SARAJEVO BUSINESS FORUM 2010 “ Why to Invest in BiH? ” & “ Investment Oppurtunities ” AAgriculture Tourism H Infrastructur e Energy 6-7 April 2010 Sarejevo, Bosnia and Herzegovina

Sarejevo Business Forum Why Sarejevo Business Forum 2010? Bosnia and Herzegovina becomes increasingly a centre of attraction for the investors mainly due to the fact that the country triumphantly undertakes significant policy reform, aiming to establish business enabling environment and more notably, there exists outstanding investment opportunities for foreign investors. To respond to increasing demand and help investors to identify potential projects, Sarejevo Business Forum will be held on 6-7 April 2010 in Sarejevo, Bosnia and Herzegovina. The forum intents to bring high level participants, including prime ministers, ministers and government officials as well as representative of private sector to discuss the current policy challenges while presenting concrete investment opportunities, providing investors with essential and first hand information. For further information, please contact to Bosnian Bank of International, whose address and contact details are given at the last page.

Country Relevant Information Official NameBosnia and Herzogovina Capital CitySarajevo (Population ) Geographic Location South Eastern Europe,borders with Croatia (932 km), Serbia (312 km) and Montenagro (215 km) Area51209 km2 Ethnic GroupsBosniaks, Serbs, Croats and Others GDP11,6 bilion EUR CurrencyKonvertibina Marka Exchange Rate1 EUR= KM 1.95 (fixed exchange rate) Key Facts about Bosnia and Herzogovina The Federation of BiH consists of 10 cantons 1- Una-sana Canton 2- Posavina Canton 3- Tuzla Canton 4- Zenica-Doboj Canton 5- Bosnian-Podrinje Canton 6- Central Bosnia Canton 7- Herzegovina-Neretve Canton 8- West Herzogovina Canton 9-Sarajevo Canton 10- Canton 10

General Information about Investment Environment in BiH  Bosnia and Herzegovina (BİH) is ideally located at the crossroads between West and East, the Mediterranean and Continent, and its proximity to the main European business hubs makes it attractable business destiny. Its position can be perceived as a natural gateway to markets while BiH has an easy access to the of 60 Millions SEE citizens as defined by the SEE Free Trade Agreement. It has a population of 4 million and a significant number of skillful labor force available.  Foreign investment Law (1998) of Bosnia & Herzegovina (BiH) grants foreign investors national treatment with the right to invest, or reinvest profits from such investments, in any sector of the economy under the same conditions as defined for the residents of BiH.  In contrast to many other countries in the region, the BiH’s foreign investment legislation provides overseas investors with the same property rights as those enjoyed by residents.  According to World Bank World Wide Governance Indicator, Rule of the Law index of the BiH is one of the highest in its Region: it is ranked whereas Albania and Serbia have the scores of -0.6 and respectively.  The Corporate Income Tax legislation of the FBiH enables firms to deduct the amount of tax equal to the percentage of foreign capital invested in the assets of the company for a period of 5 years, provided that the foreign capital is greater than 20% of capital invested. The incentive is valid for companies with 100% foreign capital investment.  In FBiH, companies investing their taxable profits (earnings before tax) in their own production activities or in buildings are given a tax relief of 100% of the invested value or in the amount of 75% if they invest in other activities of their company.  Investment capital is exempted from paying import customs and customs duties (with the exception of passenger cars, slot and gambling machines). Source: IMF,WEO Database,October 2009;Bosnia and Herzegovina Agency For Statistics Source : Bosnia and Herzegovina Agency for Statistics; Federation of Bosnia and Herzegovina Federal Office of Statistics;Republika Srpska Institute of Statistics

Agriculture  Availability of proper soil, water and mild climate make the organic farming possible and profitable as world demand is continuously increasing.  Even though employment in agricultural sector forms 21 percent, its share in GDP is relatively small, 7.4 percent.  In BiH, Climate is mild and soil productivity is immensely high. It contains 4.8 million hectare land and agricultural area accounts for 51 % of the total whereas thirty-four percent can be landed. Arable lands are mostly located in Republic of Serbska.  Wide grassland could be employed for livestock activities as it is largely available.  The existence of the subsidy policies for agricultural production is an impetus for attracting investors.  By differentiating products; associated with the efficient usage of fallowing land, it is highly possible to raise the agricultural production. Below are the investment profiles for which there exists opportunities available (for further information please contact to Bosna Bank of International) * Beekeeping and honey packaging plant investment Profile * Trout pool Fishing plant investment profile * Greenhouse plant investment profile * Meat and meat products production plant investment profile * Poultry Farming (Meat) investment profile * Fruit juice concentration production plant investment profile * Potatoes chip plant investment profile * Frozen Potatoes production plant investment profile * Dairy product production plant investment profile * Compound feed production plant investment profile * Leather processing production plant investment profile * Densified wood and particle board, oriented strand board (OSB) production plant investment profile In sum, Agricultural Sector of the BiH provides investors with outstanding prospects as high domestic demand and export opportunities ensure high rate of return. Furthermore, fertile land, high soil productivity, mild climate conditions together with cheap labour supply and lower cost, as well as marketing possibilities abroad, make agricultural sector an attractive investment niche.

Tourism  Owing to a rich history, cultural, natural assets and mild climate as well as intact environment, tourism could offer exceptional investment opportunities.  Due to its geographical position and close proximity to European tourism markets constitute notable prospects in tourism sector. To achieve high visibility, however, publicity campaigns and marketing activities should be better organized to promote the touristic assets abroad.  BiH offers numerous alternatives such as winter tourism, rafting, trekking, extreme sports as well as thermal springs  The cultural inheritance creates highly conducive environment for the development of tourism sector in BiH  BiH is at the crossroad of three abrahamic religions (Judaism, Christianity and Islam), hence their signs is everywhere across the country, leaving open niches for religious tourism  As the country is full of tourism endowment, transportation infrastructure needs to be improved to enhance the competiveness of the sector. Moreover, accommodation facilities should be multiplied in order to meet increasing demand.  Total number of tourist visiting BiH rises from 380,819 in 2003 to 610,817 in 2005, indicating high potential for the sector growth. Below are the investment profiles for which there exists opportunities available (for further information please contact to Bosna Bank of International)  Tourism Sector Investment Profile  Thermal tourism facilities investment profile  Three stars hotel investment profile

Energy & Infrastructure  Energy industry accounts for significant share of the GDP and it has a highly comparative advantage in the region. Moreover, It is among the one of the top ten sectors, having exported substantially in the recent years.  The country can be classified as energy rich in terms of coal and hydraulic energy endowment whereas it has exported and natural gas. The coal reserve is estimated to be over 10 billion ton and the current consumption rate accounts for negligible share of the total reserve, 8 million per year.  The share of the hydraulic sources in energy production is relatively high (35 percent), compared to world average, (16 percent).  There is a high potential for small scale hydroelectric power plants to increase their capacity without degrading the environment.  High energy demand of the South Eastern Europe, currently at the deficit level of 22TWh provides outstanding market niches for investment opportunities in energy sector.  BiH has considerable transport infrastructure, road, airports, inland waters, railways however they urgently need to be improved.  BiH is located on the shortest transport route connecting the central Europe to Adriatic as this place the country at the forefront of the EU agenda, together with geostrategic and economic policy implications.  If completed, VC corridor, linking Budapest to Adriatic sea, is estimated to be 330 km. will play an important role in creating vibrant economy and contributing to sustainable development.

Contact Information Bosnian Bank of International Bosna Bank International d.d. Sarajevo is established on October 19, 2000 as the first bank in Europe to operate on the principles of Islamic banking. Salih Purisevic (Secretary General of the Bank) Office: Office Direct: Fax: If you want any further information, pls contact the name(s) which are given below. F inancial and Economic Advisor SBF 2010 will be held held in collaboration with