1. EU/Western Balkans Instrument for Pre-Accession Gordana Lazarevic Ministry for International Economic Relations Republic of Serbia E-mail:glazarevic@mier.sr.gov.yu

2. Instrument for pre-accession (IPA) 5 components: Transition Assistance and Institution Building Regional and Cross-Border Cooperation Regional Development Human Resources Development Rural Development SAP

3. BUDGET 2007 – 2013

4. Challenges Unrealistically high expectations from EU funds (miracle effect) Insufficient skills to develop and manage the projects and related expertize, knowledge of languages –Administrative obstacles, –Regions eager to participate in EU projects

5. Absorption capacity Development of efficient institutions at all levels and capacities to manage EU funds Good knowledge of EU financial and programming procedures Program preparation for spending in advance (before the funds are on disposal), focusing the fund use on priorities in line with sustainable development strategy DEVELOPMENT PROGRAMS AND DOCUMENTS

6. IPA – new tasks Regional reflections –Programming Scope of projects shifted Balanced infrastructure investments v.s. institution and capacity building –Cross border cooperation Regional development issues – needs identified Building capacities and planning on local level New relations between central/local governments/ civil society

7. Institutional and capacity building Serbian government tasks: –Establishment legal framework for DIS Functional Supreme Audit Institution External budget audit –Building Institutions and capacities

8. Two main projects in 2006 Towards more effective implementation of reforms: –improving planning, budgeting, monitoring and reporting 2005-2007 Road map towards DIS – building institutional support

9. More effective reforms Main objectives –Building capacities and systems –Improving resource allocation, budgeting and programming of international assistance to meet national policy priorities –Framework for better monitoring and reporting –More accountability in policy implementation (spending linked to results)

10. Road map towards DIS TASKS Forming working group for designing “GUIDELINES for PROGRAMMING EU ASSISTANCE” by the end of 2005 Designing ‘GUIDELINES”

11. Why “GUIDELINES” To include requirements of policy coordination among MIER, SEIO and PRSP IFP To achieve coherence with process of programmatic budgeting in MoF(similar guidelines will be used for budget programming- FOUNDATION OF CO-FINANCING CAPACITY To ensure that DIS requirements related to capacities within public administartion are met within ongoing reforms led by MPALSG

12. A Roadmap Towards DIS 2006 – Matching with Budgeting Cycle TimelineEU assistance programming Budgeting Dec 2005- Jan 2006 Starting the programming cycle- TST established Budget 2006 adopted by Assembly Apr 2006First draft of Fiches- developed by LMs with MoF - Indicative appropriations for 2007 June 2006II draft of Fiches – comments of EAR PM MoF –Draft budget 2007 announced Nov 2006Final version of Fiches EC comments incl. Draft Budget 2007 submitted to Assembly 15 th Dec 2006 Final list of programs to be financed in 2007

13. Towards DIS 2006-benefits Strengthening Policy Driven Planning Strengthening Policy Driven Planning –“Guidelines” will impose linkages of proposed programs with priorities within European Partnership, Poverty Reduction Strategy and existing Sector strategies –LMs will have to consider strategic documents both adopted by the Government and those introduced by EU, which will lead to promotion and alignment of national priorities within the framework of Strategic Documents adopted internationally

14. Towards DIS 2006-benefits Linking Budget with External Resources Linking Budget with External Resources –Level of involvement of MFIN in the programming process will determine level of coherency with budgeting process –MFIN will have the opportunity to perform activities with LMs similar to those within programmatic budgeting (expected in 2007) –Joint programming of EU assistance and Budget will be a crucial step towards development of other capacities within MFIN, necessary for establishment of DIS

15. Towards DIS 2006-benefits Exit Strategy for EAR Programming Section Exit Strategy for EAR Programming Section –Described process envisages involvement of 5-10 EC representatives stationed locally; In 2006 these experts will be EAR, but in 2007 they can easily be transferred to EC DEL

16. Public Administration Reform Territorial organization – NUTS Decentralization/lack of financial regulations Stability of governmental teams Policy co-ordination and coherency Improvement of budget planning IT/IM

17. Public Administration Reform Low number of able managers in the government (ban on increase of employees, low salaries) Insufficient knowledge on the rules and procedures in EC Thinking in advance – project pipe lines Ability to monitor results and implementation

18. Sta se moze uciniti? Stalni treninzi o EU za regionalne/lokalne donosioce odluka Twinning u odredjenim oblastima za lokalnu samoupravu Uloga drugih donatora: ostaviti EU ili se ukljuciti sa svojim aktivnostima/programima

19. Naucene lekcije Strukturni fondovi su efektivni samo ako su praceni sa razvojno orjentisanim nacionalnim politikama Investicije u ljudski kapital imaju veci efekat nego investicije u infrastrukturu Ukljucivanje lokalnih vlasti i drugih aktera donosi uspeh – partnerstvo sa privatnim sektorom i civilnim drustvom