Bosnia and Herzegovina is urged to invest $6.8 billion over the next decade to safeguard its population, assets, and economy from the intensifying impacts of climate change. This recommendation comes from the World Bank Group’s Country Climate and Development Report for Bosnia and Herzegovina, released today.
The report indicates that by 2050, climate-related damages could reduce the country's economic output by up to 14%. Floods account for more than 90% of these damages, highlighting the need for nature-based solutions like floodplain restoration and peatland preservation to enhance resilience and promote economic growth.
“Climate change is not just an environmental challenge; it is a direct threat to Bosnia and Herzegovina’s economic stability, public health, and social well-being,” stated Christopher Sheldon, World Bank Country Manager for Bosnia and Herzegovina and Montenegro. He emphasized recent floods in Jablanica as a stark reminder of the human toll of climate disasters. “By taking decisive action now, Bosnia and Herzegovina can mitigate future risks and unlock opportunities for sustainable growth."
Investments in climate adaptation are seen as crucial for protecting the nation's economy. Proactive measures can lessen potential GDP losses due to climate change while creating jobs, enhancing skills, and boosting trade opportunities. The report projects that each €1 spent on adaptation could yield returns of up to €10.
A transition to a low-carbon economy by 2050 is also deemed essential. This involves phasing out coal power, expanding renewable energy sources such as solar and wind, and improving energy efficiency across sectors. To ensure this transition is equitable, government actions are needed to prevent energy poverty among low-income households.
Achieving net-zero emissions by 2050 aligns with European Union goals. The private sector is expected to provide nearly 90% of decarbonization investments in transport, buildings, and power sectors.
"Private sector investments and jobs in the green economy are vital to position Bosnia and Herzegovina for a sustainable future," said Nicolas Marquier, IFC Regional Manager for the Western Balkans. "Public-private partnerships to develop infrastructure and green financing will be key to unlocking the investments needed to decarbonize the economy."
The report also advises strengthening institutions and regulatory frameworks for effective climate action. The World Bank Group is already collaborating with local authorities on projects supporting a just transition and improving air quality.