1 September erha consulting group - / 15th Annual E.C.U. EuroMeeting Belgrade, 29 September 2006, Hotel Palace The common EU Market for a common future - „Building Europe together“ Rolf-Roger Hoeppner AEC / ECU (Germany), Brussels-Berlin-Munich

September erha consulting group - / „Building the Future together“ - Contents - EU - Serbia economic relations in brief EU Twinning System (relevance for Serbia) EU Acquis communautaire EU Instrument for Pre-Accession Assistance (IPA) „Cultural Due Diligence“,„Benchmarking“ / „Best Practices“ „Public-Private Partnership“, Public Procurement, PPP project financing, Regional development, crossborder cooperation Practical Experiences from the recent EU/German Twinning Project „Improving the Investment Climate in Turkey“ : Relevant issues applicable for Serbia

September erha consulting group - / Serbian economic relations in brief (1) „ EU / Bilaterals / Multilaterals“ Serbian economic relations in brief (1) „ EU / Bilaterals / Multilaterals“ European Commission  SAA negotiations to be resumed (ICTY condition)  IPA + „potential candidate“ – Status  IPA components relevant for Serbia  CARDS  DG enlargement + EAR  Financial Institutions ( EBRD, EIB ) Bilaterals ( example Germany )  „Deutsch-Serbischer Kooperationsrat  KfW South-East Europe Stability Facility Multilaterals  World Bank Group, IMF  UNDP, UNECE

September erha consulting group - / Serbian Economic Relations in brief (2) Recent IFC/World Bank Rating 2006 „Doing Business in Serbia“  best ranking of Western Balkans, overall ranking well ahead compared with Poland + Italy (!) EBRD/World Bank joint „Business Environment and Enterprise Performance Sampling ( „BEEPS“)  how companies (samples between firms) assess their business /investment environment and their interaction with their government Business/Investment events:  Economist EIU: 5th Business Roundtable with Government ( in Belgrade)  Montenegro Business and Investment Summit ( in Sveti Stefan)  Regions 2006 ( in Bukarest)

September erha consulting group - / Serbian Economic Relations in brief (3) Serbian government priorities provides favorable framework for EU support in regional investment promotion  privatisation process (auctions,asset sales) of large utilities ongoing (RTB Bor,Mobi63)  Municipalities funding from National Investment Plan for infrastructure, industrial zones, science parks, health, education  Law on financing of local governments( 1.5 % of GDP allocated) + Municipal Support Program for eastern Serbia will foster further decentralisation  The Standing Conference of Serbian Towns and Municipalities to be involved in implementing local government finance law

September erha consulting group - / Serbian economic relations in brief (4) Selected Ongoing EU / multilateral projects  Access to debt-based financing (EAR)  UNDPs Capacity Building Fund  EBRDs 18% equity stake in Opportunity Bank will foster small and micro business access to finance  Database of current legislation for Ministry of Justice (EAR). note: DG Markets interactive law portal under preparation for member access to public sector  EIBs Municipal Loan facility  EIBs Global Loan Facility System ( e.g.SME) through Serbian Financial Intermediaries: Komercijalna,Eksimbanka, Raiffeisen,Raiffeisen Leasing

September erha consulting group - / „Twinning“ (1) „Twinning is an instrument for accesion countries, candidate and potential candidate countries Between 2000 and 2005, some 65 twinning projects have been carried out in the Western Balkans countries with Croatia obtaining the lions share The potential in the next years is expected to increase significantly according to the commission („Twinning“ Strategy of the EU Commission“) Serbia may be able to attract more twinning projects than in the past

September erha consulting group - / Twinning (2) Twinning is a flexible instrument to correlate the administrative and institutional organisations in particular in potential candidate countries with regard to the different sections of the acquis communautaire Twinning does not require a tendering process like in Technical assistance projects. Instead, Calls for proposals are held : Interested –government- institutions to submit eligible project proposals to the EU Commission (  „Twinning Building Europe together“ ).

September erha consulting group - / TWINNING (3) The Twinning concept incorporates some specific features different from typical technial assistance programs:  The Beneficiary country has the right to select its Twinning Partner country  Twinning projects under capacity building incorporate features beyong mere economic appraisals („Cultural due diligence“)  Twinning projects follow a pragmatic „Benchmarking“ / „Best practices“ approach Examples of Twinning projects in Serbia

September erha consulting group - / Instrument for PreAccession Assistance/ „IPA“ (1) IPA starts 1st January applies for the period IPA is intended to „promote“ from a potential candidate to a candidate status IPA is applicable to candidate countries (Turkey,Croatia) and potential candidate countries (Serbia, Western Balkans) IPA will replace the current pre-accession instruments:  PHARE (acquis,institution building,crossborder cooperation)  ISPA (cohesion fund,transport infrastructure,environment)  SAPARD ( rural development)  CARDS (pre accession assistance for Western Balkans)

September erha consulting group - / IPA (2) IPA consists of 5 components  Transition Assistance and Institution Building  Regional + crossborder cooperation  Regional Development  Human Resources Development  Rural Development IPA components  and  will apply to both potential candidates (like Serbia) and candidates IPA components , ,  will apply to candidates

September erha consulting group - / IPA (3) IPA assistance to potential candidates will concentrate on  managing the assistance through EAR  starting the alignment process with the acquis communautaire  enabling capacity to operate under decentrailsed management, autonomous regional programming and management capacities  maintain the continuity of the phasing out CARD program Important : Information on the indicative allocation of IPA funds on a 3-year basis ( ) proposed by DG Enlargement are given in the multi-annual indicative financial framework as part of the annual enlargement package

September erha consulting group - / Case Study : Public Services in Europe – „ Regional Development + PPP“ (1) The EU „Committee of the Regions“ attitude (R/CoR 82/2006) towards  Public Procurement (  20% of EU GDP annually!)  Public Private Partnerships  Services of General (Economic) Interest  State Aid Public (municipal) Services typically refer to  gas, water/waste water,energy/electricity  healthcare, transport

14 September erha consulting group - / Thank you for your kind attention Looking forward to your questions and a fruitful discussion !