Financing the SDGs implementation

The Sustainable Development Goals Framework in Bosnia and Herzegovina is a generally accepted and joint platform for action at all levels of government, and its operationalization is done through strategic documents of each level. In this regard, each individual level of government will develop its development strategies within its development planning and management systems, through which it will plan measures and policies for accomplishing Agenda 2030 and the SDGs, and will ensure funds for their implementation.

Having in mind the complexity of the administrative organization in Bosnia and Herzegovina, as well as the overall socio-economic condition in the country, each level of government will make additional efforts towards mobilizing (domestic and external) financial sources. According to the IMF data, approximately 40% (or slightly more) of GDP is distributed through the public budgets. Therefor the public budgets, together with external remittances with total of approximately 78% represent dominant potential sources of funding the SDGs (according to the data for 2008-2017). The afore-mentioned is supported by the fact that, in addition the significant presence of international donor communities in Bosnia and Herzegovina, the official development aid (ODA) amounts only approximately 6% of potential sources of funding the SDGs, while less than 9% relates to foreign credit sources.

Therefore, while strengthening better and more efficient utilization of the existing (traditional) financial sources, Bosnia and Herzegovina will be working on improvement of the financial architecture to support the implementation of the Goals.

• Framework in Bosnia and Herzegovina is a joint starting point for all levels of government in Bosnia and Herzegovina;
• Each level of government in Bosnia and Herzegovina includes the Goals in its development and sectoral strategies, when indicative financial needs are estimated for implementation from domestic and external sources;
• Development and sectoral strategies of each level of government in Bosnia and Herzegovina are operationalized through three year/annual work plans, which are prepared in line with the Budget Framework Paper (BFP) and annual budget.

In addition to the afore-mentioned, the support to operational implementation of the Sustainable Development Goals will be implemented through strengthening the existing and establishing new, innovative financial mechanisms and/or instruments:

• Strengthening the existing financial mechanisms and/or instruments which are already operational at different levels of government, and are being implemented through various forms of public grant schemes, targeted direct grants and subsidies, public-private partnerships (PPPs), investment, revolving and other funds such as BiH, entity and/or municipal bonds, and similar;
• Introducing new, innovative financial mechanisms and/or instruments which are applicable within the context of Bosnia and Herzegovina, and which will have to be selected and adjusted in the regulatory and operational sense for broader application. For example, Impact Investing, Social or Development Impact Bonds; so called Green Bonds into projects that have positive environmental and climate impacts, equity- based crowdfunding, forecast- based financial mechanisms, Debt –for- nature Swaps for investments relevant for the SDGs, and similar.

Within monitoring of the accomplishment of the Sustainable Development Goals overall and for each level of government in Bosnia and Herzegovina, there will be monitoring of realized financing for the SDGs from domestic and external sources on a regular basis and recommendations will be prepared for potential improvements for the next planning period.