Agriculture represents about 9% of the Bosnian gross domestic product and
employs almost a fifth of the labor force. Agriculture is no more sufficient to ensure the
development of Bosnian rural areas; where lives around 61% of the population.
Diversification issue can be considered in terms of resources (land, labor or capital),
location (on-farm or off-farm) and output (farm or non-farm). The paper aims at analyzing
income-generating activities diversification in rural south-eastern Bosnia with a focus on
motivations and barriers. It discusses the main factors affecting off-farm and non-farm
activities development, including policies, and provides some recommendations. The
paper is based on an extended secondary data analysis and semi-structured interviews,
conducted in March-April 2012, with 104 households’ heads from Foca, Rogatica, Han
Pijesak, Vlasenica, Sekovici, Milici and Bratunac municipalities. Almost a half of the
surveyed households characterized themselves as mixed (46.1%), 41.3% as farm, and
12.6% as non-farm. Income is generated mainly from agricultural products sale (76%),
off-farm activities (52.9%) and pensions (44.2%). Motivations for engaging in off- and
non-farm activities are not always purely financial and also reflect societal changes. In the
last five years, 21.6% of the households started new income-generating activities - mainly
related to services provision and on-farm processing - but gave up while 22.6% of them
still deal with new activities. The main barrier is the lack of financial resources (39.7%)
and time (12.1%). Weak business skills are also a limiting factor. Development of new
activities raises farmers’ income and contributes to a healthy, diversified and viable rural
economy. Public institutions need to make sure that policies in place, whether sectoral or
broader, do not put obstacles in the way of diversification and improve rural planning and
services delivery. Creating an enabling environment for diversification requires the efforts
of many public and civil society actors.