Public Private Partnership Projects in Eastern Europe Experiences from the view of German agribusiness Gerlinde Sauer Director agribusiness, Committee on Eastern European Economic Relations East Agri Meeting, 4. Mai 2005 1

The Committee on Eastern European Economic Relations represents the interests of German business in Central, Eastern and South-East Europe The Committee on Eastern European Economic Relations was founded in 1952 It is a joint organ of the leading business associations representing German industry (Federation of German Industries – BDI and also leading associations in the area of trade, finance, insurance) Membership is open to companies with interests in Russia, Central and Eastern Europe, South-East Europe, the Baltic States, the Caucuses and Central Asia The task is to support and promote the efforts of German companies involved in these regions in trade, industry, investment or the service sector Within the Committee exist working groups regarding countries and special branches (e.g. agribusiness) 2

The Working Group “Agribusiness” focuses on the development of trade and investment in agriculture and food industry It was founded in 1998 as an initiative of the German ministry of agriculture to support the cooperation especially with Russia and Ukraine and was integrated to the Committee on Eastern European Economic Relations in 2001. The activities are supported and financed by the leading business associations representing Germany agribusiness: agricultural machinery seed production plant protection cattle breeding food industry agricultural cooperatives trade and consulting The aim of the working group is to support the development of agriculture and food industry especially in Eastern Europe by modern agricultural technology, know-how and direct investment. 3

Activities of the working group „Agribusiness” Forum East-West Trade fairs for agriculture Specialized conferences and workshops Working Groups on Agriculture/Food Industry within the bilateral cooperation council Bilateral committees in the area of economy and agriculture Committees Support of German companies at their commitment in Eastern Europe Conferences German and European business associations Ukrainian agrarian confederation Russian grain union Current Information on agriculture in Eastern Europe Cooperation requests Information on relevant events Information Networking 4

Russia and Ukraine are strategic markets for German agribusiness companies German agribusiness exports to Russia Mio. € German agribusiness exports to Ukraine Mio. € After successful establishment of local trade cooperation German companies now increasingly invest in local production 5

Eastern European countries are facing the challenge to effectively realize their agricultural potential Lack of modern technology for plant, meat and food production Lack of financing for agricultural producers Governmental structures are still hindering access to innovations in the area of agricultural technology (e.g. difficult and expensive registration procedures for new technologies) Lack of management know-how for efficient and internationally competitive agriculture Insufficient education and professional consulting in the area of agriculture Foreign companies distributing modern agricultural technology play a central role in providing management know-how to agricultural producers in Eastern Europe. 6

What is the outlook of the Committee on Eastern European Economic Relations on Public Private Partnership? Networking PPP-Projects of the committee Initiation of PPP-Projects of our members GTZ is member of the working group Joint events to foster the personal exchange between German companies and developing projects in Eastern Europe Project for consulting of business associations in Moldova and Albania Internship Program „Zoran Djindjic“ (Serbia) German-Russian Youth Exchange PPP-Project in cooperation with GTZ: „Promotion of Russian Agriculture by practical training and extension“ 7

Lessons learned on PPP-Project in Russia PPP-Project targets the critical factors for the development of Russian agriculture, especially insufficient management know-how Extra costs of imported agricultural technology are only economically reasonable if the products are employed efficiently Development of PPP-Projects needs time and management capacity Great demand for the services of the PPP-project Local political support is of vital importance Russian federal and regional government are advised to support PPP-Projects in the area of education and professional consultancy 8