Projekt jednako razvoj d.o.o. www.pjr.hr EU funds for Research and Development – Experience of the Republic of Croatia Projekt jednako razvoj d.o.o. www.pjr.hr

R&D – Preconditions Preconditions: EU level – Europe 2020 strategy - improving the conditions for R&D by increasing combined public and private investment in R&D to 3 % of GDP by 2020 Smart specialization strategy for R&D 2014. – 2020. Priority areas: Health and Quality of Life Energy and Sustainable Environment Transport and Mobility Security Food and Bioeconomy Horizontal areas: Key enabling tehnologies (KET), ICT

R&D – EU level basic data 2013-2015 GDP on R&D in the EU around 2.03 %. Main source of financing for R&D activities in the EU: business sector (less resilient to economic fluctuations compared to HEI and government sectors) R&D expenditure: highest in northern and western European countries (also characterised by predominantly business-financed R&D) EU increased its output of tertiary graduates in science and technology by 23% 2008-2015 Employment in knowledge-intensive activities increased in almost all EU Member States. Countries with large financial and ICT sectors relative to their GDP report the highest employment in knowledge-intensive activities in the EU. Share of R&D personnel in labour force: 1.2 % in 2015 (more than half in business sector) Almost 50% of EU’s enterprises reported innovation activity in 2014 (higher in MS with higher GDP per capita) 1/3 of innovative enterprises were engaged in some form of co-operation with other enterprises or institutions during 2012–2014 High-tech exports to outside EU doubled 2007-2015

GDP on R&D 2005 and 2015 (% of GDP) *Source: Eurostat

GDP on R&D by sector, EU28, 2005-2015 (% of GDP) *Source: Eurostat Croatia – private investments in R&D structure Large enteprises More than 60% Medium enteprises around 30% Small enteprises Less than 10%

Research and development in Croatia Problems: Outdated/inefficient research infrastructure lack of resources for conducting research underperformance of knowledge and technology transfer activities Objective: to increase private RDI investments covering support both for in house R&D activities of enterprises (including SMEs) and for purchasing R&D services to launch new or fundamentally changed processes and products Prepreke: weak innovation capacity of companies and R&D potential limited interest for collaboration between industry and R&D institutions inadequate institutional support system to foster innovation

R&D – State Aid State Aid in R&D sector is considered as horizontal state Categories: Fundamental research, industrial research, experimental development, feasibility studies (for applied and development research) Covering the costs of industrial property rights for SMEs Aid for newly-established SMEs in innovation Process innovation and business organization in services sector Consultancy services on innovation for SMEs For R&D projects personnel costs: researchers, technicians and other supporting staff to the extent employed on the project (also for SMEs) Aid for innovation clusters fostering collaboration, networking and learning

R&D – sources of funding Republic of Croatia: National funds – 4 million EUR (2015.; 0,31 % total national aid; 18 million in 2013 and 2014) 0,9 million EUR – subsidies and interest subsidies 0,57 million EUR - RAZUM – Program of development knowledge-based businesses 0,33 million EUR – IRCRO – Cooperation R&D Programme 3,1 million EUR - tax exemptions, deductions, exemptions, etc. European Regional Development Fund (ERDF) European Agricultural Fund for Rural Development (EAFRD)

R&D – sources of funding Operational Programme Competitiveness and Cohesion 2014 - 2020 (ERDF) Priority: Restructuring R&D sector through organisational reform and investments in modernisation of R&D infrastructure Supporting projects of national Centres of Research Excellence as a way of strengthening research excellence Creating conditions for business sector to invest into R&D&I by directing research organizations to focus towards applied research projects which correspond to the needs of economy Supporting R&D spending in enterprises to increase overall level of R&D spending Creation of joint interest in implementation of R&D projects between R&D institutions (including academic sector), public authorities and enterprises Creation of favourable environment for enterprises in the area of RDI.

R&D – sources of funding Operational Programme Competitiveness and Cohesion 2014 - 2020 Investment areas: Competence centres Development of products and services Technology transfer, social innovation, eco-innovation Networking Clusters and fostering innovation through smart specialization Supporting technological and applied research Pilot lines and early product validation actions Advanced manufacturing capabilities and first production, in particular in key enabling technologies and diffusion of general purpose technologies

Funds allocation - ERDF Allocation 2014-2020: 665 M. EUR Title Allocation (m EUR) 002. Research and innovation processes in large enterprises 95,0 056. Investment in infrastructure, capacities and equipment in SMEs directly linked to research and innovation activities 60,0 057. Investment in infrastructure, capacities and equipment in large companies directly linked to research and innovation activities 25,0 058. Research and innovation infrastructure (public) 163,2 059. Research and innovation infrastructure (private, including science parks) 63,0 060. Research and innovation activities in public research centres and centres of competence including networking 171,3 061. Research and innovation activities in private research centres including networking 15,4 063. Cluster support and business networks primarily benefiting SMEs 15,5 065. Research and innovation infrastructure, processes, technology transfer and cooperation in enterprises focusing on the low carbon economy and on resilience to climate change 40,0 070. Promotion of energy efficiency in large enterprises 5,0 121. Preparation, implementation, monitoring and inspection 11,4

Indicators Description Value (2023.) Research, Innovation: Number of researchers working in improved research infrastructure facilities 1215 Number of R&D&I infrastructural projects 6 Number of Centres of Research Excellences supported projects Number of R&D projects conducted by research organizations 75 Scientific publications published in journals indexed in the platform Web of Science (core collection) 6070 Description Unit Value (2023.) Increase of patent applications, trademarks and industrial design in Croatia Number of applications 870 Sales of new-to –market and new- tofirm innovation as % of turnover Percentage 3,9 Business expenditure on research and development M EUR 29 Productive investment: Number of enterprises receiving grants 400.00 Research, innovation: Number of new researchers in supported entities 30,00 Research, Innovation: Number of enterprises cooperating with research institutions 100,00 Research, Innovation: Private investment matching public support in innovation or R&D projects 210,000,000.00 Research, Innovation: Number of enterprises supported to introduce new to the firm products Number of R&D projects supported 600.00

Rural development programme Strenghtening cooperation between agriculture, food production, forestry and R&D Fostering innovative technologies and research, partnerships Promotion of cooperation between sectors for development, testing, implementation of innovatin and knowledge Promotion of innovation and applied research related to new technologies and procedures for greenhouse gases reduction. Measures: Aid for establishing Operational groups under European innovation partnership (EIP) zfor agriculture productivity and sustainability (e.g. energy efficiency, reducing environment impact, improvement of measures for implementation of innovations related to animals health (aid up to 5.000 EUR) Operational goups in agricultural and food sectors – research activiy financing (aid up to 200.000 EUR) Aid for pilot projects and new products development, process and technologies (Manufacturers, Cooperatives, Operational Groups) – financing of R&D costs: laboratory testing, field testing, market research, feasibility studies, packaging production for new process and products, up to 300.000 EUR).

R&D – projects for enterprises Operational Programme Competitiveness and Cohesion 2014 - 2020 Most relevant Calls for Proposals: Strenghtening of capacities for R&D&I (07-13) – 9,3 M EUR (0,2-1 M EUR per project) Development of new products and services based on the R&D activities – 100 M EUR (25.000-7,47 M EUR per project) Support to the development of Centres of competence – 105 M EUR (up to 15 M EUR per project) IPA: SIIF 1 & SIIF 2 – 5 + 6,7 M EUR (50-750.000 per project) 25 projects

Thank you for the attention! Ivan Serdarušić ivan.serdarusic@pjr.hr Projekt Jednako Razvoj d.o.o. www.pjr.hr