Structural Instruments in Romania Conference Workshop no. 3 – Improving Economic Competitiveness by Building the SME Base Experience of Ireland Dr Jim Fitzpatrick Managing Director Fitzpatrick Associates, Economic Consultants 122 Ranelagh Village Dublin 6 Tel: +353 1 4966008 Fax: +353-1-4966028 e-mail: jfitzpatrick@fitzpatrick-associates.com Web: www.fitzpatrick-associates.com INSTRUMENTE STRUCTURALE IN ROMANIA 1 CONTENTS • SME role in Ireland’s “Celtic Tiger” • Use of EU Structural Investments • Some Lessons for Romania? INSTRUMENTE STRUCTURALE IN ROMANIA 2 PRODUCTIVE SECTOR PERFORMANCE, 1995-2004 400 350 300 4250 00 350 200 300 150 250 2100 00 150 50 100 0 50 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Years 0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Other Internationally-traded F Full-time u ll-tim e EEmployment m p lo ym e n t ininFFinancial in a n c ia l aand nd O th e r In te rn a tio n a l S e rv ic e s Services Y e a rs VValue a lu e oof f MManufactured a n u fa c tu re d EExports xp o rts InIndigenous d ig e n o u s SSoftware o ftw a re JJobs obs INSTRUMENTE STRUCTURALE IN ROMANIA 3 IRELAND – NATIONAL POLICY DOCUMENTS http://www.forfas.ie/publications/ http://www.forfas.ie/icsti/statements/tfores ight/ http://www.arts-sporttourism.gov.ie/pdfs/tourism_review_report. pdf http://www.iua.ie/working_industry/pdf/knowled ge_economy.pdf http://www.irishspatialstrategy.ie/NS SDownloads.shtml http://www.forfas.ie/esg/ INSTRUMENTE STRUCTURALE IN ROMANIA http://www.smallbusinessforum.ie/ http://www.entemp.ie/publications/scie nce/2006/sciencestrategy.pdf 4 “COMPETITIVENESS” OPERATIONAL PROGRAMMES* Breakdown by Core Priority (total EU and co-financed) 1994-99 2000-06 € 501 (%) (11%) € 2,300 (%) (51%) Enterprise Support 3,125 (71%) 1,700 (38%) Marketing Support 552 (13%) 358 (8%) Sea Fisheries 233 (5%) 132 (3%) 4,411 100% 4,488 100% Research, Development, Innovation Total * Industry Operational Programme 1994-99, Priority of the Productive Sector Operational Programme 2000-06 INSTRUMENTE STRUCTURALE IN ROMANIA 5 PRODUCTIVE SECTOR OPERATIONAL PROGRAMME Priority/Measure 2000-2006 NDP 1. RTDI 1.1 Education 1.2 Industry RTDI 1.3 Agriculture RTDI 1.4 Food Institutional Research 1.5 Marine RTDI 1.6 Forest Research and Development Programme 1.7 Environment RTDI 2. Industry 2.1 Indigenous Industry 2.2 Food Agriculture Products 2.3 Seafood Processing 2.4 Film Industry 2.5 Gaeltacht Areas 2.6 Foreign Direct Investment 3. Marketing 3.1 Industry Marketing 3.2 Food Marketing 3.3 Seafood Marketing 3.4 Tourism Marketing 4. Sea Fisheries Development 4.1 Adjustment of the Fishing Fleet 4.2 Supporting Measures for Fisheries Development 4.3 Renewal & Modernisation of the Fishing Fleet Other Total €mn 2,300 684 1,376 61 60 53 12 50 1,700 440 165 78 61 285 670 358 1994-1999 SF €mn 240 55 185 0 0 0 0 0 0 0 0 0 0 0 0 0 67 8 200 132 7 31 % 51% 15% 31% 1% 1% 1% 0% 1% 38% 10% 4% 2% 1% 6% 15% 8% 1% 2% 0% 4% 3% 0% 1% 95 0 4,488 2% 0 100% 20 0 282 0 0 0 42 5 18 NDP % 85% 20% 66% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 15% 2% 6% 0% 7% 0 100% SF €mn 501 % 11% €mn 269 % 26% 3,125 71% 583 57% 552 13% 99 10% 233 4,411 5% 100% 72 1023 7% 100% INSTRUMENTE STRUCTURALE IN ROMANIA 6 SOME KEY PARAMETERS • OBJECTIVES: shift from employment creation to value-added • DELIVERY AGENCIES: mainly existing specialist state agencies • ELIGIBILITY: generally manufacturing and internationally traded firms (i.e. exports or export potential) • FORMS OF FINANCE: mostly non-repayable grants, some equity (preference shares) • DEADWEIGHT: part of consciousness of selection committees • APPROVAL CRITERIA: Programme Complements • PROJECT GENERATION/SELECTION: agency development staff help applicants, separate committees approve • MONITORING: project level – grants payable for agreed milestones programme level – inputs, outputs, results, impact ideally INSTRUMENTE STRUCTURALE IN ROMANIA 7 PRINCIPAL IRISH PRODUCTIVE SECTOR DEVELOPMENT AGENCIES - SUMMARY NATIONWIDE MULTISECTORAL: NATIONAL SECTORSPECIFIC: PROMOTION OF FOREIGN DIRECT INVESTMENT WWW.IDAIRELAND.IE PROMOTION OF INDIGENOUS ENTERPRISE, EXPORT PROMOTION WWW.ENTERPRISEIRELAND.COM MANPOWER SERVICES AND TRAINING WWW.FAS.IE POLICY RESEARCH AND ADVISORY BODY WWW.FORFAS.IE FUNDING OF BASIC R&D IN ENTERPRISE WWW.SFI.IE FUNDING OF R&D IN THIRD-LEVEL INSTITUTIONS WWW.HEA.IE DEVELOPMENT OF THE FISHERIES AND SEA-FOOD SECTOR WWW.BIM.IE DEVELOPMENT OF THE FOOD INDUSTRY WWW.BORDBIA.IE INDIGENOUS INDUSTRY ENTERPRISE DEVELOPMENT IN MID-WEST REGION WWW.SHANNON-DEV.IE ECONOMIC DEVELOPMENT IN IRISHSPEAKING AREAS WWW.UDARAS.IE SUPPORT FOR MICROENTERPRISE (-10 EMPLOYEES) WWW.ENTERPRISEIRELAND.COM/ STARTBUSINESS/COUNTY _ENTERPRISE_BOARDS.H TM REGIONAL/LOCAL AGENCIES CITY/COUNTY ENTERPRISE BOARDS INSTRUMENTE STRUCTURALE IN ROMANIA 8 SOME LESSONS • don’t forget the SME sector • be selective, focus on potential high performers • separate national competitiveness from regional/local development objectives • have good enterprise advice/support structure • Structural Instruments not enough, need a generally entrepreneurial climate INSTRUMENTE STRUCTURALE IN ROMANIA 9