SARAJEVO, Bosnia (November 6,2008) - Head of the World Bank Office in Bosnia Marco Mantovanelli expects the impact of the global crisis to be felt in the country through several transmission mechanisms.
First of all, loans will be harder to get, and their price will increase, both for the corporate and the retail sector. Secondly, the capital inflow from other private sources (FDI, for example) will be reduced for a while. Thirdly, demand for the products exported by the Bosnian companies is likely to decrease, and, finally, the trend of growing remittances will slow down, or even take the opposite direction,he said.
According to Mantovanelli, the Bosnian economy is not likely to go into recession, but GDP, employment and tax revenue growths from the previous years are almost certain not to continue in 2009.
Bosnia's political leaders and regulators in the financial sector need to develop measures for strengthening regulatory control, Mantovanelli recommends.