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Bosnia and Herzegovina strategy

Bosnia and Herzegovina’s path to sustainable growth and development requires a much greater focus than before on an enabling business environment for private sector development, strengthened linkages between the two entities and with neighbouring countries and greater exploitation of the country’s natural comparative advantages.

Strategy (349KB - PDF)

Local language translation (1MB - PDF)

Report on the invitation to the public to comment (228KB - PDF)
 

Challenges

In the forthcoming strategy period the Bank will focus on addressing the following challenges:

  • Restructuring and expansion of the local private sector. Bosnia and Herzegovina has a strong industrial heritage, an abundant supply of energy, and significant resources to support processing industries. In order to support private sector expansion, the Bank will target local and foreign companies with a comprehensive range of products, including direct financing for large enterprises, while Local Enterprise Facility financing will be provided for restructuring and expansion of smaller local companies that currently face limited access to financing. The Bank will provide SME credit lines through local banks, microfinance loans, and non-financial Small Business Support through the Enterprise Growth Programme and Business Advisory Services. The Bank will continue an active policy dialogue on investment climate improvements.
  • Forging closer linkages with wider regional markets. A small open economy such as Bosnia and Herzegovina can reach its full economic potential only by integrating closely with wider regional markets. Regional integration, both physical and commercial, will become even more important in the new strategy period as Bosnia and Herzegovina now has a border with the EU as of 1 July 2013, following Croatia’s accession to the EU. The Bank will therefore continue to support infrastructure improvements and encourage greater private sector involvement in public infrastructure upgrades, as well as private investments supporting deeper regional integration via investment and trade flows, thereby strengthening transport and trade linkages with neighbours in the Western Balkans, including through targeted policy dialogue initiatives. As access to the EU market requires adherence to rigorous quality standards, the Bank will put a strong emphasis on improvements of standards both by direct financing to export-oriented companies, and through Small Business Support programmes.
  • Promoting a more efficient and sustainable use of resources. Public entities and private companies make very inefficient use of existing resources, resulting in unnecessarily high energy costs and significant environmental damage. To support more efficient and sustainable use of resources, the Bank will focus on sustainable energy investments with high demonstration effects. Various instruments will be used, including the Western Balkans Sustainable Energy Direct Financing Facility, and indirect financing via local financial institutions through Western Balkans Sustainable Energy Financing Framework credit lines. The Bank will provide direct financing for energy and resource efficiency improvements for large corporate clients, both in the private and public sectors, and for the restructuring and commercialisation of municipal utility companies. The Bank will continue an active policy dialogue on sustainable use of resources, using technical assistance, in close cooperation with other donors.

In its activities in Bosnia and Herzegovina, the Bank will seek to promote internal integration by actively seeking out investments that further deepen economic linkages between the two entities, and Brcko District, both with private companies and through institutional reforms in the public sector.


Last updated 21 January 2014

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