EU Funds in Croatia: Where Does Withdrawal Problem Lie?

Lauren Simmonds

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Croatia has many issues, and rather surprisingly, a big one is with the proper withdrawal of EU funds. What exactly is the problem, and how can it be fixed? The topic of EU funds in Croatia and the upcoming financial period is explored by Ana Fresl.

As Lucija Spiljak/Poslovni Dnevnik writes on the 20th of February, 2019, Poslovni Dnevnik sat down with Ana Fresl, the director of the PJR consultancy group to discuss the EU’s new seven-year financial period and expectations, Croatia’s severe lack of EU project experts, common mistakes, how the country made the most of the last financial period and what awaits us as the ”How to prepare for the 2021-2027 financial period” conference. Croatia is looking to learn from other EU member states and their own respective experiences when it comes to strategic development and implementation of EU projects on the 6th and 7th of March, 2019, in Trakošćan, Croatia. How can the problem with the withdrawal of EU funds in Croatia be rectified?

You’ve been the director of Croatia’s largest companies for EU funds since the very beginning. How many people and companies have you consulted with and educated on EU projects?

When it comes to EU funds, it’s correct to say that I’ve really been around since the very beginning, from the Ministry of Finance and the Central Financial and Contracting Agency, to EU programs and projects, after which I opened my own company in 2009 and I was recently re-elected as the president of HUP – Association for Professionals for EU Funds. I have offered consultation for over 350 EU projects, I’ve been a public advisory expert on 20 technical assistance projects. I have more than 500 days of education in Croatia and beyond behind me. The interest in EU funds is very high, as can be seen from the recent tenders for small and medium-sized entrepreneurs who were applying for available funds within mere seconds.

The Minister of Regional Development and EU Funds, Gabrijela Žalac, stated that we lack 2,700 experts for the implementation of EU projects. How can we attract and interest people, what are we doing in that regard, do we have any specific figures?

The figure of 2,700 experts was obtained by my own company, PJR, based on the extensive research that we carried out within the project of the Ministry of Regional Development and EU Funds.

We have investigated the absorption capacity of about 500 EU funded users, and that’s the number of qualified experts which confirmed that we’re missing that number at the Croatian (domestic/national) level. There’s a lot involved, lots of education, training, seminars just for training. In PJR, we launched an EU mentorial program, EUment, which is aimed at educating students, all those looking for or changing jobs, or those who are juniors in organisations and want to learn to be better, and see a chance for that with EU funds.

The program lasts for six weeks and the person passes through each department in the company and meets and works with experts. There is a big interest in this, and I believe there is in other programs, too. Our oldest and most visited educational program is the PJR Academy – a simulation of EU project implementation through five days of education. After all the years that we’ve been doing this, we’re seeing more and more interest because we have new enthusiasts who are interested in learning.

Who mostly uses and withdraws EU funds? How successful are we when it comes to withdrawing, and how much are we to use?

Most of the money is withdrawn by Finland, the least is withdrawn by Spain. There is enough time for improvement until the end of the funding period, and in parallel, Croatia has to prepare for the new (financial) period of 2021-2027, in which many rules will be changed, and higher financial capacities will be being expected from users, not just human. When it comes to witnessing the real effects of the EU funds on employment, the economy, the quality of public administration and various areas that have been invested in in the Republic of Croatia, we still have to wait, and in a couple of years, most of the projects will be over and their effects will start to affect society.

How should we then get going on the eve of a new era, and in what area are we usually making the most mistakes?

The biggest problem is undoubtedly the slow system and unrealistic goals. At the beginning of each year, indicative plans are published with the lists of all of the tenders that are planned to opened during that year and the date of the call for the tenders is always listed. All of these tenders are always late, some of them by five to six months.

At this point, for the European Social Fund, there are still no announcements for 2019, and it’s already mid-February! Each tender is unique, requiring the special consideration of opportunities, some time of preparation, and the most important part – human and financial resources. Once a tender is opened and the project is sent, a wait for the results commences, which is known to have lasted for as long as one year, and that’s too long for entrepreneurs and their markets.

Those who manage to succeed end up encountering new problems in project implementation, the most common mistakes lie in public procurement and the lack of project success indicators. What each consultant would say is that they need to be realistic. It’s tempting to write that you’ll hire ten workers because it does, for example, bring in the most points in project evaluation but you should be realistic because if you don’t end up opening up the ten new jobs at the end of the project, then you haven’t met the indicators, you need to take responsibility, and you have to return part of the EU funds awarded to you.

What will the 2021-2027 financial period bring us? What challenges lie ahead of us?

The new financial period brings with it a large number of changes. For Croatia, this is a very challenging period because this is the first time in which we’ll be participating from the very beginning in the planning and the creating of a new seven-year financial framework.

This year and next year are set to bring changes within the current programs because there will be less money, and therefore, there will be less tenders, too. Some of the most important changes are that total allocation in ESI funds will be reduced due to the United Kingdoms’s exit from the European Union; the plan is have money in the amount of 351.8 billion euros for all members, and the amount will be available through several different funds together.

The amount of 8.8 billion for Croatia for the period 2021-2028 can be seen as a significant reduction compared to the previous period if absolute allocations are being considered, but if we look at how much this is per capita, there is no relative reduction because of the fall in the number of residents in the Republic of Croatia. The biggest change is that the maximum funding rate for less developed regions, of 85 percent, in which Croatia falls, will be reduced to 70 percent.

Make sure to stay up to date with our dedicated politics and business pages for more on EU funds in Croatia and much, much more.


Click here for the original article/interview by Lucija Spiljak for Poslovni Dnevnik


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