OPCI PROGRAM MJERA

1
SUPPORT MEASURES FOR SMES IN CITY OF
RIJEKA Bruxelles, 28.05.2009.
2
Rijeka is the main crossroad of adriatic tourist
traffic coming from middle Europe towards middle
and south Adriatic. It is an important crossroad
of highways and roads joining the background
through Gorski kotar region where mountain Dinara
is only 40-50 km long. Roads from Rijeka lead
towards Istra and slovenian border in the North,
to cities and country inland in the Northeast, as
well as to the littoral and Dalmatia. The city is
an important railways center and the airport
Rijeka in situated on the island of Krk.
3
CITY OF RIJEKA

• Rijeka is seat of Primorsko-goranska county
• area 3.582 km2
• population 350.000

• To Rijeka also gravitates
• Rijekas ring (8 cities and counties)
• population 205.000

• Urban area 44 km2
• Urban population 144.043

4
RIJEKAS ECONOMY
Period of comparation I-IX 2008 / I-IX 2007 , INDEX Period of comparation I-IX 2008 / I-IX 2007 , INDEX Period of comparation I-IX 2008 / I-IX 2007 , INDEX Period of comparation I-IX 2008 / I-IX 2007 , INDEX Period of comparation I-IX 2008 / I-IX 2007 , INDEX
All Small Medium Big
Number of entrepreneurs 107,1 107,3 93,5 116,7
Number of employees 106,2 105,9 97,7 109,7
Revenues 107,9 114,7 91,4 107,4
Expenses 110,3 114,2 92,5 112,9
Investments 109,5 135,4 126,3 93,0

Source Statistical review FINA, January
2009 Number of entrepreneurs in 2008 4.016 (
FINA ) Number of handcrafts in 2008 3.468 (
Chamber of crafts ) Prevailing activities trade,
manufacturing, transport and warehousing
5

• General program of support measures for small and
• medium entrepreneurs in City of Rijeka is a set
  of
• measures to create entrepreneurship environment
  with
• developed entrepreneurship climate and well
  designed
• pre-conditions for development of
  entrepreneurship
• skills
• General program has 5 areas
• 1. Strengthening of entrepreneurship
  competitiveness
• 2. New forms of education and information
• 3. Financing of entrepreneurship
• 4. Development of entrepreneurial
  infrastructure
• 5. Entrepreneurial culture promotion

6
PROGRAM AREAS

• 1. Strengthening of entrepreneurship
  competitiveness
• Funding of product certification
• - de minimis aid up to 15.000 kuna or 30 of
  total cost for the introduction of Quality
  Management System, certify the conformity of
  products according to national and European
  standards
• Funding of strategic marketing plans creation
• - de minimis aid up to 15.000 kuna or 30 of
  total cost for strategic marketing plan creation

7
Funding of joint promotions for products or
services - de minimis aid up to 15.000 kuna
or 30 of total cost for a joint appearance on
the market (eg. claster products and services
and their promotion, as well as co-marketing and
co-branding Funding the introduction of
support systems in decision making, management
and e-commerce - de minimis aid up to 20.000
kuna or 50 of total cost system implementation
8

• International fair of new technologies and
  products ( it was 5th in 2009)
• create link between economy and science, the
  development of communication
• between scientists and young entrepreneurs, the
  creation of links between the
• new technological achievements and entrepreneurs
  ready for their
• implementation, presentation of new scientific
  knowledge to young and the
• promotion of Rijeka as a city of knowledge
• In April 2009 in the University campus on Trsat
  officially opened the building
• Scientific and Technology Park, University of
  Rijeka - Step Ri is the first
• scientific-technology park in Croatia, whose
  services include three main
• programs the protection and transfer of
  intellectual property, incubation of
• new companies and licensing
• Awards for innovation ready for commercial
  application - only entrepreneurs
• who have their own innovation or innovation
  bought from innovators
• implemented in the product or service, award
  represents incentive of
• entrepreneurs towards the commercialization of
  innovation

9

• Using the services of the Croatian regions office
  in Brussels
• information from office about funding
  possibilities, rules of
• functioning common european market and
  european institutions
• Building a system Rijeka quality (RQ) long term
  project, in the future system of quality for
  SMEs in tourism

10
2. New forms of education and information

• Goal better education and entrepreneurship
  skill improvement
• Project Knowledge and experience the goal is
  to make connection between entrepreneurs and
  student solving the problems in business
• Project I know to work the goal is to make
  connection between pupils and handkrafts with the
  lack of educated work force
• Program "Development of entrepreneurial skills
  for young " in September 2008 started School
  for young entrepreneurs
• - measure will affect the development of
  personality and skills that are characterized by
  entrepreneurs - creativity, the ability to set up
  goals, decision-making, risk assessment,
  self-confidence, responsibility, ability to
  recognize influences from environment, all in
  order to prepare young people for the possible
  selection of entrepreneurial career
• Project "Scholarships to students in scarce
  craftsmanship occupations "
• - in 2007. the City of Rijeka and Chamber of
  crafts started with schoolarships to students for
  following occupation bricklayer, carpenter,
  machinist, cook, waiter, confectioner, plumber,
  painter, fitter and turner - City is financing
  40 of monthly amount of scholarship

11

• Project "SMS info-entrepreneur - SMS system
  delivers entrepreneurs timely
• information about loans, grants, education
  programs without compensation
• Thematic conferences - conferences are organized
  according to the current
• issues and interest of the city and entrepreneurs
• Improving the system of public procurement
  presentation of annual city
• public procurement plan, intention is to inform
  entrepreneurs on public
• procurement rules and their procedures

12
3. Financing entrepreneurship

• Goal improving access to finance
• Program Guarantees for financing projects of
  small economies
• The goal of the Program is incentive to invest in
  research,
• development and application of modern
  technologies and innovations in
• order to increase the quality and competitiveness
  of entrepreneurial projects,
• the guarantees are issued for the uncovered part
  of the loan.
• City of Rijeka has provided the amount of
  2.000.000 kuna for potential
• guarantees and deposited them as the basis for
  issuing the guarantees for
• the loans Erste Steiermarkische Bank in the
  amount of 10.000.000 kuna.
• Amounts of guarantees and entrepreneurial
  projects
• - amounts of loans that are issued by
  guarantees can be of 35.000 to 400.000 kuna

13
- entrepreneurial projects are ranked according
to priorities and cover the specific percentage
of the loan o Rank 1 / up to 70 loan amount
on the introduction of innovation in business,
start up a business based on innovation and
research o Rank 2 / up to 60 loan amount for
equipment, machines and technologies o Rank 3 /
up to 50 loan amount for the improvement of
business by introducing norms and standards (ISO,
HACCP, etc.) o Rank 4 / to 45 loan amount for
permanent current assets for investment in
production or preparation of tourist season o
Rank 5 / to 40 loan amount for the purchase,
construction, expansion or renovation of
commercial / manufacturing facilities.
14

• Program Loans with deposit
• - the goal of the Program is to provide financial
  assistance to entrepreneurs,
• which intend to realize investment projects in
  function of urban tourism and
• encourage the production
• - in 2009 it will be provided the additional
  possibility of entrepreneurs in
• the production sector they could realise
  loans for permanent current assets to survive the
  recession conditions in the market and maintain
  the existing number of employees
• - City ensured the amount of 1.000.000 kuna which
  will be successively and with
• no interest deposited in the amount of one third
  of approved loans, BKS Bank
• is providing the loan fund in the amount of
  3.000.000 kuna with interest rate
• of 6.3 fixed
• - City will make further subsidize the interest
  rate with 1.5 percentage points, the interest
  rate for the end user of these loans will be
  4.8, fixed, the highest amount of loan can be up
  to 300.000 kuna, in exceptional cases even more.

15

• Subsidies of interest rate and cost of credits
  from
• Program "Poduzetnik 2 measure represents a
• continuation of subsidizing the interest rate and
  cost
• of credits from earlier loan program
• New forms of financing promotion - measure is
  presentation of new forms of financing
  entrepreneurial projects through venture
  capital, business angels and the transfer of
  experiences and examples of good practice.

16
4. Development of entrepreneurial infrastructure

• Goal using city spatial and information
  facilities for start up and entreprenurship ideas
  realisation
• "Entrepreneurial incubators " - City of Rijeka
  has 2 entrepreneurial incubators incubator for
  manufacturing activities and incubator for
  services, contractors use commercial space total
  area of 5000 m2 and consulting services (search
  for capital, education), incubator space is
  designed for beginners and entrepreneurs who are
  in the phase of growth and development,
  incubation period lasts until 5 years, when it is
  considered that the potential for survival in the
  market is achieved

17

• "Enterprise Library " long term project, as a
  part of new city
• library, intention is to have in one place
  everything about
• entrepreneurship
• Local rates examption as a benefit for
  investment made
• through earlier programms

18
5. Entrepreneurial culture promotion

• Award for contribution in the field of
• economy
• - recognition for contributions in the fields
  of economy and promotion of the City of Rijeka
• Development of social responsibility for
• business
• - entrepreneurs take the activities of solving
  the needs of local communities, they conduct the
  project using their own resources for increasing
  the quality of citizens life (arrangement of
  children's playgrounds, schools,health clinics,
  etc.)

19

• Media Corner
• - measure is following the positive examples of
  entrepreneurial projects and their work with the
  community. Through public information raises the
  overall level of entrepreneurial climate and
  culture.
• Organization of team-building joint
• entrepreneurial initiatives
• measure will be directed to the organization of
  relations development workships in the group,
  under the expert guidance
• measure will target group of entrepreneurs who
  show the initiative for common forms of
  performance on the market (eg. clusters,
  co-branding alliances, etc.)

20
COUNTRECESION MEASURES IN 2009.

• Measures
• reduction the monthly lease of business
  facilities owned by the City to all contractors
  10 and further 10 more for production sector
• reduction of monthly local rates for all 10 and
  further 10 for catering industry
• reduction of monthly municipial rates for
  cultural monuments in zone I
• loans for permanent current assets in production
  sector to survive the recession conditions in the
  market and maintain the existing number of
  employees Program Loans with deposit

21

• The Global Entrepreneurship Monitor (GEM)
  research program is an annual assessment of the
  national level of entrepreneurial activity.  GEM
  is the largest single study of entrepreneurial
  activity in the world.
• Started as a partnership between London Business
  School and Babson College, it was initiated in
  1999 with 10 countries, GEM 2008 conducted
  research in 43 countries (Angola, Bolivia, Bosnia
  and Herzegovina,Colombia, Ecuador, Egypt, India,
  Iran, Argentina, Brazil, Chile, Croatia,Dominican
  Republic, Hungary, Jamaica, Latvia, Macedonia,
  Mexico, Peru, Romania,Russia, Serbia, South
  Africa, Turkey, Uruguay, Belgium, Denmark,
  Finland, France, Germany, Greece, Iceland,
  Ireland, Israel, Italy, Japan, Republic of Korea,
  Netherlands, Norway, Slovenia, Spain, United
  Kingdom, United States
• http//www.gemconsortium.org/
• istraživanje i mjerenje poduzetnicke aktivnosti,
  objavljueni rezultati istraživanja poduzetnicke
  aktivnosti i kvalitete poduzetnicke okoline kroz
  indikatore
• I motivacijski indeks TEA Prilika/TEA Nužnost.
  Navedeni indeks govori o odnosu poduzetnika koji
  su u poduzetnicku aktivnost ušli radi uocene
  poslovne prilike u odnosu na one koji su u
  poduzetnicku aktivnost ušli radi nužde
• Indeks motiviranosti prosjek GEM zemalja
  za Hrvatsku je 1,16
• za Istru, Primorje i Gorski kotar 3,20 - 1.
  mjesto po motiviranosti poduzetnika u Hrvatskoj.

22

• The indicators
• For the purposes of GEM project, and based on the
  conceptual
• research framework and holistic approach to the
  definition of
• entrepreneurship, a set of indicators that
  measure different
• aspects of entrepreneurial activity has been
  identified
• Indicators of total entrepreneurial activity in
  the life cycle of the
• entrepreneurial process, from startup to maturity
  of the business
• venture
• Nascent entrepreneurs (who decide to start a
  business venture)
• New business owners (business owners whose
  entrepreneurial activity is measured by having
  paid salaries for more than 3 months, but less
  than 42 months)
• Established business owners (business owners who
  are entrepreneurially active for more than 42
  months)

23

• Entrepreneurial activity of the nascent
  entrepreneurs and new
• business owners, measured by the ratio of the
  number of such
• entrepreneurs (start-up) in the sample of the
  adult population,
• aged 18 to 64, is expressed through Total
  Entrepreneurial
• Activity (TEA) Index.
• Indicators of motivation for entrepreneurial
  activity
• TEA Opportunity index those who start
  entrepreneurial activity because they have
  perceived a business opportunity
• TEA Necessity index those who are pushed into
  entrepreneurship by the situation they found
  themselves in (they lost their job, could not
  find another job.)

24
GEM Croatia

• From the tail to the first half, but still below
  the average of
• GEM countries - which means that the various
  measures to
• support entrepreneurial activities, provided
  results
• TEA index (total entrepreneurial activity index)
  - of
• entrepreneurially active persons among adult
  population of
• 18-64 years

Year Croatia GEM countries Range
2008. 7,59 TEA 10,49 TEA 24/43
2007. 7,27 TEA 9,07 TEA 21/42
2006. 8,58 TEA 9,43 TEA 18/42
2002. 3,62 TEA 8,00 TEA 32/37
25

• Motivational index (ratio of opportunity based
  vs.
• necessity based entrepreneurs)
• this index is preferable to be as large as
  possible, because it means that there are a
  greater number of people who enter the
  entrepreneurial activity of their choice, not
  because it is a situation forced on it, Croatia
  still lags the average GEM countries.

Year Croatia GEM countries Range
2008. 2,51 4,29 25/43
2007. 1,43 5,50 39/42
2005. 0,90 5,90 35/35
26

• Regional differences in entrepreneurial
  activities
• (TEA index and Motivational index)
• Regional differences were reduced may interpret
  the
• influence of different programs, but differences
  in the
• motivation are still high
• Source Singer, S. Et al What makes Croatia an
  entrepreneurial country, Results 2002-2005,
  CEPOR, Zagreb, 2006. Singer, S. et al

Croatian regions 2005 2005 2008 2008
Croatian regions TEA index Motivational index TEA index Motivational index
Zagreb and surroundings 8,43 1,68 7,07 6,44
North Croatia 4,40 0,44 5,57 2,18
Lika and Banovina 5,11 2,23 8,05 1,34
Istra, Primorje i Gorski kotar 5,74 2,27 10,00 4,76
Dalmacija 6,34 0,37 11,00 3,31
Slavonija and Baranja 4,91 0,55 4,55 0,35
27

• Thank You for attention !
• Natasa Mandic
• City of Rijeka
• Department of Enterpreneurship
• HR 51000 Rijeka, Trg. Sv. Barbare 2, Hrvatska -
  Croatia
• tel.[phone], fax.[phone]
• e-mail natasa.mandic_at_rijeka.hr