Comparative advantages

The City of Banja Luka has got a very favourable strategic position in the European continet which allows investors to easily access entire market of the European Union, Central and Eastern Europe. It is 50 km away from the Sava River and 60 km from the Pan-European Corridor X, via which a very good road connection can be established with Zagreb (182 km), Belgrade (327 km), Ljubljana (253 km), Vienna (386 km), Budapest (336 km), and further toward Western and Eastern European countries.

Bosnia and Herzegovina (BiH) has signed the CEFTA Free Trade Agreement with the following countries: Albania, Montenegro, Croatia, Macedonia, Moldavia, Serbia and UNMIK/Kosovo.

In addition, the Free Trade Agreement has been signed with Turkey, as well as preferential regime with the following countries: USA, Japan, Canada, Switzerland, Australia, Norway, New Zealand, Russia and Iran.

By signing the Stabilisation and Association Agreement – an agreement of trade as on 1 July 2008, free export of almost all goods meeting the standards to the EU was allowed, whilst gradually the BiH market is being open to the goods from the EU.

Tax policy in the Republic of Srpska is one of the most encouraging in the region, with low personal income rate, corporate income rate and cumulative contributions rate. Value added tax rate is also very encouraging (17%).

Monetary stability is confirmed by the exchange rate of the Convertible Mark (KM) which is fixed to EURO in line with the arragement of the Currency Board: 1 KM = 0.51129 EUR or 1 EUR = 1.95583 KМ. The Republic of Srpska has got the lowest inflation rate in the South-East Europe. The average annual inflation rate in 2012. in RS was 2,1%, and for the same period in 2011. it was 3,9%.

There are many tax exemptions for foreign investments in the Republic of Srpska. Foreign investors are exempted from importation tax on assets representing foreign investment. Foreign persons may open bank accounts and transfer money abroad without any limitations. When it comes to investment in economic sector, foreign persons have the same rights as the citizens of RS, defined by applicable laws in that field. Any foreign investor is registered as a national business. Foreign company has got the same rights as the national company or citizen, including the property rights in the RS.

In the past 15 years, Banking sector has gone through a complete reform in order to strengthen the overall social and sconomic system. Former state-owned banks have been privatised and are now in the hands of new owners from abroad.

Known as “a university city“, Banja Luka represents an unfailing source of trained professional staff of different occupations, who, by the quality and rather low average labour price, is more competitive in relation to the neighbouring countries.

As a modern, european middle-sized city, Banja Luka offers comfortable business and livingenvironment. Compared with surrounding cities, Banja Luka offers simpler and cheaper life, where you can find all available contents which make a life accessible and quality.

It is particularly attractive owing to a preserved and diverse natural environment which gives quality and relaxing nature to life. With increasingly improved road infrastructure, expansion of internet and overall opening of the city, it is expected that development be even faster and of better quality, primarily from the aspect of market economy through the development of trade, tourism, agriculture and food industry.