Why you should consider investing in Republic of Srpska
The Republic of Srpska is located in the heart of the Southeast Europe, in the central part of the Balkan Peninsula
Favorable geo-strategic location
The Republic of Srpska, one of two entities of Bosnia and Herzegovina is located in the heart of the Southeast Europe, in the central part of the Balkan Peninsula, at the very border with the EU (Croatia). It is connected with Europe and Asia by Pan-European Corridor X – E70 motorway, which, in addition to the railway, Banja Luka International Airport, nearby international ports in the Adriatic Sea and free trade agreements, makes Republic of Srpska an ideal strategic location for export-oriented investors.
Regular flights from the Banja Luka Airport to Belgrade enable the good connection of Banja Luka with about 50 world’s destinations. Besides, the bigest low-budget Airline company Ryanair connects Banja Luka with Berlin, Brussels, Memmingen, Frankfurt, Stockholm, Gothenburg, Vienna and Milano.
€6,39 bilion (2021)
GDP growth rate
BAM (1€ = 1,95BAM)
Banja Luka (185.094)
Southeast Europe, BiH
Mild continental, mountainous and Mediterranean
Free trade area
Investors in the Republic of Srpska gain access to the market for 600 millions of citizens based on the free trade principle.
CEFTA countries and their market of about 30 million citizens
Free Trade Agreement between BiH and Turkey –about 70 million citizens
Stabilisation and Association Agreement between the EU and BiH (which enables free export in the EU of almost all goods meeting the standards)
Republic of Srpska main foreign trade partners, 2021.
Competitive and highly skilled workforce
A republic with a well-educated and highly skilled workforce tailored to the needs of modern business market
Average net salary in RS by sectors, 2022. (€)
Information and communication
Financial and insurance activities
Electricity, gas, steam and air -conditioning supply
Mining and quarrying
Public administration and defence; compulsory social security
Human health and social work activities
Professional, scientific and technical activities
Other service activities
Real estate activities
Administrative and support service activities
Water supply; sewerage, waste management and remediation activities
Agriculture, forestry and fishing
Arts, entertainment and recreation
Wholesale and retail trade; repair of motor vehicles and motorcycles
Accommodation and food service activities
Transport and storage
Low operating cost and stimulative cost policy
Business start-ups in Republic of Srpska bear significantly lower operating costs due to stimulative tax policy and competitive labor prices.
The average net salary in the Republic of Srpska for 2022 was 1144 КМ (585 €).
The non-taxable part of personal income is BAM 1000 (511 €).
Total contributions rate on gross salary are 31% out of which:
18,5% for pension-disability insurance
10,2% for health insurance
1,7% for child protection and
0,6% for insurance from unemployment
Double taxation avoidance agreements have been signed with 40 countries of the world.
The price of electricity in Republic of Srpska is among lowest in the region – 0,065 €/kWh
Business friendly administration
The Government of Republic of Srpska and local self-government units are investing significant efforts in reform of administration and the creation of a business-friendly environment.
A business start-up in Republic of Srpska now takes only three days and costs less than 100 €. The process of establishment of e-registration of business entities in the Republic of Srpska is underway.
In order to improve and harmonize the local conditions for doing business with those in the countries of South East Europe, Republic of Srpska is taking part in the regional program of Business Friendly Certification – BFC SEE. Currently, there are twelve (12) certified cities and municipalities in the Republic of Srpska, and several more are in the process of certification.
Businesses and citizens of Republic of Srpska have access to the Point of Single Contact for Business www.pscsrpska.vladars.net portal. The Contact Point provides information pertaining to methods, administrative procedures and formalities for starting and conducting business activities.
Point of Single Contact for Businesswww.pscsrpska.vladars.net
Web portal of the Government of the Republic of Srpska Srpska– Republic of opportunity investsrpska.vadars.net, primarily intended for the present and potential foreign investors provides all necessary information to foreign investors concerning investment opportunities, legal regulations, institutions available to investors, as well as any other relevant information.
Region of the future for the foreign investment
According to the fDI Intelligence / Financial Times rankings, the Republic of Srpska has been selected as one of 10 small regions of the future for 2023, for the foreign investment strategy.
Stimulative investment policy
Favorable treatment of foreign investors
The Law on Foreign Investments in the Republic of Srpska (“Official Gazette of the Republic of Srpska”, No.21/18) is one of the most liberal and provides that Foreign investors enjoy national treatment in Republic of Srpska. Their rights are guaranteed by the Constitution. Among other things, this implies free profit transfer abroad, relief from payment of customs duties on import of fixed assets and new investment tax relief, incentives for new employment, new technologies and sallary increases free employment in accordance with the law and the right to acquire property. MIGA and 42 agreements on investment promotion and protection represent a reliable risk protection system for foreign investors. Also, Foreign Investments Council of the Republic of Srpska is established as institutional support in order to encourage foreign investment.
Investment incentives are awarded at the national and local levels. In order to consolidate data and better information exchange, the Government of the Republic of Srpska has launched activities to create a Unified Register of Incentives, which is in the final stage of development and will be available soon on the portal www.regpodsticaja.vladars.net
INCENTIVES AT THE REPUBLIC LEVEL
Institutions at the level of the Republic of Srpska award numerous incentives to the economy, we single out the key ones:
Incentives of The Ministry of Economy and Entrepreneurship
The Law on Incentives in the Economy of the Republic of Srpska (Official Gazette of the Republic of Srpska, No. 52/19, 78/20, 37/22, 56/22) provides incentives for economic development, as follows: - Incentives for increasing salaries to employees in economic entities - Incentives for direct investment for new technologies - Incentives for direct investment of special importance
Incentives оf the Employment Bureau
The Republic of Srpska Employment Institute is a key organization at the labor market which takes part in preparing, executing and implementing employment projects in line with the Republic of Srpska Employment Strategy and the annual Employment Action Plan for Strategy Implementation. There are several different categories of employment programmes, and the programme that we especially emphasize on this occasion is the "Programme of employment support in the economy through the payment of incentives in the amount of taxes and contributions for new employment of workers" which is available at LINK. Further details about these and other programs of the Institute are available at www.zzzrs.org.
Incentives of the Ministry of Agriculture, Forestry and Water Management
Incentives of the Ministry of Agriculture, Forestry and Water Management for agricultural and rural development. Every year, the Ministry adopts the Rulebook on requirements and ways of obtaining financial incentives for agricultural and rural development.
In addition to the above, there is a wide range of other incentives as well as tax benefits, and more detailed information can be found in the column DOING BUSINESS – Business guide - Incentives in the economy of the Republic of Srpska at the link https://investsrpska.vladars.net/business-guide/incentives-in-economy-of-republic-of-srpska/
INCENTIVES AT THE LOCAL LEVEL
Incentives at the local level differ, and information about them can be found at the portal www.regpodsticaja.vladars.net as well as at the official websites of the local government units.