INTEGRATED LOCAL DEVELOPMENT PROJECT (ILDP) PHASE 3

PROGRESS REPORT

(July – November 2018) 1. PROGRESS TOWARDS ACHIEVEMENT OF OUTCOMES 1.1. Outcome 1 “Lead planning structures at entity level steer the development planning and management systems characterized by vertical and horizontal coordination and greater accountability towards the citizens” In the reporting period in the entity of Federation of Bosnia and (FBiH) the FBiH Development Institute, with support of the ILDP, finalized the consultations of three by-laws stemming from the Law on Development Planning and Management (FBiH Decree on Design of Strategic Documents, FBiH Decree on Mid-Term and Short-Term Planning, Monitoring and Reporting and FBiH Decree on Evaluation of Strategic Documents). If adopted in December 2018, these by-laws will enter into force in early 2019. With adoption of these by-laws, regulatory and methodological frameworks for development planning and management system in FBiH will be fully in place. However, further efforts will be needed to strengthen institutional capacities at all levels for enable effective implementation in practice. Moreover, with support of the ILDP, the FBiH Development Institute has finalized the methodology for calculating development index in FBiH entity. Consultations with key stakeholders (FBIH institutions, cantons, Association of Municipalities and Cities and academia) were launched in November 2018. The methodology, which very much follows the approach of other countries in the region, will be reflected in a by-law that is expected to be submitted to the FBiH Government for review and adoption in early 2019. Another important milestone reached in the FBiH entity is the formal decision of the FBiH Government to initiate a participatory process of design of the FBiH Development Strategy 2021-2027 as well as the formal decision establishing the FBiH Development Council. The FBiH Development Strategy is expected to be designed in a highly participatory manner, involving all 10 cantons, local governments, academia, civil society organisations and business sector. As the FBiH Development Strategy is seen as a key instrument to align government priorities with the Agenda 2030, it will need to be clearly linked with the Sustainable Development Goals (SDGs) Framework in BiH that is currently being designed, reflecting the common vision, priority areas, targets and indicators. Importantly, the FBiH Strategy will represent a platform for subsequent design of development strategies at cantonal and local level in FBiH, including for further mainstreaming of SDGs. The design of the FBiH Development Strategy will be a challenging and complex process, requiring political support, effective coordination mechanisms and readiness of institutional stakeholders to introduce new approaches and tools. Though formally established, the first meeting of the FBiH Development Council, a body that gathers political leadership from FBiH and cantonal level as well as other stakeholders, is expected in April 2019, once new governments are established at the FBiH and cantonal level. The FBiH planning process will be formally launched at the first meeting of the FBiH Development Council, while preparatory activities will be initiated in December 2018. In July 2018, the entity of (RS) formally established a working group tasked to define improvements of strategic planning and development management in this entity, with support of the ILDP. The working group gathers representatives of a number of ministries from the entity level, the RS Gender Center, representatives of local governments and the RS AMC. At its first meeting held in September 2018, the working group agreed on the concept of the future strategic planning and development management system, including the vision and guiding principles. The ILDP is currently working with the RS Government Strategic Planning Department and key partner ministries on defining key elements of the system. Similarly, the future strategic planning and development management system in the RS is expected to serve as “infrastructure” for implementation of SDGs in this entity, including their streamlining to the local level. It should be noted that the aforementioned activities were implemented despite the fact that the action plan, jointly defined by the ILDP and key institutional partners in the RS, has still not been reviewed by the RS Government. Considering that General Elections took place in October 2018, the partners considered it more appropriate if the action plan is reviewed and approved by the new RS Government that will be responsible for its future implementation.

2 Brčko District BiH has also made steps towards creating a development planning and management system, though the pace of activities is slower than in the two entities. The public procurement process for Brčko District BiH Development Strategy was conducted in October 2018 but due to complaints of bidders, the service provider has still not been selected. Meanwhile, Brčko District Government communicated its readiness to formally introduce mid-term and annual planning that would be strategy- based. Even though the 2018 cycle of the RS Financing Mechanism for Local Development was expected to be launched in July 2018, the RS Government decided to postpone it until after the General Elections. Subsequently, in November 2018 the RS Government adopted a decision on criteria for selection of local governments’ projects under the Financing Mechanism and the RS Investment and Development Bank is expected to announce the public call for local governments in December 2018. Priority areas for local governments’ project under the public call will be service delivery and rural development as per the RS strategic documents in these fields. Projects specifically targeting gender equality and social inclusion will be given additional weight in the selection criteria. Total value of the Financing Mechanism in 2018 is BAM 1 million. As for the FBiH, a high-level meeting of UNDP and the FBiH Prime Minister that took place in September 2018 was used to raise the possibility of establishing a financing mechanism for local development under the government umbrella (rather than within one specific ministry). It was agreed that funds for this purpose would be budgeted in the 2019 FBiH budget but operational modalities for anchoring and sustaining the financing mechanism would need to be agreed with the new government after the October 2018 elections. There might be a need for Swiss support in terms of advocacy. The ILDP has prepared a concept for sustainability of the financing mechanism that is to be shared with the Project Board and subsequently with new entity governments. Below is an overview of results achieved towards the Outcome 1:

Outcome 1: Lead planning structures at entity level steer the development planning and management systems characterised by vertical and horizontal coordination and greater accountability towards the citizens

Indicators Baseline Target Result Key success and constraints 2017 2021 achieved

Advanced functionality Partial Full Partial In FBiH, the Law on Development of all sub-national in FBiH Planning and Management created development planning regulatory framework for a functional Non- and management development planning and management existent systems. system, while methodological and in RS institutional framework is to be and BD established in 2018. RS and BD initiated BiH first steps towards system building but processes are taking longer. Importantly, these systems are increasingly seen by partners as “infrastructure’ for future SDGs implementation. 1 10 6 # public mechanisms Development councils as public engaging government mechanisms have formally been authorities at different established in 5 cantons (ZDK, TK, levels for improved , Posavina and Western- vertical cooperation and Herzegovina), engaging cantonal concerted action in representatives and local governments. Importantly, FBiH Development

3 development planning and Council was formally established in management. November 2018 with its first meeting planned in April 2019 upon inauguration of new FBiH and cantonal governments.

# of institutions that apply 2 4 2 Possible delays and challenges are the EU approach to public expected in the FBiH in establishing a grant scheme comprehensive local development management financing mechanism and strong advocacy actions may be required.

Importantly, the ILDP is taking an active role in implementation of SDGs in BiH. More specifically, the obligation to ensure linkages to SDGs with all planning processes in the FBiH was prescribed in the FBiH by-law on design of strategic documents and in the emerging frameworks for the RS. Moreover, the Project is taking part in the process of design of SDGs Framework in BiH, while development planning and management systems that were established with support of the Project at sub-national levels are seen as key platforms for localizing SDGs.

1.2. Progress towards achievement of Outcome 2” Local and cantonal governments effectively address needs of citizens and accelerate growth through inclusive development planning and management” Progress in establishing systemic approach to development planning and management is increasingly visible at the cantonal level. To systematically track performance, the ILDP has introduced a capacity assessment tool. Improvements are noted in all key areas of development planning and management from linking operational planning with development strategies to monitoring and reporting. Development management units as key institutional frameworks are gradually becoming more capacitated and well positioned to coordinate strategy-based annual planning, implementation, monitoring and reporting. Development management systems are fully in place in five cantons (KS, TK, ZHK, SBK and ), while three cantons demonstrate continuous progress and have basic processes running (BPK, HNK, Canton 10). As noted under Outcome 1 progress review, development councils have formally been established in five cantons and enable political leaders from cantonal and local level to discuss development challenges and solutions. Challenges are still faced in two cantons, namely in Una-Sana and - cantons. No progress is made in Una-Sana Canton as a result of the lack of will of the previous governments to build a system. Changes in the civil service policies in Zenica-Doboj Canton affected the work of key staff and disrupted annual planning cycle. In the reporting period the cantonal leadership increasingly recognized the benefits of strategic documents and sought reference to strategies in other policy-making processes. However, challenges in future system-building efforts might be faced with post-elections changes of governments that are expected in majority of the cantons. Awareness-raising and advocacy actions might be required with new cantonal governments, once in place, possibly involving Swiss Embassy. In addition to ILDP partner local governments, the standardized planning methodology is applied at the local level by local governments independently or with support of other projects. According to the surveys conducted by the two Associations of Municipalities and Cities, 40% of the local governments that have responded to the questionnaire (53% of total responses)1 possess development strategies prepared in accordance with the MiPRO methodology, while 35% of LGs have institutional structures for development management established.1 Based on ILDP assessment, this percentage is at approx. 50%. When it comes to development management, these systems are in place in 38% local governments across the country.

1 In total 108 LGs responded to the questionairre.

4 Below is an overview of results achieved towards the Outcome 2:

Local and cantonal governments effectively address needs of citizens and accelerate growth through inclusive development planning and management

Indicators Baseline Target Result Key success and constraints 2017 2021 achieved

% of local and cantonal 30% (LG) 50% Dev. management units are formally 38 % governments with LGs established in 7 out of 11 new partner 10% (LGs) functional development LGs. Dev. management systems are (Cantons) 70% 80% management structures further affirmed in 20 “old” partner cantons (Cantons) as part of a coherent LGs, while the ILDP’s approach is system. replicated by MEG and LID in additional localities.

Average number of 40 citizens 40% Average Additional focus groups were held in citizens (including (in ILDP increase number 10 new partner LGs (91 people, 36 M percentage of women partner LGs of and 55 F (children / elderly with and representatives of and citizens disabilities, returnees, Roma, socially excluded cantons). in LGs unemployed) to enable identification groups) who engage in 46 (34 % of specific issues of these groups and development planning of possible actions that could be taken and management women) within the emerging strategies. processes at local and cantonal levels. 40% No Average % increase of 50 % No increase in ratio of additionally (average for increase additionally attracted increase attracted funds against average partner funds based on local budgets. However, average budget LGs). strategies against increased along with increase of average local externally attracted sources in total governance budget. values

Average % increase of 10,5% 20 % 10,8%3 Figure includes 10 cantons, where additionally attracted increase info for 7 cantons is based on official funds based on cantonal reports. For 3 cantons data is not strategies against available (USK, ZDK, BPK), the average cantonal ILDP calculated 0 KM budget.2 implementation. Average % of 40% 55% 56% for Increase in 22 «old» partner local implementation of local 22 LGs governments comes from more strategies’ annual from 2nd realistic annual planning and implementation plans phase, existence of development (against planned N/A for management system.4 First financial resources) 11 new implementation cycle for the new 11 LGs

2 Baseline and cumulative results include 10 cantons, where information for 7 cantons is presented based on official reports. As for 3 cantons where data is not available (USK, ZDK, BPK), the ILDP calculated 0 KM implementation. 3 As baseline was established for 2017, the cumulative value is equal to baseline since it covers 2017 financial year 4 10 partner local governments will prepare their implementation plan only in mid-2018 for 2019-2021, after adoption of their strategies. 1 local government is designing its implementation plan.

5 partner municipalities will start in 2019, first results in 2020. Average % of Figures include 10 cantons, where implementation of info for 7 cantons is based on official cantonal strategies’ reports. For 3 cantons where data is 54 % 50 % 54 % annual implementation not available (USK, ZDK, BPK) the plans (against planned ILDP calculated 0 BAM financial resources)5 implementation.

1.3. Progress towards achievement of Outcome “Citizens, civil society organizations and media take pro-active part in development management and benefit from improved services” Activities on improving awareness of civil society organisations and media in partner local governments were initiated in second part of 2018, with design and delivery of training programmes for these specific groups. The activity is to continue in 2019 and thus no measurable progress towards achievement of outcomes can be reported within this reporting period. Moreover, progress in terms of local service delivery under this outcome will be reported in 2019, as the selection of local government projects under the RS Financing Mechanism for Local Development will be launched in early 2019.

Citizens, civil society organizations and media take pro-active part in development management and benefit from improved services

Indicators Baseline Target Result Key success and constraints 2017 2021 achieved

# of articles published Following the mapping of civil which raise awareness society organisations and media in or inform the public on partner local governments, training Very Not the matters of 30 programmes for these two target limited available development planning groups were designed and its and management in delivery initiated in late November BiH. 2018.

# of citizens who N/A 250’000 Not Performance assessments will be benefit from improved available made in 1st quarter of 2019 and will public services in target serve as the basis for allocation of areas, beyond direct ILDP financial support to the best project interventions. performing local governments and cantons.

Constructive reaction 0 2 27 Improved mechanisms within of local governments on municipal departments to address demands brought community’s demands. forward by CSOs or media.

5 Baseline and cumulative results include 10 cantons, where information for 7 cantons is presented based on official reports. As for 3 cantons where data is not available (USK, ZDK, BPK) the ILDP calculated 0 KM implementation.

6 2. OUTPUTS AND PERFORMANCE ACCORDING TO ANNUAL WORK PLAN Output 1.1: Lead planning structures at entity level and Brčko District capacitated and equipped with policy and regulatory frameworks and instruments In the reporting period in FBiH entity, the ILDP continued providing support the FBiH Development Planning Institute in conducting consultations on three by-laws on development planning and management in FBiH. Following extensive consultations with cantons and local governments in the first part of 2019, an additional meeting was held with representatives of cantons and the FBiH Development Planning Institute in September 2018 where all pending issues where clarified, including maintaining some of the existing good practices at cantonal and local level (action plans for strategies’ implementation). In addition, the three by-laws were shared/presented to 9 civil society organisations as well as with the FBiH Gender Center, even though the Gender Center was also consulted in previous stages of the process. As per the standard procedure, the FBiH Development Planning Institute requested formal opinions on the three by-laws from the FBiH Ministry of Finance, FBiH Ministry of Justice and the FBiH Legal Office. After these three institutions provided their positive opinions in November 2018, the by-laws were submitted to the FBiH Government for official review and adoption. In practical terms, adoption of these three by-laws will have set in place key regulatory and methodological framework for development planning and management at all government levels in the FBiH entity. Implementation of the by-laws will introduce new planning practices and create challenges particularly at cantonal and local level. To address these challenges, the ILDP will need to quickly deploy a set of capacity building activities among its partners to ensure that key milestones are reached in line with newly introduced planning calendar. To cover as many local governments in FBiH as possible, the ILDP will need to work closely with other relevant projects, such as Swiss-funded MEG and EU-funded LID as well as with the local development practitioners’ network within the FBiH AMC. As for the by-law on development index in FBiH, the FBiH Development Planning Institute with support of the ILDP completed the proposed methodology for determining the level of development of local governments and cantons in this entity. The exercise proved to be particularly challenging, given the lack of reliable data that could be used. Despite the desire to create an index that would enable looking into particular aspects of quality of life at the local and cantonal level, the final proposed index consists of five indicators for which data is regularly available and comparable (income per capita, employment rate, population migration, ratio of population above 65 years of age in total population and education of labour force). This approach is also used in neighboring countries, such as Croatia and Montenegro, with minor differences. The proposed methodology was shared for feedback to a number of stakeholders, including relevant FBiH and cantonal institutions, FBiH AMC and a number of civil society organisations. In a workshop held with these stakeholders, the proposed methodology was assessed as the best possible and realistic approach given the general lack of data in the country. The methodology is now to be shaped into a by-law and forwarded to the FBiH Government for review and adoption. In the RS entity, the ILDP continued to provide support to the Strategic Planning Department within the General Secretariat of the RS Government in conducting quality assurance of mid-term and short- term plans prepared by the RS ministries. In the period from July to November 2018 and based on a specific request of partners in the RS, the ILDP provided mentoring support to four ministries in the RS in preparing their mid-term and annual plans.6 This technical assistance was provided to 35 participants in total (16 female, 19 male). Following the formal establishment of the RS working group tasked to define improvements of strategic planning and development management in this entity, the first meeting of the working group took place in late September 2018. In total, 25 members of the working group attended the meeting (16 female, 9 male). At this meeting the working group adopted the concept for the future strategic planning and development management system in the RS along with vision and guiding principles of such system.

6 Ministry for Industry, Energy and Mining, Ministry of Agriculture, Ministry of Labour and Social Policy, Ministry for Spatial Planning, Construction and Ecology.

7 Importantly, the guiding principles include sustainable development, coherent approach to development planning and management at all levels (including vertical and horizontal integration as well as alignment with SDGs), partnership (partnership between entity and local level and partnership with private and non-governmental sector), transparency of processes and documents, gender equality and social inclusion/equal opportunities. At its next meeting planned for late January 2019, the working group is expected to discuss and agree on some of the practical aspects of development and management system, including planning timeframe, minimum methodological requirements, mechanisms for implementation, monitoring and reporting, alignment with strategies as well as practical ways to link strategic with financial planning. Meanwhile, the ILDP is conducting bilateral meetings with ministries and local governments/AMCs to discuss these aspects and obtain opinions and feedback. So far, meetings were held with the RS Ministry of Finance and the RS Ministry for Administration and Local Self-Governance, while meetings with the Ministry for Economic Relations and Regional Cooperation, AMCs and local government practitioners are planned for December 2018. The Government of Brčko District BiH is in the process of finalizing selection of service provider for the design of its development strategy. The Government of Brčko District BiH has secured funds for engagement of service providers in the planning processes, while the ILDP will provide the methodology and support its counterparts in the quality assurance of the planning processes. Meanwhile, the Government has initiated design of regulatory framework on mid-term and short-term planning, replicating the model that is already in place at BiH, FBiH and RS level. The ILDP agreed with partners from Brčko District BiH to design an action plan reflecting the required activities, responsibilities and timeframes. Output 1.2: Public financing mechanisms sustainably reinforce the development planning and management systems, resulting in improved livelihoods and service delivery for the citizens Even though the 2018 cycle of the RS Financing Mechanism for Local Development was expected to be launched in July 2018, the RS Government decided to postpone it until after the General Elections. Subsequently, in November 2018 the RS Government adopted a decision on criteria for selection of local governments’ projects under the Financing Mechanism and the RS Investment and Development Bank is expected to announce the public call for local governments in December 2018. Priority areas for local governments’ project under the public call will be service delivery and rural development as per the RS strategic documents in these fields. Total value of the Financing Mechanism in 2018 is BAM 1 million (BAM 600,000 RS Government funds; BAM 400,000 ILDP funds), while the financial scope of individual projects is from BAM 50,000 to BAM 100,000 BAM. In addition to the main criteria for selection of projects that relate to relevance and quality of projects, additional criteria to encourage specific actions have been included, such as inter-municipal cooperation, partnership with private or civil sector and support to underdeveloped local governments. Importantly, projects specifically targeting gender equality and social inclusion will be given additional weight in the selection criteria. Considering the forthcoming holiday season, the public call to local governments will be open until the early February 2019. As in the previous years, the RS Investment and Development Bank will organize open days for local governments with the aim to clarify the rules of the public call and any questions that local governments may have in respect to the public call. To promote the new practices to grant scheme design introduced under the Financing Mechanism, the ILDP is preparing a manual that describes each step of the processes and provides practical tools and templates, based on EU practices but also taking into account specific legal framework in BiH. Once the translation of the manual is completed, it will be shaped into a website that will be available for all potential users at all government levels. Output 2.1: Local development planning and management frameworks and capacities are sustained and scaled up as part of a harmonized system, in line with EU requirements Planning processes in the 10 new local governments are completed and development strategies have already been adopted in 6 local governments (Breza, , , Rudo, Višegrada, ). The remaining 4 strategies (Čitluk, , Šipovo, Ravno) are expected to be adopted by the end of

8 December 2018. All strategies were submitted to local gender commissions and received positive opinion. Also, particular attention was paid on inclusion of socially excluded groups who participated in the process as reported earlier while minimum of 2 social inclusion projects were included in each of developed strategies. Partnership groups validated final strategic documents in 9 municipalities with a total number of 241 participants (112 female, 129 male). Partnership group meeting in the remaining local government is scheduled for early December 2018. Average number of participants at local development team meetings is 40 while overall composition of development teams is favorable with average 44% of women representation. Up to date 7 new partner local governments adopted new internal organizations with systematization of jobs to allow for establishment of local development units. These units are functional in terms of staff in 1 LG. ILDP intends to launch local development management processes in these new municipalities as of January 2019. As for the 22 local governments from previous phases of ILDP support, technical staff continued to support strategy implementation processes in these municipalities. In total, 100 local development unit meetings were held with an average attendance of 10 participants, with average 49% of women representation. These meetings were organized along key stages of annual development management cycles, namely preparation of strategies’ implementation plans, workplans of local government departments and annual reports on strategies’ implementation. Furthermore, 117 out of 22 partner local governments from the previous project stage initiated strategy revision process (June 2018) following evaluation of progress in terms of strategies’ implementation. Unfortunately, the strategy revision process in majority of these local governments are seriously delayed and completion of activities is not expected before March 2019. Current status of the revisions is that in 10 local governments sectoral planning was initiated though strategic platforms are still being finalized. Partnership groups for validation of strategic platforms are expected to take place in late 2018/early 2019, while only one municipality (Jablanica) has already validated strategic platform through their Partnership Group. In the period July-November 2018 a total of 68 development teams’ meetings were held with an average 11 participants (42% women participation). Only one Partnership Group was held with 33 participants (23 male and 10 female). In July 2018, the ILDP, the Swiss-supported MZ Project and local communities’ (MZ) coordinators from three joint partner local governments held a workshop aimed at mapping ongoing mechanisms for participation of MZs in development management processes. Based on the results, in three local governments (Ključ, and Rudo) roadmaps were designed identifying areas that needed further improvement of interaction between local governments and MZ. Currently, the ILDP is working on a specific action plan that would address the identified gaps, particularly with respect to the annual planning cycle. In the reporting period the FBiH Association of Municipalities and Cities (AMCs) delivered one additional training to Zenica Municipal Council on development management to elected officials – representatives in the City Council. In total 16 councilors participated, along with 5 additional participants from other municipal departments. Output 2.2: Core development planning and management frameworks and capacities at cantonal level further advanced and sustained as an integral part of a harmonized public system and EU integration processes Action plans 2018-2020 for strategies’ implementation and development reports for 2017 were adopted in 8 cantons. Prior the formal adoption of action plans and reports by cantonal governments, cantons conducted consultative processes that included meetings of cantonal development boards.8 In addition, in Canton, Western-Herzegovina Canton and Central Bosnia Canon these documents were also reviewed by the Development Councils/Partnership Groups that also gather mayors (or their

7 municipality has not launched the process despite multiple requests that were made by ILDP team. The process is stalled due to lack of human resources. 8 , Western Herzegovina Canton, Posavina Canton, Canton 10, , Bosnia- Podrinje Canton Gorazde, Herzegovina-Neretva Canton and Canton

9 representatives) of constituent local governments. Considerable progress is noticed at the cantonal level in terms of preparation, adoption and implementation of action plans for implementation of strategies. Moreover, the quality of action plans is continuously increasing. Most evident progress can be reported in respect to establishment of institutional structures for development management (development management units - JURA, local acronym). These units are now formally in place in place in 8 cantons, though some still require capacity development, particularly in cases where new staff was hired. The two cantons that do not have such institutional structures in place are Herzegovina-Neretva and Una-Sana Canton, Technical assistance provided by the Project in the aforementioned processes during the reporting period July – November 2018 included 204 participants (101 female and 103 male). Primary purpose of the assistance was to target issues related to strategies’ implementation reports for 2017 and evaluation of Development Strategy. Cantonal development boards, that gather representatives of public, private and non-governmental sector, are functional in nine cantons (apart from Una-Sana), with 189 members in total (77 female, 112 male). As already reported, partnership groups in the nine cantons includes a total of 239 members (70 female, 169 male), with the mission to further encourage citizen partnership and participation. Moreover, development councils, as partnership mechanisms that foster vertical coordination between cantons and local governments were established in 5 cantons with 114 members (15 female, 99 male). It is evident that some cantons seem keen to establish cantonal development councils and transfer some roles and responsibilities from partnership groups towards development councils. As gender discrepancy in this case is more than obvious, it should be noted that ILDP is not able to influence gender composition of the development councils that primarily consists of mayors and cantonal prime ministers. The evaluation of Sarajevo Canton Development Strategy was one of the key activities during the summer period. Upon the official request by the Sarajevo Canton Government (and based on a specific request of the Cantonal Assembly), the ILDP supported the mid-term strategy evaluation process. The process was also used to test the methodology for mid-term evaluation of cantonal strategies and will be used for subsequent preparation of a manual that will be available to all institutions in the FBiH in the future. The evaluation report, that was finalized and adopted by the Cantonal Government in October 2018, identified possible advancements areas for implementation of the current strategy, but also lessons-learned for future planning processes. As noted earlier, challenges are still faced with Zenica-Doboj Canton where the development management unit is currently not fully in function due to changes in civil service policies, which affected the staff involved. The issue was previously raised in a meeting with the cantonal prime minister, who was fully aware of the problem, but still no solution has been found. The ILDP plans to raise the issue with new cantonal government once established. Engagement of the Swiss Embassy might be requested. Similarly, in Una-Sana Canton the ILDP activities have not been implemented at all, primarily due to the lack of political will to establish a systemic approach to development management. The constant political changes in this Canton seriously affected the activities, which are not being given sufficient attention despite the formal protocol signed. In essence, development management unit is not existent anymore and annual planning, monitoring and reporting processes are not conducted. This issue will be raised upon establishment of new cantonal government and Swiss Embassy’s involvement might be required. Following the last meeting of the Cantonal Practitioners Network held in June 2018 in Gorazde, the ILDP in coordination with the FBiH Development Planning Institute facilitated two online meetings of the Network, held in September and November 2018. Special attention was given to the final review of the draft by-laws on development planning and management in FBiH, the forthcoming design of the new FBiH Strategy and SDGs mainstreaming. The online meetings were held by using the communication equipment that the ILDP provided to the FBiH Development Planning Institute and the cantonal development management units with the aim to make the interaction among the stakeholders easier and cost-efficient. In total, 16 representatives participated to the meeting (10 female, 6 male). In general, the partners consider this way of communication is user-friendly, effective and efficient.

10 Output 3.1: Relevant civil society organizations and journalists capacitated to understand the development planning and management system and enable wider public engagement and scrutiny in its functioning Following the mapping of civil society organisations and media in partner local governments, training programmes for these two target groups were designed and its delivery initiated in late November 2018. These training programmes aim at raising awareness and introducing civil society organisations and media with key aspects and stages of development planning and management, particularly when it comes to strengthening civic participation and performance monitoring. A particular aspect covered within the training programmes was on reaching out to the most excluded and encouraging their voice. Training delivery will be followed by a call to civil society organisations and media from partner local governments to take part in competition on best practices or stories promoting participatory development planning and management and social inclusion in particular (planned for 1st quarter of 2019). Output 3.2: Livelihoods and services for the citizens are improved through priority projects of local and cantonal governments (including Brčko District) As agreed by the Project Board, this activity will be initiated in 2019, following the Board’s adoption of the performance management criteria for partner local governments and cantons. Based on the adopted criteria performance assessments will be made in 1st quarter of 2019 and will serve as the basis for allocation of ILDP financial support to the best performing local governments and cantons.

3. CHALLENGES AND LESSONS LEARNT A key challenge for the Project in the forthcoming period is related to implementation of results of the General Elections held in October 2018, particularly at the FBiH and cantonal level. In the FBiH, delays in establishing of the FBiH Government may affect the pace of the design of the FBiH Development Strategy and the inauguration of the FBiH Development Councils. In addition, these delays may affect establishment of the FBiH Financing Mechanism for Local Development as envisaged as well as implementation of its annual cycles. Even though technical activities in most cantons can be implemented in the period until the new Government is in place, formal Government actions are still required, and lack of these formal actions will consequently reflect on timely initiation and completion of planning processes at cantonal and local level in FBiH and the ability of ILDP to provide technical assistance by 2021, considering the envisaged end of the current Project phase. Another challenge is related to expected changes in cantonal governments in almost all of the cantons. At this point in time it is difficult to assess which cantons will face largest changes. However, these changes might also be seen as opportunities, particularly in those cantons where processes introduced with support of the ILDP were not fully implemented. If governments are established on time, the ILDP will need to ensure that new cantonal governments are familiarized with the achievements made so far and seek their partnership and commitment for the planned activities. This does not only relate to development management practices at the cantonal level but also to active participation and support of cantons in the FBiH forthcoming planning processes. Challenges could also be faced in the Projects’ system-building efforts in Republika Srpska, having in mind foreseen changes in the RS Government. These changes also include internal organization of ministries where some ministries will be restructured, other will be created and some will be abolished. However, considering that the system-building activities are still in an early stage, these challenges will be tackled by timely communication and involvement of new government (and ministries) in the activities, under the overall coordination by the Strategic Planning Department of the RS Government. ILDP is facing serious challenges in three partner local governments, namely Zenica, Livno and Trnovo RS. Development management activities had been stalled in Zenica and Trnovo immediately following 2016 local elections due to change in political leadership (mayors and municipal assemblies). Revised strategies in these two local governments that were completed just before the elections have not yet been adopted. In Zenica this was due to the change of mayor where the new mayor had a different set of priorities comparing to those laid out in the draft revised strategy. The lack of revised strategy

11 negatively reflected on all other local development management processes. However, recently, there was some progress made in Zenica with the formal establishment of local development management unit which resumed activities on modification of the draft revised strategy. The revised strategy is expected to be modified by the end of 2018. When it comes to Trnovo, there was a shift in power in the municipal assembly that happened even before the elections (mayor did not have majority within municipal assembly) and this issue continued after the elections. In the meantime, early elections had to be called due to death of the mayor. A new mayor was elected, however, the issue persisted, and the new mayor continued to lack support from the Municipal Assembly. This was the main reason why the draft revised strategy remained unadopted. It was for the same reason that the Trnovo municipality never signed protocol on continuation of cooperation with ILDP despite several meetings with the mayor and repeated reminders by the ILDP team. As for Livno City, the activities have been on hold since June this year. This was largely due to changes in human resources where the main representative of local development management unit left her position. Until today ILDP has not managed to reassume technical support despite formal and informal correspondence and even one meeting with the Mayor. A considerable challenge for the ILDP will be the envisaged “localization” of SDGs at entity, cantonal and local level. Given its nature and the results achieved in supporting establishment and functioning of development management systems at sub-national level, these systems are now seen as natural platforms for SDGs localization. However, SDGs localization will require more efforts and resources than currently available within the Project and thus the ILDP will need to design a clear approach on how to achieve maximum results with the available resources. The ILDP’s experience shows that maintaining close synergies with other relevant interventions supported either by national or international institutions is extremely important for maximized effects. In providing technical assistance to the partner ministries in the RS, the ILDP closely coordinated activities with the SPPD Project supported under the BiH Public Administration Reform Fund. In designing its technical assistance to the RS ministries, the ILDP used a training programme prepared by the SPPD, providing feedback to SPPD on practical implementation and recommendations for improvement of the training programme. Moreover, the ILDP took part in two practitioners’ meeting at the BiH level organized by GIZ where the ILDP shared its experience and lessons learned that could be taken into account by state-level institutions.

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