EU4 Private Sector Development in Bosnia and Herzegovina

We are strengthening the resilience of the economy in Bosnia and Herzegovina

Overview

The EU4 Private Sector Development in Bosnia and Herzegovina (EU4PSD) initiative is co-financed by the European Union and the Federal Ministry for Economic Cooperation and Development (BMZ). Following a call for expressions of interest in December 2022, the project has been awarded to a partnership between GIZ and the OECD, with GIZ’s portion being implemented under the BMZ programme “Sustainable Economic Development and Employment Promotion” (SEDEP). EU4PSD will run for 36 months, starting on 2nd December 2024.

Goals

The primary objective of EU4PSD is to support the economic recovery of BiH post-COVID-19 and promote a more competitive and sustainable economy. Specifically, the project aims to enhance the competitiveness and innovation of micro, small, and medium-sized enterprises (MSMEs) by guiding them towards a greener and more digital economy. EU4PSD will accelerate the digital and green transformation of (M)SMEs through grants and technical support. Local partners will introduce digital and green solutions to target groups, including export-oriented SMEs, startups, innovative businesses, and women- and youth-led enterprises. The outcomes of these grants will help improve policies and strategies, strengthening the digital and green ecosystem for (M)SMEs.

GIZ and the OECD will carry out a coordinated set of activities that combine technical assistance (TA) and grant support (GS) in a harmonized, impact-driven manner.

Key Outputs:

Strengthening Economic Recovery and Policy Development:

OECD will lead efforts at the macro level, focusing on building the capacity of key stakeholders for long-term economic recovery planning and policy development.

Supporting MSMEs in Digital and Green Transformation:

At the micro level, GIZ will assist MSMEs in adopting green and digital approaches. This includes improving access to finance and providing technical assistance (TA) for targeted digital transformation and eco-innovation.

Enhancing Business Support Organizations (BSOs):

GIZ will implement interventions at the meso level to strengthen BSOs. These efforts will focus on providing technical assistance and capacity development, enabling BSOs to effectively deliver digital and green services to (M)SMEs. A digital platform developed at this level will support awareness-raising, information sharing, and policy dialogue, contributing to the resilience of (M)SMEs in key sectors.

Synergies with other programmes

The EU funded EU4PSD project complements the SEDEP programme under Private Sector Development (PSD) and furthers the competitiveness of (M)SMEs, the adoption of sustainable business practices, and Bosnia and Herzegovina’s faster economic integration with the EU.

The SEDEP programme also includes a component on strengthening vocational education and training (SVET), co-funded by the Swiss Government through the Swiss Agency for Development and Cooperation (SDC). Additionally, SEDEP is preparing to integrate an EU-funded initiative, “EU4 Digital Transformation in Bosnia and Herzegovina,” which will launch in March 2025.

Link to SEDEP programme

Part of the EU4PSD initiative is closely linked to SEDEP, which integrates private sector development with training and vocational education. The aim is to improve conditions for sustainable economic growth and employment in SMEs by supporting their green and digital transformation. As outlined in the Description of Action (DoA), this will also contribute to higher job quality, added value, and poverty reduction by introducing modern green and digital technologies into BiH’s business sector.