Programme Agreement signed for the Business Development, Innovation and SMEs programme in Croatia

The programme agreement for Croatia Business Development, Innovation and SMEs was signed on 3 March 2020.

Key information about the programme

  1. The programme is operated by: FMO.
  2. There is no Donor Programme Partner in this programme.
  3. The programme objective is: Increased value creation and sustainable growth.
  4. The programme funding amounts to €22 million and is funded entirely by the Norway Grants.

Why is the programme needed?

In Croatia, SMEs represent the basic structure of the economy, with 99,7 per cent of the total number of enterprises. Although SMEs have the role as the main engine for economic growth, they are struggling with daily operations and do not have time and resources to focus on innovation and R&D. Many SMEs depend on several of Croatia’s largest enterprises for their business. The difficult economic situation coupled with problems in some large enterprises resulted in a worsening of losses caused by bad debt.

The main challenges which generate a direct impact on Croatia’s competitiveness are low technological level, low degree of entrepreneurship culture, an educational system that is not harmonised with modern industry needs, lack of lifelong learning, low international cooperation and low business efficiency. One of the strongest barriers to innovation is the low level of R&D collaboration between science and research institutions and the business sector.

What will the programme achieve and who are the beneficiaries?

The main objective of the Business Development, Innovation and SMEs Programme in Croatia is to increase value creation and sustainable growth in Croatia enterprises, mainly SMEs. The Programme will contribute to the overall objective of reducing economic disparities by financing projects that will increase competitiveness and profitability among Croatian enterprises and bring more innovation in products, services and processes. Further, the Programme will seek to stimulate and develop long-term business cooperation between Norway and Croatia based on business development and innovation.

The main focus area for the Programme will be Green Industry Innovation and the second focus area will be Blue Growth. The Programme will have one outcome which is increased competitiveness of Croatian enterprises within the two focus areas and will be implemented by open call for proposals and a small grant scheme for innovation and investment projects. In addition, a second small grants scheme is proposed for business support and “soft measures”, i.e. business modelling, mentoring, support for start-ups and clusters, training on specific issues such as IPR etc.

The Programme will have a clear focus on SMEs, we expect to reach also enterprises that normally find it difficult to mobilise the capacity to apply for EU funding. Hence, this Programme will target SMEs with a modest technological level. This is also to be secured by introducing Small Grants Schemes to lower the threshold for participation.

Expected achievements will be innovations in technologies, products, services and processes, and by that, also reduction of CO2 and other types of emissions to air, water and soil, decrease energy and fuel consumption, collection and re-use of waste as well as the establishment of new jobs and continuing jobs in the selected focus areas.

How will the programme strengthen bilateral relations?

On the Programme level, the ambition is to strengthen bilateral relations between Norway and Croatia in the business sector by stimulating long-lasting cooperation between relevant institutions and between enterprises. The Fund Operator will implement the Programme in cooperation with the National Programme Partner Croatian Chamber of Economy and by this contribute quite a lot to strengthening the bilateral institutional relations. The main body for cooperation will be the bi-annual Cooperation Meeting.

To facilitate, encourage and mobilise for partnership the Bilateral Fund on the Programme level shall give priority to activities in the early phase of the Programme implementation. The pre-allocation of Bilateral Funds granted to this Programme through the MoU will be allocated to measures such as, but not limited to

  • Matchmaking events or Donor State and Beneficiary State entities organized by the Fund Operator and/or the National Programme Partner prior to the launching of the Calls for Proposals;
  • Travel Support to entities from Beneficiary State and Donor State for partner search, networking, sharing and transfer of knowledge, technology, experience and best practices, prior to and during the projects’ implementation period.