Annex B. The Small Business Act assessment’s scoring model for Bosnia and Herzegovina

The governance structure of Bosnia and Herzegovina (BiH) comprises the institutions of the state of Bosnia and Herzegovina, the governments of the two territorial and administrative entities – the Federation of Bosnia and Herzegovina (FBiH) and Republika Srpska (RS) – as well as Brcko District (BD). At the entity-level, both the Federation of Bosnia and Herzegovina and Republika Srpska have significant constitutional autonomy and regulate independently the matters which the Constitution of Bosnia and Herzegovina has not assigned to the state government.1 The entities’ parliaments have jurisdiction over a range of policies, among them healthcare, education, agriculture, culture, labour, police and internal affairs. Both entities have a president, prime minister and 16 ministries. The Federation of Bosnia and Herzegovina is furthermore divided into ten federal units (cantons), each with its own constitutions that prescribe their legislative, executive and judiciary authority, as well as the functioning of government authorities.

Bosnia and Herzegovina submitted three assessment questionnaires for the SBA assessment, one for the state and one each for both entities. Information from all three questionnaires has been taken into account in the analysis. Given that the Brcko District only represents approximately 1% of the total population of Bosnia and Herzegovina, it has not been included in the scoring but information related to policy developments in the Brcko District has been included in the narrative where relevant.

SME policy making in Bosnia Herzegovina is much more decentralised than in the other economies covered by the SBA assessment. Therefore, information from the two entities has been taken into account in the calculation of the total scores. Policy recommendations have been formulated to emphasise the importance of policy co-ordination in Bosnia and Herzegovina for averting the possibility that local policy measures infringe on the principle of a single domestic market and distort competition among enterprises based in different entities.

Based on these considerations and the availability of data, a scoring system involving four models has been developed (Table A B.1)

For most of the dimensions (Entrepreneurial learning and women’s entrepreneurship, Bankruptcy and second chance, Operational environment for SMEs, Support services for SMEs, Enterprise skills, Innovation policy for SMEs, and SMEs in a green economy), a score has been derived by calculating a simple average of the two entities’ scores. This approach (Model 1) has been adopted principally because major policies, mechanisms and institutions under these areas exist mainly at the entity-level and needed to be reflected in the scoring as such.

For two dimensions (Access to finance, and Standards and technical regulations), the second model was selected, giving two-thirds of the weight to the state and one-sixth to each of the two entities, since responsibilities under these dimensions lie mainly at the state-level. However, inputs from the entities were also recognised and included in the scoring.

For two other dimensions (Institutional and regulatory framework for SME policy making and Internationalisation of SMEs), a score has been derived using the third model, which allocates one-third of the weight equally to the two entities and the state. Finally, the Public procurement dimension only takes state-level information into consideration.

Table A B.2 gives an overview of all the SBA dimensions, providing the rationale for the selection of the scoring models.


← 1. The competences of the institutions of Bosnia and Herzegovina are prescribed by Article III, paragraph (1) of the Constitution of Bosnia and Herzegovina. The competences of the entities are prescribed by the same article, in paragraph (2). Paragraph (3) of the article stipulates that all government competences not expressly assigned to the state-level government belong to the entities.

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