public in the
old Yugoslav federation. Although agriculture is almost all in
private hands, farms are small and inefficient, and the republic
traditionally is a net importer of food. Industry has been greatly
overstaffed, one reflection of the socialist economic structure of
Yugoslavia. TITO had pushed the development of military industries
in the republic with the result that Bosnia hosted a number of
Yugoslavia's defense plants. The interethnic warfare in Bosnia
caused production to plummet by 80% from 1992 to 1995 and
unemployment to soar. With an uneasy peace in place, output
recovered in 1996-99 at high percentage rates from a low base; but
output growth slowed in 2000-02. Part of the lag in output was made
up in 2003-04. National-level statistics are limited. Moreover,
official data do not capture the large share of black market
activity. The konvertibilna marka (convertible mark or BAM)- the
national currency introduced in 1998 - is now pegged to the euro,
and the Central Bank of Bosnia and Herzegovina has dramatically
increased its reserve holdings. Implementation of privatization,
however, has been slow, and local entities only reluctantly support
national-level institutions. Banking reform accelerated in 2001 as
all the Communist-era payments bureaus were shut down. The country
receives substantial amounts of reconstruction assistance and
humanitarian aid from the international community but will have to
prepare for an era of declining assistance.

Botswana
Botswana has maintained one of the world's highest growth
rates since independence in 1966. Through fiscal discipline and
sound management, Botswana has transformed itself from one of the
poorest countries in the world to a middle-income country with a per
capita GDP of $8,800 in 2003. Two major investment services rank
Botswana as the best credit risk in Africa. Diamond mining has
fueled much of the expansion and currently accounts for more than
one-third of GDP and for nine-tenths of export earnings. Tourism,
subsistence farming, and cattle raising are other key sectors. On
the downside, the government must deal with high rates of
unemployment and poverty. Unemployment officially is 21%, but
unofficial estimates place it closer to 40%. HIV/AIDS infection
rates are the highest in the world and threaten Botswana's
impressive economic gains. Long-term prospects are overshadowed by