A ”Dialogue on Public Policies for a Green Transition of Small and Medium-sized Enterprises in Bosnia and Herzegovina” was held yesterday in Banja Luka with the support of the Ministry of Economy and Entrepreneurship of Republika Srpska.

As a signatory of the Green Agenda, Bosnia and Herzegovina assumed the obligation to continue designing and implementing public policies that support a green transition. Although the OECD publication SME Policy Index 2022 points to continuous progress of Bosnia and Herzegovina and engagement of both entities in the field of energy efficiency and environmental innovation, successful public policies can be achieved by ensuring an efficient implementation of measures, inter-sectoral coordination, strengthening monitoring mechanisms and increasing the financial support to the green transition. 

During the discussion, it was concluded that small and medium-sized enterprises played a crucial role in mitigating climate change and protecting the environment and that, in addition to policy makers, SMEs should be involved in the development of strategies. It was also concluded that a circular economy was not a novelty in our region and that SMEs were adaptable to such processes.

The event gathered representatives from the public administration, private sector, civil society and experts and was organised by GIZ and OECD in the framework of the project ”Innovation and Digitalisation in Small and Medium-sized Enterprises in Bosnia and Herzegovina/EU4DigitalSME” that is co-funded by the European Union and the Government of the Federal Republic of Germany.

Following an introduction by Mr Donald Prohaska, GIZ Deputy Project Manager and Senior Advisor,  the participants exchanged good practices and recommendations from the country, the region and EU for the support to SMEs in the process of green transition. According to one of the conclusions, good practices are particularly important for supporting the introduction of green transition.

Economic recovery and circular business model as a solution  

Montenegro is a country that has a good track record when it comes to good practices in the region. The country successfully developed a circular economy roadmap and action plans based on a clear strategic framework and systematic reforms and ensured financing of green projects through different funds and donor support. Olivera Vukajlović from the Ministry of Economic Development and Tourism of Montenegro pointed out that it was necessary to find out how to maintain the competitiveness of the economy and ensure the relevant quality of life of the population in the process.

”One of the answers was that it was necessary to implement systemic reforms and put the focus on the two key acceleration mechanisms – circular transition and green transition”, said Vukajlović, who stated that the ability to answer the question was also the measure of economic recovery and resilience.

By applying a circular business model as a solution in the process of green transition, companies achieve a more efficient and sustainable use of resources as a result of their return in the production process. This results in a higher energy independence, less waste and ensures continuous protection of the environment and society.

A good practice, the transition from the linear to the circular business model, was presented to the participants by Alija Salkunić, a Supervisor for the Applied Circular Economy and Analysis from the company Elixir Group. Salkunić also presented a road map that can be useful for other companies as an inspiration for overcoming environmental challenges.

”We had a good basis, but any form of continuous improvement of know-how and visits to large systems based on the principles of circular economy have helped us to transition from the linear to the circular economy quite fast. A large quantity of documents and permits, but also public outreach, are challenges we face. So far, we have been able to overcome them successfully”, said Salkunić and underlined the importance of cooperation with public institutions and business associations.

A lack of environmental awareness, know-how about consumption and free time for keeping abreast of green and technological innovation are among the key obstacles for the green transition of small and medium-sized enterprises.

A discussion participant, Olivera Radić, Head of the Centre for Project Management and Analysis at the Chamber of Commerce of Republika Srpska, pointed out that this and similar projects contributed to awareness raising and adoption of know-how by SMEs and that it was important to hear about good practices and experiences of Ireland, Montenegro and Serbia.

”It is important that we have had an opportunity to see how competent ministries and governments support the process of green transition based on experiences of EU Member States, but also our neighbouring countries and partners, such as Montenegro. This also included strategic documents based on which they carried out analyses and identified needs in the field of green transition. However, the greatest impact on companies is that of the market or buyers from abroad that in a way compel them to meet certain requirements if they wish to maintain the contracts and continue cooperating in the future”, said Radić.

This public policy panel is part of a series of four panels organised by GIZ and the OECD Regional Programme for Southeast Europe. 

The project ”Innovation and Digitalisation in Small and Medium-sized Enterprises in Bosnia and Herzegovina”, which also includes the project EU4DigitalSME, aims to create a favourable environment for small and medium-sized enterprises (SMEs) in order to enable them to successfully implement digitalisation and innovation transformation. By ensuring access to innovative technologies, skills and services, the project is supporting the establishment of a favourable business environment for the technological transformation of SMEs and start-up companies in competitive sectors. The value of the project ”EU4DigitalSME” amounts to 6.1 million EUR, out of which the EU allocated 5 million EUR, and the Federal Republic of Germany 1.1 million EUR. EU4DigitalSME and the project ”Go Digital in Bosnia and Herzegovina” are part of a larger programme for the digital transformation of SMEs that was funded by the EU with an amount of 14 million EUR. 

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