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									Southeast Europe
Enterprise Development
  ENTREPRENEURSHIP
AND SME DEVELOPMENT
      STRATEGY IN
PRIJEDOR MUNICIPALITY

    2003 --2008
    2003 2008
   ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY




CONTENT

- Introduction                                                               4

- Acknowledgements                                                           5

- Vision                                                                     6

- Economic Situation of the Prijedor Municipality                            6

- SWOT Analysis of the Prijedor Municipality                                 8

- Entrepreneurship Development Strategy in the
  Municipality of Prijedor                                                   9

- Strategic Goal no. 1                                                      12

- Strategic Goal no. 2                                                      13

- Strategic Goal no. 3                                                      14

- Strategic Goal no. 4                                                      15

- Strategic Goal no. 5                                                      16

- Matrix of Development Goals, Programs and Projects
  in the Prijedor Municipality                                              17

- Projects Matrix                                                           20

- Proposals for Initial Projects                                            22

- Prijedor Local Economic Development Agency                                22

- Entrepreneurship Incubator                                                23

- Agricultural Cluster                                                      24




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              ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY


FOREWARD

The Municipality Prijedor is the second largest Municipality in Republic of Srpska, both
population as well as the territory size vise. The Municipality is placed in the Northwest part
of Bosnia and Herzegovina in the valley of the Sana river and surrounded by the mountains
Kozara and Grmec. The Municipality has relatively well developed infrastructure and
represents an urban environment with all preconditions for comfortable living and work of
its population.

The earlier concept of development of Prijedor economy was based on development of
capacities of the basic industry. Bearers of Prijedor economy were big systems of iron,
cellulose and paper production that served as raw material base for development of
processing capacities for final products in other parts of former Yugoslavia.

In the period of transition from state to market economy such economic structure in the
Prijedor Municipality has become an obstacle to development of both the economy as well
as development of the society itself. The exiting economy structure in not only incapable of
creating new job opportunities, but it generates additional unemployment.

In order to change these negative trends in the economy, the Municipality of Prijedor has
adopted a new Strategy with the main goal to develop a diversified economy supported by
advanced service industry sector and strong focus on development of agriculture
production.

The new Strategy is focused on entrepreneurship and SME development, which are
expected to become the main element of economic development of Prijedor Municipality in
future. The Strategy for entrepreneurship and SMEs development is based and developed
on the concept and methodology of local economic development. This concept is creating
conditions for improvement of business environment, creation of new enterprises,
development and growth of existing enterprises and attraction of domestic and foreign
investors. Implementation of this concept requires that Municipal authorities take different
and new role in the economic development through creation of partnership relationship
between local authorities and private sector in order to jointly define development goals
and implement economic development projects.

Through the establishment of Info Center, One-Stop-Shop for business entities, creation of
fund and credit line for fruit producers and support to establishment of Development
Agency, Prijedor Municipality has made initial steps in its attempt to assist and support
entrepreneurs. The Strategy was developed in cooperation between the Municipality and
Southeast Europe Enterprise Development (SEED).

The final goal we want to achieve through implementation of this Strategy is creation of
conditions for economic prosperity of Prijedor Municipality and, through that, creation of
better living conditions for all citizens of this community.

In order to achieve the defined goals, Prijedor Municipality, with its modest resources,
additionally burdened with social and other problems, will need support and assistance
from all levels of BiH government as well as technical assistance, expertise and financial
resources from international organizations.

Mayor of Prijedor Municipality
Prof. Nada Ševo                                               Prijedor 25. 08. 2003.

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             ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY




ACKNOWLEDGEMENTS

From the very beginning of the project, the Mayor and her team have been showing
great understanding, proactiveness and recognized the need to take a lead role in
their community in the matters related to economic development.

Throughout this project, with strong support from Mayor and her staff, we have been
initiating dialogue between the Municipality, entrepreneurs and other stakeholders
about issues related to business environment, non-financial and financial support to
private sector, human resources development, etc.

Without active involvement of all this professionals and their willingness to
contribute towards the improvement of economic situation in their community, it
would be almost impossible to implement this project and to bring it to the very
successful end.

Beside the above mentioned participants in the project, I wish to address special
gratitude to the members of the SEED consulting team, Ms. Gwen Swinburn, the
World Bank Senior Urban Specialist, Prof. Dr. Miroslav Glas, Mr. Bogo Filipic, MSc and
Prof. Dr. Darko Tipuric, who have invested a lot of efforts, time and energy into the
activities and contributed a lot to the quality of the project itself.

This project sets a good foundation and designs a platform which can serve to all
those who have possibility to help the Municipality and private sector in Prijedor in
creation of the better business environment, establishment and initiation of the
efficient organization and institutions for provision of different kinds of support to
private sector as well as to enhance and develop human resources in accordance to
the new needs arising from the economy of today.

Work of local organizations and institutions, resources and efforts they invested so
far as well as their commitment to this project, represent a guarantee to all domestic
and international organizations and institutions that they would be serious and
sincere partners, ready for cooperation with all the parties interested in changing
currently unfavorable economic situation in Prijedor and improvement of the quality
of life and standard of Prijedor citizens.



Davorin Pavelic
Business Development Analyst
Southeast Europe Enterprise Development - SEED




                                              5
                     ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY




ECONOMIC SITUATION OF THE PRIJEDOR MUNICIPALITY

The development document “Entrepreneurship and small and medium-sized enterprise
d e v e l o p m e n t s t r a t e g y f o r t h e M u n i c i p a l i t y o f P r i j e d o r, 2 0 0 3 - 2 0 0 8 ” p o s i t i o n s t h e
Municipality as an active center of entrepreneurial activities after almost ten years of
economic stagnation, caused by war devastation and economic transition.

T h e M u n i c i p a l i t y o f P r i j e d o r i s t h e s e c o n d l a r g e s t m u n i c i p a l i t y, b o t h b y t h e a r e a i t
o c c u p i e s , a n d b y t h e p o p u l a t i o n ( a f t e r B a n j a L u k a ) , i n t h e Re p u b l i c o f S r p s k a . I t
comprises 24 local communities, three of which are part of the city itself. Just as the
majority of other cities in B&H, Prijedor has significantly changed its own demographic
p i c t u r e t h r o u g h , a n d s i n c e t h e B & H w a r. A c c o r d i n g t o t h e 1 9 9 1 c e n s u s , 1 1 0 , 1 3 0
population resided in this area, and the number of population in Prijedor in 2000 was
95,502. According to some estimation, today some 37,000 refugees also reside in the
Prijedor Municipality, who are both a social and economic challenge for the Municipality.
Thus, in 2001, the workforce population was 17,829 persons, of which there were 7,608
employed (in 1988, there had been 21,555 employed) and 10,221 unemployed (even
7443 in 1996), so the unemployment rate that year was 57.33 % with an increasing
t r e n d . A t t h e s a m e t i m e t h e u n e m p l o ye d w o r k f o rc e i s a l s o a g e n e ra t o r o f t h e g ra y
economy at the large scale and it will be reduced only by job creation in large, medium
and small enterprises.

In 2001, 1.653 entrepreneurs                     worked in the economy , and in addition to this, 359 more
e n t i t i e s w e r e r e g i s t e r e d i n 3 9 d i f fe r e n t a r e a s o f t h e e c o n o m y, o f w h i c h 5 5 ( 1 5 . 3 )
pertained to state-owned enterprises, and 304 (84.7%) pertained to private enterprises.
The current state-owned enterprise privatization process changes both organizational
forms of the majority of enterprises into shareholding companies, and the ownership
relations (equity structure).

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                     ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY


The majority of the enterprises has been registered in trade (47%), business activities
(6.10%), construction (6.10%) and wood processing (4.5%).

The Prijedor Municipality did not base its development on the tradition of the SME
development. Its mono-production orientation with a few large state owned enterprises
was appropriate in the centralized economy regime characterizing the period until the
most recent war. Because the former characteristics of the economy in the Municipality,
which had a function of creating a base for raw materials for the industries outside the
Prijedor area, there is a significant need for transition of the economy to enable Prijedor
to become a center for SMEs and entrepreneurship activities in different industries. The
P r i j e d o r M u n i c i p a l i t y h a s m a d e d e c i s i o n t o p r e p a r e t h e S M E D e v e l o p m e n t S t ra t e g y
because of the need for major structural changes.

The preparation of this strategy began with creation of an organizational structure
and at a LED strategy workshop in March 2002. Today the organizational structure
involves the municipal authorities, local partners and foreign consultants, and therefore
consists of the following:

      o     Forum of influential interested entities (stakeholders), headed by the Mayor;
      o     Project Board at the municipal level, led by the Mayor;
      o     Local Economic Development Team (LED Team)
      o     Four working groups: for business development; for infrastructure and
            environmental protection; for human resources development; and for
            agricultural and rural development.

The joint work of this structure is reflected in the “Entrepreneurship, Small and
Medium-Sized Enterprise Development Strategy for the Prijedor Municipality,
2003-2008” which is presented here in the text below in its summarized version. The
summarized version was prepared as an INVITATION TO DONORS AND PARTNERS to join
in implementation of this strategy and to assist in improvement of the economic situation
within the Municipality.

This initiative was funded by the Municipality itself and SEED. The SEED experts, the
World Bank Local Economic Development expert and international consultants from
Slovenia were engaged for the preparation of this strategy.




                                                                  7
                 ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY


SWOT ANALYSIS OF THE PRIJEDOR MUNICIPALITY

Simultaneously with collecting statistical data on the economic situation, a survey was
conducted among entrepreneurs in Prijedor and interviews were held with the
representatives of all the economic development support organizations. The SWOT
analysis of the Municipality Prijedor shows the picture of the economic situation from the
aspect of entrepreneurship development.




                                         POSITIVE FACTORS
 S – Strengths                                     O – Opportunities
 Ø   Honest and diligent people, willing to make   Ø   Strengthening of the coalition between private and public sectors




                                        NEGATIVE FACTORS
 W - Weaknesses                                    T – Threats
 Ø   Few SMEs                                      Ø   Resistance to change
 Ø   Lack of entrepreneurship tradition,
 Ø   Lack of integration in the structures of
     private and public sectors
 Ø   Poor organization of entrepreneurship
     support,
 Ø   Lack of infrastructure entities (agencies,
     zones, incubators, clusters, etc.)
 Ø   Lack of entrepreneurial skills
 Ø   Underdeveloped banking sector in Prijedor
 Ø   Lack of foreign investment;
 Ø   Lack of qualitative information base
 Ø   Obsolete technologies,
 Ø   Farms of small size




                                                         8
 ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY




                   Step 1. Organization of Activities


Step 2. Municipality competitiveness assessment & SWOT analysis


Step 3. Creating development strategy: vision, goals, projects


                   Step 4. Strategy implementation


Step 5. Strategy implementation analysis & supplemental measures




                                   9
                     ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY

The Prijedor Municipality Vision acknowledges all the advantages and development
o p p o r t u n i t i e s , a n d i t m e a n s a d e s c r i p t i o n o f e c o n o m i c f u t u re t h a t a l l e n t i t i e s a r e
interested in and that all the entities creating this future agree with: entrepreneurs,
municipal administration, people from education, health system, and other services,
residents of Prijedor and the whole municipality. The vision provides a clear direction as
t o t h e w ay f u r t h e r, m e a n i n g , t h e P r i j e d o r d e v e l o p m e n t v i s i o n a n t i c i p a t e s t h a t t h e
P r i j e d o r M u n i c i p a l i t y w i l l n e v e r a g a i n a s b e f o re r e l y o n t h e i r o n m i n e , a n d d u e t o
technological obsoleteness it can not expect much from revitalization of the former
major enterprises. Therefore it will rely on the SMEs for its development, changing the
economic structure into an interwoven network of micro-, small and medium-sized
enterprises.




                                                                  10
           ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY




   BASIS FOR DEVELOPMENT VISION OF PRIJEDOR AS CENTER
    FOR DEVELOPMENT ACTIVITIES IN NORTHWEST BOSNIA

In five years, Prijedor Municipality will be a source of economic development and
   a strong entrepreneurship center with a network of small and medium-sized -
                 enterprises and a dynamic and versatile economy.




        Entrepreneurship and SME development strategy
                      STRATEGIC GOALS




  STRATEGIC GOAL 1                                           STRATEGIC GOAL 2
Creation of enabling business                               Creation of physical and
        environment                                        development infrastructure




      STRATEGIC GOAL 3                                  STRATEGIC GOAL 4

   Strengthening the SME sector                         Production job creation
        and their capacities                           while retaining versatility




                              STRATEGIC GOAL 5
                         Human resource development
                           for economic growth and
                                 restructuring




                                           11
                ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY


                                STRATEGIC GOAL NO. 1
                         Creating enabling business environment


   Create business environment that will encourage the establishment of commercial
      and industrial businesses that will be of benefit to the community, promote
   stabile and diversified economy that is, at the same time, env    ironmentally sound.



          Objective 1
                                              Objective 2                         Objective 3
 Increasing the entrepreneurs'
                                     Active work of the Stakeholder   Establishment of public -private sectors
   satisfaction level with the
                                    Forum (development coalitions)                 partnership
performance of the Municipality




                                                  12
                      ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY


                                                  STRATEGIC GOAL NO. 2
            Creation of physical (hard) and business (soft) infrastructure for SME
                                         development

 SMEs may be well developed in the environment offering them better conditions for growth, meaning,
 offering them the infrastructure, assisting in creation of new enterprises, and subsequently with growth and
 increase in volume of production of products or services. On the other hand, a developed business
 infrastructure increases favorableness of the environment and motivates both SMEs and new investors to
 come and creation new jobs.




                        Objective 1                                                             Objective 2
    Development of necessary physical                                             Creation of the business infrastructure for
              infrastructure                                                                 SME development


Physical infrastructure is a support                                             The business infrastructure consists of
instrument assisting new companies from the                                      institutions and enterprises that may service
start to meet the spatial requirements for                                       development coalitions at the local level, that
work and begin to operate and create new                                         may represent the local environment with
j o b s a s s o o n a s p o s s i b l e . Fo r t h e e x i s t i n g             external, national or foreign partners, and
SMEs, this infrastructure allows expansion                                       that may provide high-quality services for the
and growth (in terms of space too) and new                                       local partners, foreign partners, donors,
job creation. Under the right conditions, this                                   investors and SMEs on development projects.
i n f ra s t r u c t u r e a l l o w s f o r c o n c e n t ra t i o n o f
expertise and development of innovative
enterprises.




                              1. Program for development of support institutions
                                 and mechanisms
                              2. Program for infrastructure development




       1.    Establishment of the Prijedor Development Agency
       2.    Foundation of the SME Development Financial Fund (micro-credit, guarantees, subsidies)
       3.    Foundation of a One Stop Shop
       4.    Creation of Entrepreneurship Incubators
       5.    Creation of the Business Zone with improved utilities and infrastructure
       6.    Creation of the Development Center for Rural Areas




                                                                            13
                   ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY


                                         STRATEGIC GOAL NO. 3
          Strengthening the small and medium-sized enterprise (SME) sector

The number of SMEs in Prijedor is below the standards of the developed countries, and what is
particularly lagging behind is the dynamics of creation of new enterprises, introducing new products,
services and technologies. Quicker development requires improvement of the existing companies to
invest into growth and development of support instruments to create new enterprises and thus
effecting a change in the structure of industries.



          Objective 1                              Objective 2                         Objective 3

                                           Encouragement to growth of           Opening SMEs towards
 Increase in number of small                                                 broader markets of B&H and
                                          dynamical small and medium-
and medium-sized enterprises                                                  the neighboring countries
                                                sized enterprises


Structural changes and                    New and existing SMEs need        Opening SMEs towards outer
larger business dynamics                  various support instruments in    markets requires the SMEs to
are accomplished by                       order to be able to develop       learn, to cooperate, to
i n c r e a s e i n S M E n u m b e r,    quicker, to invest and create     introduce standards and new
reduction of gray economy                 new jobs. Supporting growth       methods of work, to introduce
and quicker job creation in
SMEs. This increases                      means leading a dynamical         new technologies, to network,
employment and share of                   policy of support through         to use new IT and new
these enterprises in it, and              d e v e l o p m e n t a n d       distribution channels;
due to the high unemplo-                  implementation of various         therefore the implementation
yment rate in the Prijedor                support instruments that can      of this goal is crucial for
Municipality this is a                    be used in SME growth.            survival of SMEs.
significant objective.




                             1.     Program of support for new entrepreneurs
                             2.     Program of support for growing enterprises
                             3.     Program of including gray economy into the legal
                                    economy




    1.    Simplification of registration procedures for new companies
    2.    Introduction of voucher and other support schemes for dynamical SMEs (consulting,
          preparation of business plans for banks, consulting for internationalization of business)
    3.    Project of support for quality development and introduction of ISO and CE standards in
          SMEs
    4.    Projects to group enterprises into networks and clusters
    5.    Organization of a number of meetings with SMEs from neighboring countries
    6.    Support to internationalization (organizational and financial) of SMEs to participate in fairs,
          exhibitions and conferences




                                                        14
               ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY


                                  STRATEGIC GOAL NO. 4
          Creation of productive jobs with variety of activities

Encouragement to job creation     for various target groups and in varying industries     provides a long-
term solution to many issues related to employment        for »difficult to employ« persons or to
employment in industries where there is normally a lack of skilled workers.         Through programs
focused on removal of these obstacles,     we can achieve job creation      appropriated for the needs of
the economy.



        Objective 1                              Objective 2                                Objective 3

 Increase of job creation in          Increase of shares of new                    Increase of actual wages and
           SMEs                            industries in BDP                                 salaries



By encouraging training and       As the SME sector in Prijedor is                 The low personal standard
retraining of the unemployed,     still largely underdeveloped,                    depends on wages and
we open the opportunity for       there is also an underdeveloped                  salaries. Through training and
both new and existing SMEs        supply of services and products                  professional development,
to find the workforce skilled     needed by the local and broader                  and further through self-
appropriately for their           m a r k e t s . E n c o u ra g e m e n t f o r   employment, conditions are
production programs.              employment in underdeveloped                     built allowing higher and
                                  industries improves supply on                    additional wages and salaries
                                  the market and changes the                       in urban and rural areas as
                                  situation in the economy.                        well.




                      1.   Program   of   active employment policy
                      2.   Program   of   entrepreneurship initiatives for women
                      3.   Program   of   rural entrepreneurship
                      4.   Program   of   youth entrepreneurship




  1.   Analysis of human resources and needs of SMEs, and larger enterprises, by numbers and
       types of skilled workforce
  2.   Analysis of the existing training and education programs
  3.   Development of new training programs and change/adjustment of the existing ones to the
       SME needs
  4.   Development of financial action plan subsidies for new job creation
  5.   Entrepreneurship training for youth
  6.   Support to employment of young graduates
  7.   Support to development of supplementary rural activities
  8.   Support to association and entrepreneurship initiative for women
  9.   Support to employment of disabled persons and persons with limited working ability



                                                       15
              ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY


                     STRATEGIC GOAL NO. 5
  Human resource development for economic growth and restructure


Human resources allow for transformation of expertise and skills into products and services sellable
on the market. Due to the war, failed enterprises, difficult economic situation, technological
obsoleteness, isolation and brain drain it is necessity today to have additional education and training
of entrepreneurs, entrepreneur candidates, workers, the unemployed, students and other
population and it is a precondition for quicker development of SMEs and Prijedor as a whole.




        Objective 1                              Objective 2                       Objective 3

   Education system for                 Education system for             Education system for other
      entrepreneurs                       workers in SMEs                    population groups


The time of quick changes           Competitiveness of work              SME development also
in all areas of work requires       depends on technology and            depends on how we
business people to                  worker skills. Use of IT             motivate pupils, students,
permanently learn and               technologies in all                  the unemployed, and others,
study, so they can promptly         industries requires people           to become involved in
respond to changes in the           to attain new skills and             various education programs
business environment and            expertise, as well as a              thus raising levels of their
in the municipality of their        different approach in work           expertise and possibilities to
residence. In addition to           and organizational sense.            a c c o m p l i s h t h e i r
this, the business world is         Education of workers is              entrepreneurial ideas or to
becoming increasingly               becoming a precondition for          be employed by SMEs where
global, requiring broader           encouragement of                     such knowledge is needed.
and completely new                  competitiveness.
expertise.




                      1.Training (educational)       program for competitiveness




  1.   Development of special education programs for entrepreneurs and workers
       from various sectors
  2.   Development of comprehensive education programs for starter entrepreneurs
       and for students
  3.   Development of public vocational training programs for adults




                                                      16
             MATRIX OF DEVELOPMENT GOALS, PROGRAMS AND PROJECTS IN THE PRIJEDOR MUNICIPALITY
                  Vision                        Strategic goals      Operational Objectives                     Programs                                 Projects

       Prijedor will become a                   G1: Creation of     Objective 1 :                     1. Program to create development    1.Establish Stakeholder Forum and
     center of development                      enabling business   Increasing entrepreneurs'            coalitions                         other development coalitions
     activities in the                          environment         satisfaction level with the
     Northwest part of BiH.                                         Municipality performance          2. Program of non-financial forms   2.Develop a joint overall Prijedor
     It will encourage, create                                                                           of support to SME development      Municipality Development Strategy
     and concentrate                                                Objective 2:
     business initiatives in                                        Active work of the Stakeholder    3. Program to promote               3.Staff training in Municipality and
     the form of a network of                                       Forum (development coalition)        entrepreneurship                   institutions for support to SMEs for
     small and medium                                                                                                                       better performance and barrier
     enterprises, directed                                          Objective 3:                      4.Program to improve local            removal
     towards broader                                                Establishment of public-private      business environment
     regional markets.                                              sectors partnership                                                   4.Establish One Stop Shop in the
                                                                                                                                            Municipality
        The development -
     oriented climate in the                                                                                                              5.Establish municipal non-financial
     area will ensure                                                                                                                       forms of support to entrepreneurship
     d i v e r s i ty i n p r o d u c t i o n                                                                                               development
     structure, quick
     a cc e p t i n g o f n e w s k i l l s                                                                                               6.Promote entrepreneurship and




17
     and quick impleme-                                                                                                                     opportunities it offers
     ntation of good business
     ideas. The economic                                                                                                                  7.Promote entrepreneurship success
     motto will be openness                                                                                                                 and successful entrepreneurs
     and removal of all
     barriers, followed by                                                                                                                8.Promote joint projects and
     better quality of living                                                                                                               cooperation
     of all people and
     m a i n t e n a n c e o f                                                                                                            9.Co-finance promotion materials,
     historical and cultural                                                                                                                business meetings and business
     values. Proactive                                                                                                                      networking
     approach will give
     Prijedor advantage over
     neighboring areas and
     encourage excellence,
                                                                                                                                                                                   ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY




     flexible business
     infrastructure as a
     source of future
     e c o n o m i c d e ve l o p m e n t
     a n d g e n e ra l w e l fa r e o f
     the Prijedor people
                  Vision                        Strategic goals        Operational Objectives                      Programs                                 Projects

       Prijedor will become a                   G2: Creation of       Objective 1:                         1. Program to develop support   1. Establish Prijedor Development Agency
     center of development                      physical and busi -   Development of the necessary         institutions and mechanisms
     activities in the                          ness infrastructure   physical infrastructure                                              2. Establish Financial Fund (micro-credit
     Northwest part of BiH.                     for SME develo -                                                                              schemes, guarantee schemes,
     It will encourage, create                  pment                 Objective 2:                                                            subsidies)
     and concentrate                                                  Create business infrastructure for
     business initiatives in                                          SME development                                                      3. Establish One Stop Shop everything at
     the form of a network of                                                                                                                 one place
     small and medium
     enterprises, directed                                                                                                                 4. Establish Entrepreneurship incubator
     towards broader
     regional markets.                                                                                                                     5. Establish Business Zones with arranged
                                                                                                                                              utilities
        The development -
     oriented climate in the                                                                                                               6. Establish Rural Area Development
     area will ensure                                                                                                                         Center
     d i v e r s i ty i n p r o d u c t i o n
     structure, quick                           G 3: Strengthening    Objective 1:                         1. Program to support new       1.Simplify registration procedures for
     a cc e p t i n g o f n e w s k i l l s     of SME sector         Create the most important            entrepreneurs                     new companies




18
     and quick impleme-                                               institutions of physical
     ntation of good business                                         infrastructure                       2. Program to support growing   2. Introduce voucher and other schemes
     ideas. The economic                                                                                   enterprises                        of support to dynamical SMEs
     motto will be openness                                           Objective 2:                                                            (consulting, preparation of business
     and removal of all                                               Create business infrastructure for   3. Program to integrate gray       plans for banks, consulting for
     barriers, followed by                                            SME development                      economy into legal economy         internationalization of business)
     better quality of living
     of all people and                                                                                                                     3.Projects supporting quality
     m a i n t e n a n c e o f                                                                                                                development and introduction of ISO
     historical and cultural                                                                                                                  and CE standards in SMEs
     values. Proactive
     approach will give                                                                                                                    4.Projects to group enterprises into
     Prijedor advantage over                                                                                                                  networks and clusters
     neighboring areas and
     encourage excellence,                                                                                                                 5.Organize a number of meetings with
                                                                                                                                                                                       ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY




     flexible business                                                                                                                       SMEs from neighboring countries
     infrastructure as a
     source of future                                                                                                                      6.Support internationalization
     e c o n o m i c d e ve l o p m e n t                                                                                                    (organizational and financial) of SMEs
     a n d g e n e ra l w e l fa r e o f                                                                                                     for participation in fairs, expositions
     the Prijedor people                                                                                                                     and conferences
                  Vision                        Strategic goals      Operational Objectives                      Programs                                    Projects

       Prijedor will become a                   G 4. Productive     Objective 1 :                      1. Program of active employment   1. Analysis of human resources and needs
     center of development                      job creation with   Increase employment in SMEs           policy                         of SMEs and major enterprises, by
     activities in the                          industry                                                                                 numbers and types of skilled workforce
     Northwest part of BiH.                     diversification     Objective 2:                       2.Program of entrepreneurial
     It will encourage, create                                      Increase share of new industries      initiatives for women          2 . A n a ly s is o f e x is tin g e d u ca tio n a n d
     and concentrate                                                in GDP                                                               training programs
     business initiatives in                                                                           3.Program of rural
     the form of a network of                                       Objective 3:                          entrepreneurship               3. Develop new training programs and
     small and medium                                               Increase in actual salaries                                          change/adjust to existing SME needs
     enterprises, directed                                                                             4.Program of youth
     towards broader                                                                                      entrepreneurship               4. Develop Financial Scheme subsidies
     regional markets.                                                                                                                   for new job creation

        The development -                                                                                                                5. Entrepreneurship training for youth
     oriented climate in the
     area will ensure                                                                                                                    6. Support employment of young
     d i v e r s i ty i n p r o d u c t i o n                                                                                            graduates
     structure, quick
     a cc e p t i n g o f n e w s k i l l s                                                                                              7. Support development of supplementary
                                                                                                                                         industries in rural areas




19
     and quick impleme-
     ntation of good business
     ideas. The economic                                                                                                                 8. Support networking and
     motto will be openness                                                                                                              entrepreneurship initiatives for women
     and removal of all
     barriers, followed by                                                                                                               9. Support employment of disabled
                                                                                                                                         persons and people with limited working
     better quality of living
                                                                                                                                         ability
     of all people and
     m a i n t e n a n c e o f
     historical and cultural                    G 5:Human           Objective 1:                       1. Education Program for          1. Develop special education programs for
     values. Proactive                          Resource            Entrepreneur education system         competitiveness                entrepreneurs and workers from various
     approach will give                         Developments for                                                                         sectors
     Prijedor advantage over                    economic growth     Objective 2:
     neighboring areas and                      and restructuring   Education for SME workers                                            2. Develop general education program for
     encourage excellence,                                                                                                               start-up entrepreneurs and students
                                                                                                                                                                                                   ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY




     flexible business                                              Objective 3:
     infrastructure as a                                            System for education of other                                        3. Develop vocational training programs
     source of future                                               population                                                           for adults
     e c o n o m i c d e ve l o p m e n t
     a n d g e n e ra l w e l fa r e o f
     the Prijedor people
                                                                                          GOALS                        VALUE              SOURCES OF FUNDING in %
                                                                                                                                                                              IMPLEME                    DURA
                       PROJECT LIST                                                         SME                                                                                              START
                                                                               Infrastru                Job                                                                     NTER                     TION
                                                                   Partnership           Strengthen              HRD   in EURO   Donors         State   Municipality   SME
                                                                                 cture                Creation
                                                                                             ing
     1.Foundation of the Stakeholder Forums and other                                                                                                                                       February Continuo
     development coalitions
                                                                       X           x                                     4.000                              100              Municipality
                                                                                                                                                                                             3, 2003     us
     2.Completion of the Joint Comprehensive Development                                                                                                                                    March 03, April 06,
     Strategy for the Prijedor Municipality
                                                                       X           x                     x        x     50.000     80                       20                 Agency
                                                                                                                                                                                              2003     2004
     3.Staff training in the Municipality and institutions
                                                                                                                                                                                            March 09, March
     encouraging SME development for improved                          X          X                               x     10.000     50                       50               Municipality
     performance and removal of obstacles                                                                                                                                                     2003    12, 2004
                                                                                                                                                                                          March 09,      March
     4.Foundation of One Stop Shop in t he Municipality                X          X                                      6.000     50                       50               Municipality
                                                                                                                                                                                            2003        12, 2004
     5.Creation of municipal non -financial forms of support to                                                                                                                           March 10,     continuo
     entrepreneurship development
                                                                       X          X          X           x             200.000                              100              Municipality
                                                                                                                                                                                            2003           us
     6.Promotion of entrepr eneurship and opportunities                                                                                                                                    October      Continuo
     offered by entrepreneurship
                                                                       X                     X                    X     30.000     40                       40         20     Agency
                                                                                                                                                                                            2003           us
     7.Promotion of entrepreneurship and successful                                                                                                                                        October      Continuo
     entrepreneurs
                                                                       X                     X                    X     30.000     40                       20         40     Agency
                                                                                                                                                                                            2003           us
                                                                                                                                                                                          February      Continuo
     8.Promotion of joint p rojects and cooperation                    X                     X                    X     10.000     50                       20         30        A
                                                                                                                                                                                            2004           us
     9.Co-financing of promotion materials, business                                                                                                                                                    Continuo
     gatherings and business networking
                                                                       X                     X                          40.000     50                       50                Chamber       July 2003
                                                                                                                                                                                                           us




20
                                                                                                                                                                                          February      Continuo
     10. Foundation of the Prijedor Development Agency                 X          X          X           X        X    250.000     60            20         20               Municipality
                                                                                                                                                                                            2004           us
     11. Foundation of the SME Development Financial Fund                                                                                                                                 November        April
     (micro-credit, guarantees, subventions)
                                                                       X          X          X           X             300.000     70                       30                 Agency
                                                                                                                                                                                            2003          2004
     12. Foundation of the One St op Shop – everything                                                                                                                                     October        July
     available at a single place
                                                                       X          X                      X              30.000     50            30         20                 Agency
                                                                                                                                                                                            2003          2005
                                                                                                                                                                                          December      October
     13. Creation of Entrepreneurship Incubators                       X          X          X           X        X    220.000     50            30         20                 Agency
                                                                                                                                                                                            2003          2004
     14. Creation of the Business Zone with imp roved utilities                                                                                                                            October      October
     and infrastructure
                                                                       X          X          X           X             100.000     50            30         20                 Agency
                                                                                                                                                                                            2003          2005
                                                                                                                                                                                          December      Continuo
     16. Creation of Rural Area Development Center                     X          X          X           X        X    200.000     70            20         10                 Agency
                                                                                                                                                                                            2003           us
     17. Simplification of registration procedures for ne w                                                                                                                                October      Continuo
     companies
                                                                       X          X          X                          10.000                              100              Municipality
                                                                                                                                                                                            2003           us
                                                                                                                                                                                          February      Continuo
     18.Consulting services for internationalization of business                  X          X                          50.000     60                       20         20      Agency
                                                                                                                                                                                            2004           us
     19.Introduction of vouchers and other tools for support for                                                                                                                          February      Continuo
                                                                                                                                                                                                                    ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY




     dynam ical SMEs (consulting, preparation of PN)
                                                                       X          X          X                         150.000     50            30         20                 Agency
                                                                                                                                                                                            2004           us
     20. Support projects for quality development and                                                                                                                                     February      Continu o
     introduction of ISO and CE standards with SMEs
                                                                                  X          X                         120.000     50            30         10         10     Chamber
                                                                                                                                                                                            2004           us
     21. Projects grouping enterprises into networks and                                                                                    Continuo
     clusters
                                                                   X   X   X   X   X   200.000   70        20   10   Agency    April 2004
                                                                                                                                               us

     22.Organization of a number of meetings with SMEs from                                                                                 Continu o
     neighboring countries
                                                                   X       X            40.000   50   20   20   10   Chamber   April 2004
                                                                                                                                               us

     23.Support towards internationalization of SMEs to                                                                        February     Continuo
     participate in fairs, expositions, conferences
                                                                   X       X           100.000   20   20   10   50   Agency
                                                                                                                                 2003          us

     24.Analysis of human resources and needs of SMEs and                                                                      November       May
     larger enterprises by worker skills
                                                                               X   X    50.000   80        20        Agency
                                                                                                                                 2003         2004

     25.Analysis of the existing training and education                                                                        November       May
     programs
                                                                               X   X    10.000   80        20        Agency
                                                                                                                                 2003         2004
     26.Development of new training programs and
                                                                                                                                            January
     change/adjustment of the existing ones to the n eeds of       X   X   X   X   X    50.000   80        20        Agency    April 2004
     SMEs                                                                                                                                     2005

     27.Development of financial schemes – subsidies for job                                                                   February       June
     creation
                                                                   X   X   X   X       100.000   60   30   10        Agency
                                                                                                                                 2004         2004

                                                                                                                               November       June
     28.Entrepreneuship training for youth                         X   X       X   X    50.000   70   20   10        Agency
                                                                                                                                 2003         2004




21
                                                                                                                                 March      Continuo
     29.Support to employment of young graduates                   X   X   X   X   X   150.000   50   40   10        Agency
                                                                                                                                 2004          us

     30. Support to development of supplementary rural                                                                                      Contin uo
     activities
                                                                   X   X   X   X   X   200.000   60   30   10        Agency    April 2004
                                                                                                                                               us

     31.Support to grouping and entrepreneurship initiatives for                                                                 March      Continuo
     women
                                                                   X   X   X   X   X    50.000   50        25   25   Agency
                                                                                                                                 2004          us

     32. Support to employment of disabled persons and                                                                         Feb ruary     March
     persons with limited working ability
                                                                   X   X       X   X   200.000   50   40   10        Agency
                                                                                                                                 2004        2004

     33. Development of special training programs for                                                                          December      March
     entrepreneurs and workers from various sectors
                                                                   X   X   X   X   X   100.000   70        30        Agency
                                                                                                                                 2003        2004

     34.Development of comprehensive education programs                                                                        December     January
     for start up entrepreneurs and for schools
                                                                   X   X   X       X    40.000   70        30        Agency
                                                                                                                                 2003         2005

     35. Development of vocational training programs for                                                                       February     January
                                                                   X   X   X   X   X   200.000   70        30        Agency
                                                                                                                                                        ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY




     adults                                                                                                                      2004         2005
           ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY

Proposals for initial projects
Prijedor Local Economic Development Agency




                                           22
          ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY


Entrepreneurship Incubator Project




                                          23
           ENTREPRENEURSHIP AND SME DEVELOPMENT STRATEGY IN PRIJEDOR MUNICIPALITY


Agriculture Cluster Project




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