Bosnia and Herzegovina - Forest Economy Development Project (BiH FEDEP)

dropped

The proposed project contributes to a circular forest-based economy in RS by: (i) developing a roadmap for increasing efficiency in the public sector in forest management, addressing the policy gaps to level the playing field for private enterprises and improving the performance of the wood processing industry; and, (ii) enhancing the sustainable production of wood from public and private forests with technical assistance, and, improved management practices and technologies. Forest-based industries will be facilitated to transition from the current low-value model to a modern, to higher efficiency with enhanced climate and sustainability standards of the EU Green Deal, the Carbon Border Adjustment Mechanism and the EU Regulations on Deforestation-free products. Better, agile technologies will be introduced to make forests more accessible, reduce unintended damage and harvesting costs by mechanizing operations, and improving forest productivity with intensive silvicultural treatments. Skills will be strengthened in the wood processing industry and in forest management. The proposed project will thus, contribute to a circular forest-based economy and a more sustainable COVID-19 recovery. Project investments are expected to benefit the small and medium wood processing enterprises, and rural private forest owners as recipients of technical assistance to improve their businesses. Forestry operations including, raising of planting material, planting works, road works and maintenance and harvesting and other operations will create short- and medium-term job opportunities and entrepreneurial opportunities. The project will have the following 3 components: Component 1: Enhancing efficiency of the public and private sector in forest management and wood processing This component aims to strengthen processing enterprises to improve productivity and enhance profitability through: (i) Strengthening Policy, Information Technology and Capacity for public sector forest management to improve revenue generation capacity and efficiency of the public forest enterprise (RS Šume), strengthen the newly established wood industry department in MAWFM and enhance the forest information management system in the ministry and reforms of the timber sales mechanisms in the public sector; (ii)establishment of a wood competence center in the University of Banja Luka combined with technical, market information and skills development services for wood processing enterprises and, (iii) matching grants to wood processing enterprises to strengthen performance; Component 2: Strengthening Sustainable Forest Management Expanding forestry operations through investments in improved management of existing forests, restoration of degraded forests and landscapes and forest protection, fire management and intensive silvicultural treatments (re/afforestation, thinning and other management operations), increased and improved nursery capacity, fire protection equipment, construction and rehabilitation of forest roads, purchase of equipment and software and training of personnel. Private forest owners would be supported to improve their management practices, for example, through certification, establishing a private forest owners’ association and extension services. These activities would help improve the supply of certified raw material for production of wood and other forest products from these lands. Component 3: Project Management and Monitoring This component will finance the APCU responsible for project management, monitoring and reporting, and, the incremental costs associated with project management – e.g. procurement of consultants, civil works, training, equipment; financial management and reporting; and, monitoring and evaluation as well as activities necessary to ensure compliance with the environmental and social framework. The establishment and maintenance of the grievance redress mechanism will be financed under this component. The proposed project is aligned with the World Bank Country Partnership Framework (CPF, 2023–2027) and directly addresses CPF Objective 6: Improved use of natural resources and CPF Objective 4: Improved performance of selected SOEs and public institutions for better service delivery. The proposed operation will also be complementary to other World Bank engagements in the country. Particularly relevant is the Supporting Better, Effective, Sustainable and Transparent SOEs (BEST-SOEs) project and the BiH SOE Sector Modernization Program.