1. Łódzka Agencja Rozwoju Regionalnego S.A. Lodz Regional Development Agency R EGIONAL F INANCING I NSTITUTION Specific Development Issues SME ASSISTANCE IN THE LODZ REGION Pawel Zuromski – President of the Board, LRDA Open Days in Brussels, DG REGIO Workshops and Training Sessions 28 September 2004

2. Lodz Region area (sq km) population (thousands). Lodz RegionPoland 18 219 5,8% 2 663,6 6,9% 312 685 100% 38 667,0 100% Statistic data:

3. Łódź Skierniewice Piotrków Trybunalski kutnowski łęczyckiłowicki poddębicki zgierski sieradzki radomszczański pajęczański wieluński wieruszowski zduńskowolski łaski bełchatowski opoczański piotrkowski tomaszowski łódzki wschodni rawski skierniewicki pabianicki Lodz Region Statistic data: Number of communes (gminy)-177 Incl.:urban-18 urban-rurual -24 rurual-135 Number of districts (powiaty)-23 including: urban districts-3

4. Regional SME Sector Characteristics Data sources: Statistic Office in Lodz Polish Agency for Enterprise Development (31.12.2002) Lodz Region Poland Number of SMEs registered Number of active SMEs (share) Number of SMEs’ (share) 239,8 127,0 (7,3%) 3.495,3 1.732,7 (100%) 405,9 (7,3%) 5.559,9 (100%) (thousands)

5. Łódzka Agencja Rozwoju Regionalnego S.A. Lodz Regional Development Agency WHAT WE DO.... 4 Support the development of small and medium enterprises by financial instruments, training and advisory services; 4 Provide services for regional institutions: advice for communes in the field of development and implementation of local strategies, advice concerning access to foreign assistance programmes, feasibility studies for infrastructure projects, trainings for local authorities; 4 Manage the PHARE and Structural Funds programmes, promote the EU structural policy; 4 Provide economic promotion of the Lodz Region and assistance for investors.. WHO WE ARE... LRDA is a joint stock company set up in 1992 as an initiative of regional authorities and with the assistance of public institutions and private entrepreneurs.

6. INSTITUTIONAL SYSTEM OF SUPPORTING SMEs in POLAND CENTRAL LEVEL POLISH AGENCY FOR ENTERPRISE DEVELOPMENT (PAED) Governmental Agency responsible for implemantation of SMEs’ sectoral policy REGIONAL LEVEL REGIONAL FINANCING INSTITUTION (RFI) 16 RFIs (one in each Region) co-operating with PAED in implementation of SMEs sectoral programmes, management of regional SMEs development programmes, „Regional Consulting Desk Point” on public support for SMEs LOCAL LEVEL Business support institutions offering services for SMEs Advisory, training, information and financial services National System of Services for SMEs (NSS) Network of non-profit or not-for-profit business support institutions Auditied and acredited by PAED Local Consulting Desk Points providing consultancy services („information packages” on business activities and public support for SME) Costs of services co-financed by PAED from public grants Training and business advisory companies (non-profit and commercial) „Long list” Acredited by PAED to provide services granted from public money.

7. Instruments for supporting SME sector development in the Lodz Region Financial Instruments for SMEs managed by Regional Development Institutions: Financial Instruments for SMEs managed by Regional Development Institutions: Loan Funds7 Guarantee Funds3 (aprox. 60% of financial resources at the LRDA’s disposal) Financial Instruments for SMEs managed by LRDA (in co- operation with PAED and Regional Authorithies): PHARE Grant Schemes (since 1994) Structural Funds Grants Schemes (since 2004) Network of information services for SMEs acredited by PAED: 13 Local Consulting Desk Points

8. The Loan Fund for investment 1996 The Loan Fund for investment was established on the basis of the state budget reserve for the support of regional restructuring programmes. 1996 -start of the Fund’s activities LRDA’s Regional Loan Investment Fund for SME Financial resources of the Fund: Grants from the State budget-9,97 mio PLN Interest revenues-5,01 mio PLN Total - 30.06.2004:- 15,13 * mio PLN Loans granted in 1996 - 2004 (30.06.2004): Number of loans granted- 242 Creation of new jobs (declared)- 2.704 Amount of investment - 122,94 mio PLN Amount of loans granted - 40,74 mio PLN * (1 euro ~ 4,50 PLN)

9. LRDA’s PHARE experiences 1994 - 2000 Small Infrastructure Projects of the PHARE: STRUDER, RAPID, STRUDER 2 (Lodz Region 1994 – 2000): PHARE grants - 4,50 mio € Number of projects co-financed- 40 Total amount of grants- 7,59 mio € Number of applications - 346 Number of grants awarded- 235 Number of new jobs created- 2.786 PHARE: STRUDER, RAPID, STRUDER 2 (Lodz Region 1994 – 2000): Total PHARE grants (1994 – 2000): - ~ 16,40 mio € Grant Scheme of the PHARE-STRUDER (Lodz Region 1994 - 1997):

10. SMEs Development Programmes PHARE 2000, PHARE 2001, PHARE 2002 PHARE Grants : PHARE 2000, PHARE 2001 - sectoral and regional programmes: number of SMEs applying-1120 number of SMEs granted-678 total amount of grants (contracted)-5,78 mio € The Lodz Region – summary 2002 -2004: LRDA – Regional Financing Institution (since 2001) Consulting Services: xx services, xx hours of consultancy PHARE 2002 - sectoral and regional programmes (started in July 2004): number of SMEs applying:- 667 applied amount of grants (approx.)- 10,33 mio €

11. „Sectoral Operational Programme – Improving Competitiveness of Enterprises”: Measure 2.1 Improving Competitiveness of SMEs through counselling Advisory projects concerning rules of running an enterprise, systems of quality management, innovations and new technologies, export activity etc. Grants: min. 500 – max. 50.000 €, up to 50% of eligible costs Measure 2.3 Improving Competitiveness of SMEs through investments Investments in material goods, investments in non-material and legal values. Grants: min 2.500 – max. 250.000 €, up to 50% of eligible costs STRUCTURAL FUNDS 2004 – 2006 Sectoral Programmes for SME „Sectoral Operational Programme – Human Resources Development”: Measure 2.3 Development of Staff of Modern Economy Trainings for employees and management staff of enterprises

12. STRUCTURAL FUNDS 2004 – 2006 Regional Programmes for SMEs „Integrated Regional Development Programme” Measure 2.5. Promotion of the entrepreneurship Advisory and training services which support setting up and running business activity; Grants: max. 5.000 €, up to 75 % of eligible costs Measure 3.4. Microenterprises Specialized advisory services which introduce innovations in the enterprise and improve its competitiveness; Investment endowments Grants: min. 500 – max. 50.000 €, up to 65% of eligible costs

13. PHARE –National Export Development Programme Internet database of companies and products from the Lodz RegionInternet database of companies and products from the Lodz Region Offers for international co-operationOffers for international co-operation Links to national and foreign institutions and economic servicesLinks to national and foreign institutions and economic services www.rsie.lodzkie.pl www.rsie.lodzkie.pl In 2003 LRDA developed the project: „Regional Export Information System”:

16. Łódzka Agencja Rozwoju Regionalnego S.A. Lodz Regional Development Agency R EGIONAL F INANCING I NSTITUTION Tuwima 22/26, 90-002 Lodz, Poland tel.: +48-42 632 18 92 fax: +48-42 633 07 63 http://www.larr.lodz.pl e-mail: larr@larr.lodz.pllarr@larr.lodz.pl President of the Board: Paweł Żuromski e-mail: Pawel_Zuromski@larr.lodz.pl