Analysis: Consumer basket price in Bosnia and Herzegovina hits record high

A consumer basket in Bosnia and Herzegovina costs more than 2,600 BAM. The average net salary is slightly over a thousand. And the prices go up, shall we say, hour by hour. Despite this, the Consumer Protection Ombudsman Institution claims that citizens of Bosnia and Herzegovina do not complain about price increases.

That they tell fairy tales to the citizens and that in our country those at the top deal with the current situation by pushing the problems under the rug – economic experts also agree.

“The absence of empathy, the absence of everything. Citizens are on their own. The way the government is behaving is, to say the least, inappropriate. Obviously, the government is incompetent, it is not up to the situation in which it finds itself”, underlines the economic analyst Aziz Sunje.

While the average net salary for the month of April this year is 1,083 BAM and the gross salary is 1,658 BAM, and there is no improvement, it seems that the citizens of Bosnia and Herzegovina are extraordinary magicians, considering that the consumption basket in May 2022, according to the latest report of the BiH Statistics Agency, amounted to 2,639.48 BAM.

By comparison, some of the largest consumption categories in the basket compared to the previous year saw huge increases, such as food up 22.7%, housing and overheads up 11%, 3%, health care 1.3% and transport the same 30.3%.

The question is, is there a way out? We all know the causes of inflation, but…

“There is room for action for the government – ​​much higher revenues thanks to higher indirect taxes: 730 million more this year than last. They order him to increase the wages, that is to say the incomes. Let the state cede a part, let it not make populist platitudes like the VAT. Let him fundraise, let him reduce fundraising by giving up revenue specifically from petroleum products,” says Sunje.

The price of fuel largely generates inflation and reduces the consumption basket of individuals, ie citizens. Still, economic experts say the government should be more proactive and look for ways to help the people as well.

Oil prices on the world market have fallen by more than 2% in recent days. Investors are analyzing recession risk and fuel demand due to rising interest rates in major economies, CNN reports.

However, this is not felt in BiH.

A liter of diesel can hardly be found below 3.50 BAM.

In Sarajevo, the price of diesel varies from 3.56 to 3.81 and that of gasoline from 3.36 to 3.56. Prices are similar to Mostar. The diesel ranges from 3.56 to 3.71, and in Zenica from 3.56 to 3.76 BAM. Gasoline is slightly cheaper.

In Tuzla, a liter of diesel costs from 3.66 to 3.76 BAM, and gasoline from 3.31 to 3.56 BAM.

Oil prices in 2008 peaked at $147 per barrel. At that time, fuel was 2.10 BAM per liter at gas stations. A month ago, fuel cost $134 per barrel, and at gas stations in BiH at that time it was already BAM 3.26 per liter, Nezavisne Novine recalls.

Thus, the fuel is 23% cheaper today than in 2008, but the liter in the service stations costs more than 70% more expensive compared to this period”, is it specified in the status on the social networks .

One way to mitigate the new increase is to limit the margin on fuel prices, but even that is not enough, says Adnan Smailbegovic, president of the Federation of Employers’ Associations of Bosnia and Herzegovina.

The freight and passenger transport sector takes the biggest hit, but it ripples through every branch of production, along with the prices of all products and services for the end customer.

“It was an idea, and I think it should have been passed, to temporarily suspend fuel excise duties. State revenue is increasing and excise duty is not a revenue the state would feel significantly, and the economy and the citizens would certainly feel relieved if, for some 40 pfennigs, a liter of oil or gasoline would be cheaper for them,” Smailbegovic points out, writes Avaz.

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