Local Development Project: Technical Assistance to Local Governments

The objective of this two-year (2000-2002) project was to strengthen the institutional and financial capacity of local governments in Bosnia and Herzegovina so as to enable them to provide improved municipal infrastructure and services and to initiate, on a pilot basis, the development of a municipal credit market for infrastructure investment. Technical assistance focused on assisting local governments in demonstrating their credit-worthiness and preparing investment projects within a strategic plan for commercial bank financing; this included providing and modifying, as necessary, core technical assistance to 15 local governments. This involved: i) providing core training to 30 local governments in capital planning and budgeting, accounting, financial management and public budgeting, debt management and cost recovery; ii) working with each municipal government to enable them to understand the concept of credit worthiness and to develop the systems and materials required to undertake loan-financed infrastructure; and iii) contributing to the Policy Framework in Bosnia and Herzegovina by identifying and documenting policy obstacles to loan financing of infrastructure and supporting the activities of a working group set up to improve the policy framework.