news 25 Jul 12

Bosnia Faces Losing Millions in Lost Trade with Croatia

EU official warns Bosnia that a significant amount of its exports to Croatia may be cut off next year, owing to its failure to impose EU hygiene standards.

Elvira M. Jukic
BIRN
Sarajevo

After Croatia joins the European Union in July 2013, Bosnia may face sharp reductions in its exports, as the country has not harmonized hygiene standards and laws to EU standards, an official has warned.

The warning came as Johann Hesse, from the EU Delegation to Bosnia, and Ljubomir Kalaba, director of the Bosnian Veterinary Office, on July 24 in Sarajevo discussed concerns about exports of goods of animal origin from Bosnia to the EU market.

“Bosnia cannot export poultry or poultry meat, and other goods of animal origin, to the EU, since EU standards have not been implemented yet,” Hesse said, urging Bosnia to act fast.

“If the authorities do not act swiftly, exports of these products will drop significantly next year when Croatia joins the EU, because that important market will then be lost, too,” Hesse added.

Bosnia remains unprepared for the change in Croatia's status in many fields, such as accreditation bodies and certificated laboratories that can check goods' origins.

Some of the biggest worries concern milk producers who will no longer be able to sell dairy products across the border after 2013, as their products won't meet EU standards.

More than 60 per cent of the milk produced in Bosnia is exported to Croatia. Because Bosnia does not have EU-level hygiene standards or laboratories to certify goods, many farmers stand to lose money and jobs.

Bosnia’s exports to Croatia are currently regulated by the easier regime of the Central European Free Trade Agreement, CEFTA, to which both countries now belong.

These exports account for 15 per cent of Bosnia's overall trade and are worth an estimated 3.73 billion euro a year to the country.

Before Croatia joins the EU it must leave CEFTA and it may only import goods that meet the EU’s stringent agriculture hygiene inspection standards.

Moreover, the new regime will start on January 1, 2013, six months before Croatia's official membership of the EU begins.

Bosnia could lose as much as 22 million euro a year in lost exports of meat, eggs and dairy products. The Foreign Trade Chamber said year that the country exports 40 million litres of milk alone a year to Croatia.


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