ECONOMY

Call to protect producers

SARAJEVO – Bosnia must quickly introduce quality-control institutions and protection measures for local producers to reduce its large foreign trade gap, the president of the country’s Foreign Trade Chamber, Milan Lovric, said. Lovric told Reuters initial figures showed the gap amounted to nearly 5 billion Bosnian marka ($3.3 billion) in the first 11 months of 2003, with imports of some 7 billion marka and exports of 2.1 billion marka. Those figures represent an 11 percent narrowing of the gap compared to 2002. But Lovric said the final numbers could yet show an increase for the year as a whole and the gap was still too large even if it did end up declining slightly last year. «We are today a very unprotected market and, as a result, we have such a foreign trade deficit,» he said in an interview late on Tuesday. «The most important task is to establish institutions which would protect local production and our own market,» he said. Many local firms complain they cannot export their products because Bosnia has not set up agencies such as a veterinary institute to check agricultural goods and provide guarantees that they meet international standards. Lovric blamed lobbying by importers and trading companies for delays in setting up the necessary institutions in Bosnia, where the 1992-95 war resulted in the country’s division into two autonomous regions with only a weak central state. He said the lack of quality-control institutions meant Bosnia had failed to profit much from preferential status granted by the European Union for some of its goods as it could often only export raw materials and semi-finished products. Bosnia is also losing out in free trade deals with other Balkan states, which can now provide finished products more cheaply than it cost local companies to buy the raw materials to produce them at home in sectors such as textiles, he said. Lovric said that agriculture, where exports cover only 8 percent of imports, had been hit hardest as authorities did nothing to protect local farmers from imports of goods that are subsidized in the countries of origin but not in Bosnia. He said higher customs tariffs would have to be introduced this year as the current rates for some products have put local producers at a disadvantage. He also said new laws should be introduced to check the quality of food being imported. Although Bosnia has delayed for three months the abolition of customs duties on food products from Croatia and Serbia and Montenegro, that was only an interim measure and the authorities must act swiftly to protect local farmers, Lovric said.