ANALYSIS OF THE COMPETITIVENESS OF BOSNIA AND HERZEGOVINA IN THE CONTEXT OF EU ACCESSION PROCESS

Even though there are several definitions of the concept of competitiveness, the OECD has defined it as an ability of a country to produce goods and services that pass the test of international market in the conditions of free and equal market, while increasing the real income of the population. This definition of competitiveness clearly shows that each country can be considered competitive not only under the condition that it has a significant role in the production and marketing of goods on world markets, but also that the citizens of this country in the observed period achieved a higher standard of living, measured by various indicators. Unfortunately, the low living standard of a third of the EU28 average clearly indicates that B&H lags far behind other transition countries that have undergone or are undergoing the process of European integration. From the standpoint of economic theory, factors determining the pace of economic convergence are a starting position, maintaining macroeconomic stability and the degree of success in implementing structural reforms. After the global recession, the world economy is characterized by high unemployment, lower productivity growth and subdued economic growth which continues to be burdened by a variety of uncertainties, such as geopolitical tensions, energy prices and changes in foreign currency exchange rates. Thus, the resulting situation was named "new normal", i.e. new normal situation. However, recent development trends are promising. The so-called fourth industrial revolution and new ways of spending such as "sharing economy" could lead to a new wave of innovation to drive growth. Also, in many countries, economic policies are increasingly focused on the needs of citizens, and are embedded in the overall societal objectives and strategies of development.