Sustainability of Bosnia and Herzegovina’s international trade flows

Sa？etak The aim of this research is to examine the sustainability of international trade flows of Bosnia and Herzegovina with the rest of the world. The data sample consists of quarterly data from the first quarter of 2008 to the last quarter of 2016. Johansen tests of cointegration indicated that exports and imports are co-integrated in the case of Bosnia and Herzegovina and Vector Error Correction Model (VECM) is estimated and tested. Research results revealed a bidirectional weakly sustainable relationship between exports and imports pointing out the need to improve external competitiveness of Bosnia and Herzegovina’s economy