J.1 SOO amended.pdf

Attachment J.1

Statement of Objectives (SOO)

C.1 Purpose:

The purpose of this Activity is to catalyze the economic and social potential of BiH diaspora with the goal of improving socio-economic conditions in BiH.

C.2 Background

C.2a General Background and Country Context

More than 2 million people originating from Bosnia and Herzegovina (BiH) reside outside of the country, making BiH sixteenth in the world when it comes to the percentage of total population living abroad1. The BiH diaspora is dispersed over fifty countries, with large numbers settled in Europe, the United States, Canada, and Australia. BiH diaspora is mostly well-integrated and better off than other migrant communities in their host countries, with ample potential and willingness to contribute to the development of BiH. This is evidenced by substantial diaspora remittances. BiH is one of the world's top recipient countries for remittance inflows receiving approximately $1.5 billion in remittances annually2 (equivalent to 7.1 percent of the Gross Domestic Product). BiH has a trade deficit of approximately negative 3.7 percent, and remittances represent an important factor in funding the deficit and supporting the stability of the BiH economy.

Remittances are often used to support consumption and, to a somewhat lesser degree, business development. They are directed at increasing the household’s budget, providing for needs of relatives, house building and repairs, procurement of home appliances, etc.3 However, the BiH diaspora's potential is much bigger and can provide a multitude of opportunities for local economic and social development, through trade, investment, job creation, knowledge sharing and knowledge transfer, networking, and being the country’s global ambassadors. Diaspora have the ability to influence positive local economic reform and development. They can support local small and medium businesses by providing linkages with larger markets, demonstrating how socially responsible business practices can make a positive impact on businesses and catalyze local social change, support and facilitate networking, or support or guide local small businesses in accessing finance and capitalizing on investment.

Access to finance remains an obstacle for entrepreneur-minded diasporans wanting to reinvest in BiH through startup4 enterprises. The diaspora’s non-existent local credit history severely

1 https://balkaninsight.com/2017/08/08/half-of-all-bosnians-live-outside-bosnia-08-07-2017/ 2https://www.cbbh.ba/press/ShowNews/1365?title=Na%C5%A1i-gra%C4%91ani-koji-%C5%BEive-u-inostranstvu-su-sna%C5%BEan-potencijal-razvojnim-procesima-u-BiH 3 http://www.mhrr.gov.ba/PDF/MAPPING%20BIH%20DIASPORA%20REPORT.pdf 4 Startup: Companies that have been in business less than 5 years. Includes all startup phases: pre-seed, seed, early, growth, expansion, and exit https://balkaninsight.com/2017/08/08/half-of-all-bosnians-live-outside-bosnia-08-07-2017/ https://balkaninsight.com/2017/08/08/half-of-all-bosnians-live-outside-bosnia-08-07-2017/ https://www.cbbh.ba/press/ShowNews/1365?title=Na%C5%A1i-gra%C4%91ani-koji-%C5%BEive-u-inostranstvu-su-sna%C5%BEan-potencijal-razvojnim-procesima-u-BiH https://www.cbbh.ba/press/ShowNews/1365?title=Na%C5%A1i-gra%C4%91ani-koji-%C5%BEive-u-inostranstvu-su-sna%C5%BEan-potencijal-razvojnim-procesima-u-BiH http://www.mhrr.gov.ba/PDF/MAPPING%20BIH%20DIASPORA%20REPORT.pdf hinders their opportunities for accessing local finance because private entities need to operate for at least two years to demonstrate their creditworthiness. This impediment can lead diasporans to search for joint ventures and collaboration and coordination with local micro, small, and medium enterprises (MSMEs). Even when local business partners are found, access to startup enterprise finance is very difficult for small and start-up businesses in an environment saturated with banking finance targeted at moderate and low risk profile medium-sized companies. A report issued by the European Investment Bank emphasizes a lack of equity finance in the market.

Because of this, startup enterprises have particular difficulty getting funding, as do enterprises that are too big to be served by Microcredit Financial Institutions (MFIs), but small enough to be of limited interest to banks.5

To partially address this finance gap, USAID, in cooperation with US Development Finance Cooperation (DFC) and Swedish Development Agency (Sida) established the Loan Portfolio Guarantee Program with ProCredit Bank. This assistance helps reduce or eliminate barriers for businesses, mobilizes private capital to finance development initiatives in BiH, and demonstrates the economic viability of such investments to the local banking sector. To date ProCreditBank has disbursed 45 loans in the amount of $8,000,000. The loan guarantee will end in 2027.

Some cities/municipalities have improved their business climates and can serve as examples of good practices to other local communities that lag in the creation of a business-friendly environment. Whereas political instability is a state-level issue, strengthening the business-enabling environment at the local level has been shown to help drive diaspora investments.6 Unfortunately, communication on diaspora-related issues among cities/municipalities is modest and impedes cities/municipalities from replicating examples of good practice and learning from each other. These factors contribute to the deteriorating trust diasporas feel toward the BiH government and make BiH a less attractive location for diaspora investments, especially to women investors who are more risk-averse and tend to seek safer investments compared with men5.

In addition to complex administrative and bureaucratic procedures, the lack of information about investment opportunities is also recognized as a business environment shortcoming hindering diaspora investments. The USAID/BiH “Diaspora Assessment Report” revealed that 82 percent of interviewed diasporas think that information on investment climate, challenges, and opportunities is not well disseminated to diasporas. Whereas some structures for providing information on investment opportunities exist at all government levels, the assessment found that this information was insufficient for diasporas to make informed decisions about potential investments.

Recognizing the demand for information, USAID/BiH’s Diaspora Invest Activity supported the creation of the Diaspora Business Center (DBC) by Naša Perspektiva. The DBC facilitates diaspora investor relationships, organizes investment info sessions, implements locally themed diaspora business networking events, and exchanges investment opportunity information (such as industrial and economic zones with favorable conditions). The DBC signed Memoranda on

5 EIB Report, available via https://www.eib.org/attachments/efs/assessment_of_financing_needs_of_smes_bosnia_herzegovina_en.pdf 6 USAID/BiH Diaspora Assessment available via- https://www.measurebih.com/uimages/Diaspora20Assessment2C20Final20Report.pdf https://www.eib.org/attachments/efs/assessment_of_financing_needs_of_smes_bosnia_herzegovina_en.pdf https://www.measurebih.com/uimages/Diaspora20Assessment2C20Final20Report.pdf

Cooperation (MoCs) with 15 municipalities (see Attachment J.5 for the complete list of municipalities) to further facilitate diaspora business relationships at the municipality level.

“Brain drain” remains a major problem faced by the BiH Government. The deteriorating economic conditions, an unstable political environment, persistent poverty, and almost 30% unemployment rate, especially amongst college-educated young adults, has led BiH citizens to pursue opportunities outside of BiH. Nearly half of young people (ages 18-29) in Bosnia and Herzegovina, 47 per cent, are thinking of leaving the country, a survey issued by the United Nations Population Fund, UNFPA7. Many businesses also acknowledge that political instability exacerbates their already difficult job of attracting investment and creating new opportunities for employment in BiH.

Meanwhile, BiH has done very little in terms of responding to these new challenges. In particular, it has thus far not strategically considered the added value of its numerous highly qualified diaspora for countering high emigration levels. A survey among highly skilled professionals living abroad shows the perception that the lack of initiative of BiH institutions and organizations causes a major blockage to the establishment of a relationship and cooperation between the diaspora and the home country.8 Some BiH diaspora associations, e.g. Bosnian- Herzegovinian American Academy of Arts and Sciences (BHAAAS)9 and Bosnian-Swedish professional network (APU)10, gather several hundred prominent individuals from both industry and academia with the objective to build cooperation with the homeland and contribute their expertise and knowledge.

Despite all the challenges, BiH diaspora want to invest in their home country. They are not blind to the higher risk and unpredictability of investing in BiH and offset these concerns against their personal desire to rebuild and strengthen their links to BiH. They place additional importance on returning to their communities of origin and contributing to their recovery/development and believe that investment in BiH would help bring about social, environmental, and/or governance related improvements in the country (USAID/BiH Diaspora Assessment).

C.2b Development Challenge

The current stagnant business environment limits employment opportunities and leads to out-migration of many of BiH’s most promising citizens, especially youth. It adds additional pressure on the private sector, and is preventing BiH from having a faster growing, market-oriented economy.

Economic and business growth is constrained due to the business enabling environment not responding to, nor addressing the needs of, diaspora and local MSMEs including start-ups.

Interaction with diaspora at the local level has been largely unstructured, with little systemic

7 https://ba.unfpa.org/sites/default/files/pub-pdf/youth_emigration_survey_in_bih_eng_final_0.pdf 8 The Scientific Diaspora as the Brain Gain Option: Exploring the Case of Bosnia and Herzegovina”, Nikolic and Cosic, 2010 9 https://bhaaas.org/ 10 https://apunetwork.net/ https://ba.unfpa.org/sites/default/files/pub-pdf/youth_emigration_survey_in_bih_eng_final_0.pdf https://ba.unfpa.org/sites/default/files/pub-pdf/youth_emigration_survey_in_bih_eng_final_0.pdf https://wbc-rti.info/object/document/14655/attach/document.pdf https://bhaaas.org/ https://apunetwork.net/ engagement and no incentives to help channel diaspora investments toward productive uses in terms of socio-economic development.

The local business environment and investment climate must be improved through partnerships between risk-tolerant and socially conscious diaspora, local and international investors, innovative finance vehicles, civil society, and business-reform oriented local governments.

C.2c Relationship to Other Activities

USAID has a long history of support to the BiH private sector, including diaspora-led investments; the Diaspora Invest Activity is the most recent manifestation of this support (Refer to the List of referenced documents available at the bottom of the SOO for a list of relevant reports and documents for Diaspora Invest. Offerors are encouraged to research beyond the documents in this list). Beginning April 2017 and ending in April 2022, USAID/BiH's Diaspora Invest Activity demonstrated that BiH diaspora are ready to begin to realize their vast economic potential. USAID Diaspora Invest Activity supported 164 diaspora startups established in 65 municipalities throughout BiH. These interventions yielded $22.1 million (BAM 37.6 million) in new diaspora direct investment and directly supported the creation of 475 new full-time jobs.

The total employment in these firms grew to 1,571 in September 2021. USAID-supported firms generated $74 million (BAM 125 million) in revenues during 2020, with $52.4 million (BAM 89 million) generated through exports.

The Contractor must take into account and build upon this previous programming, to include activities already completed, relationships already established, materials already produced, and all levels of BiH government plans and normative frameworks already developed. Lessons learned from the Diaspora Invest Activity are included within Attachment J.7.

This activity will build upon prior investments from Diaspora Invest and complement a number of recently awarded USAID activities. See “C.4.h. Coordination with USAID and Other Donor Activities” for a list of current activities that the Contractor must coordinate with during implementation. The Contractor should plan and carry out a program of activities with a clear understanding of the scope and impacts of other USAID Activities and donor efforts in private sector development.

C.3 Contract Objectives

C.3a Description of Objectives

USAID believes that through targeted and strategic assistance, BiH diaspora can continue to drive economic growth and influence positive economic and social change. The activity purpose is to catalyze the social and economic potential of BiH diaspora11. More active engagement of diaspora individuals and business communities is crucial for BiH’s development. Such an

11 Diaspora is defined as emigrants and their descendants who live outside the country of their birth or ancestry, either on a temporary or permanent basis, yet still maintain effective and material ties to the countries of origin. The common thread among these recent arrivals and members of long-established communities is that they identify with the country of origin or ancestry and are willing to maintain ties to it. These ties are, potentially, beneficial to development- Developing a Road Map for Engaging Diasporas in Development, Migration Policy Institute (2010) engagement is expected to further catalyze diaspora contributions and create positive spillover effects for local MSMEs and Municipalities.

USAID/BiH envisions that the resultant contract will be divided into four objectives:

Objective 1: Local governments’ abilities strengthened to engage diaspora in local economic development.

Objective 2: Country-wide direct investment12 to high-potential diaspora13 and/or diaspora-related14 MSMEs startups and/or joint ventures expanded.

Objective 3: Business and social change15 that links diaspora best business practices, investment capital, and knowledge with domestic MSMEs stimulated.

Objective 4: Access to existing and new financial instruments that enable flow of private capital (either debt or equity) to all MSMEs and startups operating in BiH increased.

C.3b Indicators

USAID requires offerors to include the below indicators in their proposals:

- Number of direct full time officially registered jobs in USG-assisted enterprises and other private sector partners/beneficiaries

- Number of public-private partnerships facilitated

- Value of direct investment (domestic and foreign) resulting from USAID assistance

- Number of private sector enterprises with increased access to finance due to USG assistance (EG.2-12)16

- CBLD-9 - Percent of U.S. Government-assisted organizations with improved performance17

- EG.5.2-1 Number of firms receiving USG-funded technical assistance for improving business performance

- PSE-2 Number of private sector enterprises that engaged with the USG to support U.S.

Foreign Assistance objectives

The Contractor will develop final baselines and targets in consultation with USAID but must indicate proposed baselines and targets where available or appropriate.

12 Direct investment: investment in diaspora-related MSME startup and/or joint venture through private capital and/or USAID-funded grants.

This includes local MSME that through direct investments become diaspora-related or diaspora-owned MSMEs and/or joint ventures.

13 Diaspora company: 100% owned or co-owned by diaspora investors/entrepreneur 14 Local company that is co-owned by a diaspora entrepreneur or joint venture 15 Social change is defined as changes in human interactions and relationships that transform cultural and social institutions.

16 Note: Activity interventions will focus on start-up MSMEs and/or joint ventures.

17 This indicator measures whether USG-funded capacity development efforts have led to improved organizational performance in organizations receiving organizational capacity development support. This indicator should only be used when an activity intentionally allocates resources (human, financial, and/or other) toward strengthening organizational capacity and undergoes a deliberate performance improvement process that is documented. Details and resources related to this global indicator can be found on this link: https://www.usaid.gov/npi/capacity-building-indicator-resources.

https://www.usaid.gov/npi/capacity-building-indicator-resources https://www.usaid.gov/npi/capacity-building-indicator-resources

Other outcome indicators will be developed and proposed by the Contractor. The Contractor is required to develop a set of indicators that appropriately measures outcomes for each Activity sub-purpose. The Contractor should pay particular attention to proposing strong metrics that will measure diaspora-led business and social change.

C.3c Theory of Change

IF the economic and social potential of the BiH diaspora is harnessed through diaspora active economic engagement and knowledge transfer THEN the proliferation of new and scalable diaspora-linked enterprises will lead to overall private sector growth, inclusive and sustainable job generation, brain-gain, and a market-oriented, socially conscious economy providing better economic opportunities for all its citizens.

C.4.a Local Systems

To increase the likelihood of sustainability, the Contractor must support an interconnected set of local actors - governments, civil society, the private sector, diaspora organizations and others -that jointly produce the desired development outcomes.

The Contractor will provide a direct grant not to exceed $500,000 during the life of the activity to the local NGO, Nasa Perspektiva. Nasa Perspektiva was a partner in USAID/BiH’s Diaspora Invest Activity. An overview of the services Nasa Perspektiva provided to the Diaspora Invest Activity is as follows:

1. Nasa PERSPEKTIVA’s Diaspora Business Center provides information and services to diaspora investors. These services facilitate diaspora investments and business to business (B2B) connections in BiH. Diaspora Business Center advisory services include: business establishment and registration assistance, investment opportunity, legal and regulatory requirements, liaison with local institutions, business planning services, financial products, etc.

2. Organization of business networking (B2B) events.

3. Organization of the LEADER Knowledge Sharing/Business Training program. This includes candidate recruitment from diaspora owned companies and identification of local MSMEs demanding these services and market links.

4. Produce and publish video stories on diaspora investments in BiH.

5. A monthly diaspora investment newsletter.

6. Government partnerships promoting investment opportunities and collaboration between diaspora and the public sector. This includes partnerships with 15 local governments (including diaspora mapping at these municipalities) the Foreign Investment promotion Agency, and the Foreign Trade Chamber.

7. Maintenance of a diaspora networking web-portal (www.diasporainvest.ba). The portal was developed during the USAID’s Diaspora Invest Activity). The portal is still used for the intended purposes.

C.4b Private Sector http://www.diasporainvest.ba/

USAID is building dynamic, mutually beneficial partnerships with companies and investors to advance development progress and address many of the obstacles that businesses face – from supply chain stability to community investment and workforce development. Development and business leaders alike recognize that by collaborating and leveraging each other's unique resources, assets, and skill set, we can tackle problems together that neither of us could address alone. Please refer to the USAID Private Sector Engagement Policy18.

C.4c Innovation

The Contractor must address innovation in its approach. BiH diaspora led businesses - and BiH private sector in general - offers fertile terrain for innovation. Innovation in BiH can refer to technologies new to the country, new ways of delivering or financing goods and services, more cost-effective or efficient adaptations to existing solutions, new ways of increasing implementation of existing proven solutions, policy changes based on insights from behavioral economics, social or behavioral innovations and changes, novel approaches in using socio-economic levers to catalyze social and behavioral change, and inclusion of the private sector, investment funds, or individual investors in the identification and/or funding of direct investment and technical support opportunities to MSMEs startups and/or joint ventures. Building sustainable digital tools and platforms at the local level is essential to create and maximize long-term impact. Digital solutions must follow best practices identified in USAID’s Digital Strategy19 and outlined in the Principles for Digital Development20.

C.4d - Grants Under Contract

The Contractor must include a Grants Under Contract (GUC) component up to $2,800,000 and the contractor is strongly encouraged to explore creative and innovative ways to maximize the impact of grants by complementing, integrating, or substituting them with non-donor funds.

Non-donor funds can include, but isn't limited to, the partnering with investment funds, financial products, or other non-grant funding sources to competitively identify and/or provide funding to startups enterprises. If grants are provided, grant beneficiaries are required to provide at least a one-to-one (1:1) match (cash and/or equity). Matching grants should be used to catalyze purchase of business assets.

C.4e Gender Equality and Female Empowerment

The Contractor must have a gender-conscious approach that will maximize gender and social inclusion. Per ADS 205, all USAID activities are required to take into account not only the different roles of men and women, but also the relationship between and among men and women, as well as the broader institutional and social structures that support them. The approach should be informed by a gender and inclusion analysis that will describe how interventions are likely to impact individuals differently based on their gender roles and cultural norms. While this activity is not conceived as one specifically devoted to gender issues, the Contractor will take into account the role of women in the economic and social advancement of a nation as a key

18 https://www.usaid.gov/work-usaid/private-sector-engagement/policy 19 https://www.usaid.gov/sites/default/files/documents/USAID_Digital_Strategy.pdf.pdf 20 https://digitalprinciples.org/ https://www.usaid.gov/work-usaid/private-sector-engagement/policy https://www.usaid.gov/sites/default/files/documents/USAID_Digital_Strategy.pdf.pdf https://digitalprinciples.org/ component of development. The Contractor must consult the 2019 USAID country level gender21 analysis and the Diaspora Invest lessons learned document to produce an activity-level gender analysis and implementation plan to fully incorporate the analysis into the activity within the first six months of implementation.

C.4f Disability Considerations

USAID has a priority to help underserved groups, including people with disabilities. According to the United Nations Convention on the Rights of People with Disabilities, a person with a disability is defined as someone who has long term physical, mental, and intellectual or sensory impairments which, in interaction with various barriers, may hinder their full and effective participation in society on an equal basis with others.

Under this award, every effort will be made to accommodate the needs of people with disabilities. Furthermore, within the first six months of implementation, the Contractor shall submit a disability inclusion plan specifically delineating how the project will address barriers for people with disabilities relevant to the project and ensure equal access and disability inclusive development practices.

C.4g Flexibility

The Contractor must ensure technical and programmatic flexibility within and across program components to respond to changing circumstances in the BiH political and economic contexts. The Contractor will outline its approach to keeping abreast of changes in the situation on the ground by conducting relevant assessments and other monitoring, evaluation, and learning activities to maintain flexibility and accommodate changes. The Contractor must include such situational analyses and scenarios as part of its regular reporting and engage with USAID to make appropriate programmatic adjustments.

C.4h Coordination with USAID and Other Donor Activities

The contractor must coordinate closely with current and future USAID activities and work to synergize the initiatives with other international donors, specifically those working at the municipality level (identified with a * below). Please find below a brief summary of current and future activities the Contractor must closely coordinate with.

There are current and future USAID (and other donor supported) activities/projects that have components involving support or advising to local governments (please see the list of current activities/projects listed below). The contractor must identify and coordinate with these activities/projects to a) avoid duplication of efforts and b) find synergies between the activities/projects to further reforms in local governance.

USAID/BiH Local Works Activity22* focuses on advancing locally led development and self-reliance through empowering local actors to identify and solve their own developmental challenges. In Bosnia and Herzegovina, the goals of the program are achieved through a series of

21 https://measurebih.com/uimages/Gender20Analysis20201920Follow-Up20Final20Report.pdf 22 https://www.usaid.gov/bosnia/news-information/fact-sheets/fact-sheet-localworks-bosnia-and-herzegovina https://www.usaid.gov/bosnia/news-information/fact-sheets/fact-sheet-localworks-bosnia-and-herzegovina activities focused on increasing trust among local actors, vigorously mobilizing available local resources, and developing local capacity for sustainable growth. The Contractor will coordinate its activities with Local Works Program through cooperating with current Local Works Activities to initiate and develop local sustainability and self-reliance through engaging with USAID Activities and their local partners. Specific coordination focus should be made with the forthcoming USAID/BiH Local Works Philanthropy in Action Activity.

Diaspora Loan Portfolio Guarantee Program23*: USAID/BiH, U.S. Development Finance Corporation (DFC), and the Swedish Development Office have developed a variable coverage loan portfolio guarantee with a commercial bank to expand the availability of credit to Diaspora and local SMEs with Diaspora link operating across multiple sectors including tourism and agriculture. As a result of these guarantees, Diaspora led investments have available financing, providing a demonstration effect to local banks for the viability of lending to Diaspora investors.

The loan guarantee is expected to end in 2027.

USAID’S Developing Sustainable Tourism Activity24* fosters economic development opportunities in the tourism sector thus creating private sector jobs and generating income and increasing the country's competitiveness within the tourism sector.

(New) Local Governance Activity*: The purpose of the activity is to support municipalities in enhancing their capacity to deliver transparent, efficient and accountable public services.

Economic Development, Governance, and Enterprise Growth Activity (EDGE) EDGE is a 3- to 5-year, up to $21 million, regional activity in Europe and Eurasia (E&E) that aims to create inclusive, sustainable economic growth and to support intra-regional and Euro- Atlantic integration. EDGE is managed by the E&E Bureau in Washington and works closely with USAID Missions and projects in the region. EDGE aims to generate synergies among the USAID projects working in economic growth and bring together stakeholders across countries to work on mutual problems, giving the E&E portfolio a regional dimension. Components include:

Improved Business Enabling Environment (BEE) and Reduced Barriers to Trade; Improved Financial Sector Stability and Increased Access to Finance; and Improved Competitiveness through Value Chains and Trade Promotion.

USAID CATALYZE is a global project designed to facilitate partnerships and craft solutions to mobilize $2 billion in blended private sector and other financing to USAID partner countries.

The program can work in any development sector or region, enabling USAID Bureaus and Missions around the world to efficiently facilitate investment solutions that respond to the needs of specific sectors, issues, and geographies and leverage private sector financing to achieve development objectives. USAID’s Engines of Growth (EoG) Activity falls under the USAID CATALYZE Project umbrella. The overall purpose of the EoG Activity is to facilitate Western Balkans SME resilience, growth, and job creation by improving their access to and utilization of appropriate finance. EoG will help mobilize capital in order to sustain viable SMEs and jobs in the wake of COVID 19 in the near term and will promote improved SME growth financing in the long term.

23 https://www.procreditbank.ba/en/dfc-sida-diaspora-guarantee-line/ 24 https://www.usaid.gov/bosnia/news-information/fact-sheets/fact-sheet-developing-sustainable-tourism-turizam-bosnia-and https://www.procreditbank.ba/en/dfc-sida-diaspora-guarantee-line/ https://www.usaid.gov/bosnia/news-information/fact-sheets/fact-sheet-developing-sustainable-tourism-turizam-bosnia-and

USAID’s E-governance in Bosnia and Herzegovina Activity* assists BiH in harmonizing its e-governance legislative and regulatory framework with EU directives and international best practices and developing new software to improve the efficiency, accountability, and transparency of government institutions that provide services to businesses and citizens. To further bolster accountability and transparency, the project also works to build the capacity of civil society organizations (CSOs) to monitor and report on public procurement processes, including possible corruption.

Other relevant donor activities:

Swiss Agency for Development and Cooperation (SDC): Diaspora Community Program aims to build a vibrant Community of diaspora, SME’s, and startups which will result in a dynamic, sustainable and holistic local ecosystem, whereby one is energizing the other, andwhere innovative digital tools, physical networking and social science are used in efforts to support sustainable local economic development.

Swedish Development Agency: The Challenge to Change, C2C, program in Bosnia and Herzegovina is implemented by the Sarajevo Economic Region Development Agency, SERDA, and the Development Agency of RS - RARS in partnership with the Region Ostergotland from Sweden. The main goal of the project is to strengthen economic development in Bosnia and Herzegovina, and cooperation between Sweden and Bosnia and Herzegovina.

The Delegation of the EU in BiH: EU4Business25, EU4Agri26, and EU4DigitalSME27 projects.

EU4Business includes EUR 10 million allocated for financial support to the private sector development in BIH. EU4Agri aims to modernize the agri-food sector, create new jobs, as well as retain existing ones, and support recovery from the crisis caused by COVID-19. Total of EUR

14.8 million will be allocated for grants. EU4DigitalSME will create three functional Digital Innovation Hubs in Bosnia and Herzegovina to support small and medium size enterprises during the digital transformation, making them competitive, skilled, cost-effective and environmentally friendly.

The European Bank for Reconstruction and Development (EBRD): EBRD’s SME Competitiveness Support Programme28 helps to increase the competitiveness and capacity of SMEs in their trade with EU clients as well as in their home markets by making targeted project investments easier. In BiH, EBRD is extending a loan of up to €5 million to Sparkasse Bank d.d.

in Bosnia and Herzegovina to boost the competitiveness of small local businesses.

The World Bank Group in BiH: The Firm Recovery and Support Project29 loan ($65.30 million) will help BiH MSMEs recover through improved access to much-needed, longer-term

25 https://eu4business.ba/en/about-eu4business-project/ 26 https://eu4agri.ba/en/ 27 https://europa.ba/?p=74214 28 https://www.ebrd.com/news/2021/ebrd-and-eu-provide-further-support-for-smes-in-bosnia-and-herzegovina.html 29 https://www.worldbank.org/en/news/press-release/2020/12/11/bosnia-and-herzegovina-to-help-businesses-weather-the-covid-19-crisis-with-support-from-world-bank https://eu4business.ba/en/about-eu4business-project/ https://eu4agri.ba/en/ https://europa.ba/?p=74214 https://www.ebrd.com/news/2021/ebrd-and-eu-provide-further-support-for-smes-in-bosnia-and-herzegovina.html https://www.worldbank.org/en/news/press-release/2020/12/11/bosnia-and-herzegovina-to-help-businesses-weather-the-covid-19-crisis-with-support-from-world-bank https://www.worldbank.org/en/news/press-release/2020/12/11/bosnia-and-herzegovina-to-help-businesses-weather-the-covid-19-crisis-with-support-from-world-bank financing and the provision of tailored programs, focused on adapting technology and digitization.

C.4.k Climate Change Adaptation and Renewable Energy

As part of the administration’s global climate change strategy, Executive Order (E.O.) 14008 Tackling the Climate Crisis at Home and Abroad, this activity will support investments in renewable energies and climate adaptation as part of its portfolio of investments. We will seek diaspora who wish to invest in businesses that strengthen BiH’s capacities to adapt and build resilience to a wide variety of climate impacts. This could include, but is not limited to: better manage climate and disaster risks; enhance global food and water security; expand critical renewable energy infrastructure; protect valuable natural resources and key infrastructures;

prevent the spread of vector-borne disease and promote resilient health systems; improve access to and use of climate information; and reduce resource related conflict by using climate solutions and adaptation assistance to address intersecting climate and conflict stressors. Climate risks related to all activity components should be independently addressed and mitigated by the contractor throughout the life of the activity.

[END OF THE SOO]

List of referenced documents

- Mapping Bosnian Diaspora

- Bosnia and Herzegovina - Assessment of financing needs of SMEs in the Western

Balkan Countries

- USAID/BiH Diaspora Assessment

- Survey on Youth Emigration in Bosnia and Herzegovina

- The Scientific Diaspora as the Brain Gain Option: Exploring the Case of Bosnia and Herzegovina”, Nikolic and Cosic, 2010

- USAID/BiH Diaspora Invest Activity - Overview of Lessons Learned (See

Attachment J.7 of the RFP)

- USAID Private Sector Engagement Policy

- USAID Digital Strategy http://www.mhrr.gov.ba/PDF/MAPPING%20BIH%20DIASPORA%20REPORT.pdf https://www.eib.org/attachments/efs/assessment_of_financing_needs_of_smes_bosnia_herzegovina_en.pdf https://www.eib.org/attachments/efs/assessment_of_financing_needs_of_smes_bosnia_herzegovina_en.pdf https://www.measurebih.com/uimages/Diaspora20Assessment2C20Final20Report.pdf https://ba.unfpa.org/sites/default/files/pub-pdf/youth_emigration_survey_in_bih_eng_final_0.pdf https://wbc-rti.info/object/document/14655/attach/document.pdf https://wbc-rti.info/object/document/14655/attach/document.pdf https://www.usaid.gov/work-usaid/private-sector-engagement/policy https://www.usaid.gov/sites/default/files/documents/USAID_Digital_Strategy.pdf.pdf