Lessons from transitional economies’ failures: Why is B&H a transitional (non) success story?

Bosnia and Herzegovina (B&H) is faced with many challenges on its path of economic prosperity and suffers from many disappointments and setbacks of transition process. The social and economic activities have deteriorated and changed over time and B&H has passed through different political and economic changes. This paper aims to introduce the debate about the weakness of transitional model in order to explain the process of shift with the decline in production and demand, which increasingly affects the difficult socio-economic status of its citizens. The current concept of economic growth is based on consumption of private and public borrowing, as well as the increasing imports has been proven to be unsustainable. Accordingly, it provides a critical review of the effects that the current transition model left on the development of B&H. A comparative analysis of the characteristic of various important macroeconomic variables and graphical representations of the collected statistical data, on which it formulates proposals for overcoming the current situation in B&H, will be given