The circular economy is increasingly moving from a general concept to a practical approach for strengthening competitiveness, particularly for micro, small and medium-sized enterprises (MSMEs) in Bosnia and Herzegovina that operate within export supply chains and work with buyers on the European Union market. Instead of the traditional linear model, the circular approach focuses on more efficient use of materials and energy, extending the lifespan of products, better management of by-products and waste, and the development of services and design solutions that reduce overall costs throughout the production cycle.
For SMEs, one of the most important aspects is that the benefits of circular solutions are often visible quickly and in measurable ways, since many of the changes directly affect the cost categories that place the greatest pressure on business operations: raw materials, energy, logistics, and waste management. In practice, even relatively simple measures in production can lead to tangible savings. For example, one company from the wood sector in Bosnia and Herzegovina reported reductions of 9% in electricity consumption, 5% in diesel consumption, and 24% in wood usage after introducing process improvement measures. Such results demonstrate that the circular economy is not only an environmental topic but also a management approach that helps reduce operational costs and increase resilience to rising prices of energy and raw materials.
In addition, circular business models are becoming increasingly relevant in relationships with buyers and partners, as EU regulations and supply chain requirements more frequently demand evidence of resource efficiency, transparency regarding the origin and flow of materials, effective waste management, and plans to reduce negative environmental impacts. For SMEs, this means that companies that establish basic resource monitoring practices early and introduce measures to reduce waste will gain a clear advantage in negotiations, respond more easily to buyer inquiries, and plan production more reliably.
In the upcoming period, companies in Bosnia and Herzegovina will have the opportunity to receive technical and financial support for introducing and implementing circular business models, with a focus on solutions that are practical for production processes and value chains. This support forms part of broader development initiatives aimed at strengthening SMEs and promoting the green economy. These activities are supported by the European Union and the German Federal Ministry for Economic Cooperation and Development (BMZ) and are implemented by Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH within the Private Sector Development in Bosnia and Herzegovina project. More information about available opportunities and next steps will soon be published on the project website: www.digigreen.ba.
