership, but remains a potential candidate country. Agreement on constitutional amendments to implement the European Court of Human Rights ruling in the Sejdic-Finci case remains a priority before Bosnia and Herzegovina can progress negotiations.

Economic overview

The economy of Bosnia and Herzegovina is still largely in transition from a centrally planned to a market economy. Successive governments have pursued structural and market reforms since the conflict ended in the mid-1990s, but privatisation has been slow and government spending remains high at roughly 50% of GDP.  The coordination of economic policy is made considerably more difficult by the highly decentralised nature of the government and its ethnically-based power-sharing arrangement.  Despite these difficulties, Bosnia and Herzegovina enjoyed sustained economic growth between 2003 and 2008.

The global financial crisis caused the economy to contract in 2009 and growth has been slow since then (1.2 per cent in 2013).  According to Eurostat, Bosnia and Herzegovina’s per capita GDP is well below the average for emerging and developing European States.  Ongoing problems include high poverty and unemployment rates.  Official figures listed 27.5% unemployment in 2013, but actual unemployment may be closer to 18- 22% when unofficial employment is factored into the statistics.

In September 2007, Bosnia and Herzegovina became a full member of the Central European Free Trade Agreement.  Most of Bosnia and Herzegovina’s trade is with the EU, and the country benefits from autonomous trade measures introduced by the EU in September 2000 which allow more than 95% of all exports (including agricultural products) to enter the EU duty and quota free.  Major exports include metals, clothing, and wood products.  Principal imports include machinery and equipment, chemicals, fuels, and foodstuffs.