Interview with Ljilana Pancirov

Croatia became member of the European Union on 1st of July, 2013. In connection to the important event, Ljiljana Pancirov, Consul General of Croatia to Hungary, Pécs, talked about the effects of the EU accession of Croatia on the SME sector of the country and its business relation potentials with other member states.

In your opinion what are the most significant opportunities that became available to the Croatian and Hungarian SMEs regarding the joint cooperation of the two nations?

The cooperation between SME-s on Croatian and Hungarian side has been determined by the mutual areas of interest and financial possibilities for contacts and business interaction. Similar economic foundations, educational backgrounds, geographical closeness, social and human resources similarities offer a suitable potential for mutual co-operation. Equal possibilities of presentation on the open market and the survival in the strong competitive environment enhances SMEs comparative advantages – they are able to continuously and dynamically, better than bigger ones, adjust to the market requirements.

Cross-border pre-accession EU projects enabled SMEs to get used to the strict and high EU standards in project preparation which is a healthy basis for their future mutual financial requirements in the available EU funds. Structural funds have allocated between 16-18% of the total money available, specially to the SME-s. Besides financial instruments available, there are supportive business services for the innovation by cluster formation, sector connections and public and private partnership.

Do you think that the EU accession of Croatia would make the SMEs to start to develop a more international operation?

The ratio of SMEs in the number of entrepreneurs is almost the same in Croatia (99,4%) as it is in the EU (99,8%) proving that the importance given to this business sector is on both sides of the same value. In the EU we are talking about 23 million SMEs, employing more than 100 million workers, which is quite a potential. Without mutual communication, exchange of ideas, experiences and economic interactions abroad, they would not be able to function in the competitive environment. International operations and networking become their necessity, and spreading best practices, their reality.

SME sector offers possibilities of applying modern solutions and the practice of highly developed countries, such as in transfer of technology, investments in research and development, innovations with the adjustment to the changes of the market demands, modern management techniques and building up spirit of entrepreneurship enthusiasm.

According to the experts, potential obstacles for Croatian SMEs entering EU might be the restricted demand for products, administrative restrictions, lack of qualified human power, infrastructural problems, restricted entrance to the finances, usage of new technologies and organization structures and the qualified management, imbalanced regional development, corruption…SMEs successful economic performance, therefore, depends on the local and national but also on the wider international business environment. Measures applied to SME sector in Croatia in recent years have developed electronic business operations, financial sources became more assessable, there is an initiative to accept the EU standards and to minimize the administrative obstacles by one-stop-shop type of initiatives.

Croatia being an EU country, mainly what kind of joint projects could be foreseen?

Croatian entering EU gives some new perspectives to the small joint projects performed by EU countries on the level of individual business subjects, but also to big energetic and infrastructural investments on the national and international level (highways, railways…).

In the second part of 2013 in Croatia should start the implementation of several big priority projects of overall estimated value more that half a billion euro. In Croatian Ministry of Regional Development and EU Funds expect co-financing from the Structural Funds and Cohesion Fund in the amount more than 430 million euro. At this moment for EU financing there are already nine projects in the category of BIG ones. In the pipe-line there are a lot of big investment projects around Croatia from Vukovar, Slavonija, Kupari, Dubrovnik, including Pelješac bridge that is expected to be realized through European funds, railway from Botovo-Rijeka (from border with Hungary) investment of several billion euro, Plomin and some other energetic projects as well as Hotel Brijuni enterprise.

The biggest investment of almost 300 million euro is in three projects of Croatian Railways. Reconstruction of the railway on the international corridor Vb (Dugo Selo - Križevci) of 198 million euro value and building of new city railways in the Zagreb surroundings area of 97 million euro. Croatian Waters are preparing the implementation of 5 projects of building and reconstruction of water and drainage systems (in Osijek, Poreč, Čakovec, Vukovar and Vodice) in which they plan to invest more than 230 million euro. The value of the project of the Ministry of Science, Education and Sport at Rijeka University is 19 million euro and it is planned for supplying several laboratories and centers of excellence in the area of bio, nano and info sciences. Mayor part of the investment money for all these projects, from 70 to more than 80%, has been planned for financing from European funds.

Besides so called big investment projects there is a list of prepared first circle developing regional projects, 32 of them, for the cumulative value of 700 million euro. Ministry expects some 30 to 40 new regional development projects which might not be ready in this, but next year 2014. As Structural Funds comprise a possibility of grants to enterprises and NGO-s for smaller projects of competitiveness strengthening and human resources, there is open space for possible projects of long-life education, improvement of education system…

What kind of effects could be expected on the business relations of the two countries?

Croatia has been negotiating 35 chapters with the EU under the strictest rules ever, given to one EU pre-accession country. That gives the basis for good legal foundations in business performances. Political stability and the confidence in the legal state crucial are for the long-lasting investments because they define many aspects of business environment (law, customs…). Accepting the Strategy of Development of Entrepreneurship 2013-2020 in May 2013, Croatian Government has defined strategic aims among which is the enlargement of SMEs in GDP from present 51,6% to 62 % by stronger investment in the research and development, enhancing innovations and export as well as developing business networks. Positive results of cumulative business enhancement measures on the national level are expected to be seen in the relations between Croatia and Hungary as well. The establishing of Croatia-Hungary Section of the Hungarian Chamber of Industry and Trade in Pécs and the Carpatian Region Business Network Office in Osijek, both are additional encouraging factors for future business relations of the two countries. New possibilities are open in the regional grouping and Pannon EGTC project whose presidency is in Pécs.

Croatia intends to be a member of the Schengen area. What do you think about that further step?

Croatia accepts European visa regime from 1 July 2013, so that the citizens of Russia, Ukraina and Turkey will have to obtain visas for Croatia. Nevertheless, whoever has Schengen visa for another EU country, will be able to enter Croatia.

Croatia, entering EU, becomes one of the longest outer borders so in the following two to three years it will have at the disposal from facillity funds 120 million euros for Schengen preparations. Putting cameras and radars on the outer islands along the maritime border, arround 900 km is a necessary step with 50 guarding boats on the sea. Croatia will have more than 6.000 police officers along the border. Croatian government plans to get into the Schengen area in two to three years. With the rule of law and adequate preparations for outer EU border control, being a Schengen country offers a lot of advantages for the Croatian citizens and their business partners.

Personally, what do you consider the biggest success regarding the EU accession of Croatia?

EU has been created on the basis of European peace and stability. Coming from the country which underwent several transitions, among which is one from war to peace, I highly appreciate European standards and values as well as the assurance of peaceful multicultural existence of nations. Croatia is a small Mediterranean, Middle European and Danubian country, open, ecologically conscious, beautiful and heritage preservation oriented and I think that we could participate successfully in building all the high values of European Union states.

28th June, 2013

Ljiljana Pancirov

Veneto AgricolturametidVEDADDRIUCCICJCCIDRAMACONSVIPOCIHEAM-IAMBCPOKASHFINSALMA MONSMoAFCPCERPSAseb

European Union European Regional Development RefundSouth East Europe

Powered by: KETSH Web