The 3rd international conference on Economic Diplomacy and Internationalization, 2-3 June 2014, Sarajevo, Bosnia and Herzegovina

The 3rd international conference on Economic Diplomacy and Internationalization organized by ICPE between 2-3 June 2014 in partnership with the Ministry of Foreign Affairs of Bosnia and Herzegovina and the Foreign Trade Chamber of Bosnia and Herzegovina and in cooperation with the Ministry of Foreign Affairs of the Republic of Slovenia has successfully ended yesterday in Sarajevo, Bosnia and Herzegovina.

More than 100 participants attended the conference including high-profile experts from Bosnia and Herzegovina and other foreign national institutions, representatives of the diplomatic corps, international organizations, business and academic professionals who shared their knowledge, expertise and insights in dealing with economic diplomacy and internationalization.

Janez Podobnik, ICPE Acting Director General (photo by Foreign Trade Chamber of BH)

The themes under discussion prioritized the importance of economic diplomacy and internationalization of national economies in general and of Bosnia and Herzegovina in particular and stressed the crucial role of efficient economic diplomacy in the elimination of consequences of natural disasters.

Peter Sørensen, European Union Special Representative to Bosnia and Herzegovina (photo by Foreign Trade Chamber of BH)

Welcome speeches were held by Ahmed Egrlić, President, Foreign Trade Chamber of Bosnia and Herzegovina, and by the ICPE Acting Director General Janez Podobnik who were  followed by addresses delivered by Peter Sørensen (European Union Special Representative to Bosnia and Herzegovina), Ermina Salkičević – Dizdarević (Deputy Minister, Ministry of Foreign Trade and Economic Relations, Bosnia and Herzegovina), Željko Jerkić on behalf of the Ministry of Foreign Affairs of Bosnia and Herzegovina, Gazmend Turdiu (Deputy Secretary General, Regional Cooperation Council, Sarajevo) and on behalf of the Ministry of Foreign Affairs of the Republic of Slovenia, H.E. Iztok Grmek (Ambassador of the Republic of Slovenia to Bosnia and Herzegovina). The opening session was chaired by Mitar Kujundžić, Ambassador, Assistant Minister for Multilateral Relations, Ministry of Foreign Affairs of Bosnia and Herzegovina.

The conference debuted with a minute of silence in the memory of the victims of the terrible natural flood disaster that affected Bosnia and Herzegovina in May 2014.

During the opening ceremony on the first day of the conference the speakers have underlined the necessity of economic diplomacy to adapt to the new conditions caused by the globalizing trends. Since the conference took place after the massive floods in Bosnia and Herzegovina the speakers emphasized the necessity to intervene for alleviating floods consequences and stressed that this is a part of governing and that it should be ensured that development continues also with the help of economic diplomacy.

The economic diplomacy of the European Union is also focused on economic recovery which depends on Bosnia and Herzegovina’s ability to exercise economic diplomacy and implement economic reforms in order to make Bosnia and Herzegovina competitive in the European market. One of the EU’s goal is to provide know-how to Bosnia and Herzegovina to align its legislation to the acquis communautaire. Other topics that have been touched upon were related to the necessity of establishing a legal basis for the functioning of economic diplomacy as well as gender mainstreaming. Finally, the great potential of honorary consuls were viewed as a tool for complementing the network of existing economic counselors in diplomatic-consular missions, especially in those countries or regions where there are no diplomatic missions.

H.E. Iztok Grmek, Ambassador of the Republic of Slovenia to Bosnia and Herzegovina

The speakers mentioned the importance of economic diplomacy to promote state’s prosperity through a multidisciplinary approach in which development cooperation is crucial, especially in so far as regional and EU integration is concerned. In this context a change in the companies’ goals aiming to develop not only at the national level, but also at the regional and at the European level is a must. Related to internationalization the bilateral cooperation between states for approaching third markets is vital. The importance of supporting the efficient use of resources, the flow of goods, capital and people has been brought into discussion together with research, development and innovation as a means for reaching inclusive growth and good governance.

The ICPE Acting Director General's welcome address stressed that with the opening of the regional office in Sarajevo ICPE wants to strengthen its cooperation with Bosnia and Herzegovina as one of the ICPE's member states, and other member states in the region. ICPE's goal is to develop common training and educational projects and programs adapted to the concrete needs of Bosnia and Herzegovina and other South-Eastern European countries for sharing the experience of ICPE's member states and partner countries in areas related to: public sector enterprises, social responsibility, entrepreneurship development, SME and infrastructure sectors, corporate governance, technology transfer, PPP (public-private partnership), sustainable development, EU economic and financial instruments.

The first session on the second day of the conference was dedicated to effective economic diplomacy and it was moderated by Neven Kulenović, Minister-Counselor, Head of the Department for Economic Diplomacy, Ministry of Foreign Affairs of Bosnia and Herzegovina. The following panelists delivered their interventions: Zvone Dragan, (Ambassador, Special Adviser to the Acting Director General, ICPE), Neven Kulenović, H.E. Željko Jerkić (Ambassador of Bosnia and Herzegovina to the Republic of Slovenia), H.E. Iztok Grmek (Ambassador of the Republic of Slovenia to Bosnia and Herzegovina), H.E. Ivan Del Vechio, M. Sc. (Ambassador of the Republic of Croatia to Bosnia and Herzegovina), Radoslav Janković (Ambassador, Coordinator of the Group for bilateral economic cooperation, Ministry of Foreign Affairs of the Republic of Serbia), Boštjan Udovič, Ph.D. (Assistant Professor, Faculty of Social Sciences, University of Ljubljana, Slovenia) and David Dašić, Ph.D. (Professor, European Center for Peace and Development, Belgrade).

Neven Kulenović, Minister-Counselor, Head of the Department for Economic Diplomacy, Ministry of Foreign Affairs of Bosnia and Herzegovina

It has been noted that efficient economic diplomacy is one of the important factors contributing to the successful solving of economic crises. Its results are particularly important for the improvement of the balance of payments, for intensifying the export average and the acquisition of net foreign investments as urgent generators for the rebirth of economic growth. During crisis economic diplomacy has to quickly adapt the content of its work (program priorities, key markets) and increase its operativeness in cooperation with state organs or local and foreign companies. Moreover, although economic diplomacy covers all areas of economy the focus on several sectors or areas is paramount.

Ervin Vivoda, Head of Division, Elimination of Consequences of Natural Disasters Division, Ministry of Agriculture and the Environment of the Republic of Slovenia

In case of national disasters international cooperation doubled by a strong commitment of diplomacy is needed. International assistance can alleviate the consequences in two phases: immediately during and after the occurrence of such disasters in the form of humanitarian aid as well as in the form of long-term assistance, financial or of any other type.

In terms of economic cooperation it has been revealed that a synergy of all institutions (such as Ministries of Foreign Affairs, Ministries of Economy or Trade, government agencies, non-governmental organizations, business associations etc.) is the best way to support economic growth and internationalization.

Efficient economic diplomacy cannot be implemented without a selection of its actors on the basis of merit, without a concrete and timely assessment of the efficiency of those actors or without a well-designed communication system between all actors involved in the process.

With regard to international cooperation membership in international organizations has been mentioned as a factor contributing to the successful internationalization of national economies which cannot be achieved without the placement of foreign policy high on the national political agenda and particularly economic diplomacy.

Foreign policy and diplomacy are inseparable from market activities, market laws, logic and ethics including market fundamentalism and profit is the main market value so the business criterion should become a tool for measuring foreign policy.

Another important ingredient in a successful economic diplomacy are effective public relations and the media which can significantly alter the way in which the tasks of economic diplomacy are supported by companies, by other institutions and by the public in general.

The second session was devoted to the internationalization of national economy and it was chaired by Igor Gavran, Senior Adviser, Foreign Trade Chamber of Bosnia and Herzegovina. The speakers during the second session were Lejla Hamzić (Unit for Trade Relations with European integrations, Ministry of Foreign Trade and Economic Relations of Bosnia and Herzegovina), Ervin Vivoda (Head of Division, Elimination of Consequences of Natural Disasters Division, Ministry of Agriculture and the Environment of the Republic of Slovenia),

Elma Kovačević-Bajtal, M.Sc. (Adviser, Foreign Trade Chamber of Bosnia and Herzegovina – Institute for Education), Alexander Märdian (Delegation of German Economic Affairs in Bosnia and Herzegovina - AHK BH) and Sigmund Nemeti (Commercial Counselor, Embassy of Austria in Bosnia and Herzegovina).

The speakers have discussed the importance of international agreements for supporting economic growth – especially the CEFTA 2006 agreement.

Efficient management and elimination of the consequences of natural disasters has been identified as vital for ensuring economic growth and successful internationalization since the impact of national disasters on the economy can be enormous. This can only be accomplished with an adequate legislative framework clearly defining the allocation of resources, individual sector roles, categories of beneficiaries of state aid etc. Additionally, damage assessment is needed for example for establishing the eligibility of funds from the state budget.

The support of the economic diplomacy and internationalization can also be achieved by engaging the diaspora, particularly in those countries that have a large and geographically wide-spread diaspora, together with the establishment of mixed chambers of commerce. Moreover, constructive input from companies can help to improve the work of economic diplomacy and chambers of commerce, hence the dialogue between the business sphere and institutions should not be neglected. Furthermore, market researches are useful tools for signaling certain trends or indication directions to follow. In this sense the involvement of the academia and graduate students in initiating such researches should also be taken into account.

For those countries with a limited market internationalization is an efficient way for bringing about economic growth. Another issue that has been noted relates to the attraction of foreign direct investments and of the role of foreign trade chambers for facilitating such investment projects bilaterally, both in the country of origin and in the foreign market.

Last but not least understanding intercultural differences is a factor that can greatly improve companies’ performance in a certain market and therefore intercultural consulting should also be considered.

In the second part of the session on internationalization the representatives of Bosnian enterprises successful in foreign markets have presented their concrete best-practice cases for approaching foreign markets: Senada Spahić, M. Sc. (Assistant General Manager for Finance and Director of Finance Department, Energoinvest d.d.), Amer Bukvić (CEO, Bosna Bank International (BBI), Sanja Praštalo (Director of Marketing Department, Mikroelektronika), Adis Hasaković (As Group Jelah), Miroslav Ćorić (Owner, Andrija), Snježana Koepruner (One - Association of Women Entrepreneurs and CO GS-TMT dd) and Haris Kulović, (Altermedia).

Senada Spahić, M.Sc., Assistant General Manager for Finance and Director of Finance Department, Energoinvest d.d.

The representatives of the companies from Bosnia and Herzegovina have mentioned several aspects that should not be left aside in the companies’ internationalization process. Firstly, within the marketing concept globalization should be taken into account while a particular marketing orientation should be designed for each country bearing in mind the business culture of the people in that market. Secondly, state support either in the form of subsidies or for instance in the form of guarantees for accessing favorable credit lines can help companies for producing better products and successfully market them abroad. Thirdly, the state’s role for obtaining the required patents for exporting to certain markets is indispensable.

ICPE Acting Director General delivered the closing address by emphasizing the commitment of ICPE to support efficient economic diplomacy and internationalization considering that economic diplomacy and internationalization are activities that merge together states and enterprises but their final goal should be the increased welfare of citizens. Janez Podobnik concluded that the results of the 3^rd international conference on Economic Diplomacy and Internationalization in Sarajevo should not be reflected only in general discussions of the role of economic diplomacy but in the more active cooperation between diplomacy and economy and in the concrete support of economic diplomacy for accomplishing common projects in the region.

Please find the closing remarks of Mr Janez Podobnik, ICPE Acting Director General here.