Project Brief Investment Climate | World Bank Group 90709 Simplifying Foreign Investment in Bosnia and Herzegovina Project At A Glance Results and Impacts  OSNIA AND HERZEGOVINA/ Country/Region B • Annual cost savings of nearly EUROPE AND CENTRAL ASIA $1 million to foreign firms from Product INVESTMENT POLICY investment climate reforms. THEME Fragile and Conflict-Affected Area • Increase in FDI flows from $225 Since 2007, the World Bank Group has worked with Bosnia million in 2010 to $378 million in and Herzegovina to streamline regulations related to permitting 2011. and administrative procedures and to overcome regulatory • Adoption in February 2012 of impediments for attracting and retaining cross-border administrative procedures for legal investments. The project aims to improve the investment climate entities and entrepreneurs resulting in and increase levels of private investment. 19 percent processing time reduction for each of approximately 220 local permits and licenses. Context Investing in Bosnia and Herzegovina poses many challenges for companies, from the difficulty of accessing land to the process of obtaining construction or foreign employee work permits. The constitutional framework poses another challenge, by requiring potential investors to navigate the political agendas of stakeholders at four different levels of government. Despite bureaucratic and In Partnership with SWEDEN, SWITZERLAND (SECO), THE UNITED KINGDOM World Bank Group constitutional obstacles, the business climate has seen creating an interactive business map containing useful moderate reforms over the past ten years. Today Bosnia information for investors, including: and Herzegovina has a strong incentive for business 1. Economic and demographic data. reform, namely, accession to the European Union. The 2. Land use and natural resources. World Bank Group and its partners aim to improve the investment climate to help the country access new regional 3. Investment procedures. and international investment. The new investment portal (http://www.fipa.gov.ba) includes useful information such as tenders for contracts, Our Role attractive sectors, and a catalog of projects by sector. It also As a part of a larger reform program, investment climate features an interactive business map that can be filtered teams of the Bank Group partnered with government according to an investor’s interest in particular sectors, and donors in Bosnia and Herzegovina to improve the geographical features, transportation, and other resources. regulatory environment and remove administrative obstacles to foreign direct investment (FDI). One such obstacle was the onerous process of business registration. Working with the government, the project, implemented by IFC, helped streamline FDI registration procedures, and eliminate the compulsory double registration of foreign investment at the Ministry of Foreign Trade and Economic Relations. A second obstacle was the lack of clear information for potential investors, such as land-related information and investment opportunities. The project addressed this by Online Interactive Business Map of Bosnia and Herzegovina. Another bottleneck for investment in Bosnia and Herzegovina was the lengthy and complex process of obtaining work permits for foreign employees. The Bank Group helped reform the process, reducing by more “We wish that Bosnia and Herzegovina than 50 percent the number of procedures required to is a country that will guarantee safety obtain work permits for foreigners. The allowable time for through its legislation to those who invest the government to approve permits was reduced from 30 their money here, ensure a high quality to 15 days. By reforming the business climate and reducing presentation and remove barriers.” the number of burdensome procedures for businesses, the Project aims to attract new investment to Bosnia and Mirko Šarovic Minister of Foreign Trade and Economic Relations Herzegovina from neighboring countries and from potential Bosnia and Herzegovina regional and international investors. Contact Tarik Sahovic | Operations Officer | Investment Climate Email: TSahovic@ifc.org | TEL: 387-33-251-555 | www.wbginvestmentclimate.org