Representatives of the European Commission and Bosnia and Herzegovina met in Banja Luka to discuss the level of approximation of the country in the fields of free movement of goods, industrial policy, small and medium sized enterprises (SMEs), taxation and customs. Trade and cooperation with other candidate countries were also discussed.

Progress of Bosnia and Herzegovina (BiH) in its European Integration process depends on fulfilment of requirements of the Stabilisation and Association Agreement and the European Partnership with the European Union (EU), amongst others in those areas, which are particularly important for the country’s economic development.

Both parties agreed that the Interim Agreement is overall smoothly implemented. It is of paramount importance to ensure further correct implementation. General recommendation of the European Commission was to pursue activities in law approximation throughout BiH in a harmonized and coherent way respecting the BiH constitutional framework. 

The European Commission pointed out that the European Convention for Human Rights (ECHR) is an essential element of the Interim Agreement and underlined the importance of timely implementation of the Action Plan for implementation of the Judgment of the European Court for Human Rights. 

The European Commission welcomed BiH’s progress in the transposition of the New Approach Directives. Some outstanding issues in accreditation, metrology and conformity assessment should be solved soon in order to strengthen the competitiveness of BiH’s industry. The Commission welcomed the strengthening of administrative capacities in this field. 

The European Commission underlined that industrial policy should be part of the Development Strategy of BiH, which is one of the European Partnership priorities. The Commission stressed the importance of setting up a of country wide comprehensive strategy on tourism which would be beneficial also to small and medium sized enterprises.  

The European Commission welcomed the adoption of the Strategy for Development of SMEs, but underlined the importance of full implementation of the Strategy and the adoption of the Law on promoting SMEs in BiH. The Commission recalled that the implementation of the Strategy, the establishment of the Entrepreneurship Agency and of the Forum for Promotion of SMEs and Entrepreneurship in BiH are long overdue short-term priorities of the European Partnership. The European Commission pointed out that coordination mechanisms in this area should be reinforced as a precondition for the availability of further EU funds at large scale.

The economic and financial crisis did not have as huge an impact as expected to the trade between the parties, in particular as regards the exports of products from BiH to the EU. The European Union is still the most important foreign trade partner of BiH. Although the largest part of BiH exports is still with the EU internal market, the share decreased slightly in 2009 in favour of the export to the Central European Free Trade Agreement (CEFTA) market. This shows the high importance of trade with BiH’s neighbours. The CEFTA Agreement is implemented without major problems. 

The European Commission welcomed progress that Bosnia and Herzegovina has made in the negotiation process for the accession to the World Trade Organization (WTO) and offered further technical assistance.   

Some progress has been made in the approximation of taxation and customs to EU laws. However, further alignment is necessary, above all with regard to the laws on excise and customs. The Commission took note of the good cooperation of BiH with other countries under the Stabilisation and Association Process with the EU and candidate countries, in particular in trade.