REPUBLIC OF MACEDONIA MINISTRY OF ECONOMY

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REPUBLIC OF MACEDONIAMINISTRY OF ECONOMY
Clustering in the Republic of Macedonia- cluster
policy and pratice MSc. Trajanoska Nikolina
11- May- 2009 Opatija, Croatia
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GENERAL INFORMATION

• Crossroad of the Balkan Peninsula
• Two Pan-Europian corridors 8 and 10
• Total area 25.713 sq. km
• Population
• 2,1 million
• Capital city
• Skopje
• Independence
• 8 September, 1991
• Parliamentary democracy

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ECONOMIC PRIORITIES(Govements work Programme
2006-2010)

• Economic growth and development
• - increase domestic and foreign direct
• investment
• - increase the competitiveness of
• Macedonian companies
• - improve capacity of public
• institutions to implement reforms.
• Regional and world integration processes NATO
  and EU candidate
• Maintenance of macroeconomic stability
• Reduction of unemployment

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Macroeconomic Indicators

• GDP US 5.407 bln, per capita 2646 US
• Real GDP growth 4 for 2008 5,1
• Inflation 3,2, for 2008 6
• Industry growth 13,5
• Export growth rate 17,6
• Import growth rate 16,6
• Free Trade Agreements 650 mill Consumers
• Credit Ratings BB (FITCH, STANDARD POOR,S)

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VISION OF INDUSTRIAL POLICY 2009 - 2020

• The pro-active industrial policy will encourage
  the orientation of Macedonian industry towards
  higher value added products and services based
  on knowledge, innovation and collaboration.
  The future of Macedonian industry will be
  built on the development of capabilities in
  applied research and manufacturing of
  sustainable, organic and specialized high-tech
  products and services serving the needs of
  international niche markets. By 2020
  Macedonia will develop the dynamic mix of
  sustainable and authentic industries like
  organic wine and foods, eco-steel, eco-friendly
  construction, ITC, specialized electronic parts,
  renewable energy production, creative
  industries, medical equipment and services,
  authentic tourism and other industries.

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Five areas of intervention
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Measures for collaboration in clusters and
networks

• Further awareness raising and training for
  clustering / networking
• Cluster / network analysis and strategy
  development accompanied with action plan and
  specific projects
• Supply chain partnerships acceleration
• Stimulation of , technological centers and parks
  on the regional level, support of networks of RD
  institutions

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Macedonia Competitiveness Activity

• Textile
• IT
• Wine
• Tourism
• Lamb meat and sheep cheese
• Wood and furniture
• Automotive
• Agro equipment
• Macedonians designers
• Macedonian food processing (vegetables and
  fruits)

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Purpose of the Evaluation of the clusters

• Provide relevant information on effectiveness of
  various approaches implemented by ME
• Use lessons learned to guide the development of
  the strategy for private sector development and
  the new competitiveness activity
• Executed in November December 2008 by a local
  consulting company

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Specific objectives of the evaluation

• Independently identify achieved results and
  assess the impact on clusters
• Analyze the effectiveness of implemented
  interventions
• Evaluate the current state of clusters in terms
  of functionality, sophistication, sustainability,
  collaboration
• Identifying key problems and obstacles for
  Macedonian businesses to become more competitive

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Findings on achieved results

• Enormous direct influence in initiating the
  process of building competitiveness of
  enterprises in domestic, regional and global
  markets
• Only the active cluster members experienced
  increase in exports and productivity no ripple
  effect yet
• No visible results in job creation and increasing
  salaries, but qualitative improvement in raising
  the professional knowledge and business skills
• Greatest results are in initiating export growth
  and in promoting cooperation and partnership
• Gender and ethnic balance equal contribution and
  opportunities to all, but no changes in the
  existing equilibrium
• NECC is still not recognized by the cluster
  members

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Findings on Impact - 1

• Greatest success in achieving the
  cluster-creation effects
• initiating cooperation and rising partnership
  among cluster members and other domestic and
  international stakeholders.
• Significant success in
• Supporting export growth
• Supporting productivity growth
• Supporting positive trends in GDP growth

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Findings on Impact - 2

• Indirect effects have been identified in
• The increase of companies domestic market share
• The revenue growth
• Improvement of professional and business skills
  within companies
• Less effective than desired in job creation

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Specific results for the Apparel cluster

• 7.5 increase in export
• Soft results Changed mentality, awareness of
  cooperation and partnership
• Establishment of Textile Trade Association
• Joint marketing and participation on fairs
• Rivalry still exists

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Most valuable interventions for Clusters

• Promotion and marketing activities, participation
  on fairs (operational assistance)
• Expertise in increasing productivity and
  flexibility
• More local experts
• Improving the value chain purchasing raw
  materials, logistics, warehousing, financing

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Findings on most valuable interventions for other
clusters

• TOURISM
• Establishment of the Tourism Web Portal
• NECCs support in bringing tourists from Israel
  Cooperation with the NECC
• IT
• Establishment and capacity building of the export
  IT Consortium (MASIT)
• the 2nd Conference of IT Associations of
  South-East Europe (SEEITA) in Skopje
• Initiating the dialogue within the cluster
• LAMB CHEESE
• Ohrid Cheese and Wine Festival
• SIAL building sustainable business connections
• B2B meetings with partners from Albania, Italy,
  USA and Greece
• Valuable foreign consultants (clustering, cheese
  tasting, market research)
• Training in meeting the market needs
• WINE
• Presentations of Macedonian wine in Paris and
  London
• Training in sales, marketing and promotion

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Findings on current state of clusters

• Willingness to continue to exist and be active
  after the completion of MCA
• The clusters are not mature to operate alone and
  need further assistance
• Clusters based on or including associations are
  stronger, have better negotiation position, and
  better networking among members
• The number of actively participating cluster
  members is decreasing
• Clusters do not include a wide variety of
  supporting institution
• Lack of promotion initiatives to attract new
  members
• Lack of management capacity of the Cluster
  Leadership Council no membership policy

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Findings on firm related problems and obstacles
for growth

• Inappropriate knowledge base of the management
• Under-skilled work force for the new-age
  businesses
• Low level of technological development among the
  majority of the companies
• Low level of investment (lack of ideas where to
  invest, short-term thinking, lack of strategic
  planning skills)
• Very small number of firms that have implemented
  quality standards
• Absence of R D (only 11 of the research
  projects ordered by the business sector)
• Market research has not been recognized as a tool
  in decision making
• Inappropriate horizontal and vertical cooperation
  between companies

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Recommended future initiatives for the clusters
- 1

• Transfer knowledge in new production methods
• just in time, scheduling, flexible manufacturing
• Continue strengthening the Clusters
• Investigate possibility for intermediary
  wholesaler
• Continuous education
• Technology Transfer Centers
• Linkages with educational and RD institutions

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Recommendations for Building Competitiveness
long term

• Building assets, skills and capabilities that
  meet the test of the foreign competition
• Continuous investing in ICT (equipment, software
  and knowledge)
• Relying on market research
• Implementation of integrated marketing approach
• Work on branding
• Introduction of international quality standards
• Improvement of the business culture
• To be present at international exhibitions and
  trade fairs
• Permanent education and training
• Cooperation with the universities in order to
  adjust their curricula to bring competent and
  skilled staff to the industry

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Recommendations for self-development - 1

• Cooperate with the local government
• Use sector-specific information in developing
  adequate business strategies (information about
  technology, RD, input markets and target
  markets, etc.)
• Establish code of practice and change managerial
  approach to act on domestic market as well as on
  foreign market.
• Use local consultancy services for process and
  quality management

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Recommendations for self-development - 2

• Participate in the establishment and financing of
  supporting organizations, such as trade
  associations, cluster-relevant RD institutions,
  training centers etc.
• Strengthen horizontal and/or vertical cooperation
  by converting informal agreements into formal
  contractual commitments.
• Foster the cooperation and openness of clusters
  in order to
• build up a critical mass of information,
  knowledge, skills and technology,
• reduce the cost of developing new products and
  services,
• decrease pressure among local rivalries etc.

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Thank You for Your Attention

• Our contact
• MINISTRY OF ECONOMY
• Tel[phone] 488
• Fax[phone]
• E-mail economy_at_economy.gov.mk
• www.economy.gov.mk