Principle of Econ Assignment
1.1 Economic background of Bosnia and Herzegovina (B&H)
Bosnia and Herzegovina was among the poorer areas of the old Yugoslav Federation and remains one of the poorer countries in Europe. Agriculture remains in private hands, but farms have been small and inefficient, and net food imports increased dramatically in the aftermath of the 1992-1995 war. Many industries are still overstaffed, reflecting the legacy of the centrally-planned economy, though limited privatization has improved efficiency in certain sectors.
Transition economy: Bosnia and Herzegovina sees the long-term goal of EU membership as a driver to further economic growth and development. Due to Bosnia and Herzegovina's strict currency board regime, inflation has remained relatively low. The banking sector has been fully reformed, with a significant inflow of foreign banks providing businesses with easier access to capital and a better range of banking services. Lending has slowed significantly since 2008. B&H's most immediate task remains economic revitalization. The country needs meaningful progress in structural reforms to strengthen the basis for sustained, private sector-led growth.
B&H's top economic priorities are: acceleration of EU integration; strengthening the fiscal system; public administration reform; World Trade Organization (WTO) membership. To date, work on these priorities has been inconsistent. The country has received a substantial amount of foreign assistance and will need to demonstrate its ability to implement its economic reform agenda in order to advance its stated goal of EU accession. In 2009, B&H undertook an International Monetary Fund (IMF) standby arrangement, necessitated by sharply increased social spending and a fiscal crisis precipitated by the global economic downturn.
1.2 Economic background of Indonesia
Indonesia has a market-based economy in which the government plays a significant role. There are 141 state-owned enterprises, and the
Bosnia and Herzegovina was among the poorer areas of the old Yugoslav Federation and remains one of the poorer countries in Europe. Agriculture remains in private hands, but farms have been small and inefficient, and net food imports increased dramatically in the aftermath of the 1992-1995 war. Many industries are still overstaffed, reflecting the legacy of the centrally-planned economy, though limited privatization has improved efficiency in certain sectors.
Transition economy: Bosnia and Herzegovina sees the long-term goal of EU membership as a driver to further economic growth and development. Due to Bosnia and Herzegovina's strict currency board regime, inflation has remained relatively low. The banking sector has been fully reformed, with a significant inflow of foreign banks providing businesses with easier access to capital and a better range of banking services. Lending has slowed significantly since 2008. B&H's most immediate task remains economic revitalization. The country needs meaningful progress in structural reforms to strengthen the basis for sustained, private sector-led growth.
B&H's top economic priorities are: acceleration of EU integration; strengthening the fiscal system; public administration reform; World Trade Organization (WTO) membership. To date, work on these priorities has been inconsistent. The country has received a substantial amount of foreign assistance and will need to demonstrate its ability to implement its economic reform agenda in order to advance its stated goal of EU accession. In 2009, B&H undertook an International Monetary Fund (IMF) standby arrangement, necessitated by sharply increased social spending and a fiscal crisis precipitated by the global economic downturn.
1.2 Economic background of Indonesia
Indonesia has a market-based economy in which the government plays a significant role. There are 141 state-owned enterprises, and the