Washington Economic Agreement and the Implementation of Structural Policies in Bosnia and Herzegovina

The Washington Consensus (WC) development approach consists of three macroeconomic and seven structural policies for transitional transformation of the economy. Proper implementation of the structural policies was important for qualitative changes in the economy. In this paper, we will explain and evaluate the implementation of seven structural policies, being: improvement of the legal system and governance, privatization, foreign direct investment (FDI), deregulation, redirecting public expenditures, trade liberalization and tax reform, over time. This paper will also make comparisons with other transitional countries in the region, in order to draw the lessons and make recommendations for the future development of B&H. It can be concluded that B&H has been stagnating in its economic development, and that B&H’s government must improve its tax system, governance, engage in the fight against corruption, speed up the business deregulation and privatization in order to accelerate the economic growth