COP29 Side Event: Transition in the Western Balkans: Empowering SMEs for a Net Zero Economy

Side Event at COP29

21 November 2024 15:00 – 16:30 Baku / 12.00 – 13.30 CET Room: SIDE EVENT 3

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Government of Montenegro and Helvetas
Side event at COP29

Date: 21 November 2024
Time: 15:00 – 16:30 Baku / 12.00 – 13.30 CET
Location: SIDE EVENT 3, Baku Stadium, Baku, Azerbaijan

Small and medium-sized enterprises (SMEs) are the key drivers of sustainable economic growth in the Western Balkans, constituting 99% of all businesses and employing 75% of the workforce in the region. Given their integral role in local communities and economies, SMEs are crucial actors in the green transition. However, they suffer disproportionately from the climate crisis and often have limited capacity to decarbonize their business models and align with national climate ambitions and international trade dynamics, particularly as stricter environmental compliance trends emerge.

Building an ecosystem that provides support and services for inclusive and sustainable growth is critical for mobilizing the private sector and ensuring the engagement of SMEs in a just transition to decarbonized and resilient economies in the Balkans. Access to clean technologies and climate finance, skills and capacity for introducing low-carbon production practices, and involvement in framing and executing national and regional climate policies are essential elements of such an ecosystem.

Objectives

This side event will explore how to bridge the gap between climate policy aspirations and ground realities for SMEs in the Western Balkans region and other low- to middle-income countries by sharing experiences and insights from the private sector, governments and development actors. The following questions will orient our discussion:

What are the largest constraints SMEs in low- and middle-income countries face in their efforts to decarbonize operations? How can partnerships between the state, private sector associations and civil society accelerate this transition?

What role do national governments play in supporting SMEs' transition to low-carbon business models? What are the essential policy elements to create incentives for the private sector's engagement in climate action?

What measures can be taken to ensure that efforts focused on greening international trade flows consider the ground realities of SMEs? What strategies can address possible risks for SMEs and build their readiness for emerging environmental compliance requirements?

What has been the experience of the Western Balkans in mobilizing climate finance and making it accessible to SMEs? How can we ensure that investment flows are redirected towards climate action?