The Effect of foreign trade on economic growth in the Republic of Srpska
Journal Title: Acta Economica - Year 2014, Vol 12, Issue 20
Abstract
Ever since Adam Smith the scientists have been investing enormous efforts to explore and prove relationships between the foreign exchange and economic growth. One thing in common to all researches so far is that there is no complete agreement on a direct, positive inter-relation between the foreign exchange and economic growth. However, the major number of researches confirm the existence of the statistically significant, direct relation. The special attention is paid to the analysis of the influence of the foreign trade to the developing countries, principally as a channel for the import of new technologies by which it has been proven that the growth of the import does not have to have necessarily a negative impact to the economic growth but it may also impact the productivity growth, i.e. indirectly the total economic growth of the country of import. The research of the influence of the foreign trade to the economic growth becomes even more relevant after year 2008, i.e. after the world economic crisis as small, open economies, such as the Republic of Srpska see its “development drive” in the growth of the export through the consolidation of the developed countries and thus additional growth of the foreign demand. That is why in our paper we have tried to explore the relevance of the foreign trade to the economic growth of the Republic of Srpska, to analyse the foreign trade exchange of Republic of Srpska in order to determine the weaknesses of its commodity structure and the relations with the leading foreign trade partners as well as to explore the interrelated, quantitative relation between the foreign trade and the GDP of Republic of Srpska. Summarizing the results of our research we have come to a conclusion that the foreign trade is very relevant for the economic movements in the Republic of Srpska, i.e. the relevance of the foreign trade for the economic development of Republic of Srpska is very high. However, it is necessary to work on the decreasing of the foreign trade deficit through the increase of the export and the improvement of its commodity structure as well as through the selective decreasing of the import. Before all this, it is necessary to undertake the change of economic structure and considerably increase the competitiveness of the domestic producers.
Authors and Affiliations
Миленко Крајишник, Далибор Томаш
Keywords
Related Articles
- EP ID EP43789
- DOI https://doi.org/10.7251/ACE1420125K
- Views 246
- Downloads 0
PROFITABILITY ASSESSMENT OF INVESTMENT PROJECTS OF DIFFERENT ECONOMIC DURATION
When any project economical effectiveness is estimated by net present value, each project having either positive or zero net present value can be accepted provided that such project does not depend on other projects. In...
Scientific research and horizons of knowledge
Intellectual climate has served for development of the economy based on knowledge. But did only the knowledge from the economy seve for the development of economic knowledge? Knowledge can’t be transplanted but it can be...
BOSNIA AND HERZEGOVINA’S BANKING SECTOR, DYNAMICS OF ITS PROFITABILITY COMPONENTS
Period from 2000 to 2005 saw a significant change in profitability of Bosnia and Herzegovina’s banking sector and its components. Indicator of operational efficiency, return on income (ROI) takes positive value for th...
Imperative of International Business and Management
Успешно међународно пословање се најчешће везује за компаније из земаља Тријаде. И поред тога, процес интернационализације и глобализације није могуће зауставити националним границама. Земље у развоју, као и неразвијене...
Value Added as a Measure of Economic Profit
Economic profit is the concept immanent for the value added. It is an attempt to analyze properly the business success in terms of contribution of profit to the increase in the company value and the stockholders’ wealth....