REGIONAL COMPETITIVENESS OPERATIONAL PROGRAMME 12 TH SECTORAL MONITORING COMMITTEE MEETING Ministry of Science, Industry and Technology 27 June 2013

AGENDA 1. Introduction and Adoption of the Agenda a)Introductory Remarks (HOS, EC) b)Approval of the Minutes of the previous SMC and the Agenda of the Meeting (HOS, EC) Information on Annual Audit Activity Report for RCOP (Audit Authority) Information on Programming a)1 st project package (OS) b)2 nd project package (OS) c)3 rd project package (OS, EIF) d)4 th project package and individual projects (OS) Information on Procurement and Implementation a)Tendering and contracting (OS) b)Implementation (OS) c)Absorption (n+3), procurement plans and disbursement forecasts (OS) d)Updated payment forecast and payment cycle for 2013 (OS, NAO) Information on Technical Assistance and Communication Activities a)Technical assistance activities (OS) b)Communication activities (OS) Monitoring Activities a)Discussion and Endorsement of 2012 Sectoral Annual Implementation Report (OS) b)Information on Monitoring Report and Monitoring Sheets (OS) Information on IPA II Programming (EC, NIPAC) AOB and indicative date of the next SMC meeting Lunch

1st project package 2nd project package 3rd project package 4th project package Individual projects Overall Assessment PROGRAMMING

TOTAL BUDGET: € Establishment of 3 Business Incubators in Selected Regions and Development of a Network among Incubators in Turkey, KOSGEB Establishment of Innovation Centre for Food- INNOFOOD CENTER, TUBITAK Establishment of 3 Technology Development Zones, MoSIT-DG for Science and Technology Winter Tourism Corridor in Erzurum, Erzincan and Kars, Ministry of Culture and Tourism Enlargement of the European Turkish Business Centres Network to Sivas, Antakya, Batman and Van, TOBB Ministry of Economy Empowering SMEs for networking and inter-regional cooperation, Ministry of Economy Technical Assistance + Publicity, MoSIT – RCP-CID TOTAL OPERATIONS: 11 APPROVED OPERATIONS: 10 1st PROJECT PACKAGE

TÜBİTAK, TÜBİTAK, The Scientific and Technological Research Council of Turkey INNOFOOD - MAJOR PROJECT  First Submission of the Documents –  Admissibility Letter –  Comments from the EC –  Second Submission of the Documents –  Comments from the EC –  Meeting with EC Representatives –  Unofficial Submission of Revised Docs. –  Unofficial Submission of Revised Docs. – st PROJECT PACKAGE

Prioritized Projects by the call: 47 Current Number of Projects: 37 Approved Projects: 30 OIS in Preparation: 7 Total Budget of Approved Projects: € nd PROJECT PACKAGE

2nd PROJECT PACKAGE - PLANNING MeasureName of the ProposalERAStatus Estimated Submission Date 1.3 Establishment and Operationalisation of an Applied R&D and Service Centre, specialized on Food Industry, at Çankırı Karatekin University Çankırı Karatekin University OIS in preparation3rd Quarter of Establishment and Operationalisation of a Lab Services Unit at the Hazelnut Research Station in Giresun Hazelnut Research Station OIS in preparation3rd Quarter of Ardahan Yalnızçam Winter Sports Tourism Development Operation Ardahan Special Provincial Administration OIS in preparation3rd Quarter of 2013

2nd PROJECT PACKAGE - PLANNING MeasureName of the ProposalERAStatus Estimated Submission Date 2.2 Development of Dairy Products Cluster in Eastern Anatolia Through a Market Oriented Strategy Kars Governorship OIS in preparation 3rd Quarter of Kommagene Nemrut Tourism Oriented Revival Project (KN-TOC) Adıyaman Governorship OIS in preparation 3rd Quarter of Establishment of cold storage house by using renewable energy (soil, solar) and Apricot Clustering Valley for apricot processing SMEs Malatya Governorship and Malatya Commodity Exchange OIS in preparation 3rd Quarter of Increasing Regional Competitiveness in Kars, Ağrı, Ardahan and Iğdır Provinces Kars Governorship OIS in preparation 3rd Quarter of 2013

3rd PROJECT PACKAGE 51,15 M.€ IPA Contribution 900 M. € Credit Volume for SMEs Under implementation 5 Steering Com. held. Need Assessment for KGF completed KGF Capacity Building phase II to start Q Capacity Building for banks kick-started Q Capacity Building for DGIT to start Q Greater Anatolia Guarantee Facility - GAGF 16.3 M. € IPA Contribution Contribution Agreement Official launch of the project – Publication of Call for Expression of Interest eligible applications by deadline proposal approved by the Investment Committee in July 2012 Legal negotiations with selected fund manager-on going Announcement of Fund Manager officially (Q3-2013) G-43 Anatolian Venture Capital Fund Establishment of Technology Transfer Accelerator Fund - € Offical Submission New project proposals

Results as of 1Q of 2013 Total Volume: > EUR 390 million Total Number of Loans: >4,900 Total Number of SMEs: >4,900 Supprassed the target by 196% 3rd PROJECT PACKAGE

Next Steps GAGF’s budget was increased by EUR 19,2 m in Dec 2012 –Phase 1: EUR 32m budget –Phase 2: EUR 19,2m budget EUR 100m more to be deployed from Phase 1 EUR 400m loan volume to be created by Phase 2 3rd PROJECT PACKAGE

4th PROJECT PACKAGE Number of Projects: 12 Approved Projects: 4 OIS in Preparation: 8 Total Budget of Approved Projects: €

#MeasureTitle of the Operation End Recipient of Assistance Status Indicative Budget (€) 11.1 Sivas Industry Incubator Center Project (ISGEM) Middle Anatolia Dev.Agency (ORAN) Submitted to EUD on 08 May Samsun Logistics Center Middle Blacksea Dev.Agency (OKA) 2nd-3rd Q of Processing and Storing of Sea Food North Anatolia Dev.Agency (KUZKA) 3rd Q of Establishment of Nanotechnology and Nonwoven R&D Centre Silkroad Dev.Agency (İKA) 3rd Q of Turkish Cluster Academy MoSIT-DG for Industrial Zones 3rd Q of Carpet Incubator Centre Silkroad Dev.Agency (İKA) 3rd Q of Kars City with its Historical Identity Serhat Dev.Agency (SERKA) 3rd Q of Shoe-making Training and Design Centre and Shared-use Workshop East Mediterranean Dev.Agency 3rd Q of PRIORITIZED LIST OF PROJECTS IN 4TH PACKAGE (IND €)

#MeasureTitle of the Operation End Recipient of Assistance LocationStatus Indicative Budget (€) 21.4 Sustainable Tourism Development in Kaçkar Mountains National Park Ministry of Forestry and Hydraulic Works Rize3Q of Increasing Tourism Capacity in Van Ministry of Culture and Tourism Van3Q of OPERATIONS SUBMITTED BY THE NATIONAL PUBLIC BODIES (IND € )

APPROVED OPERATIONS FROM THE LAST SMC MEETING Name of ProposalLocationBudget (€) Submission Date Approval DatePackage Yozgat Investment Support OfficeYozgat nd Establishment of Enterprise Development Center (İŞGEM) in Bingöl Bingöl th Şanlıurfa Cotton Licensed Warehouse Şanlıurfa th The Common Use Workshop Project Hakkari, Bitlis, Muş, Van via 4th Establishment of a Enterprise Development Center in Gümüşhane Gümüşhane via 4th Increasing Tourism Capactity in Şanlıurfa Şanlıurfa via NPB

Total Number of Operations : 66 Total Number of approved operations: 47 Operations in preparation: 19 Total Budget of OP: € Total Volume of Project Portfolio: ind. € 607 mil. Total Budget of Approved OISs: ind € 397 mil. (72% of OP Budget) OVERALL ASSESSMENT

(Total Budget: ind 607 MEUR) WHOLE OPERATION PORTFOLIO

Priority 1: Improvement of Business Environment (Budget. ind 540 MEUR) PROGRESS BY PRIORITY AXES

Priority 2: Strengthening of Enterprise Capacity and Foster Entrepreneurship (Budget: ind. 40 MEUR) PROGRESS BY PRIORITY AXES

MEASURE BASED PROJECTS IN TARGET REGION 15 Growth Centers Provinces not covered: Artvin Iğdır Ağrı Şırnak Kilis Tunceli

Tendering and Contracting Implementation Absorption (n+3), Procurement Plans and Disbursement Forecasts Updated Payment Forecast and Payment Cycle for 2013 PROCUREMENT and IMPLEMENTATION

TENDERING and CONTRACTING

*Starting from NUMBER of SIGNED and FORESEEN CONTRACTS

REALISED and FORESEEN CONTRACTED BUDGET € 222 million is foreseen to be contracted until April, 2015.

Total of 7 contracts Type of Contracts WorksSupervision Technical assistance / FW SupplyTotal Number of Contracts Budget (Euros) FINALISED CONTRACTS (since 2012)

Total of 19 contracts – Cumulative Total (*Only 2 Contracts added since December 2012) Type of ContractsWorksSupervision Technical assistance SupplyDirectGrantTotal Number of Contracts65*6 *0219 Budget (Euros) CONTRACTS UNDER IMPLEMENTATION (as of June 2013)

PROJECTS COMING TO IMPLEMENTATION Type of Contracts WorksSupervision Technical Assistance Supply Total # of Contracts Budget (€) ,243,727 1st Q / ,345,932 2nd Q / ,084,818 3rd Q / ,581,026 4th Q / ,261, ,272, ,812,507 Total # of contracts ,329,221 Budget (€) 98,377,84410,834,84460,001,38053,115,153222,329,221

YEARLY BUDGET ALLOCATION for RCOP YearEU Contribution (EUR) %85 National Contribution (EUR) %15 Total EUR % TOTAL Advance payment % EUR

PREPARATION of DISBURSEMENT FORECAST ContractProjectMeasurePriorityProgramme Projects/Contracts under; Implementation Procurement Programming

PAYMENT CYCLE for 2013 PAYMENTS Paid until May To be paid from 1st of June to 31st of October To be paid from 1st of November to 31st of December TOTAL ,259, ,710, ,226, ,328, ,934, ,328, ,591, Priority 12,328, ,867, ,012, ,208, Priority ,284, , ,640, Priority ,282, ,959, ,242, Major Project TTA0.0025,500, ,500,000.00

ABSORPTION (N+3) Disbursement Forecast (EU Contribution) - June TOTAL PRIORITY I 27,200,00013,855,00019,379,53115,208,73688,880,84961,314,19312,906,736818,360239,563,405 PRIORITY II 1,219,338271,7474,640,9047,806,1867,105,1952,966,426174,39924,184,193 PRIORITY III 59,5771,636,302570,7575,242,3314,656,8514,965,1422,714,638 19,845,599 OHTER (non approved project) 00025,500,0006,000,00044,000,000 41,402,345160,902,345 TOTAL (per year) 27,259,57716,710,64020,222,03450,591,971107,343,886117,384,53062,587,79942,395,104444,495,542 TOTAL (Cumulative) 27,259,57743,970,21764,192,251114,784,222222,128,108339,512,638402,100,438444,495,542 Certified to EC (by NF) 27,259,57743,970,21764,304,315 Allocated fund for RCOP41,900,00043,500,00043,179,31571,430,00088,020,00089,016,59891,720, ,766,501 N+3 Expenditure Requirements (per year) 41,900,00043,500,00043,179,31571,430,00088,020,00089,016,598091,720,588468,766,501 Pre-finance* 42,060,00022,215,000 64,275,000 Expenditure paid and declared cumulative -160,00021,125,00064,304,315135,734,315223,754,315312,770, ,766,501 N+3 Gap (Cumulative) 27,419,57722,845, ,950,093-1,626,20726,741,72589,329,525-24,270,959 Assumptions: TTA project under 1.2. will be approved in 2013 (EU Budget € ) EU Budget of the 4th PP is € ,00

TECHNICAL ASSISTANCE ACTIVITIES

Project progress over the last seven months 1 December 2012– 27 June 2013

Result 1: Achievements in Reporting Period QAC Department – revision of 17 Manual Chapters (out of 19) - Expected to fully conclude by mid July 2013 TA to RCP-CID ToRs (TA II, Project Preparation Facility – PPF and Multi Annual Plan for Direct Expenditure) have been prepared. Shortlist for TA II is being prepared by CA and EUD. TA II Project planned to be start in February or March One visibility event organized in Urfa & Mardin (June 2013)

Result 1 - Achievements in Reporting Period (2) Assistance in the preparation of the template of the Operation Monitoring Reports (OMR) 2 Study Visits organized: Ireland (11th to 15th of March 2013) and Hungary (27th to 31th of May 2013) 21 internships organized to Hungary (4), Latvia (5), Lithuania (4), United Kingdom (4) and Italy (4) Trainings: 11 training delivered for RCP-CID staff, with 158 attendants.

Result 2 - Achievements in Reporting Period Procurement and Implementation Guidelines for end recipients revised. 4 trainings to ERAs delivered during the period: 2 on Procurement, 2 on Implementation and 1 on Monitoring and Irregularities, with a total of 212 participants.

Result 3: Achievements in Reporting Period 2 Tourism projects have been developed: Nemrut and Kaçkarlar. 12 projects (including one major – Samsun Logistics Centre) are being prepared. Support to Implementation Division proceeding, as foreseen, with 2 NKED.

Result 3: Achievements in Reporting Period Tender Dossier Preparation Six new projects have been prepared and delivered by the design team: GAP Food Cluster, Business Cluster Maraş Pepper, Osmaniye, Elazıg, 2 components of Bafra and one component of Sorgun. Currently working on one additional tender dossier; GETAM, expected to be delivered in August Totally, tender dossiers of 24 contracts (out of 41) have been finalised up to date under 14 projects. Tender dossiers of 17 contracts are still under revision.

Result 4: Achievements in Reporting Period Regular procurement meetings held with EUD and on the job support to FCD staff on procurement. Regular monitoring and updating of the Procurement Plan and support / coaching on all procurement documents. Daily on the job coaching and support to FCD in financial operations & accounting (Tax exemption Regulation, VAT information forms, Withholding Tax issues, etc).

COMMUNICATION ACTIVITIES

Events Operational Agreement Signature Ceremony of Şanlıurfa Projects (June 10, 2013 ) Contract Signature Ceremony of Mardin Sustainable Tourism Project (June 11, 2013 ) VISIBILITY, PUBLICITY and IMAGE-BUILDING ACTIVITIES

Promotional Materials Outdoor Promotional Materials (Billboard-banner) VISIBILITY, PUBLICITY and IMAGE-BUILDING ACTIVITIES

Regional Seminars Attendance to 3 University-Industry Cooperation Regional Meetings 6-26 December 2012 (Sinop, Trabzon, Rize) Attendance to 9 Regional Seminars, 8 May – 20 June 2013 (İzmir, Adana, Diyarbakır, Van, Ankara, Samsun, Erzurum, Konya, İstanbul) Conferences Attendance to «Growing together - International Conference on EU Cohesion Policy» held on March 28, 2013 in Ankara INFORMATION ACTIVITIES

Presentations Publicity/ Visibility presentation for ERA 4 presentation in presentation in 2013 Website management News and documents were updated Information requests were answered INFORMATION ACTIVITIES

–December 2012 issue of the monthly journal (Anahtar Magazine) of the Directorate General for Productivity was about RCOP –Press Release to announce RCOP events MEDIA RELATIONS

The tender process of the Project is finalized. The contract is planned to be signed by the end of June PUBLICITY, INFORMATION and PROMOTION of the RCOP PROJECT

THANK YOU FOR YOUR ATTENTION Ministry of Science, Industry and Technology Regional Competitiveness Programme Coordination and Implementation Directorate Web address: ipa.sanayi.gov.tr