PROGRAMME OF MEASURES FOR PROMOTING ENTREPRENEURSHIP AND COMPETITIVENESS

Transcription

1 REPUBLIKA SLOVENIJA MINISTRSTVO ZA GOSPODARSTVO REPUBLIC OF SLOVENIA MINISTRY OF THE ECONOMY PROGRAMME OF MEASURES FOR PROMOTING ENTREPRENEURSHIP AND COMPETITIVENESS Ljubljana, 6. March

2 TABLE OF CONTENTS FOREWORD... 4 BASIC PROGRAMMING DOCUMENTS... 5 SUMMARY OF THE PROGRAMME OF MEASURES... 6 GENERAL PRINCIPLES FOR GRANTING STATE AID PROMOTING ENTREPRENEURSHIP AND ENTREPRENEUR-FRIENDLY ENVIRONMENT PROMOTING ENTREPRENEURSHIP AND EDUCATION FOR ENTREPRENEURSHIP SUPPORT TO VEM ENTRY POINTS VOUCHER CONSULTING AND TRAINING Voucher consulting Voucher training PROMOTING ENTREPRENEURSHIP IN SPECIFIC TARGET GROUPS KNOWLEDGE FOR BUSINESS VOCATIONAL EDUCATION R&D FOR BUSINESS Junior basic researchers in enterprises Improved mobility of highly-skilled people in the business sector Research & development activities of interdisciplinary R&D groups in enterprises R&D AND INNOVATIONS IN COMPANIES ECONOMIC DEVELOPMENT LOGISTICS PLATFORMS (INFRASTRUCTURE) Promoting investments in business-development-logistics platforms Start-up capital for technology parks, business incubators and university incubators R&D IN BUSINESS Promoting research & development activities in enterprises Promoting technological investments Promoting process and organisational innovations INNOVATIONS Slovene Competitiveness and Innovations Centre Promoting establishing and work of innovative groups Incentives to SMEs for acquisition of industrial property rights Start-up capital for new innovative companies Special incentives for early-stage innovative companies PROMOTING SMALL AND MEDIUM-SIZED ENTERPRISES WITH EQUITY AND DEBT INSTRUMENTS PROMOTING FAST-GROWING AND INNOVATIVE SMALL AND MEDIUM- SIZED COMPANIES WITH EQUITY INSTRUMENTS

3 4.2. PROMOTING INVESTMENTS OF SMALL AND MEDIUM-SIZED ENTERPRISES WITH DEBT INSTRUMENTS ENCLOSURES

4 Foreword Slovenia is at an exceptional turning point of economic development. It is also envisaged in a number of strategic documents (aligned with the national documents and the renewed Lisbon strategy) adopted by the Government of the Republic of Slovenia, for implementation of which the Government firmly stands. These documents are a great challenge not only to the Government but to the entire Slovene economy as well as to all citizens of the Republic of Slovenia. "Bringing Slovenia in the group of the most advanced member states of the European Union" is not the only motto for survival on global markets. A number of other economic superpowers also dictate conditions for survival on global markets. Therefore certain measures from other most advanced nations of the world, adapted to Slovene specifics of course, were included in the Programme for Promoting Entrepreneurship and Competitiveness in addition to Slovene ideas and European good practices. Lack of entrepreneurial culture, inefficient and deficient supporting environment, inadequate and incomplete infrastructure, not enough investments in R&D and related activities, poor links between business and science, shortage of highly-skilled human resources in companies, lack of support and undeveloped market in innovations and, last but not least, too few favourable and special financial sources, make the four basic pillars of the Programme necessary, namely: - Promoting entrepreneurship and entrepreneur-friendly environment; - Knowledge for business; - R&D and innovations in companies; - Promoting small and medium-sized enterprises with equity and debt instruments. The numerous measures stemming from individual strategic documents specify what should be done to enhance competitiveness of the Slovene economy and entrepreneurship as its integral part. The Programme for Promoting Entrepreneurship and Competitiveness speaks on how to do it, following clearly defined objectives and guidelines. Time to turn words into action! Andrej Vizjak, MSc Minister of the Economy 4

5 Basic programming documents The contents of the Programme of Measures for Promoting Entrepreneurship and Competitiveness (hereinafter: the Programme of Measures) are derived from four strategic documents in the field of economic policy: Slovenia s Development Strategy, adopted by the Government on 23 June 2005, Reform Programme for achieving the Lisbon Strategy Goals (National Action Plan), prepared in 2005, the Framework of Economic and Social Reforms for Increasing the Welfare in Slovenia, adopted by the Government on 3 November 2005, and the National Research & Development Programme The latter was approved by the Government on 15 September The Programme of Measures thus represents the action document for implementation of measures required by superior documents in which it is also based on international comparisons and research on entrepreneurial and innovative activities. Presentation of implementation of individual measures from the listed strategic documents is shown in the table below. Table U - 1: Connection between measures for promoting entrepreneurship and competitiveness and economic policy strategic documents of Slovenia SDS 1 NRDP 2 Reforms 3 NAP 4 Promoting entrepreneurship and education for entrepreneurship X X X Support to VEM entry points X X X Voucher consulting and training X Support to Euro info centres network X X X Promoting entrepreneurship in specific target groups X X Vocational training and education X X R&D for business X X X X Economic development logistics platforms X X X X R&D in business X X X X Innovations X X X X Promoting small and medium-sized enterprises with equity instruments X X X X Promoting small and medium-sized enterprises with debt instruments X X 1 Slovenia s Development Strategy 2 National Research & Development Programme Framework of Economic and Social Reforms for Increasing the Welfare in Slovenia 4 National Action Plan for the Lisbon Strategy As evident from the table above, the measures are on average based on three documents simultaneously, which is understandable as these documents are somewhat similar and even include direct cross-references. However, the measures are not only based on these documents, each one of them also stems directly from issues at hand. The Programme of Measures will be constantly monitored and evaluated, which will due to measuring of effectiveness of individual measures provide for flexibility in terms of appropriate improvements should they be deemed necessary. 5

6 Summary of the Programme of Measures The Programme of Measures is based on four basic pillars (sections) interconnected to form the whole document: 1. Promoting entrepreneurship and entrepreneur-friendly environment; 2. Knowledge for business; 3. R&D and innovations in companies; 4. Promoting small and medium-sized enterprises with equity and debt instruments. Measures included in the first section are aimed at promoting entrepreneurship and education for entrepreneurship for the purpose of improving the entrepreneurial culture in Slovenia and enhance knowledge and use of support services for potential entrepreneurs and already established companies. An important element of measures is development of an efficient and transparent supporting environment. Measures within the framework of promoting the supporting environment for development of entrepreneurship will be linked by an integrated information system enabling preparation of a database for all measures and thus for follow-up and development of individual participants in the programmes/projects. This will provide for synergy between individual measures and follow-up of all programmes for the purpose of achieving common goals. Measures concerning the supporting environment are divided into support to the "One-Stop-Shop" system (hereinafter: VEM), voucher consulting and training and specific target groups (women, entrepreneurs in rural areas, social entrepreneurship). The second section is aimed at strengthening of internal capability of companies for more intensive, knowledge-based development, notably in the technological sector, which will enable the Slovene economy, and SMEs in particular, to manage increasingly rapid technological progress as the main element for improving competitiveness at the global level. Measures of the second section are aimed at strengthening human resources for needs of the economy by stimulating the share of highly educated people in the economy, priority given to development of knowledge in natural sciences and mathematics, by encouraging international mobility of human resources as well as promoting mobility of R&D staff from knowledge institutions to businesses and from big companies to small and medium-sized enterprises. Effective implementation of these measures depends on joint activities and co-operation with other competent ministries and implementing institutions. The third section is aimed at enhanced investments in research & development and economic infrastructure of the private as well as the public sector. Measures supporting R&D and innovations in the commercial sector are aimed at establishing an efficient supporting environment, providing for adequate infrastructure at the local and the national level, and strengthening financial resources for R&D and innovations in the Slovene economy. Measures for planned improvement in quality of operations of Slovene enterprises are aimed at promotion and introduction of the European model of excellence in Slovene enterprises (increased number of companies using self-evaluation in line with the model and increased number of top Slovene companies receiving the national and European quality awards). The fourth section is aimed at financial support to small and medium-sized enterprises with equity and debt instruments. Venture capital will be provided through venture capital funds as a form of equity financing within the framework of public-private partnership. Measures of the fourth section are also aimed at assistance by warranties and debt instruments, such as guarantees, loans and leasing. 6

7 General principles for granting state aid State aid includes direct financing from the government budget granted to companies for eliminating the established structural imbalances and represents urgent state aid for implementing the set long-term economic development goals. It is intended for financing and co-financing programmes of enterprises engaged in production of goods and services for the market as specified in Article 87 of the Treaty establishing the European Community (Official Gazette of the RS, international treaties 03/04). Enterprises in the entire territory of the Republic of Slovenia are entitled to regional aid (pursuant to Article 3 of the Decree on the Allocation of Regional State Aid). The first criteria in assessing granting of state aid is the criteria of urgency. Aid can be granted if it represents encouragement for project implementation or is urgently necessary for implementation. The applicant must prove that the measure or investment cannot be implemented without state aid. State aid can only be granted if the applicant submitted the application before the project implementation began. The aid from this programme cannot be granted to companies, which are: In voluntary settlement, bankruptcy or liquidation proceedings; Companies in trouble receiving state aid under a special programme for assistance and restructuring. In accordance with Articles 1 and 4 of the Commission Regulation (EC) No 70/2001 of 12 January 2001 on the application of Articles 87 and 88 of the EC Treaty to State aid to small and medium-sized enterprises, the programme is not used for activities related to production, processing and marketing of products specified in Annex I to the Treaty. In accordance with the guidelines on regional state aid (2006/C 54/08) of 4 March 2006, the programme is not applicable to the following sectors: fishery, shipbuilding, coalmining, agricultural production except processing and marketing of agricultural products however only to the extent set by guidelines for state aid in the agricultural sector, steel industry, and synthetic fibres industry. The programme takes into account the rule on cumulation of state aid meaning that the total amount of all development incentives received by individual companies from all public sources including aid in line with the de minimis rule cannot exceed the permitted total amount of aid by purpose for which control instruments and monitoring of compliance with the cumulation rule have been established. Group exceptions within the Programme of Measures are as follows: - State aid to small and medium sized enterprises (Commission Regulations (EC) No 70/2001 of 12 January 2001 and No 364/2004 of 25 February 2004 on the application of Articles 87 and 88 of the EC Treaty to State aid to small and medium-sized enterprises); - State aid for training (Commission regulation (EC) No 68/2001 of 12 January 2001 on the application of Articles 87 and 88 of the EC Treaty to training aid); 7

8 - National regional investment aid (Commission regulation (EC) No 1628/2006 of 24 October 2006 on the application of Articles 87 and 88 of the Treaty to national regional investment aid). The enterprise beneficiary for the purpose of the Regulation shall be enterprises registered under the Companies Act, such as: Partnerships (unlimited liability companies, limited partnerships and silent partnerships); Equity companies (limited liability companies, public limited companies and a limited partnerships with share capital); Sole proprietorships (natural persons) independently performing a gainful employment as their exclusive business activity. Beneficiaries for individual purposes can also be other legal entities if so specifically set forth in individual measures. Criteria from Commission Regulations (EC) No 70/2001 of 12 January 2001 and No 364/2004 of 25 February 2004 on the application of Articles 87 and 88 of the EC Treaty to State aid to small and medium-sized enterprises shall be used for definition of micro, small and medium-sized enterprises. Detailed criteria and conditions will be set forth in individual calls for proposal or in a different manner in accordance with the applicable legislation. The programme implementation will start on 1 January 2007 (except for measures Junior basic researchers in enterprises, Research & development activities of interdisciplinary R&D groups in enterprises, Promoting research & development activities in enterprises, 3.2.3a Process and organisational innovations, Promoting establishment and work of innovative groups, Encouraging SMEs to obtain industrial property rights, 4.1 Promoting fast-growing and innovative SMEs with equity instruments applicable after approval of schemes by the European Commission) and shall apply until 31 December

9 1. Promoting entrepreneurship and entrepreneur-friendly environment Defining the challenge According to survey of the Global Entrepreneurship Monitor (GEM) Slovenia 2005, early entrepreneurial activities included 4.4% of adult population (2.6% in 2004 the lowest number in Europe), resulting in 17 th place among 20 European countries. Slovenia is ranked 31 st by entrepreneurial activity among 35 GEM countries. Every 26 th adult decides to enter entrepreneurship because of an opportunity, and each 204 th because of necessity so that the share of those becoming entrepreneurs because of an opportunity and not because of necessity has increased compared to According to the GEM estimate, 55,000 emerging and new entrepreneurs were in Slovenia in 2005 (the respective number in 2004 was ). 1 Slovenia has a satisfactory share of entrepreneurs with secondary school education but lacks those with higher education. The most active in entrepreneurship are men and women between 25 and 34 years old. Less than a tenth of men and 5.6% of women enter into entrepreneurship at that age. Established companies are found in larger proportion in older age groups. In the age group an average of 3.75% of adults in Slovenia are active owners or co-owners of an enterprise, while the respective number in the age group reaches 10.58%. Thus, an average of every 9 th Slovene in this age group has an enterprise older than three and a half years. 2 According to the Strategy of Economic Development of Slovenia , the main factors of international competitiveness today are created factors and not natural resources, and entrepreneurship is at the top of created factors. Entrepreneurship is not a value in Slovenia as is the case in certain other countries (e.g. the USA) and therefore the Slovenia's challenge is to improve the entrepreneurial culture and ensure that entrepreneurship gets its place among important values. 3 In 2004, the proportion of adults in Slovenia planning to establish a new company or having one less than three and a half years was a low 2.6%, however the share rose to 4.4% in An important indicator is also the organisational mortality index specifying how many newly established enterprises are required for survival of a single enterprise. The organisational mortality index for Slovene companies was 2.72 in 2004 and improved to 2.14 in The supporting environment for development of entrepreneurship has only started to develop during the transition in the nineties of the previous century. Establishment of a market banking system, opening of the economy to international competition and entry in the European Union increased the need of enterprises for information, however the existing support institutions were unable to cater to all needs of businesses. Among others, the Small Business Development Centre (PCMG), the Small Business Development Fund of the Republic of Slovenia and the promoting network for small business were established in Global Entrepreneurship Monitor 2005, Entrepreneurship between wishes and reality 2 Global Entrepreneurship Monitor 2005, Entrepreneurship between wishes and reality 3 Strategy of Economic Development of Slovenia

10 Globalisation and the need for acquiring funds from the EU require a different, more in-depth approach to offering of information, advice and other support services to enterprises. Obstacles standing in the way of faster development of entrepreneurship should be eliminated for providing an effective supporting environment. The time burden and costs for entrepreneurs, resulting from administrative burdens of the state for establishing and for operation of enterprises should be reduced. Requirements of the state represent an administrative obstacle for entrepreneurs as well as for entrepreneurial ideas. According to the Slovene Entrepreneurial Observatory, administrative procedures represent one of the main obstacles to entrepreneurship. 4 Attempts are made within the EU to improve legislation in order to reduce the negative consequences of administration for the economy while at the same time trying to replace regulation with self-regulation. Cost reduction means lower costs for enterprises as well as the government. The Ministry of the Economy puts efforts, in line with guidelines of the European Union and the study on employment opportunities of the young, women and rural population, also to improve the environment for entrepreneurship of young families. According to the GEM data for 2005 Slovenia is in the 20 th place among 33 countries as regards attitude of women towards entrepreneurship (the value for Slovenia and the average value are 3.2 and 3.3, respectively). 5 According to data and methodology of the World Bank 6, it took 60 days to establish a company in Slovenia in 2005, and the registration cost was 10.1% of GNI (Gross National Income) per capita. The OECD average for establishing a company was 19.5 days and the cost was 6.8% of GNI per capita. The number of steps was also smaller in OECD countries: it took 9 steps for an entrepreneur to establish a company in Slovenia while the number of steps in OECD countries was Figure 1-1: Entrepreneurial activity by gender 9 % of population between 18 and 64 years of age Men W omen Start-up companies New companies Established companies Early-stage entrepreneurial activity Early-stage entrepreneurial activity - opportunity Early-stage entrepreneurial activity - necessity Source: GEM Slovene Entrepreneurial Observatory Global Entrepreneurship Monitor 2005, Entrepreneurship between wishes and reality 6 The calculation methodology is available at the World Bank's website: 7 Source: World Bank, Doing Business,

11 Data from the GEM research for 2005 show that men are prevalent in all categories of Slovene entrepreneurs, except in the category of entrepreneurs selecting entrepreneurship because of necessity. Men are also prevalent among owners of established companies (the men/women ratio equals 2.2:1). On average, nearly a tenth of men between 18 and 64 years old are owners or co-owners of an established enterprise, while the respective number for women is only 4%. Men also show greater early-stage entrepreneurial activity (measured with the TEA Total Early-stage Entrepreneurial Activity index) with the men/women ratio of 2:1. In comparison to previous years, inclusion of women in entrepreneurship has increased the ratio equalled 3.8:1 in Attitude towards women entrepreneurs is encouraging, however their number is too small. The biggest number of start-up and new entrepreneurs is in the age group slightly lees than 10% of men and 5.6% of women becomes entrepreneurs. Established companies are more common in the older age groups than start-up and new ones as much as 10.58% in the age group 9. Figure 1-2: TEA index by gender and age years years Age years years W omen Men years Early-stage Entrepreneurial Activity index Source: GEM 2005 Measures taken Measures of the Ministry of the Economy related to promoting entrepreneurship and education for entrepreneurship have been implemented on the basis of the Programme of Measures for Promoting Entrepreneurship and Competitiveness Permanent promotion of entrepreneurship aimed at improving the entrepreneurial culture in Slovenia has been implemented via the Small Business Development Centre and the Ministry of the Economy. In the period, the Ministry of the Economy promoted the Programme for Developing Entrepreneurship and Creativity of the Young implemented by the Small Business Development Centre (the present JAPTI). 8 Global Entrepreneurship Monitor 2005, Entrepreneurship between wishes and reality 9 Global Entrepreneurship Monitor 2005, Entrepreneurship between wishes and reality 11

12 Activities for establishing the VEM system (one-stop-shop) providing information and consulting services and the possibility of registration and other communications with the authorities have been initiated in While information and consulting services have been provided by the implementer PCMG (now JAPTI) since 2002, VEM started to operate in The result of operation of the entire VEM system is shorter time needed to register a sole proprietorship with all activities completed within a day or two. The VEM network, which provides services to entrepreneurs with qualified advisers at VEM points, was formally established in 2006 for the purpose of recognisability and promotion. Figure 1-3: Number of established, wound up and surviving companies established between 2000 and Number of companies Established Wound up within three years from establishing Number of companies surviving the first three years Source: Agency of the Republic of Slovenia for Public Legal Records and Services, 2005 Figure 1-4: Number of companies established between 2000 and 2002 which were wound up, presentation by the year of winding up 12

13 Number of companies W ound up in the first year from establishing W ound up in the second year from establishingn W ound up in the third year from establishing Source: Agency of the Republic of Slovenia for Public Legal Records and Services, 2005 The voucher consulting system was initiated as a pilot project in two regions in 2000 aimed at potential entrepreneurs and the established companies. The system was extended throughout Slovenia in The Public Agency for Entrepreneurship and Foreign Investment of the Republic of Slovenia (hereinafter: JAPTI) provides as the national co-ordinator of the programme for implementation of more than 37 programme implementers (entrepreneurship centres) at the local level. There were 2466 voucher consultancies to established companies in JAPTI (previously PCMG) has promoted, together with entrepreneurship centres at the local and regional level, entrepreneurship and self-employment of the young and women in urban and rural areas with programmes of consulting, education and promotion, and by financial aid. Figure 1-5: Number of SMEs included in the voucher consulting programme No. of SMEs Year Source: Ministry of the Economy 13

14 The programme of Women Entrepreneurs started via PCMG (now JAPTI) in Until 2005, more than 4,600 consulting services were provided through free-of-charge telephone consulting, and hits on the website offering information exceeded 44,000. Promotional activities included implementation or co-organisation of more than 140 international events (international meetings, conferences, presentations of the programme at the international level, meetings of female entrepreneurs, roundtables, etc.), organisation or co-organisation of presentation or participation of female entrepreneurs at the national and international level (fairs, conferences, roundtables and workshops), and implementation of a number of motivational workshops. They have also organised numerous local and regional meetings, attended by 2705 women, and training and consulting meetings with various topics resulting in 39 forms of self-employment (21 registrations of complementary activities on farms and 18 self-employments). Another programme implemented in the past years is the programme Entrepreneurship in Rural Areas being implemented since Ten rural development cores (hereinafter: the RDC) were established during that period. The RDC are non-profit institutions performing activities related to animation, consulting and training of people for entrepreneurship in rural areas. The animation programmes involved 4860 participants, training and consulting programmes included 3292 people, and 205 self-employments and other forms of employment were the result of this programme between 2003 and Future measures Activities of future measures are aimed at promoting entrepreneurship and education for entrepreneurship for the purpose of improving the entrepreneurial culture in Slovenia and enhancing the knowledge and use of support services for potential entrepreneurs and already established companies, and developing and efficient and transparent supporting environment. Measures within the framework of promoting the supporting environment for development of entrepreneurship will be linked by an integrated information system enabling preparation of a database for all measures and thus for follow-up and development of individual participants in the programmes/projects. This will provide for synergy between individual measures and follow-up of all programmes for the purpose of achieving common goals. Measures concerning the supporting environment are divided into support to the "One-Stop-Shop" system (hereinafter: VEM), voucher consulting and training and specific target groups (women, entrepreneurs in rural areas, social entrepreneurship). 14

15 1.1. Promoting entrepreneurship and education for entrepreneurship Past activities related to promoting entrepreneurship, both internal and individual, were foremost implemented partially and not at the national level. This also dictates the measures by which we will include the largest possible proportion of people in Slovenia, in the sense of promoting innovations, entrepreneurial spirit and internal entrepreneurship as well as sole proprietorship. Measures for promoting entrepreneurship are therefore aimed at all citizens of the Republic of Slovenia. An important element is also promotion of the supporting environment within the framework of offering miscellaneous services and financial resources. Activities related to education of the young regarding entrepreneurship as well as introduction of methods of entrepreneurial culture are implemented on certain university schools and secondary schools, however they are not aimed at solving the issue at the national level with inclusion of the entire potential of young people. As a part of this measure, the Ministry of the Economy will co-operate with the Ministry of Education and Sport and the Ministry of Higher Education, Science and Technology as well as with other institutions at the national and local level. Education is one of the key areas in promoting entrepreneurship and is as such an essential development task. Both the European Charter for Small Enterprises and the European Agenda for Entrepreneurship emphasise the role of schools and universities in promoting entrepreneurial attitude among young people and providing the appropriate skills. Primary school pupils and children in pre-school education will be familiarised with the basics of entrepreneurial culture in a manner tailored to them. The following activities will be implemented as a part of the measure of promoting entrepreneurship and education for entrepreneurship: Promotion of entrepreneurship, entrepreneurial culture and the supporting environment via the media (television, radio, printed media, the Internet, etc.). The activities will include presentations of good practice (of successful entrepreneurs) in entrepreneurship in Slovenia and abroad, presentations of interesting market niches, presentations of the supporting environment for entrepreneurship, monitoring and promotion of tenders, promotion of government services and institutions for entrepreneurship, etc. Preparation and printing of brochures and other promotional material. Organising and participating in events, tenders, business meetings and fairs related to entrepreneurship and crafts, and promotion of professions. Linking and joint promotion of activities of the entire supporting environment for entrepreneurship and crafts. Inclusion of entrepreneurial topics in all levels of formal education with the emphasis on linking theory with practice. Inclusion of successful entrepreneurs in promotion of entrepreneurship in schools. Training of teachers for introduction of pedagogic methods promoting entrepreneurial skills and discovering initiatives for entrepreneurship (in co-operation with the competent ministries). Enable flexible forming of study programmes for several courses and for education of students also on foreign universities. The measure will strengthen the confidence of young people in their own abilities and knowledge, inform them of the basic principles of an entrepreneurial society and the basic entrepreneurial skills, but foremost help them to get to know their potentials and further plan 15

16 their path. This will encourage faster transfer of ideas to the market and raise the level of respect given to entrepreneurship and the entrepreneurial spirit. Aid scheme: Not state aid Aid form: Selection of implementers through call for proposals or in a different manner (in accordance with the Public Finance Act and the Public Procurement Act). Eligible cost: Set forth in a call for proposals or in a different manner (in accordance with the Public Finance Act and the Public Procurement Act). Implementers and conditions: Implementers of the measure for the Ministry of the Economy will be JAPTI, the Slovene Enterprise Fund and the Chamber of Craft of Slovenia as well as other institutions at the national and local level, selected by JAPTI through call for proposals or in a different manner (in accordance with the Public Finance Act and the Public Procurement Act). Selection criteria: Set forth in a call for proposals or in a different manner (in accordance with the Public Finance Act and the Public Procurement Act). Aid intensity: Up to 100% Final beneficiary: All citizens of Slovenia, potential and existing entrepreneurs. Primary school pupils, secondary school and university students and teachers at all levels of formal education. Objectives and indicators of Measure 1.1: Promoting entrepreneurship and education for entrepreneurship Measure Indicator Starting point in Promoting entrepreneurs hip and education for entrepreneurs hip Entrepreneurship is an appropriate career choice (GEM) Successful entrepreneurs are respected (GEM) Stories about successful entrepreneurs frequently appear in the media (GEM) Established the entire system of education for entrepreneurship at all levels Establish new companies in the target group of the young % 45.5% 32.72% - 0 Planned result as at the end of % 80% 70% until Support to VEM entry points The existing network of one-stop-shops at the local level will be upgraded as a part of the support to VEM entry points. JAPTI shall be in charge of development, improving support services and co-ordination of VEM one-stop-shops. 16

17 Support services of VEM one-stop-shops will be available and intended for all interested. VEM one-stop-shops will offer an integrated service for the entire supporting environment (as specified in the Manual on the Supporting environment Entities). VEM one-stop-shops will provide the following support services at a single point: General and specific information for all target groups (e.g. the possibility for acquiring funding, the possibilities of establishing a company, on other support institutions for entrepreneurship, other information on entrepreneurship, etc.); Advice regarding development of business ideas, use of various support instruments, directing to state incentives available for promoting entrepreneurship, and similar; Promotion of services of one-stop-shops and promotion of development of entrepreneurial culture at the local level; The option of registration of an enterprise and the related changes. Simultaneously with the activities for provision of the aforementioned support services, activities aimed at improving the quality of the applicable and forthcoming legislation will be implemented for the purpose of simplifying the administrative procedures regarding establishment and development of enterprises. Preparation of proposals for system changes will include the existing networks of advisers at the local level as well as any other interest groups and institutions representing an important information source on economic, social and environmental impacts related to implementation of new or amended legislation. Activities will be implemented within ministries (co-operation with the Ministry of Public Administration, and within VEM) and implementers at the local and national level. Implementers at the local level will be selected through call for proposals implemented by JAPTI. Evaluation of each VEM one-stop-shop will be performed annually, on which financing of services of VEM will depend (the criteria for evaluation of one-stop-shops will be the area they cover, the number of established companies in the area, unemployment rate in the area, the regional development index, support of the local environment, linking with institutions at the local level, personnel qualification, etc.), and, most importantly, work effectiveness. This will ensure more transparent financing within contracts with individual VEM one-stop-shops. VEM one-stop-shops will be specified in the Act Regulating Supportive Environment for Entrepreneurship and the secondary legislation adopted in relation thereto as the entities of the supporting environment at the local level. Aid scheme: Not state aid Aid form: Implementers will be selected through individual call for proposals or in a different manner in accordance with the applicable legislation. Eligible cost: Costs of VEM one-stop-shops incurred in implementation of support services specified above. Support services and eligible costs will be set forth in individual call for proposals or in a different manner in accordance with the applicable legislation. Implementers and conditions: The Ministry of the Economy will implement the measure through JAPTI. JAPTI will select implementers (VEM one-stop-shops) through call for proposals or in a different manner pursuant to the applicable legislation. (in accordance with the Public Finance Act and the Public Procurement Act). 17

18 Selection criteria: Set forth in individual call for proposals or in a different manner in accordance with the applicable legislation. Aid intensity: Up to 100% Final beneficiary: All interested (e.g. young people, students, other support institutions, potential entrepreneurs, companies, entrepreneurs, etc.). Objectives and indicators of Measure 1.2: Support to VEM entry points Measure Indicator Starting point in Support to VEM entry points Number of days needed to register a company Cost of incorporating a company % of GNI Planned result as at the end of % of GNI Number of users of support services by companies at the local level Coverage with information and consulting services of all final beneficiaries at an annual level 25,000-35,500 30% 1.3. Voucher consulting and training Voucher consulting By the voucher consulting programme, the government wants to provide accessible consulting services in terms of location and price to entrepreneurs. The programme is intended for small and medium-sized enterprises and potential entrepreneurs deciding on the entrepreneurial path. The core service is entrepreneurial consulting and directing in implementation of business ideas, projects, growth plans or in solving of business problems. Access to the voucher consulting programme will be provided by JAPTI in co-operation with partners at the local level being the programme's implementers and representing points where potential users of services can be included in the voucher consulting programme. Direct consulting services of the programme will be offered by qualified consultants entered in the entrepreneurial consultants register. Voucher consulting will be directed in the future towards improving the quality of service within the programme, adjustment of contents to the needs of companies, intensified promotion of the programme, and evaluation of the system and consultants included in voucher consulting. Voucher consulting includes consulting related to business functions of enterprises, consulting in preparation of development-oriented programmes and projects, and consulting regarding the appropriateness of the selected organisational form. Voucher consulting for potential entrepreneurs also includes consulting in verification of business ideas, preparing business plans, and other consulting needed to start a company. Particular attention will be given to consulting to small and medium-sized enterprises with regard to internationalisation, EU projects and preparation for EU projects. 18

19 Scheme type: Small and medium-sized enterprises, and de minimis Aid scheme: Grant Eligible cost: Costs of consulting services of external consultants, except for costs of consulting services provided on an ongoing or periodical bases or connected to the usual operating costs of an enterprise such as for usual tax consultancy, legal advice and advertising services. Implementers and conditions: The Ministry of the Economy will implement the measure through JAPTI. JAPTI will select implementers at the local level through call for proposals or invitation or in a different manner pursuant to the applicable legislation. (in accordance with the Public Finance Act and the Public Procurement Act). Selection criteria: The condition for inclusion in the voucher consulting programme is expressed interest of a potential entrepreneur or an existing enterprise. The subsidy for costs of consulting will be utilised by using the referral/voucher received by the entrepreneur from the programme implementers at the local level. The entrepreneur will decide by him or herself on inclusion in the programme on the basis of presentation of the programme's services by local implementers. Entrepreneurs will receive initial information on the offer of voucher consulting, and they will be able to select the consultant of their own choice from the entrepreneurial consultants register. Aid intensity: - Potential entrepreneurs: 100% of consulting costs (de minimis) - Established companies: up to 50% of consulting costs (SMEs scheme) In accordance with Articles 1 and 4 of the Commission Regulation (EC) No 70/2001 of 12 January 2001 on the application of Articles 87 and 88 of the EC Treaty to State aid to small and medium-sized enterprises, the Measure (for established companies) is not used for activities related to production, processing and marketing of products specified in Annex I to the Treaty. Final beneficiary: Established small and medium-sized enterprises, potential entrepreneurs For other target groups (the unemployed, farmers, etc.), the voucher consulting programme will be implemented in co-operation with the competent ministries. Objectives and indicators of Measure 1.3.1: Voucher consulting Measure Indicator * Starting point in Voucher consulting Increase in the number of SMEs receiving the grant Increase in the number of potential entrepreneurs receiving the grant Planned result as at the end of % annually 3% annually Number of new jobs created Successful applications of Slovene companies to EU programmes/projects % annually (100 companies) Number of companies expanding their operations (internationalisation and international co-operation) * There were 2466 voucher consultancies to established companies in

20 Voucher training The purpose of the voucher training programme is to ensure to potential entrepreneurs and employees of SMEs facilitated adjustment of the level of knowledge and skills needed for operation, preservation and growth of an enterprise by way of access to miscellaneous training schemes at subsidised price. Training will be provided by qualified institutions at the national and local level. The obtained knowledge will facilitate to enterprises the day-to-day operations, provide for easier entry on foreign markets and acquiring of specific know-how related to individual areas of the company's business. The voucher training programme will include training in business functions of enterprises (especially ICT), intellectual property rights, taxes, law, accounting, training of entrepreneurs -managers with the emphasis on internationalisation of the economy, training for international operations, and training in production and technological processes. Aid scheme: Training Aid form: Grant Eligible cost: Costs of general and specific training: a) Cost of lecturers external contractor b) Travel expenses of persons included in the training c) Costs of consulting related to the training d) Other costs of training (e.g. rent of premises, projector, etc.) Specific training means training used by employees on their current or future posts in the company receiving aid, providing knowledge not transferable to other enterprises or fields of work. General training means training used by employees not only on their current or future posts in the company receiving aid, but providing to the employees knowledge transferable to other enterprises or fields of work. Implementers and conditions: The Ministry of the Economy will implement the measure through JAPTI. JAPTI will select implementers through call for proposals or invitation or in a different manner pursuant to the applicable legislation. (in accordance with the Public Finance Act and the Public Procurement Act). Selection criteria: The manner of inclusion in the programme is identical to that used for voucher consulting. Aid intensity: - Up to 45% of costs of specific training - Up to 80% of costs of general training Final beneficiary: Employees of SMEs and potential entrepreneurs 20

21 Objectives and indicators of Measure 1.3.2: Voucher training: Measure Indicator Starting point in Voucher training Increase in the number of SMEs receiving the grant Increase in the number of potential entrepreneurs receiving the grant Planned result as at the end of % annually 3% annually 1.4. Promoting entrepreneurship in specific target groups The programme's aim is to prepare the model for supporting specific target groups and the proposal for inclusion in other support measures for entrepreneurship in co-operation with the Ministry of Agriculture, Forestry and Food, the Ministry of Education and Sport, and the Ministry of Labour, Family and Social Affairs. These groups need special support as they are faced with the lack of information, contacts, access to networks, sex discrimination, stereotypes, problems in combining professional and family obligations, and meet specific issues with regard to types of companies and industries. The activities of informing, raising entrepreneurial culture, animating and motivating target groups will be implemented within the measure for the following purposes: Creating the supporting environment tailored to the needs of specific target groups Promoting networking within the specific target groups Obtaining information on business opportunities Exchange of good practices Aid scheme: Not state aid Aid form: Selection of implementers through call for proposals or in a different manner (in accordance with the Public Finance Act and the Public Procurement Act). Eligible cost: - Costs of preparing the model for supporting specific target groups with regard to entrepreneurship - Costs of animation and motivational workshops Activities will be implemented at the local level through institutions of the supporting environment for entrepreneurship. Implementers and conditions: The measure will be implemented through JAPTI, which will select implementers at the national/local level through call for proposals or in a different manner (in accordance with the Public Finance Act and the Public Procurement Act). Selection criteria: Set forth in a call for proposals or in a different manner in accordance with the applicable legislation. Aid intensity: Up to 100% Final beneficiary: Women (in co-operation with the Ministry of Agriculture, Forestry and Food and the Ministry of Labour, Family and Social Affairs) Young (in co-operation with the Ministry of Education and Sport, the Ministry of Agriculture, Forestry and Food and the Ministry of Labour, Family and Social Affairs) 21

22 People from less developed and rural areas (in co-operation with the Ministry of Agriculture, Forestry and Food) Vulnerable groups (Italian and Hungarian national communities and Roma, disabled persons, persons released after served prison sentence, persons released after completed treatment in institutions for treating alcoholism and other psychological problems, single mothers, etc.) Objectives and indicators of Measure 1.6: Promoting entrepreneurship in specific target groups: Measure Indicator Starting point in 2005 Promoting entrepreneurs hip in specific target groups Number of new companies (target groups of the young, women, people from rural areas) Number of jobs created Planned result as at the end of

23 2. Knowledge for business Defining the challenge Knowledge is one of the key factors for competitiveness of a modern economy. Slovenia has roughly 5 registered researchers per 1000 people, while the respective numbers in EU15 and EU25 are 6.1 and Slovenia deviates the most from developed European countries in low share of researchers in the business sector. Only around 38% of all researchers (roughly 1,900) were employed in the business sector in 2004, compared to 53% and 49% in EU15 and EU25, respectively. 11 If we focus on manufacturing (see chart below), then the data on education level are alarming. Manufacturing companies in Slovenia have on average 11.5% of employees with at least college degree, 21.7% of employees with secondary school education and 66.8% of those with less than secondary school education. 12 Of 11,639 top staff being at least masters of science, only 9.3% (1,090) were employed in manufacturing (i.e. mostly in R&D) at the end of The share of people with MSc or PhD employed in manufacturing is extremely low: only around 7 in large corporations and as little as 4 and 3 in medium and small enterprises, respectively. 13 Figure 2-1: Share of employees in manufacturing by level of education for different sizes of enterprises Delež zaposlenih (%) Velikost podjetja veliko srednje malo 0 Doktorat Magisterij Visoka izobrazba Višja Srednja Nižja VKV KV Stopnja izobrazbe PKV NKV Neznano Source: SORS, 31 December Source: Eurostat Yearbook Source: Eurostat Yearbook Source: Statistični letopis 2005 (Statistical Yearbook) 13 Source: Statistični letopis 2005 (Statistical Yearbook) 23