VIENNA, October 27 (FENA) – The World Bank forecasts that Bosnia and Herzegovina’s economy will grow by 2.4 percent in 2026, below the expected Western Balkans average of 3.1 percent, while economic activity in the country is projected to gradually strengthen over the following two years. At the same time, the World Bank’s latest Western Balkans Regular Economic Report, published today, warns that high trade costs and complex regulatory procedures are among the key obstacles to stronger economic development, business competitiveness, and the creation of quality jobs across the region.
According to the World Bank’s projections, BiH’s economic growth is expected to accelerate from an estimated 2.1 percent in 2025 to 2.4 percent this year, with growth projected at 2.9 percent in 2027 and 3.1 percent in 2028.
However, the outlook for BiH is somewhat less favorable than in the World Bank’s spring report. Growth forecasts for all three years, from 2026 to 2028, have been lowered by 0.1 percentage points each.
According to the report, BiH’s economy grew by 2 percent in 2023, accelerating to 3.2 percent in 2024 before slowing in 2025.
For the six Western Balkan economies, Albania, Bosnia and Herzegovina, Montenegro, Kosovo, North Macedonia, and Serbia, the World Bank expects average economic growth to accelerate from 2.6 percent in 2025 to 3.1 percent in 2026, primarily driven by consumption and investment.
Economic activity is expected to strengthen further in 2027, when regional growth is projected to reach 3.4 percent. The same rate is forecast for 2028.
According to the report, these trends confirm the resilience of Western Balkan economies to external shocks and their continued economic convergence with the European Union, despite geopolitical uncertainty and weaker economic activity among key trading partners.
World Bank Western Balkans Director Xiaoqing Yu noted that the region had once again demonstrated its ability to adapt to adverse international conditions, but warned that resilience alone was not enough to achieve long-term development goals.
“Amid heightened geopolitical uncertainty and weak growth among key trading partners, the Western Balkans has once again demonstrated its economic resilience,” Yu said.
She stressed that further improvements to the business environment were necessary to bring incomes closer to the EU average and create quality jobs.
“Resilience alone is not enough to help the region converge with the European Union’s average income levels or create the quality jobs its citizens need. Jobs are created by dynamic private sectors, and the next phase of growth requires efficient, predictable regulations and the removal of trade barriers, not only at borders but also behind them,” Yu said.
According to individual projections, Kosovo is expected to record the highest economic growth in 2026, at 3.6 percent, followed by Albania at 3.4 percent and Montenegro at 3.3 percent.
North Macedonia is forecast to grow by 3.2 percent and Serbia by 3.1 percent, while BiH ranks last among the six regional economies, with projected growth of 2.4 percent.
In 2027, Kosovo is again expected to record the highest growth, at 3.8 percent, followed by Serbia at 3.7 percent and Albania at 3.6 percent. Montenegro and North Macedonia are each projected to grow by 3 percent, while BiH’s economy is expected to expand by 2.9 percent.
The 2028 projections point to growth of 3.9 percent in Kosovo, 3.7 percent in Albania, 3.5 percent in Serbia, 3.1 percent in both Bosnia and Herzegovina and Montenegro, and 3 percent in North Macedonia.
