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					    Government of the Republic of Serbia




           Draft
OPERATIONAL PROGRAMME FOR
  ECONOMIC DEVELOPMENT

             2012 - 2013



Instrument for Pre-accession Assistance
            Component III


                ANNEXES

                 2nd Draft
                 May 2011
                                             OP for Economic Development (Annexes), 2012-2013                                   2nd draft


Table of Contents

ANNEX A: Glossary of IPA terms ............................................................................................................. 1
ANNEX B: Pan-European Transport Corridors in the Balkans ................................................................. 8
ANNEX C: Road transport infrastructure of the Republic of Serbia within the South East Europe core
regional transport network links............................................................................................................. 9
ANNEX D: Rail transport infrastructure of the Republic of Serbia within the South East Europe core
regional transport network links........................................................................................................... 10
ANNEX E : Transport infrastructure of the Republic of Serbia within the South East Europe core
regional transport network links - nodes and waterways .................................................................... 11
ANNEX F: Institutional and legal framework for transport policy in Serbia ......................................... 12
ANNEX G: Forestry coverage in Serbia.................................................................................................. 17
ANNEX H: Map of Serbia’s Protected Areas.......................................................................................... 19
ANNEX J: Map of industrial plants causing the most significant air pollution in Serbia ....................... 20
ANNEX K: Institutional and legal framework for environment policy in Serbia ................................... 21
ANNEX L: Index of Revealed Comparative Advantage .......................................................................... 28
ANNEX M: Details of registered clusters in Serbia................................................................................ 29
ANNEX N: Foreign Direct Investment by Municipality .......................................................................... 37
ANNEX P: Institutional and legal framework for competitiveness policy in Serbia .............................. 38
ANNEX Q: Administrative structures in Serbia ..................................................................................... 43
ANNEX R: Emerging automotive sector in Serbia and cluster in Kragujevac ........................................ 45
ANNEX S: Inter-ministerial Agreement on the SCF Joint Body ............................................................. 47
ANNEX T: Rules of Procedure of the SCF Joint Body ............................................................................. 50
ANNEX U: List of partners & stakeholders consulted ........................................................................... 53
ANNEX V: Results of partner consultation ............................................................................................ 54
ANNEX W: Report of ex ante evaluation and strategic impact assessment ......................................... 55
ANNEX X: Recent and ongoing assistance to Serbia under EU funds (2006-2011) .............................. 56
ANNEX Y: Recent and ongoing bilateral and multilateral assistance to Serbia .................................... 64
                                OP for Economic Development (Annexes), 2012-2013                  2nd draft


                              ANNEX A: Glossary of IPA terms
Accreditation       Confirmation by the National Authorising Officer (NAO) and subsequently by the European
                    Commission (EC), that the established structures are eligible and ready to manage and use
                    EU funds, in such a way that the country itself can assess if the programming and
                    programme implementation can be carried out independently in accordance with defined
                    procedures and manuals. In the process of decentralised management of pre-accession
                    funds (DIS) it represents the process of assessing the readiness of certain structures (e.g.
                    National Fund and Operational Structures) for the initiation of management and use of EU
                    funds in accordance with clearly defined criteria.
Acquis              Term used in EU law to refer to the total body of EU legislation accumulated thus far,
communautaire       including all the treaties, regulations, directives passed by EU institutions and all court
                    decisions by the European Court of Justice. The term is French: acquis meaning "that which
                    has been acquired", and communautaire, "of the community". During the process of the
                    enlargement of the EU, the acquis is divided into chapters for the purpose of negotiation
                    between the EU and the candidate country.
Audit trail         A chronological sequence of paper or electronic records, which provides a step-by-step
                    history of a transaction or event, from start to completion. Information obtained from an
                    audit trail enables the examiner to review all relevant documentation and trace the actions
                    in any process, including the individual responsibilities of staff. Audit trails can be very
                    straightforward or extremely complicated, depending on the number of steps involved.
Candidate country   A country wishing to become an EU member state, which has been awarded the
                    “candidate” status by the European Council on the basis of an opinion from the European
                    Commission, drawn up following an application for membership by the country concerned.
                    However, candidate country status does not give a right to join the EU automatically. The
                    Commission scrutinises the application in the light of the accession criteria (Copenhagen
                    criteria), while the accession process starts with the European Council decision to open
                    accession negotiations. Depending on their circumstances, candidate countries may be
                    required to institute a reform process in order to bring their legislation into line with the
                    EU acquis and to strengthen their infrastructure and administration if necessary. The
                    accession process is based on the pre-accession strategy, which provides instruments such
                    as financial aid. Accession depends on the progress made by the candidate countries,
                    which is regularly assessed and monitored by the Commission.
Cohesion Fund       Funds allocated by the European Union as part of its cohesion policy, that contributes to
                    interventions in the field of the environment and trans-European transport networks. It
                    applies to Member States with a Gross National Income (GNI) of less than 90% of the EU
                    average. In the programme period 2007 – 2013, the Fund contributes alongside the ERDF
                    to multi-annual investment programmes managed in a decentralised way, rather than
                    being subject to individual project approval by the Commission.
Conferral of        The decision by the EC to confer powers of funds management to the national bodies of a
management          beneficiary country under decentralised management, after it has established effective
                    functioning of the management and control system. The EC may withdraw or suspend the
                    conferral of management powers at any time, in the event that any of the requirements for
                    the effective functioning of the system are no longer fulfilled.
Co-financing        All operations receiving assistance under IPA shall require national and EU contributions
                    which is referred to as “co-financing” and is defined in percentages of the overall value of
                    the project’s eligible expenses. The maximum EU co-financing rate for IPA components III
                    and IV is 85%, although this may vary depending on the costs of individual projects and
                    decisions by the Serbian Government and/or IFIs and other potential donors, as well as on
                    the results of the financial analysis.
Decentralised       A system that provides the appropriate legal and administrative framework for the transfer
Implementation      of responsibilities for the implementation of the EU funded programmes from the
System (DIS)        European Commission to the partner countries. In essence, the DIS involves the transfer of
                    project management responsibility (i.e. tendering, contracting and payment) to the
                    authorities in the partner countries under the supervision of the European Commission.



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                                 OP for Economic Development (Annexes), 2012-2013                   2nd draft




End recipient       The body which will ultimately own the outcome of the operation (funded under IPA) and it
                    responsible for the ongoing use and maintenance of the asset created (whether tangible in
                    the case of works or supplies, or intangible in the case of services), beyond the period of
                    the IPA assistance.
End recipient       The agreement between on the one side, the Head of Operating Structure and Head of
agreement           Contracting Authority (CFCU), and the end recipient on the other (if different), which sets
                    out the obligations and rights of both parties relating to the operation; it entrusts the end
                    recipient with all technical and legal aspects of an operation’s implementation, transfers
                    specific day-to-day management responsibilities (e.g. provision of staff, acceptance of
                    works, monitoring requirements etc) and stipulates conditions for future hand-over of
                    assets and transferring The end recipient agreement must be signed prior to the EU
                    Delegation’s endorsement of any works, supplies, services or grant contract relating to the
                    implementation of the operation.
Final beneficiary   In accordance with the IPA Implementing Regulation (IR), the final beneficiary is any body
                    or firm, whether public or private, responsible for initiating or initiating and implementing
                    operations. The draft Financing Agreement (Article 15) provides further clarification: the
                    final beneficiary can also be the Operating Structure, or any body specifically designated in
                    the decision of conferral of management, if it retains direct responsibility for the
                    implementation of the operations under the programme, namely for all contracting
                    arrangements and associated financial transactions. On this basis, the CFCU is considered
                    the final beneficiary for non-grant operations involving service, supplies and/or works
                    contracts. In the case of grant schemes, the grant recipient is considered the ‘final
                    beneficiary’, under both the IR and FA definitions – “in the context of aid schemes, final
                    beneficiaries are public or private firms carrying out an individual project and receiving
                    public aid” and given that it is responsible for implementation (secondary procurement and
                    payments) under its own project.
                    Please note, the PRAG uses a different definition of ‘final beneficiary’ (“those who will
                    benefit from the project in the long term at the level of the society or sector at large”), but
                    it is the IR and FA definitions that take precedent within this OP.
Financing           Agreement by which the beneficiary country accepts the assistance of the EU and agrees to
Agreement           the rules and procedures concerning disbursement related to such assistance. It sets the
                    terms on which the assistance is managed, including the relevant methods and
                    responsibilities for implementing the annual or multi-annual programme and/or
                    operations, as well as provisions relating to the establishment and regular updating, by the
                    beneficiary country, of a roadmap with indicative benchmarks and time limits to achieve
                    decentralisation without ex-ante controls by the Commission.
Framework           The general rules and conditions governing the cooperation of the EU with the beneficiary
Agreement           country concerned. It is the legal basis for the implementation of all EU assistance
                    operations in a country. A Framework Agreement is made specifically for the IPA
                    Programme in a country.
Grant               A direct financial contribution, by way of donation, from the EU budget, in order to finance
                    either an action intended to help achieve an objective forming part of a European Union
                    policy; or the functioning of a body which pursues an aim of general European interest or
                    has an objective forming part of a European Union policy. In other words, it is a payment of
                    a non-commercial nature by the Contracting Authority to a specific beneficiary to
                    implement an action intended to help achieve an objective forming part of a European
                    Union policy, and covered by a written agreement.
Implementing        Agreement signed between the National Authorising Officer (NAO) and the Head of
Agreement           Operating Structure (HOS),. setting out the obligations on the HOS for executing the
                    functions in Article 28 of the IPA Implementing Regulation, and in accordance with
                    decentralised management of IPA funds.




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                                OP for Economic Development (Annexes), 2012-2013                    2nd draft




Indicator          Variable used to measuref the inputs and outcomes from a programme, whether an
                   objective has been met, a resource mobilised, an effect obtained, a gauge of quality or a
                   context variable, and the basis for monitoring and evaluation of programme performance.
                   Each indicator should be specific, measurable, achievable, realistic and time-limited
                   (SMART) and should comprise a definition, a measurement unit, a source of verification,
                   and agreement on the frequency of monitoring. For the purposes of this OP, indicators can
                   be categorised as follows:
                    Input indicators refer to the budget allocated to each level of the assistance
                        (operation, measure, priority axis, OP) and are used to monitor progress in terms of
                        the (annual) commitment and payment of the funds..
                    Output indicators relate to activity. They are measured in physical units (e.g. numbers
                        of SMEs assisted, people trained, kilometres of track built, etc).
                    Result indicators relate to the direct and immediate effect on beneficiaries brought
                        about by changes to their behaviour, capacity or performance, as a consequence of
                        the activity. The result arises from the achievement of the output. Such indicators can
                        be of a physical (number of jobs created, qualifications gained, etc.) or financial (cost
                        reduced, time saved) nature.
                   For programmes financed by the Structural Funds and Cohesion Fund, there are also
                   impact indicators, which refer to the consequences of the OP beyond the immediate
                   effects. Two concepts of impact can be defined: specific impacts, which are those effects
                   occurring after a certain lapse of time but which can, nonetheless, be directly linked to the
                   action taken and the beneficiaries; and global impacts, which are longer-term effects
                   affecting a wider population.
                   While impact indicators are not appropriate for IPA programmes, as the level of resources
                   are relatively small and hence it is not feasible to correlate inputs at this scale of resources
                   with the outcomes at this level (two steps removed from the activity), such indicators can
                   often be used as context indicators, which can be tracked during the programme period to
                   assess and understand better the environment within which outputs and results are
                   occurring.
Internal audit     Audit carried out by an independent unit in the body responsible for the management of
                   EU funds, with the aim of ensuring that the internal management and control system
                   operates effectively.
IPA                The main financial tool of the Commission’s pre-accession assistance strategy. The purpose
                   of IPA is to support countries in their transition from potential candidates to candidate
                   countries and through to membership of the European Union. IPA will help these countries
                   meet the Accession Criteria (fulfil the political, economic and acquis-related criteria for
                   membership, building up their administrative and judicial capacity), preparing them for the
                   programming, management and implementation of EU Cohesion, Structural and Rural
                   development Funds after accession.
IPA component I    IPA component for ‘Transition Assistance and Institution Building’ (TAIB), which is designed
                   to support the administrative and judicial capacity building of the public institutions,
                   support economic development and social cohesion and ability to assume obligations of
                   accession process.
IPA component II   IPA component for ‘Cross-Border Co-operation’, which operates on the local level in the border
                   areas. CBC programmes support regions and populations on both sides of borders, promoting
                   sustainable economic and social development, working together to address common challenges
                   (e.g. environment, natural and cultural heritage, public health, prevention of and fight against
                   organised crime, etc.). CBC also supports efficient and secure borders and promots joint small
                   scale actions involving local participants from the border regions. Actions funded under this
                   component are generally implemented through grant schemes.




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                                   OP for Economic Development (Annexes), 2012-2013                  2nd draft




IPA component III     IPA component for ‘Regional Development’ which is based on 3 sub-components:
                       Environment - serves to support the transposition, implementation and enforcement
                           of the EU environmental legislation);
                       Transport - serves to support the provision of efficient, flexible and safe transport
                           infrastructure vital for economic development as good transport networks boost
                           opportunities for trade, while increasing efficiency, and more particularly transport
                           infrastructure;
                       Competitiveness - serves to support the internal development which provides for a
                           higher level of social and economic cohesion between regions, through high
                           employment and productivity growth.
                      IPA component III is available only to candidate countries which have achieved conferral
                      of decentralised management.
IPA component IV      IPA component for ‘Human Resources Development’, which is designed to contribute to
                      strengthening economic and social cohesion as well as to the priorities of the European
                      Employment Strategy in the field of employment, education and training and social
                      inclusion. IPA component IV is available only for candidate countries which have achieved
                      conferral of decentralised management.
IPA Component V       IPA Rural Development (IPARD) component, which serves as the framework for supporting
                      sustainable agricultural and rural development in EU applicant countries during the pre-
                      accession period. It aims to solve problems affecting the long-term adjustment of the
                      agricultural sector and rural areas, to help implement the EU acquis in matters of the
                      common agricultural policy (CAP) and related policies. IPA component V is available only
                      for candidate countries which have achieved conferral of decentralised management.
IPA Framework         Council Regulation (EC) No 1085/2006 of 17 July 2006 establishing an Instrument for Pre-
Regulation            Accession Assistance (IPA), referred to as the IPA Framework Regulation. The purpose of
                      this Regulation is to provide pre-accession assistance to beneficiary countries and support
                      them in their transition from status of potential candidate counties to candidate countries,
                      and through to membership of the European Union. The IPA Regulation applies from 1
                      January 2007.
IPA Implementing      Commission Regulation (EC) No 718/2007 of 12 June 2007 implementing Council
Regulation (IPA IR)   Regulation (EC) No 1085/2006 establishing an instrument for pre-accession assistance
                      (IPA). This Regulation lays down the general principles for the implementation of the EU of
                      pre-accession assistance established the IPA Framework Regulation. This Regulation clarifies
                      the rules on granting and evaluating pre-accession assistance. Furthermore, it establishes EU
                      rules for the five thematic IPA components. It also includes the potential for funding granted
                      under cross-border cooperation. It has been amended by Commission Regulation (EU) No
                      80/2010 of 28 January 2010.
Major project         See definition of ‘project’. A major project is a project whose total cost exceeds € 10
                      million. It must be submitted directly to the European Commission for approval, leading to
                      the signature of a bilateral project agreement with the beneficiary, which governs the
                      project’s implementation. The concept of major projects only applies to infrastructure
                      spending; in other words, works-based projects, not projects based on grant schemes,
                      services and/or supplies only.
Management and        The whole system of financial and other controls, including the organisational structure,
control system        methods, management of daily tasks and activities, procedures and internal audit. It is
                      established by management within its goals, to assist in conducting operations in a regular,
                      economic, efficient and effective manner.




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                                   OP for Economic Development (Annexes), 2012-2013                      2nd draft




Measure               The mechanism for implementation of a priority axis [under IPA components III and IV],
                      and identifying and selecting operations. Each measure is defined by: a specific objective
                      which is subordinate to the strategic objective at priority axis level; a clear rationale for the
                      intervention, based on analysis (including the SWOT); a general description of the
                      intervention itself; the specification of eligible actions which the measure can finance; the
                      selection criteria which the operating structure will employ for choosing operations; the
                      scope of the intended final beneficiaries and (optionally) the likely end recipients; and a
                      table of monitoring indicators, at outputs level, including targets to be achieved. Funding is
                      allocated at measure level on an indicative basis (it is only fixed at priority axis level), in the
                      financial table (OP chapter 4). The aggregate effect of all the measures together should
                      achieve the objective at priority axis level.
Monitoring            Ongoing analysis of project progress toward achieving planned results with the purpose of
                      improving management and decision making.
                      Systematic and continuous collection, analysis and utilisation of data for managing and
                      decision-making purposes.
Multi-annual          The strategic document for IPA developed by the Commission in consultation with the
Indicative Planning   beneficiary country and adopted by the Commission. It presents indicative allocations for
Document (MIPD)       the main priorities within each component. It is multi-annual by nature (3 years), but is
                      reviewed annually.
N+3                   The rule in the EU’s Financial Regulation which establishes spending deadlines. N+3
                      spending targets refer to Commission budget programme level commitments (one
                      commitment per year, per programme), not to projects. The Commission shall
                      automatically decommit any portion of a budget commitment for the programme by 31
                      December of the third year following year N being the one in which the budget
                      commitment was made in the case that: 1) it has not been used for the purpose of pre-
                      financing; 2) it has not been used for making intermediate (or interim) payments; 3) no
                      declaration of expenditure has been presented in relation to it.
Operating             An agreement between the bodies of the Operating Structure to enable and ensure that
Agreement             the commitments made by the Head of Operating Structure (HOS) in the Implementing
                      Agreement with the National Authorising Officer are fulfilled. Thea Head of the Operating
                      Structure (HOS) signs an Operating Agreement jointly with the responsible individuals in
                      each bodiy within the OS), clearly setting out their roles and responsibilities, and corrective
                      action which will be taken if designated tasks are not performed. The OA is subordinate to
                      the IA and its signature is an important element of the DIS accreditation process.
Operating             The body or collection of bodies within the administration of the beneficiary country
Structure (OS)        (Serbia) which is established to deal with the management and implementation of the
                      assistance under the IPA Regulation for each component or programme, in accordance
                      with the principle of sound financial management. The heads of the bodies constituting the
                      operating structure shall be clearly designated and shall be responsible for the tasks
                      assigned to their respective bodies. In the case of this OP, the operating structure
                      comprises a number of designated units within Government ministries, which are
                      accountable for performing tasks set out in the Operating Agreement with the Head of
                      Operating Structure (HOS), an Assistant Minister in the Ministry of Finance / Economy and
                      Regional Development. (Further details of the operating structure are set out in chapter 5)
Operation             An operation comprise a project or a group of projects implemented by the Commission, or
                      initiated or initiated and implemented by one or more final beneficiaries, whose
                      implementation leads to the achievement of goals set in a measure and/or priority axis to
                      which it relates. Each operation is aimed at bringing about a clearly specified objective and
                      achieving an agreed output, within a defined time-period and with a defined budget.




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                                  OP for Economic Development (Annexes), 2012-2013                   2nd draft




Programming          Programming of EU assistance is a process of identification and development of projects to
                     be funded through EU funds based on the relevant strategic and programming documents.
                     The programming process is a long-lasting process requiring a strategic approach, inter-
                     ministerial consultations, coordination between institutions and appropriate capacities of
                     the public administration to identify priorities for financing.
                     Under IPA III and IV the programming is done multi-annually in a wide consultation process.
                     The programming is based on analysis and strategy (priority axes and measures),
                     monitoring indicators, financial tables, implementation provisions and (IPA III only)
                     indicative list of major projects.
Practical Guide to   EC’s guide on procurement and contracting procedures and rules which apply to EC
EC External Aid      external aid contracts. It is applicable to projects financed from IPA, instead of the public
Contract             procurement rules of the beneficiary country.
Procedures
(PRAG)
Priority axis        The main sub-division of OPs, priority axes are major intervention areas or themes (e.g.
                     transport, environment, competitiveness), each of which shall be implemented through a
                     coherent group of measures, which are delivered in turn through operations. Each priority
                     axis is defined by: a global aim; a description of the relevant EU legislation which applies to
                     the priority axis, particularly where it supports transposition or implementation of the EU
                     acquis; the objective which the priority axis will serve; a clear rationale for intervention,
                     based on analysis (including the SWOT); a general description of the intervention itself; the
                     targeting of the intervention, in terms of sectors, geographical areas and/or groups, in
                     order to concentrate resources to greatest effect; the listing of measures which fall under
                     the priority axis; a description of envisaged delivery of the priority axis (including any
                     eligibility criteria which apply to all measures); and a table of monitoring indicators at
                     results level, including targets to be achieved. Funding is allocated at priority axis level in
                     the financial table (OP chapter 4).
Procurement          Contract in which the Contracting Authority draws up the Terms of
contract             Reference/Specifications for a project it wants to be carried for the Contracting Authority’s
                     benefit and which owns the results of the project and closely supervises its
                     implementation.
Project              A project is a series of activities, involving the performance of works, provision of supplies
                     and/or provision of services, which is intended to accomplish a definite and indivisible task
                     of a precise economic or technical nature, which has clearly identified goals. For the
                     purposes of IPA, an operation may comprise one or more projects.
Stabilisation and    SAAs are part of the EU Stabilisation and Association Process (SAP) and European
association          Neighbourhood Policy (ENP). At present, Serbia, Albania, Bosnia and Herzegovina, the
agreement (SAA)      Former Yugoslav Republic of Macedonia and Montenegro are the focus of the SAP.
                     Specific SAAs have been implemented with each country which explicitly include provisions
                     for future EU membership of the country involved. SAAs are based on the EU's acquis and
                     predicated on its promulgation in the cooperating state’s legislation. Association
                     agreements must be ratified by the associating state and all EU member states.
Stabilisation and    The European Union's policy towards the countries of the Western Balkans takes the form
Association          of the SAP launched at the Zagreb Summit in November 2000. The countries concerned
Process (SAP)        are: Serbia, Albania, Bosnia-Herzegovina, Croatia, the Former Yugoslav Republic of
                     Macedonia and Montenegro. The process is intended to ensure peace and stability in the
                     region by providing support for the strengthening of democracy and the rule of law and the
                     development of a market economy.




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                                 OP for Economic Development (Annexes), 2012-2013                    2nd draft




Strategic           SCO is an entity within the state administration of the beneficiary country, placed under
Coordinator (SCO)   the responsibility of the national IPA coordinator, and with no direct involvement in the
                    implementation of components concerned. The function of the SCO is to ensure the
                    coordination of programming IPA components III and IV, including the drafting of the
                    Strategic Coherence Framework. In Serbia, the Office of the Deputy Prime Minister for
                    European Integration was appointed Strategic Coordinator by the Conclusion of the
                                                                    th
                    Government 119-214/2009-5 of February 13 , 2009 and Mr Ognjen Miric as a responsible
                    person for the functions of the SCO.
Strategic           SCF is a reference document within which the funding and overall management of several
Coherence           Operational Programmes takes place - including IPA III & IV. It is based on the Multi-Annual
Framework (SCF)     Planning Document (MIPD) and drafted by the Strategic Coordinator, under the overall
                    responsibility of the NIPAC. SCF is a “prerequisite” for the approval of the Operational
                    Programmes. It is submitted to the EC before - or (at the latest) with - first draft OPs.
Structural Funds    Funds allocated by the EU as part of its cohesion policy. They aim to reduce regional
                    disparities in terms of income, wealth and opportunities. Europe’s poorer regions receive
                    most of the support, but all European regions are eligible for funding under the policy’s
                    various funds and programmes.
                    The Structural Funds are made up of the European Regional Development Fund (ERDF) and
                    the European Social Fund (ESF). Together with the Common Agricultural Policy, the
                    Structural Funds and the Cohesion Fund make up the great bulk of EU funding, and the
                    majority of total EU spending.
SWOT analysis       A strategic planning tool which is used to analyse the Strengths, Weaknesses,
                    Opportunities, and Threats affecting a programme or project. Strengths and weaknesses
                    are assessed on the basis of factors which are internal to the programme or project
                    (endogenous) and are evident already; opportunities and threats are factors which are
                    external to the programme or project (exogenous) and may occur in the future.
Targets             These are indicators with a specific value which should be achieved at a specific time
                    during or after the programme’s implementation. In order to become a target, for the
                    purposes of monitoring and evaluation, the indicator (see definition) must also include a
                    baseline value (and point in time in which the measurement has occurred or will occur) and
                    a target value (and point in time in which the final measurement will occur).
Target group        In accordance with the definition in the PRAG, these are groups (of individuals) or entities
                    (institutions) that will be directly and positively affected by a project. In the context of the
                    OP, the term takes a broader meaning (within each measure) to describe the wider set of
                    people and bodies which will enjoy an indirect benefit from the measures than the ‘end
                    recipient’ who will be the immediate and direct beneficiary, once the operation is
                    completed.
Technical           This has two meanings in the context of IPA components III and IV:
assistance           The most common use of the term technical assistance is at the level of the operation
                         and refers to a specific type of service contract, whereby a service provider is called on
                         to play an advisory role, to manage or supervise a project, or to provide the experts
                         specified in the contract, in return for a fee calculated on the basis of the number of
                         days (according to the PRAG).
                     Technical assistance is also the name of the priority axis within the OP, which enables
                         the Operating Structure to finance preparatory, management, monitoring, evaluation,
                         information and control activities and activities to reinforce the administrative capacity
                         for implementing the assistance (according to IPA implementing regulation, relating to
                         IPA components III and IV), and in the case of IPA component III, to finance
                         preliminary studies and technical support related to eligible activities, including those
                         necessary for their implementation IPA, and in the case of component IV, preparatory
                         activities with a view to the future management of European Structural Funds. Under
                         IPA components III and IV, this priority axis may reach a maximum allocation of 6% of
                         the total value of the OP, or 10% in exceptional circumstances.



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                              OP for Economic Development (Annexes), 2012-2013   2nd draft


    ANNEX B: Pan-European Transport Corridors in the Balkans




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                                                   OP for Economic Development (Annexes), 2012-2013   2nd draft


ANNEX C: Road transport infrastructure of the Republic of Serbia within the South East Europe core regional
                                         transport network links




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                                                   OP for Economic Development (Annexes), 2012-2013   2nd draft


ANNEX D: Rail transport infrastructure of the Republic of Serbia within the South East Europe core regional
                                          transport network links




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                                                 OP for Economic Development (Annexes), 2012-2013   2nd draft


ANNEX E : Transport infrastructure of the Republic of Serbia within the South East Europe core regional
                            transport network links - nodes and waterways




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                                              OP for Economic Development (Annexes), 2012-2013                         2nd draft


         ANNEX F: Institutional and legal framework for transport policy in Serbia
Institutional framework

National Council for Infrastructure

The National Council for Infrastructure of the Republic of Serbia was established by the Government1 to
coordinate and supervise specific activities related to infrastructure development. The Council is headed
by the President of the Republic of Serbia and includes several ministers. Transport infrastructure
strategic planning and implementation is also included in the Council’s agenda.

In general, the competency for transport sector development is given by different laws to the Ministry
of Infrastructure and Energy, together with special organisations(1) established by the Law on the
Ministries, the regulatory bodies(2) , public enterprises(3) and a Limited Liability Company(4).

                                        Table 1: Summary of institutional competencies
                                                   Type of                           Transport mode
                                                 institution                                    Inland water
                                                                 Road         Rail        Air                Intermodal
                                                                                                     way
Ministry of Infrastructure and Energy                              X           X           X          X           X
                                                     (1)
Road Safety Agency                                                 X
                                                     (2)
Directorate for Railways                                                       X                                   X
                                                     (1)
Directorate for Inland Waterways “Plovput”                                                              X
                                                     (2)
Civil Aviation Directorate                                                                 X
                                                     (3)
PE “Roads of Serbia”                                               X
                                                     (4)
LLC “Corridor X”                                                   X
                                                     (3)
PE “Serbian Railways”                                                          X                                   X
                                                     (3)
“Railway Integral Transport (ZIT)”                                                                                 X

Ministry of Infrastructure and Energy

The Ministry of Infrastructure and Energy performs the tasks2 of public administration in the area of
railway, road, water and air traffic, pertaining to: the organisation and establishment of the traffic
system; realisation of the infrastructure investment projects; inner and international transport and
intermodal transport; organisation and safety of the technical and technological traffic system;
obligations and proprietary legal relations; inspection control; strategy for traffic development,
development plans and plans related to the organisation of the traffic system and organisation of
transport; issuance of the certificate to use traffic facility or infrastructure; certification of approval to
use vehicles, equipment and vehicle parts; organisation of financial and technical control; international
affairs in the area of traffic; incentive measures for research and development in the area of traffic, as
well as other affairs specified by the law.

The structure of the Ministry includes six departments, and the Secretariat.




1
    Official Journal of the Republic of Serbia, No.68/2008 and 73/2008
2
    Article 11 of the Law on Ministries (Official Journal of the Republic of Serbia, No. 65/2008 of 5 July 2008)

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Road Traffic Safety Agency

The Road Traffic safety Agency was founded in 2010, in accordance with the Law on the Road Traffic
safety. The internal structure of the Agency and job description of individual units is currently under
development and before approval by the Minister.

Directorate for Railways

The Directorate for Railways is a special organisation of the Republic of Serbia established in 2005. In
accordance with the Law on Railway of the Republic of Serbia3, the Directorate has the qualification of a
legal entity and is responsible for performing professional and regulatory tasks in the area of railway
transport.

Directorate for Inland Waterways “Plovput”

Plovput is a potential End Recipient of IPA support. It was established by the Law on the Ministries, as a
special organisation of the Government of the Republic of Serbia. Its competency includes: execution of
hydro-engineering activates of trimming the river bed; establishment of a marking system on IWWs and
maintenance of structures for safe navigation on them; performance of hydro graphic surveying of
water surfaces; development of project documentation in the branch of navigation safety; and
regulation of river flows and other specific activities relevant to introduction of new technologies and
merging them with traditional navigation, with an aim to better support and increase the safety of
transport.

Plovput has a separate account in the national budget; the annual allocation of about €2 million remains
inadequate to finance required rehabilitation works. Within its structure (101 budgeted positions),
Plovput includes various high qualified professionals with good skills and expertise in project
programming, supervision and monitoring of implementation.

The Civil Aviation Directorate

It was established by the Government of the Republic of Serbia as a regulatory and supervisory authority
over the civil aviation industry. Its priority is to provide the conditions for safe and secure air transport
operations, in accordance with international standards. Activities within that field are based on
regulations, ratified international agreements and international standards.

Public Enterprise “Roads of Serbia”

PE "Roads of Serbia" was established4 for the management of state roads and is in charge of planning
and execution of the development, maintenance, protection, and exploitation of roads of I and II
category, including the technical, traffic and other data keeping. The enterprise is also competent to
honour public authorisations vested within its regulatory function granted by the Law on Public Roads.




3
 Official Gazette of the Republic of Serbia, No 18/2005
4
 Decision of the Government of the Republic of Serbia Establishing Public Enterprise for State Roads Management of 22
December 2005

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Financing of PE Roads of Serbia is provided from the road toll, excise on oil derivates, credits and the
budget of the Republic of Serbia. Credits for current development are provided to PE Roads of Serbia by
the WB, EBRD and EIB.

Limited Liability Company “Corridor X”

LLC Corridor X was founded in accordance with the Decision of the National Infrastructure Council of the
Republic of Serbia, and the Decision5 of the Management Board of PE Roads of Serbia and has become
the main entity for managing the construction works on the road Corridor X in Serbia

Public Enterprise “Serbian Railways”

PE Serbian Railways is a potential End Recipient of IPA contribution. It was founded6 to carriage
passengers and goods, to haul trains, to maintain traction units, trains and rolling stock, and to maintain
and inspect the track, the stations and other structures and installations, including maintenance and
assembling of devices, plants and installations. The enterprise employs more than 20,000 persons.

The financing of PE Serbian Railways is provided from own revenues, the national budget and loans. The
state subsidy7 of €145.7 million is about 55% of total operating costs; even this level is insufficient to
cover the operating losses - the annual debt in 2007 reached €94.5 million.

The specification of total investment and resources of PE Railways of Serbia in 2003-2009 is the
following:

                         Table 2: PE Serbian Railways, resources allocation 2003-2009 (€ ‘000s)
    Description              2003        2004        2005         2006        2007      2008       2009          TOTAL
    1. Infrastructure      224,139    275,219    228,7774      172,382      116,070     6,700     26,987      1,050,271
    2. Rolling stock*)      50,346     89,671     152,640      100,065       42,474    37,776     26,754        499,726
    3. Intermodal                                                                                                 2,210
                               810        500         500          300          100         0          0
         equipment
    4. Information                                                                                               16,613
                             2,440       3,740       4,610       2,920        1,130     1,771          2
    system
        Investment in                                                                                         1,568,820
                           277,735    369,130     386,524      275,667      159,774    46,247     53,743
         basic assets
    5. Studies and                                                                                                3,212
                               450        300            -            -            -    1,353      1,109
    projects
    6. Environment           2,500      2,000        2,000        1,500            0        --         --         8,000
    7. Human resources       4,604      2,496        2,000             0           0        --         --         9,100
       TOTAL               285,289    373,926      390,524      277,167      159,774   47,600     54,852      1,589,132
                                          Source: Website of PE Serbian Railways

PE Serbian Railways is undergoing a restructuring at present. The enterprise cooperates with railway
operators from Slovenia and Croatia on the establishment of an efficient and fast traffic within Corridor
X; for this reason, a joint venture company “Cargo 10“ registered in Slovenia was established in
September 2010.


5
  No.953-67/08-48 (dated 22nd January 2009)
6
   Decision of the Government of the Republic of Serbia on the establishment of the public enterprise for public rail
infrastructure management and public rail transport(Official Herald of Republic of Serbia, No. 78/2004, 19/2005)
7
  0.45% of GDP (2007), WB estimate

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ZIT Railway Integral Transport

ZIT was established by the PE Serbian Railways as a “social” organisation dealing with intermodal
transport. ZIT is currently under transformation to a state-owned public company.

Legal framework

The Republic of Serbia is a signatory of the majority of international transport agreements of European
importance, resulting from its membership in the UN, the Danube Commission, and other international
organisations, as well as of agreements on regional cooperation in transport, specifically the
Memorandum of Understanding on the development of the South East Europe Core Regional Transport
Network, including its addendum for a South East European Railway Transport Area, the Multilateral
Agreement on the European Common Aviation Area and the Treaty Establishing the Transport
Community that have been recently concluded with EU support.

At present, the Republic of Serbia is commencing the process of harmonisation of its transport
legislation with the EU. The approximation is considered the most important step towards achieving EU
requirements in the field of transport.

Specific activities relevant to Serbian legislation updating and harmonisation with EU acquis are subjects
of EU assistance within IPA Component I support. This will be implemented within the second twinning
contract awarded in 2010 to support the Ministry and transport regulatory bodies in their legislation
activities.

The current status of legislation of different modes of transport is the following:

Road transport:
    The Law on Public Roads - in effect since January 2006;
    The Law on Traffic Safety on Roads – in effect since December 2009;
    The Law on Road Transport of Goods – under preparation
    The Law on Road Transport of Passengers – under preparation
    The Law on Road Transport; in effect since 1995;
    the Law on International Road Transport - in effect since 1998;

Railways transport:
     The Law on Railways – in effect since 2005, amendment is being drafted;
     The Law on Safety in Railway Transport – in effect since 2005, amendment is being drafted;
     The Law on the Transport of Dangerous Goods – under consideration;

Inland waterways transport:
     The Maritime and Inland Navigation Law – in effect since January 1978; last amended in 1998;
     The draft Law on Safety of Navigation and Ports on Inland Waterways – under preparation;
     The draft Law on Maritime Navigation – under consideration;
     The draft Law on Ships Nationality and Registration – under consideration;
     The draft Law on Waterborne Transport – under consideration;
     The draft Law on Inland Navigation Fund – under consideration;




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Air transport:
      The Law on Air Transport - in effect since 1998, updated in 2001;
      The Law on Civil Aviation - under preparation, before finalisation, for adoption in 2010.




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                  ANNEX G: Forestry coverage in Serbia




     Source: Statistical Office of the Republic Of Serbia, Statistical Yearbook of Serbia, 2008




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     Map of forests and forested land




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              ANNEX H: Map of Serbia’s Protected Areas




     Source: Institute for Nature Protection of Serbia (http://www.natureprotection.org.rs/)




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ANNEX J: Map of industrial plants causing the most significant air pollution in
                                   Serbia




                   Chemical industry and metallurgy
                   Refineries
                   Cement factories
                   Paper factories
                   Construction materials and elements industry
                        Source: SEPA Annual Environmental Report 2007




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  ANNEX K: Institutional and legal framework for environment policy in Serbia

Institutional framework

The following section describes the legal obligation, administrative structure, human resource capacity
of each of the four Ministries involved in the creation and implementation of the Environment priority
axis.
                    Environmental responsibilities of the line ministries in the Republic of Serbia
                   Ministry                                            Responsibilities
Ministry of Environment, Mining and Spatial          Waste (municipal, hazardous - general, mining,)
Planning (MEMSP)                                     Water (water quality, water pollution control)
                                                     Air quality (legislation, air protection)
                                                     Protection of natural goods and resources (soil,
                                                         air, water, forestry etc)
Ministry of Agriculture, Trade, Forestry and         Water (water supply, wastewater treatment)
Water Management (MATFWM)                            Waste (animal waste)
Ministry of Infrastructure and Energy (MIE)          Air quality (power plants and district heating)
Ministry of Health (MoH)                             Waste (hazardous - medical / infectious)

Ministries

The Ministry of Environment, Mining and Spatial Planning (MEMSP) is competent for waste
management, except for: radioactive waste (which belongs under the jurisdiction of the Ministry of
Education and Science), and animal waste (Ministry of Agriculture, Trade, Forestry and Water
Management - MATFWM).

Water management is the responsibility of the MATFWM, although the MEMSP is responsible for
groundwater protection and shares responsibility for water policy, water quality and water pollution
control.

Air quality is primarily regulated by the Law on Air Protection, for which MEMSP has primary
competency. The Ministry for Infrastructure and Energy is responsible for power plants and district
heating.

The Autonomous Province of Vojvodina is competent for environmental monitoring within its territory,
water management within its territory, where it is carried out by the Provincial Secretariat for
Agriculture, Forestry and Water Management.

Water Directorate

MATFWM includes the Water Directorate, which is generally responsible for water management, and
the Water Inspectors, which are part of the General Inspection under the Minister of Agriculture. The
Directorate prepares major strategic documents relating to water, sets standards and norms for the use
and protection of water, issues by-laws, and supervises implementation. The Directorate plays a special
role in the preparation of annual programmes at the national level, which identify priority construction
and reconstruction projects, priority infrastructure maintenance activities, and respective sources of
funding. For its tasks it remains understaffed and its institutional capacity is inadequate. The division of
responsibilities for water management is fragmented and the capacity for water management is weak.

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Environmental Protection Agency

The Serbian Environmental Protection Agency (SEPA) was established in November 2004 as an institution
that should focus on:

  •       Development, regulation and maintenance of the National information system for environmental
          protection (monitoring the parameters of the state of the environment, pollutants cadastre, etc.);
  •       Environmental data acquisition, centralisation and processing, reporting about the state of the
          environment and policy implementation in the field of environmental protection;
  •       Development of the procedures for environmental data processing and evaluation;
  •       Management of information about best available techniques and practices and their
          implementation in the field of environmental protection;
  •       Cooperation with the European Environmental Agency (EEA) and European Environment
          Information and Observation Network (EIONET), as well as other objectives defined by law.

Environmental monitoring is performed by many institutions: the Hydro-meteorological Institute, the
Regional and National Health Protection Institutes, the Secretariat for Environmental Protection of the
Province of Vojvodina, and the Statistical Office, which is in charge of ambient air monitoring:

          Air and water emissions are monitored by industry, pollution production facilities, and self-
           monitoring;
          Water quality is monitored by the Hydrometeorological Institute, the Regional and National
           Health Protection Institutes, the Secretariat for Environmental Protection of the Province of
           Vojvodina, Water Directorate (Ministry of Agriculture, Trade, Forestry and Water Management),
           and the Statistical Office;
          Soil is monitored by the Soil Institute, the Institute of Field and Vegetable Crops, the Ministry of
           Agriculture, Trade , Forestry and Water Management, the Statistical Office, and the Secretariat
           for Environmental Protection of the Province of Vojvodina;
          Biodiversity is monitored by the Institute for Natural Protection, Institute for Biological
           Research, Institute for Forestry, and the Statistical Office;
          Waste is monitored by the Statistical Office and local municipalities.

Municipalities

Formally, Serbia has three levels of government, consisting of the Republic level and the 168 cities and
municipalities at the local self-government level, plus the Autonomous Province of Vojvodina.
Municipalities are responsible for a wide range of infrastructure services, including water, wastewater,
district heating, and public transport among others.

In the field of waste management municipalities are responsible for following: adoption of the local
waste management plan and providing conditions and ensure its implementation; ensure, organise and
perform the management of municipal, that is, inert and non-hazardous waste on its territory, in
accordance with the Law on Waste Management; prescribe the procedure of service charging in the
area of municipal, that is, inert and non-hazardous waste management; issue permits, approvals and
other acts in accordance with Law on Waste Management; supervise and control waste handling
measures in accordance with this law. Funds for these tasks are derived from local revenues and


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transfers from central government. The Law provides for cooperation with other local government units
in fields of mutual interest.

According to the Environmental Laws and Law on Planning and Construction, the Republic of Serbia
delegates to local self government some activities from the fields of EIA, SEA, IPPC permits, waste
management (inert and non-hazardous), air protection, protection of noise as well as inspection and
permitting process relating to planning and technical documentation, etc.

Public Utility Companies

Water and wastewater utilities provide drinking water and wastewater collection, treatment (minimal)
and discharge. Three Public Water Management Enterprises - Srbijavode; Vode Vojvodine; and Beograd
Voda (established in 2008) - have been formed, not following the River Basin Management principle, but
they manage water within the certain administrative regions. This includes water consumption,
management, protection against the adverse effects of water, implementation of measures aimed at
protecting water resources and infrastructures, and implementation of measures to ensure efficient use
of water. The public water companies prepare plans and programmes, organise maintenance of state-
owned water infrastructures, implement flood/erosion/flood defence, and issue water criteria and
approvals for water infrastructure projects. These companies also act as contracting authorities for
water infrastructure construction and reconstruction projects, manage information systems for their
areas and may carry out other duties if mandated by legislation. These companies conduct water-
related operations, including the operation and use of water infrastructure and participation in flood
and erosion defence, water management, maintenance and rehabilitation of infrastructures. Water
management in Vojvodina falls within the competence of the Provincial Agriculture, Forestry and Water
Management Secretariat.

Among other tasks, communal activities mean maintenance of cleanliness in the municipalities (waste
collection and other natural and man-made waste from residential, commercial and other buildings,
except industrial wastes and hazardous substances, and disposal of their driving, removing waste from
the trash container in public places, as well as garbage and other waste from streets and public areas,
cleaning and washing of streets, squares, car parks and other public areas) and the maintenance of
landfills (equipment for safe waste disposal, treatment, neutralisation of municipal solid waste and
hazardous waste materials in the towns and cities, as well as the selection and processing of secondary
raw materials from waste in landfills), water treatment and distribution of water. This activities in Serbia
are mainly the responsibility of public utility companies that are established by local self-government
units.In the case of regional sanitary landfills, two or more units of local self-government can jointly
manage the waste, if it is a common interest, under conditions prescribed by Law on waste management
and under inter-municipality agreement between the Assembly of Local Governments. This agreement
also defines the rights and obligations of the public utility company or other legal or natural person in
carrying out the above activities.

The public utility company, Electric Power Industry of Serbia (EPS), is running the major power plants in
Serbia and will be in charge for the implementation of the measures concerning the improvement of the
outdoor air quality.




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National Hydrometeorological Institute

Air quality monitoring is within the competence of the Hydrometeorological Service and the
Environmental Protection Agency (SEPA). A systematic air quality testing programme is implemented at
24 stations within the national meteorology network of the Hydrometeorological Service. International
GWA (Global Atmosphere Watch) and EMEP (Monitoring and Evaluation of the Long Range Transmission
of Air Pollutants in Europe) programmes are conducted at one of the stations and air pollutant
distribution and transportation is modelled. The Republic Hydrometeorological Institute is responsible
for monitoring and quality control of water.

The Environmental Protection Fund (SEPF)

SEPF was founded through Law on Environmental Protection (2004) as an independent body (status of
legal entity) within the Government of the Republic of Serbia, in order to provide financial means to
enhance and advance environment protection in the Republic of Serbia. SEPF is a place where is
collected revenues through the current economic instruments (particularly charges based on “polluter
pay” and “user pays” principle).

On the basis of the amended Law on Environment Protection and the Ordinance on Types of Pollution
and Criteria for Calculating the Fees for Environment Pollution, the Fund retains 60% of the fees
collected, while 40% is returned to the municipality in which the fee had been collected. Also, the
financial means of SEPF could be a source of co-financing for major projects.

The Environmental Protection Fund is active, especially in the fields of waste and hazardous waste
management, sanitation, soil remediation, the creation of conditions for the emissions reduction into
the air and the monitoring of air quality projects in the field of biodiversity-protection and preservation
of biodiversity and geodiversity.

Legal framework

Progress with acquis harmonisation

Serbia has adopted a large number of environmental laws and ratified several environmental
international conventions recently. The Law on Air Protection has been adopted, as well the Law on
Waste Management and the Law on Packaging and Packaging Waste. Implementing legislation has been
also adopted, transposing the relevant acquis. However, there has been little progress on water quality
improvement. The new Law on Water introduces new instruments for financing the water sector,
including appropriate tariffs, but the system to monitor nitrates concentrations and contamination in
groundwater is not in place, vulnerable areas have not been determined and River Basin Management
principles have not yet been introduced.

Serbia adopted four key environmental laws already in 2004. These are all horizontal laws, which closely
modelled on EU directives and were intended to provide a strong regulatory framework establishing a
basis for environmental protection which provides a framework for ensuring that public policy, land
development and industry are sustainable. The laws were: Law on Environmental Protection; Law on
Strategic Environmental Assessment; Law on Environmental Impact Assessment and Law on Integrated
Pollution Prevention and Control (Law on IPPC). All these laws were amended in 2009, except the Law
on IPPC.

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1998 Law on Communal Activities

This Law (Official Gazette RS", br. 16/97, 42/98) shall determine the public utility services and general
conditions governing the manner of their performance (among other things, maintenance of cleanliness
in the municipalities (towns and cities) and the maintenance of landfills, water treatment and
distribution.

2004-2009 Law on Strategic Environmental Impact Assessment (SEA) and Law on Environment Impact
Assessment (EIA)

These two laws, adopted in 2004, and amended later in 2009, introduced EC EIA and SEA Directives into
the Serbian national legislation. According to the 2009 Progress Report SEA Directive has been
transposed 97% into the national legislation, mainly through the Law on Strategic Environmental Impact
Assessment (''Official Journal of the Republic of Serbia'', No. 135/2004) and Law on EIA with appropriate
bylaws has transposed EIA Directive in 99%.

The only provision of the Directive that has not been transposed so far is Art. 11.1 related to the carrying
out of environmental assessment “without prejudice to any of Directive 85/337/EEC requirements & to
any other EU law requirements.” The deadline for transposition of this provision has not been
determined yet.

The Law on EIA regulates the impact assessment procedure for projects that may have significant effects
on the environment, the contents of the Environmental Impact Assessment (EIA) Study, the
participation of authorities and organisations concerned, the public participation, transboundary
exchange of information for projects that may have significant impact on the environment of another
state, supervision and other issues of relevance to impact assessment. The provisions of this Law do not
apply to projects designated for national defence purposes.

The Law on SEA regulates the conditions, methods and procedure according to which the assessment of
impact of certain plans and programmes on the environment (hereinafter referred to as: strategic
assessment) shall be carried out, in order to provide for the environmental protection and improvement
of sustainable development through integration of basic principles of environmental protection into the
procedure of preparation and adoption of plans and programmes.

2007 Law on Privatisation

The Law on Privatisation (“Official Gazette of RS”, No. 38/01, 18/03, 45/05 and 123/07) stipulates that
the funds for repairing the damage to the environment, which the subject of privatisation has done
before the contract of sale of capital or property, have to be provided in the budget of the Republic of
Serbia.

2009 Law on Environmental Protection

This is a fundamental horizontal law, which provides juridical ground for management of resources and
goods with strategies, conditions and legal measures; setting environmental standards and
requirements; establishing permit conditions also norms and technical standards of technologies and


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processes; production and trade prohibitions; ecological labelling, environmental monitoring etc. it also
sets legal ground for environmental fines and establishes powers for environmental authorities.

2009 Law on Integrated Prevention Pollution and Control (IPPC)

This Law introduces principles of the IPPC Directive into the national legislation. Later on IPPC issues a
number of by-laws have been adopted, notably on submission of integrated permit applications. Besides
the Law on Integrated Prevention Pollution and Control also Law on Environmental Protection, Law on
Waste Management, Law on Ratification of the Basel Convention, Law on IPPC and some other relevant
bylaws transpose IPPC Directive. Full transposition, in line with EU legislation, has been achieved
through adopting Law on Waste Management in 2009.

The Law on IPPC regulates the conditions and procedure of granting of integrated permits for
installations and activities that may have adverse effects on human health, environment or material
resources, types of activities and installations, supervision and other issues which are of relevance for
environmental pollution prevention and control.

2009 Law on Waste Management

The Law on Waste Management was adopted on May 15th 2009. This law has pivotal role for the whole
waste management sector since it transposes bulk or part of the following EC Directives: Directive on
waste (2006/12/EC); Hazardous Waste Directive (91/689/EEC); The Directive on the Disposal of waste
oils (75/439/EEC); Sewage Sludge Directive (86/278/EEC); Batteries Directive (2006/66/EC); End-of Life
Vehicles Directive (2000/53/EC); Directive 2002/96/EC on waste electrical and electronic equipment
(WEEE), Landfill Directive (99/31/EC) and Waste Incineration Directive (2000/76/EC).

The Law regulates: types and classification of waste; waste management planning; waste management
entities; responsibilities and obligations in the management of waste; organisation of waste
management; specific waste stream management; permit conditions and procedure; licensing terms and
procedure; cross-border movement of waste, waste reporting and database; the financing of waste
management, supervision, as well as other matters relevant to waste management.

2009 Law on Air Protection

Likewise, the Law on Air Protection, which was adopted on May 12th 2009, has key role in the
atmosphere-related EC environmental directive. This law transposes partly following EC Directives:
Solvents Directive (1999/13/EC); Large Combustion Plants Directive (2001/80/EC); The Benzene and
Carbon Monoxide Directive (2000/69/EC); The National Emission Ceilings Directive (2001/81/EC); The
Directive on Limitation of VOC emissions due to the use of organic solvents in certain activities and
installations (1999/13/EC); Ambient Air Quality and Cleaner Air for Europe Directive (2008/50 EC);
Ambient Air Quality Framework Directive (96/62/EC); Limit Values for SO2, NOx, NO2, Particulate Matter
and Lead Directive (99/30/EC) and Ozone in Ambient Air Directive (2002/3/EC).

The Law regulates the air quality management and defines the measures, methods of organisation and
control of the protection and improvement of the air quality as a natural resource of general interest
which is particularly protected. The provisions of this Law shall not apply to the pollution caused by
radioactive substances, industrial accidents and natural disasters.


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2009 Law on Environmental Protection Fund

This Law regulates the status, activities, organisation, revenues of the SEPF, purpose and usage of SEPF
finances. This law regulates the establishment and operation of the SEPF, defines incomes of the SEPF,
sets framework i.e. priorities for financing the projects (solid waste management, cleaning development
mechanism, protection and improving of quality of air, water, soil and forests and amortising climate
changes and ozone layer, protection and sustainable use of nature goods and geodiversity, use of
renewable energy sources, geological exploration etc.).

2009 Law on Planning and Construction

This law establishes a general framework and requirements for planning and construction of objects in
Serbia, and was last amended in 2009. The Law shall regulate: the conditions and terms of space
planning, planning and usage of construction land and construction of facilities, supervision of the
provisions of this Legislation and the inspection, other issues of importance for the regulation of space,
editing and use of construction land and building facilities. The provisions of this Law shall not apply to
the construction of facilities that are considered as the military facilities under the legislation that is
regulating the affairs of Defense.

2010 Water Law

The new Water Law was adopted on May 7th 2010. This is a key piece of legislation for the water sector
and created necessary basis for transposition of the EC acquis in water sector.




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                  ANNEX L: Index of Revealed Comparative Advantage

The Index of Revealed Competitive Advantage (RCA) represents a ratio between the foreign trade
balance and overall foreign trade, expressed in percentage terms. A positive value of RCA is indicative of
the comparative advantage (trade surplus) of a given sector.

                     Index of revealed comparative advantage (RCA) of SMEs (%)




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                                                            ANNEX M: Details of registered clusters in Serbia
No            Name                   Sector          Workforce         Members8              Location        Established                  Scope of activities                         Cluster’s objective
1          Automotive           Production of         12,650                41               National           2005               Organising trainings of cluster        “To support its members in the process
         cluster of Serbia    parts, components                      (36 companies                                              members in relevant fields; Cluster          of strengthening competitiveness,
                              and services in the                      +5 support                                                promotion at international fairs;       reaching profitable position in the chain
                                 automotive                           institutions)                                              Establishing regional platform of             of suppliers of international car
                               supplier industry                                                                                    the Automotive SEE Cluster;                manufacturers, and to indirectly
                                                                                                                                  cooperation with international         influence the improvement of economic
                                                                                                                                         clusters in the field.             situation of the industry as a whole”
2             Serbian              Software             3,000                16              National            2006           Identifying innovative customised              “To offer support to the Serbian
             Software                                                (12companies +                                               products and services; Finding        software sector to achieve success in the
              Cluster                                                    4 support                                              experienced and reliable partners;      international market by means of market
                                                                       institutions)                                                   Establishing strong and             monitoring, identifying new business
                                                                                                                                confidential business relationships        opportunities and defining strategies
                                                                                                                                 between SSC members and their             and activities of the cluster members.
                                                                                                                                  clients; Negotiating on partner           Thus, it serves as market catalyst for
                                                                                                                                    agreements with prominent             selection and choice of the main areas
                                                                                                                                   companies; Providing market           where innovative solutions and business
                                                                                                                                     analysis and expanding the                  expertise could be applied”
                                                                                                                                 network of business contacts in
                                                                                                                                                Serbia.
    3    BIPOM - Balkan          Agricultural            809                 22              National            2005           Organisation of joint distribution of    “To create a network of manufacturers
          and Black Sea           machines                           (15 companies +                                               products, market research on           of selected assortment of agricultural
           Industry of                                                   7 support                                                   behalf of cluster members,           machinery, primarily based on Italian
           Agricultural                                                institutions)                                                  organisation of fairs and         technology and competitive in providing
           Machinery                                                                                                                         exhibitions.                 services for local buyers in the Balkan
                                                                                                                                                                                  and Black Sea region”
4        Sumadijski cvet            Flower               544                109            Sumadija and          2005               Joint distribution of products      “To support flower industry in Šumadija
                              production, some                       (25 companies +        Pomoravlje                             produced by cluster members;                  and Pomoravlje regions”
                                companies are                         74 agricultural         region                             Improving professional capacities
                                  engaged in                        farmlands and 10                                                  through educating cluster
                               complementary                             support                                                    members on the new flower
                                 horticultural                         institutions)                                              growing technologies and flower
                                 endeavours,                                                                                          species; Cluster territorial
                              including medical                                                                                    expanding; Internationalisation
                               plants and herbs                                                                                    and establishing contacts with
                                                                                                                                        international partners.




8
    Companies and support institutions (support institutions are: R&D centres, educational institutions, public institutions)

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                                                                              OP for Economic Development (Annexes), 2012-2013                          2nd draft




5   The Agency for    Wood processing       5,500          127        National      2005       Production of furniture; Cluster      “To increase the competitiveness and
    Wood – Serbian                                  (116 companies                           promotion by participating at the      export potential of wood processing and
        Wood                                          + 11 support                            international fairs, conferences,       furniture industry in the Republic of
      Processing                                      institutions)                               domestic and international                         Serbia”
        Cluster                                                                                  professional congresses and
                                                                                             workshops; creation of „Cluster –
                                                                                                    DP” information system;
                                                                                                 organisation of conferences.
6    Galenit - the    Batteries recycling   1.200           17        National      2007          Establishment of model for        “To provide support in the development
    Cluster for the                                 (14 companies +                             organised collection of waste         and promotion of organised collection
      Organised                                        3 support                            accumulators; preparation of study        and environmentally safe recycling of
    Collection and                                    institutions)                             on possibilities for increasing        used batteries and accumulators. By
       Recycling                                                                            employment in the sector, creating      doing so, it aims to increase the number
                                                                                            PR strategy for clusters, and cluster   of jobs and productiv-ity in this branch. A
                                                                                                   expanding; general public             side aim is to provide additional
                                                                                               awareness through educational          education to professionals working in
                                                                                             campaigning, organising seminars        this field, as well as the general public.”
                                                                                            for environmental activists and the
                                                                                             staff working on waste collection;
                                                                                              creating an integrated data base
                                                                                                for cluster members – Cluster
                                                                                                       Knowledge Base
7   DUNDJER - Civil     Construction        1.226           59          Niš         2007           Creating a data base of all          “To advance the civil engineering
     Engineering                                    (53 companies +                             graduated civil engineers and           activities in the Nis region and to
       Cluster                                         6 support                                architects; managing cluster’s         introduce quality standards in the
                                                      institutions)                              Education Development and          construction field in accordance with the
                                                                                                   Computer Science Centre                best tradition of Serbian civil
                                                                                            providing training and education in     engineering, through developing human
                                                                                                the field of computer science           resources, unifying informational
                                                                                                  engineering; Unification of         technologies, providing professional
                                                                                               computer system of the entire         education and fostering technological
                                                                                              cluster through a Virtual Private                    development”
                                                                                                 Network (VPN) that provides
                                                                                             online consultations and access to
                                                                                            data bases on real estate, available
                                                                                                  labor force and engineers;
                                                                                              organising trainings for the labor
                                                                                              force on in-demand occupations




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                                                                                  OP for Economic Development (Annexes), 2012-2013                           2nd draft




8     Knjazevac–          Shoes            190               20        Municipality of   2007    Participating in fairs, promotion of     “To increase production, employment
     cluster shoes                                   (16 companies +    Knjaževac                 members; organising the Leather         opportunities and export potentials, to
      production                                        4 support                                 Goods and Shoes Fair and the VI         improve branding for the shoemaking
                                                       institutions)                             Entrepreneurship Fair „PRIVISI“ in       industry’s products in order to further
                                                                                                         Knjazevac; facilitating the       contribute to poverty reduction and
                                                                                                      exchange of experiences with            strengthen regional economic
                                                                                                  other manufacturers in the same                     development”
                                                                                                field from developed countries and
                                                                                                providing support in adopting good
                                                                                                             practice examples
9      Kraljevski        Tourism          2,000             26          Raška region     2008         Cluster expanding, preparing       “To utilise competitive advantages of the
     odmor (Royal                                    (20 companies                                educational programs for cluster;       region and to offer high quality tourist
       Vacation)                                       +6 support                               Installation of proper signposts for     products which should contribute to the
                                                      institutions)                               all significant tourist attractions;    further development of tourism in the
                                                                                                 activities for connecting all cluster   region through increasing the number of
                                                                                                         members to the Internet           visitors and creating new jobs in the
                                                                                                       reservation making system.                          field”
10     Istar 21          Tourism           228               20         Podunavlje       2008         Development of joint tourist           “To interconnect tourist services
                                                     (14 companies +      region                      product of "Istar 21" cluster;            providers and other related
                                                        6 support                                  Promotion of the cluster and its         organisations in order to create an
                                                       institutions)                                    members on domestic and          authentic tourist product along the river
                                                                                                     international fairs; Creation of    Danube that would be attractive for both
                                                                                                 "Istar 21" data base; Organisation           domestic and foreign tourists.”
                                                                                                  of relevant educational programs
                                                                                                       for cluster members for the
                                                                                                  purpose of setting standards and
                                                                                                   improving the quality of offered
                                                                                                                 services.
11   Embedded.rs           Micro-       1,100 (180           13           National       2008     Review current state of affairs in          “To popularise the profession, to
                     electronics/Embe       in       (10 companies +                                    the industry – exchange of           improve the cooperation between
                       dded software    companies)       3 support                                  information and cooperation in        educational and research institutions -
                                                       institutions)                                     solving mutual problems;          thus serving as a basis for the future -
                                                                                                       Preparation and adoption of        and to offer answers to current market
                                                                                                      industry internationalisation           needs through unifying business
                                                                                                 strategy; There are marketing, RD,       processes and improving their quality”
                                                                                                  sales, educational activities, joint     „to support industry in marketing and
                                                                                                                 projects.                  sales opportunities, to influence and
                                                                                                                                             lobby Government and strengthen
                                                                                                                                              cooperation between embedded
                                                                                                                                                  companies and faculties.”




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                                                                       OP for Economic Development (Annexes), 2012-2013                         2nd draft




12   Medical tourism    Tourism     N/A           23         Belgrade and    2008     Preparation of brochures, guides,       “To enhance marketing position of the
                                           (19 companies       Novi Sad              and online data bases with medical      Republic of Serbia as a medical tourism
                                             +4 support                                tourism offers of the Republic of          destination and to offer highly
                                            institutions)                               Serbia; Organisation of medical       professional services to all seeking for
                                                                                               tourism conferences.                medical treatments abroad”
13   Tourist BC Srem    Tourism     N/A           23            Srem         2008      To steer the cluster members to            “To create a respectable and a
                                          (20 companies +                                  shift its orientation towards        competitive position of receptive
                                             3 support                               organising daytrips and promoting           tourism in Srem, and to provide
                                            institutions)                                tourist attractions of the Srem     assistance in development of small and
                                                                                       region; To develop cross-border       medium-sized enterprises in tourism and
                                                                                             cooperation with similar         complementary industries, in order to
                                                                                     organisations by putting particular         strengthen sustainable regional
                                                                                      emphasis on promoting domestic                      development”
                                                                                        tourist product, to facilitate the
                                                                                       exchange of experiences, and to
                                                                                            stimulate tourist turnover.
14        JATO         Plastics /   325            13         Vojvodina      2004    Establishment and development of        “To create a more efficient and rational
                       packaging          (9 companies + 4                                 cooperation with the Italian      operation pattern through standardising
                                               support                                industrial districts; Establishment      production and creating quality and
                                             institutions)                                of cooperation with the first       highly competitive products for both
                                                                                      Hungarian cluster for OMNIPACK             domestic and foreign markets”
                                                                                           packaging technologies and
                                                                                          participation in the project of
                                                                                     applying biopolymers in producing
                                                                                          self-degrading foils and bags
15     NETWOOD          Furniture   180            12        Šumadija and    2007    Creating data base on all furniture       “To promote innovations and increase
                       production         (9 companies + 3    Pomoravlje                  producers and supplemental             the competitiveness of small and
                                               support          region                    activities in the Sumadija and        medium-sized furniture production
                                             institutions)                           Pomoravljeregion; running cluster        enterprises in Sumadija and Pomoravlje
                                                                                           service center providing the      regions through creating new innovative
                                                                                      services of business information,      business networks which would allow for
                                                                                          professional and legal advice,       better cooperation, transfer of know-
                                                                                          administrative and technical               how and higher business
                                                                                     support and business networking ;                   competitiveness”
                                                                                       organising participation on fairs
                                                                                                   and exhibitions.




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                                                                           OP for Economic Development (Annexes), 2012-2013                        2nd draft


16     MEMOS         Metal products    308           19          Indjija and      2006     Creating the network of cluster             “To systematically develop and
                                             (14 companies +        Srem                 member companies and a unified              implement innovative solutions to
                                                5 support                                 business and information system        existing production and service programs
                                               institutions)                                   through developing and             and joint presentation on the targeted
                                                                                             implementing "Clusterpro"                markets, and to improve private
                                                                                             software; Preparing cluster                 enterprises in the regions”
                                                                                         members for the implementation
                                                                                         of the quality standards (ISO 9001,
                                                                                          ISO 14001, OHSAS 18001 and CE
                                                                                             sign); development of new
                                                                                          technology "Producing Plants for
                                                                                         Bio-renewable Sources of Energy";
                                                                                           development and production of
                                                                                            fume cupboards for biodiesel
                                                                                           production in farm households;
                                                                                             Organisation of trainings for
                                                                                               industrial managers and
                                                                                             entrepreneurs in the region
17   South Serbian   Wine production   622           16        Jablanica and      2006       Preparation of promotional           “To join all producers of alcoholic and
     ALCO Cluster                            (6 companies +    Pcinja districts             material for cluster members;          non-alcoholic drinks of the complete
                                                10 support                               running a data base on the cluster         value chain at the regional level by
                                               institutions)                                members and their potential             creating conditions for high cluster
                                                                                                       partners                    positioning on domestic and foreign
                                                                                                                                      markets, and strengthening the
                                                                                                                                  competitiveness of the cluster and its
                                                                                                                                      members by fulfilling required
                                                                                                                                  production and delivery dynamics and
                                                                                                                                            quality standards”
18      PEKOS        Bakery products   200           23          Vojvodina        2008     Establishment of strong business       “To provide support to its members in
                                             (20 companies +                             relations among cluster’s members          the process of strengthening their
                                                3 support                                 and their clients.; Development of         competitiveness and generating
                                               institutions)                                 innovative products suited to       profitable positioning on both domestic
                                                                                          client’s needs; Participation in the             and foreign markets”
                                                                                            events related to food industry;
                                                                                          Quality standards implementation
                                                                                           to cluster’s members involved in
                                                                                           production; managing data base
                                                                                          on producers of baked goods and
                                                                                                   mills in Vojvodina

19   PHOENIX –         Aerospace       730           18           National        2009         Improvement of existing           “Serbia to become leader in production
       Serbian                               (13 companies +                               capabilities and quality system;         of aircraft and components in the
     Aeronautics                                5 support                                   Establishment of reliable and          Western Balkans region in order to
     Cluster Ltd                               institutions)                             flexible supplier’s network; Export     contribute to the creation of new jobs”
                                                                                            promotion; Attracting Foreign
                                                                                              Investment in the industry



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                                                                                     OP for Economic Development (Annexes), 2012-2013                         2nd draft



20       Asstex             Textile –        782               17          Novi Pazar       2009      Activities are concentrated on       “To build capacity and to increase the
                          production of                (14 companies +                                      sales and marketing.             competitiveness of its members”
                              jeans                        3 support                                  Implementation of system for
                                                         institutions)                                 waste water treatment. Joint
                                                                                                       purchasing of raw materials.
21     Film cluster      Film production     256               21           National        2009        Promotion of a country as a       “To promote and develop Serbia as cost-
                                                       (18 companies +                             destination, providing information,     effective, quality destination for filming,
                                                           3 support                                  training, creating film-friendly     and to provide support to international
                                                         institutions)                                 environment, liaison office to     filmmakers who consider Serbia for their
                                                                                                         government, international                        production“
                                                                                                               productions etc
22      Cluster for         Tourism         2,993 in           26           Regional        2008         Development of business            “To improve service standards in the
     development of                        companies   (22 companies +   (Belgrade and                 cooperation between cluster         hotel - management industry, promote
      Serbian hotel -                                      4 support       Vojvodina)               members, lobbying and influence         business efficiency and organisation,
       management                                        institutions)                              on creating strategies relevant for      facilitate and accelerate the flow of
     and gastronomy                                                                                the cluster, network development,      information, represent companies in the
           - HGS                                                                                    communication strategy and data        market and provide timely information
                                                                                                             base development,                 on current developments in the
                                                                                                           Implementation of new                           industry“.
                                                                                                     technologies and standards (ISO
                                                                                                          2200, HACCP etc, цluster
                                                                                                    development: growth in numbers
                                                                                                      of members and their quality,
                                                                                                            Formal and informal
                                                                                                     education.Organisations of fairs
                                                                                                      and other promotional events.
23     Microregion          Tourism          528           29 (25        Local (Subotica)   2008          Networking through the             ”To achieve active influence on the
     touristic cluster                                 companies + 4                                   development of database of          development of micro regions through
      Subotica, Palic                                     support                                         cluster members;cluster         tourist-hospitality offer, improvement of
                                                        institutions)                              promotion (preparation of cluster’s         capacity of business members,
                                                                                                      brochures, participation at the      assistance in resolving issues regarding
                                                                                                      conferences etc); education of        development of services at the local
                                                                                                       cluster members (courses for          level, the implementation of good
                                                                                                        bartenders and sommeliers,          practices and connection with more
                                                                                                    HACCP, food safety, tourism etc);             developed micro-regions“.
                                                                                                      establishing cooperation with
                                                                                                   international and regional clusters
                                                                                                     in order to promote the cluster;
                                                                                                   preparation and participation at EU
                                                                                                     projects (preparation of project
                                                                                                    applications for IPA cross-border
                                                                                                   cooperation with Croatia, Hungary
                                                                                                         and preparation of project
                                                                                                     applications for participation at
                                                                                                     South East Europe Programme).



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                                                                                OP for Economic Development (Annexes), 2012-2013                           2nd draft


24.    Agroindustry      Agriculture and    209        21 (18        Regional (Bačka   2010     Support to the development of          “Through joint efforts of its members to
                          food industry            companies + 3         region)                agricultural producers and food          achieve profitable, competitive and
                                                      support                                      processors in the region;           sustainable production of conventional
                                                    institutions)                                networking and cooperation               and organic food, and to diversify
                                                                                               between members and relevant             production towards the production of
                                                                                              stakeholders; achieving profitable,         energy from renewable sources.”
                                                                                                 competitive and sustainable
                                                                                                production of conventional and
                                                                                                          organic food




25.     Fashion and      Textile industry   1286   12 (9 companies      National       2010       Building and sustainability of         The cluster aim is to serve as support
          clothing                                    +3 support                                 operational and administrative           organizations to strengthen overall
      industry cluster                               institutions)                                capabilities and capacities of       economic competitiveness of companies
                                                                                               institutions; rReaching long-term       related to textile and clothing industry as
                                                                                                  financial sustainability of the         a whole, throughout the Republic of
                                                                                               cluster; increasing the visibility of                      Serbia.
                                                                                                 the organisation in public and
                                                                                               private sectors, with the ultimate
                                                                                               goal and intention to increase the
                                                                                                 awareness of members of the
                                                                                                  cluster, as well as the Serbian
                                                                                                   textile industry as a whole;
                                                                                              Increasing the efficiency of cluster
                                                                                                 members and their workforce,
                                                                                               through a series of programmatic
                                                                                                interventions that will aim to fill
                                                                                              gaps in expertise and lack of labour
                                                                                                               force




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                                                                             OP for Economic Development (Annexes), 2012-2013                       2nd draft


26.   Vojvodina ICT    Information and    1500   36 (33companies      Regional     2010    Strengthening of the Association;      “Development and advancement of ICT
         cluster       Communication                +3 support      (Vojvodina)             positioning of the Association in      sector in Serbia through coordinated
                         Technologies               institutions                           social and business environment;       activities of the members, development
                                                                                               generating new business              and application of ICT products and
                                                                                            opportunities; building stronger         services with high profit potential,
                                                                                            ties between R&D and market;          development of individuals, companies
                                                                                                   lobbying activities               and regional businesses, boosting
                                                                                                                                  competitiveness and quality of Serbian
                                                                                                                                        SMEs, and export promotion.




27.     Šumadija       Textile industry   186         14 (10         Regional      2009    Support the promotional activities        “To reach synergy effect by linking
         textile                                  companies + 4     (Sumadija              and improvement of the key areas         companies from the textile sector in
                                                     support          region)               of textiles manufacturing; quality       Sumadija and Pomoravlje region in
                                                   institutions)                                information and training of        innovative network, in order to create
                                                                                            members on practical experience         conditions to promote cooperation,
                                                                                           in the manufacture of textiles and           improve the knowledge and
                                                                                            current production lines; support         competitiveness of enterprises.
                                                                                                   for clusters in the joint
                                                                                             procurement of equipment and
                                                                                             providing necessary information
                                                                                               about opportunities to place
                                                                                            product at the market; organising
                                                                                                    various events, public
                                                                                           performances, exhibitions, fairs for
                                                                                                      cluster members




28.   Association of   Food products      1099        27 (20          Regional     2010    Creation of a joint sales network;        “Increasing business efficiency and
           food                                   companies + 7    (Belgrade and             education and awareness of           effectiveness of member`s development,
      manufacturers                                  support         Vojvodina             business culture; joint marketing;     increasing productivity growth based on
      Serbian POLUX                                institutions)      Region)                   entering new markets;             the exchange of information and the use
                                                                                                encouraging innovation            of common resources and the growth of
                                                                                                                                    innovation based on the exchange of
                                                                                                                                           ideas and knowledge.”




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                            OP for Economic Development (Annexes), 2012-2013            2nd draft


            ANNEX N: Foreign Direct Investment by Municipality
     Local self-government units with highest levels of FDI cumulative 2001-2008 (€m)




37
                                   OP for Economic Development (Annexes), 2012-2013           2nd draft


ANNEX P: Institutional and legal framework for competitiveness policy in Serbia
Institutional framework

Ministry of Economy and Regional Development

According to the Law on Ministries, the central government institution that is competent for formulating
regional development, SME and tourism policy is the Ministry of Economy and Regional Development
(MoERD). MoERD is competent for planning and implementation of regional development, SME and
tourism policy, proposing and harmonising implementation of measures, programmes and projects of
state aid, and assessing their performance. The Ministry is in charge of the creation of the legal and
institutional framework for regional policy, and implements that policy through affirmation and
strengthening the institutions at national and local level. In that sense, according to the recently
adopted Amended Law on Regional Development, Regional Development Agencies and Regional
Development Councils will be established.

National Council for Regional Development

The National Council was established for the purposes of ensuring and promoting regional development
in the Republic of Serbia. It monitors the situation in the area of regional development and proposes
measures for its promotion, gives formal opinion on the proposals of development planning documents,
coordinates the work of regional councils, etc. It has a president and 28 members (relevant ministers,
representatives of the regions, and other relevant members).

National Agency for Regional Development (NARD)

The Agency is the legal successor of the Republic Agency for SMEs and is directly accountable for
implementation of regional development and SMEs strategic documents, policies and programmes and
in this field liaises with other agencies (Serbian Investment and Export Promotion Agency, Export Credit
and Insurance Agency, and National Employment Service), as well as with the network of regional
development and SME agencies and local centres.

Regional Development Councils (RDCs)

The five RDCs were established for the purposes of ensuring and promoting development of regions.
Their members shall be the representatives from LSUs constituting a region, representatives from public
and civil sector, and from the Government.

Regional Development Agencies (RDAs)

Currently in Serbia, there are 15 regional development agencies (Belgrade, Vranje, Zajecar, Zrenjanjin,
Kraljevo, Kragujevac, Krusevac, Niš, Novi Pazar, Subotica, Užice, Sombor, Leskovac, Šabac, Pozarevac)
and three offices of the NARD (Trstenik, Paracin and Kosovska Mitrovica). Their main role is to support
regional development in the Republic of Serbia, through strategic planning, preparation and
implementation of regional projects in the field of SME development, infrastructure, tourism, welfare
and social inclusion, attracting foreign investors and capacity building of local stakeholders. They have
been mainly created by local self-government units as a bottom up initiative and supported by EU and
various donor programmes in Serbia. In order to standardise and improve their work, and to

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                                    OP for Economic Development (Annexes), 2012-2013          2nd draft


acknowledge the previous massive financial support to these agencies from the EU and other donors,
the Government decided to formally recognise those RDAs which meet required standards, through a
process of accreditation, as part of the institutional framework for preparing and implementing regional
policy.

In order to ensure balanced regional development, the Amended Law on Regional Development,
determines the minimum number of regional development agencies that must be accredited in the
regions:
         1) Region of Vojvodina - three regional development agencies;
         2) The Belgrade region – one regional development agency;
         3) Sumadija and West Serbia region - four regional development agencies;
         4) Southern and Eastern Region of Serbia - three regional development agencies;
         5) Region of Kosovo and Metohija - one regional development agency.

The future role of the accredited agencies will be: to participate in the preparation and implementation
of development documents and monitor their implementation at the region and local level; to
cooperate with the autonomous provinces and local self-government units in the preparation and
implementation of local development plans; to represent the interests of the region in relation with the
National Agency; to prepare and implement professional development programs for the development of
companies and enterprises, infrastructure development and development of institutions and
organisations and to improve the capacity of local government units; to monitor and enforce measures
and implement development projects for which it is authorised; and to deal with international, cross-
border and inter-municipal cooperation within its jurisdiction and lead information system relevant for
the region.

The Council for Small and Medium-sized Enterprises

The Council, being a body which is made up of representatives of various ministries and entrepreneurs
and coordinates activities aimed at defining SME policy and analyses the state of the SME sector, was
involved in designing the Strategy for Development of Competitive and Innovative SME 2008-2013; by
the end of 2008, this body was also working on drafting the Action Plan for eliminating administrative
barriers for operating of the SME sector in Serbia that was adopted in early 2009. The Council is
currently in the process of transformation and is expected to be operational again in the autumn 2010.

National Council for Competitiveness

The National Competitiveness Council, as the governmental working body in charge of proposing
measures for enhancing competitiveness of Serbia, adopted a set of measures for 2010. The adoption
and implementation of these measures will enable improvement of business climate, which will have
positive impact on SMEs and the degree of their competitiveness.

Ministry of Education and Science

Research activities in Serbia are financed in accordance with the Law on Scientific and Research Activity
(Official Gazette RS, no 110/05 and 50/06 – correction). The Ministry is the authorised institution in
charge of enforcing the Law on Scientific and Research Activity and the Law on Innovation Activity, as
well as planning and financing of public R&D activities. Its primary task is coordination of science and
development in Serbia and it is responsible for fulfilment of country’s obligations in this area. The

     39
                                   OP for Economic Development (Annexes), 2012-2013            2nd draft


Ministry also monitors and encourages R&D activity in Serbia, allocates budget resources to R&D
organisations for the programmes defined in the Law on Research Activity and ensures that funds are
used as planned.

MoSTD is the supervisory authority for Intellectual Property Office of the Republic of Serbia. The
Intellectual Property Office is an institution which is responsible for the tasks related to industrial
property rights (patents, trademarks, industrial designs, indications of geographical origin, and
topographies of integrated circuits), copyright and related rights through The Patent Law, The Law on
Trademarks, Law on Legal Protection of Industrial Design , Law on Indications of Geographical Origin ,
The Law on Copyright and Related Rights, Law on the Protection of Topographies of Integrated Circuits.

National Council for Science and Technological Development

The National Council is another parallel body at the governmental level, whose role is to design and
propose to the government a strategy for scientific and technological development and to monitor its
implementation. Serbia is relatively advanced in the development of legislative framework for research.
However, substantial efforts are still needed to develop this sector and to link it to the economic context.

Ministry of Culture, Media and Information Society

The Ministry is the central state administration body competent for telecommunications, postal services
and Information Society. In the field of information society, the Ministry is responsible for information
society policy and its implementation, in particular for developing the information society development
strategy and for the development of e-Government. The ministry is also the supervisory authority for
electronic signature and timestamps.

The National Information Technology and Internet Agency

The Agency is a government body that performs professional public administration duties related to the
enhancement, development and operation of the information system within state authorities, local
governments and public services, the application and usage of the internet in the work of state
authorities, local governments and public services, data protection, developing and applying standards
in the introduction of information technologies within state authorities.

Serbia Investment and Export Promotion Agency (SIEPA)

The Serbia Investment and Export Promotion Agency (SIEPA) is a government body of the Republic of
Serbia with a mandate of attracting foreign investment, increasing Serbian exports and strategically
promoting Serbia as a country abroad. The Serbian government has mandated that SIEPA undertake the
following, providing professional assistance to individual companies in order to develop their export
potential, informing Serbian exporters about the needs of potential foreign buyers, coordinating
activities concerning financial and other types of aid for export promotion, proposing measures and
activities for improving the image and brand of the Republic of Serbia, cooperating with relevant local
and foreign institutions and organisations for the purpose of increasing exports, creating and updating a
database on the Republic of Serbia’s export sectors, informing foreign investors on programs for
encouraging foreign investments in certain sectors, providing professional assistance to foreign
investors concerning the selection of investment locations, assisting foreign investors in acquiring
licenses and permits, coordinating measures and activities concerning financial and other types of aid

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                                    OP for Economic Development (Annexes), 2012-2013            2nd draft


for investment promotion, cooperating with local and foreign institutions and organisations in order to
increase foreign investment, creating and updating a database on the Republic of Serbia of potential
suppliers and investment locations.

Legal framework

Serbia has created a legal framework for development policies in thematic sectors related to
competitiveness (as defined by the IPA Implementing Regulation), thus setting legal grounds for
definition of further actions.

Law on Regional Development

This Law defines the names of regions and regulates: method of defining districts which constitute a
region and method of defining government units which constitute a district; indicators of the level of
development of regions and local self government units; classification of regions and local self
government units according to the level of development; development planning documents; subjects of
regional development; measures and incentives and financial resources for the implementation of
measures of regional development.

Law on Innovation Activity

This Law encourages the creation of an innovative system that encompasses education, scientific and
development research, and development and work of innovative companies. The Law regulates basic
principles, goals and organisation of application of scientific knowledge, technical and technological
knowledge, inventive faculties and inventiveness, for the purpose of creation and realisation of new and
improved products, processes and services as a driving force for the development of the Republic of
Serbia, as compared to the currently existing technical and technological base. There are two types of
organisations which are supported by this Law and which are registered by MoES, as follows:
organisations for the performance of innovation activity (development and production centres; research
and development centres; innovation centres) and organisations for rendering infrastructural support to
innovation activity (business and technology incubator; science and technology park; organisation for
stimulation of innovation activities in the priority field of science and technology; centre for transfer of
technologies), also Technology Companies are supported. All these organisations are registered in
Innovation Activity Registry, and conditions for registration prescribed bylaws of each organisation
individually.

Law on Scientific and Research Activity

The Law defines the basis by which scientific and research activity in Serbia is financed in accordance
with the State budget. The Law envisages budgetary funds for research extended exclusively through
science-research and development projects, and financing of other expenditure related to the field of
science – through special programmes stated in the Law. As different from other countries, budget
funds intended for scientific and research activity can only be allocated to science-research
organisations registered in the Ministry of Education and Science provided that they meet defined
requirements




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                                    OP for Economic Development (Annexes), 2012-2013            2nd draft


Law on Foreign Investments

This Law establishes guaranteed rights of foreign investors who invest in the economy of Serbia, and
particularly: freedom of the foreign investment; equal legal treatment of the foreign investors and the
national subjects of law; full legal security and protection of the foreign investors; the right of free
transfer of profits and property abroad; implementation of the international agreements. The Law
promotes conditions for stimulating foreign investment in order to generate efficient development of
Serbian economy, to strengthen its competitiveness, to establish a wider presence of Serbian economic
entities in the international trade, to import new equipment and contemporary technologies, to
modernise business and increase export volume, all for the purpose of achieving economic progress in
Serbia.

Law on Electronic Signature (Official Gazette RS no. 135/04)

The Law regulates the use of digital signature in legal transactions and other legal affairs, as well as the
rights, obligations and responsibilities with regards to electronic certificates in conformity with the
European Directive on electronic signatures and EU recommendations.

Law on Electronic Documents (Official Gazette RS no. 151/09)

The Law regulates the conditions and procedures for using electronic documents in legal commercial,
administrative, judicial and other proceedings, as well as the rights, liabilities and responsibilities of
other legal entities in regard to the electronic document. Law on Electronic Document also regulates
timestamping service.




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                       ANNEX Q: Administrative structures in Serbia
In accordance with the Law on Territorial Organisation in the Republic of Serbia, adopted in 2007,
municipalities are the basic units of local self-government in Serbia. There are 150, each of which has an
assembly, elected on local elections every four years, as well as a municipal president, public property
and a budget. Municipalities should have more than 10,000 inhabitants (although some have fewer as
they were formed prior to the adoption of the 2007 Law) and should encompass natural geographic
areas which are connected through shared economic activity and have linked communities.

Most of the activities that come under the authority of municipalities relate to the design and
implementation of development programmes, urban planning, issues regarding housing, utilities,
property and land acquisition, in accordance with the Law on Local Self-Government, adopted in 2007.

There are also 23 cities, which are also a type of local self-government, each of which has an assembly,
their own budget and a mayor. Territories that carry city status should have more than 100,000
inhabitants, but are generally similar to municipalities in terms of both administrative structure and
competencies.

Autonomous provinces (APs) have their own assembly and executive council (government) and enjoy
autonomy in some spheres, such as education and culture. AP Vojvodina, which lies in the north of
Serbia, includes 39 municipalities and 6 cities. The Statute of Vojvodina, which sets out the province’s
jurisdictions, was approved by the Parliament of Serbia on 30 November 2009. AP Kosovo and Metohija
is under the administration of UNMIK in accordance with the UN Security Council Resolution 1244
(1999).

In addition, there are 29 districts in Serbia - 17 in Central Serbia, 7 in Vojvodina and 5 in Kosovo and
Metohija, while the City of Belgrade is a district on its own. These are made up of several municipalities
and are administrative units, with no assemblies of their own, and host various state institutions such as
funds, office branches and courts. Districts are not defined by the Law on Territorial Organisation, but
are organised under Government Decree since January 1992.

The districts and municipalities of Serbia are shown in the figure overleaf.




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    ANNEX R: Emerging automotive sector in Serbia and cluster in Kragujevac

The automotive sector in Serbia has shown significant increase in revenues over recent years:

                   Turnover of automotive sector in Serbia in the period 2005-2008




                                           Source: SIEPA 2010

Serbia has a tradition in the automotive industry, which has been recognised by international car maker
Fiat SpA, whose relationship with Serbia’s Zastava company dates back to 1955. In 2008, Fiat formed a
joint venture with the Serbian Government on a 67:33 basis, based on the former Zastava plant in the
central Serbian town of Kragujevac in the. While currently production is limited to basic assembly of up
to 20,000 Fiat Puntos a year from imported kits, Fiat has committed the joint venture to moving to full
manufacture of two models from late 2011, with expectations of 200,000 units a year, mostly for export.
On 22 October 2010, Zastava produced its 30,000th Punto since the beginning of their assembly.

The expanded presence of the world’s 6th largest carmaker has stimulated a drive to attract investment
in component and systems manufacturers.




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                            Major investors in the automotive industry in Serbia
Company          Activity                            Country of origin      Investment         Investment value (€m)
                                                                                type
Fiat             Car assembly                            Italy             Privatisation               700
Cimos            Car spare parts                       Slovenia            Privatisation               100
Michelin         Tyre manufacture                       France             Joint venture                44
Brikel           Tyre manufacture                      Bulgaria            Privatisation                37
Galaxy Tire      Tyre manufacture                        USA               Privatisation                22
Albon            Truck engine parts                       UK                 Greenfield                 18
Leoni            Automotive cables                     Germany               Brownfield                 15
Draexel Meier    Auto electrical systems               Germany               Greenfield                 10
Lohr             Car spare parts                        France               Brownfield                  7
Streit Group     Automotive components                  France               Greenfield                  7
Tesnila          Hydraulic components                  Slovenia              Greenfield                  6
Grammer          Interior car equipment                Germany               Greenfield                  4
Bauerhin         Automotive seat heating systems       Germany               Greenfield                  2
                                              Source: SIEPA 2010

This presents opportunities for close cooperation with Serbian suppliers within the automotive cluster
and further engagement of the cluster itself as an association, for the benefit of its members. Support
institutions within the cluster are helping their member companies to develop products that will satisfy
the quality standards and follow market requirements, thus increasing their chances for expanding their
order book. The quality and quantity of local suppliers and their products is one of the factors
influencing foreign investor’s decision for locating their operations. Investors are also interested in
government incentives, the ease of doing business and the overall business, regulatory and tax
environment of a country.

                   Planned investment in the automotive sector (as at September 2010)
        Investor                         Sector                 Country of         Investment            Timeline for
                                                                  origin            value (€m)           investment
Fiat                        Car manufacture                        Italy               573                  2011
Leoni                       Electrical cables                    German                 15               2010 -2013
Yura                        Auto ignition parts                South Korea              15                End 2010
Grah Automotive             Automotive electronics               Slovenia               12                End 2010
Elrad                       Cable sets for the electronics       Slovenia               10                  2011
                            and automobile industries
Applicazioni Elettriche     Electrical appliances                  Italy                   2               End 2010
Generali (AEG)
Dunkermotoren               Electric motor production           Germany                    2                 2011




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               ANNEX S: Inter-ministerial Agreement on the SCF Joint Body
Based on the Law on Ratification of the Framework Agreement between the Government of the
Republic of Serbia and the Commission of the European Communities on the Rules for Cooperation
concerning EC-financial assistance to the Republic of Serbia in the framework of the implementation of
the assistance under the Instrument for Pre-accession Assistance (IPA) (“Official Gazette of the Republic
of Serbia” № 124/07) and based on Article 27 of the Regulation on Principles of Internal Structuring and
Systematisation of Jobs within Ministries, Special Organisations and Services of the Government
(“Official Gazette of the Republic of Serbia” № 81/07, 69/08) the following is adopted:

AGREEMENT
ON ESTABLISHMENT OF THE JOINT BODY
FOR PREPARATION OF THE STRATEGIC COHERENCE FRAMEWORK

    1.    Joint Body for Preparation of the Strategic Coherence Framework (hereinafter: Joint Body) is established.

    2.    Goal of the Joint Body is to analyse drafts of the Strategic Coherence Framework, provides suggestions
          and recommendations, provides support to the activities during process of preparation of the Strategic
          Coherence Framework and monitors and coordinates preparation of Operational Programmes for IPA
          components of Regional Development and Human Resources Development. The enlisted documents shall
          be prepared in accordance with the existing national strategies adopted by the Government, as well as
          with the appropriate strategic framework of the European Union that is implemented upon IPA funds.

    3.    The Strategic Coherence Framework and Operational Programmes shall be introduced with decision made
          by the Government.

    4.    The Joint Body Consists of the following members:

                  1.     Ognjen Mirid, Strategic Coordinator for IPA components Regional Development and
                         Human Resources Development, Office of the Deputy Prime Minister for European
                         Integrations;
                  2.     Gordana Lazarevid, Assistant Minister and Branislav Stipanovid, independent Advisor
                         within Sector for Preparation of the Budget of Treasury Department, Ministry of Finance;
                  3.     Rajko Perid, State Secretary, Ministry of Infrastructure;
                  4.     Nebojša Pokimica, Head of Department for Project Management, Ministry of Environment
                         and Spatial Planning;
                  5.     Dejan Jovanovid, State Secretary and Ljiljana Dzuver, Assistant Minister, Ministry of
                         Economy and Regional Development;
                  6.     Tinde Kovač Cerovid, State Secretary, Ministry of Education;
                  7.     Tatjana Matid, Secretary of the Ministry, Ministry of Labour and Social Policy;
                  8.     Goran Simunovid, Department for Management of EU Funds, Ministry of Agriculture,
                         Forestry and Water Management;
                  9.     Zoran Filipovid, Assistant Minister, Ministry of Mining and Energy;
                  10.    Elizabet Paunovid, Assistant Minister, Ministry of Health;
                  11.    Dušan Brajkovid, Advisor and Head of Group for Preparation of Projects, Ministry for Public
                         Administration and Local Self Government;
                  12.    Petar Janjid, Advisor, Ministry of Telecommunications and Information Society;
                  13.    Jadranka Đuričid, Senior Advisor, Ministry of Science and Technological Development;
                  14.    Zoran Cekid, State Secretary, Ministry for the National Investment Plan;
                  15.    Branko Budimir, Advisor, Serbian European Integration Office.



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5.    Representatives of other bodies and organisations and representatives of civil society organisations may
      participate, if needed, as experts and/or advisors in work of the Joint Body.

6.    Work of the Joint Body will be governed with Rules of Procedure that is an integral part of this
      Agreement.

7.    The Joint Body is headed by Ognjen Mirid, Deputy Director within the European Integration Office of the
      Government of Serbia.

8.    The Joint Body makes decisions with a consensus. The Government is responsible for solving of eventual
      disputes in work of the Joint Body.

9.    Implementation of this Agreement commences on the next day from accepting and signing of all
      institutions included in this Agreement.

10. This Agreement is made in 15 originals, one for each of the institutions that has signed the Agreement.

          Deputy Prime Minister of The European                   Minister of Finance
          Integrations And Minister For Science And               Diana Dragutinovid
          Technological Development
          Božidar Đelid




          In Belgrade                                             In Belgrade

          Minister of Economy and Regional                        Minister of Education
          Development Development                                 Žarko Obradovid
          Mlađan Dinkid




          In Belgrade                                             In Belgrade

          Minister of Environment and                             Minister of Agriculture, Forestry and Water
          Spatial Planning                                        Management
          Oliver Dulid                                            Saša Dragin




          In Belgrade
                                                                  In Belgrade

          Minister of Labour and                                  Minister of Infrastructure
          Social Policy                                           Milutin Mrkonjid
          Rasim Ljajid




          In Belgrade                                             In Belgrade

          Minister of Mining and Energy                           Minister of Health
          Petar Škundrid                                          Tomica Milosavljevid




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     In Belgrade                                             In Belgrade

     Minister of Public Administration and                   Minister of Telecommunications and
     Local Self Government                                   Information Society
     Milan Markovid                                          Jasna Matid




     In Belgrade                                             In Belgrade

     Minister of the                                         Director of Office for
     National Investment Plan                                the European Integrations
     Verica Kalanovid                                        Milica Delevid




     In Belgrade                                             In Belgrade




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                                    OP for Economic Development (Annexes), 2012-2013           2nd draft


                    ANNEX T: Rules of Procedure of the SCF Joint Body
ARTICLE 1: LEGAL BASIS FOR ESTABLISHMENT OF THE JOINT BODY FOR PREPARATION OF
THE STRATEGIC COHERENCE FRAMEWORK

Based on the Law on Ratification of the Framework Agreement between the Government of the
Republic of Serbia and the Commission of the European Communities on the Rules for Cooperation
concerning EC-financial assistance to the Republic of Serbia in the framework of the implementation of
the assistance under the Instrument for Pre-accession Assistance (IPA) (“Official Gazette of the Republic
of Serbia” № 124/07) and based on Article 27 of the Regulation on Principles of Internal Structuring and
Systematisation of Jobs within Ministries, Special Organisations and Services of the Government
(“Official Gazette of the Republic of Serbia” № 81/07, 69/08) the Joint Body for preparation of the
Strategic Coherence Framework is established (hereinafter; the Joint Body).

The Joint Body consists of representatives of Office of the Deputy Prime Minister for European
Integration, Ministry of Finance, Ministry of Infrastructure, Ministry of Environment and Spatial
Planning, Ministry of Economy and Regional Development, Ministry of Education, Ministry of Labour and
Social Policy, Ministry of Agriculture, Forestry and Water Management, Ministry of Mining and Energy,
Ministry of Health, Ministry of Public Administration and Local Self Government, Ministry of
Telecommunications and Information Society, Ministry of the National Investment Plan and Serbian
European Integration Office.

ARTICLE 2: THE STRATEGIC COHERENCE FRAMEWORK AND OPERATIONAL PROGRAMMES

In accordance with the Annex A of the Law on Ratification IPA Framework Agreement and article 23 of
IPA Implementing Regulation, the Strategic Coordinator is responsible for coordination of assistance
within IPA components three [Regional Development] and four [Human Resources Development];
preparation of the Strategic Coherence Framework in accordance with Article 154 of the IPA
Implementing Regulation and harmonisation of sectoral strategies and programmes.

The responsible ministries shall prepare, based on the Strategic Coherence Framework and in
cooperation and under guidance from the National IPA Coordinator and Strategic Coordinator,
appropriate Operational Programmes.

The Strategic Coherence Framework represents the strategic document that defines priorities within IPA
component III [Regional Development] and IV [Human Resources Development], specifically in areas of
infrastructural investments within environmental protection and transport; development of economy
and competitiveness, and employment, social policy, education as well as within the necessary technical
assistance. The priorities shall be elaborated in more detail on the level of sectoral documents, i.e.
Operational Programmes. Activities of the Joint Body will be organised through work in appropriate sub-
groups, during preparation of Operational Programmes. Priorities that will be defined within these
documents shall be based on national strategies and strategic guidelines of the European Union.

The Strategic Coherence Framework consists of the following:

        Brief analysis of strengths, weaknesses, opportunities and threats [so called SWOT analysis] of
         enlisted sectors and priorities in which government of the Republic of Serbia plans to direct
         funds within IPA components III and IV;

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                                    OP for Economic Development (Annexes), 2012-2013           2nd draft


        Description of objectives in accordance with national strategies and with strategic guidelines of
         the European Union;
        List of Operational programmes with brief description of key priorities within each of
         programmes;
        The indicative distribution of funds among programmes during three-year period, in accordance
         with the Multi-annual Indicative Financial Framework and with Multi-annual Indicative Planning
         Document [both documents are prepared by the EC];
        Mechanism of coordination with other national programmes, international financial institutions
         and donors;
        Mechanism of coordination with other IPA components.

Operational Programmes are consisting of the following:

        Estimation of the mid-term needs and goals, with emphasis on strengths, weaknesses,
         opportunities and threats in appropriate sectors;
        Overview of consultations with the relevant partners and with the representatives of civil
         society, where necessary;
        Description of the strategic priorities, bearing in mind the Strategic Coherence Framework,
         measures for its realisation and the indicators for assessment for its accomplishment;
        Description of assistance of technical activities, if anticipated;
        Identification of the end-beneficiary for each of the measures;
        Table with the financial allocation, in accordance with the Multi-annual Financial Framework
         that determines investments for each of the priorities and measures for its implementation;
        Proposal for the system of evaluation and monitoring;
        Indicative list of Major Projects, with description of status of the project documentation,
         expected sources of financing and indicative implementation timetable;
        Description of the Operating Structures that will manage and control implementation of the
         Operational Programmes.

Support in preparation of the Strategic Coherence Framework and Operational Programmes is provided
with implementation of “Project Preparation Facility II” that is funded out of IPA 2007 funds. Strategic
Coordinator, line ministries responsible for Operational Programmes and the Joint Body will work closely
with experts within this project on preparation of these documents as well as on preparation of the
appropriate project documentation.

ARTICLE 3: TASKS OF THE JOINT BODY

Tasks of the Joint Body are as follows:

    1. Analysing drafts of the Strategic Coherence Framework and assessment of its harmonisation
       with the priorities defined in national strategies adopted by the Government and with priorities
       defined in the European Partnership and in Multi-annual Indicative Planning Document;
    2. Supervision and coordination of preparation of Operational Programmes that will be prepared
       by the line ministries;
    3. Creation of conditions for the Strategic Coherence Framework and Operational Programmes to
       be prepared in anticipated timeframe.



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                                   OP for Economic Development (Annexes), 2012-2013            2nd draft


    4. Identification of weaknesses and problems during process of programming of IPA components
       III and IV and proposal of measures to the Strategic Coordinator and National IPA Coordinator
       for their elimination.

Activities of Secretariat of the Joint Body are performed by the “Project Preparation Facility II” that is
responsible for operational activities within work of the Joint Body.

ARTICLE 4: DECISION MAKING

The Joint Body makes decisions with a consensus. In a case when consensus cannot be reached the Joint
Body is obliged to consult the National IPA Coordinator. Disputes in work of the Joint Body will be
settled by the Government.

ARTICLE 5: DOCUMENTATION

Work of the Joint Body is based on reports and documentation prepared by members of the Joint Body
or any other party that is involved in work of the Joint Body. Institutions participating in work of the
Joint Body are obliged to provide, upon timely request made by the Strategic Coordinator, necessary
reports and documentation at least 10 days before the meeting. The Joint Body will take into
consideration reports and documentation that is prepared by the European Commission.

ARTICLE 6: MEETINGS AND PRESIDENCY

A minimum of three meetings of the Joint Body will be organised, bearing in mind that the Strategic
Coherence Framework and Operational Programmes will be prepared between 2009 and 2011. Irregular
meetings may be organised upon request made by the Strategic Coordinator or upon request made by
the institution that participates in work of the Joint Body, with approval by the Strategic Coordinator.
Meetings of the Joint Body are headed by Ognjen Mirid, Coordinator for EU funds within Office of the
Deputy Prime Minister for European Integration.

Representatives of other bodies and organisations and representatives of civil society organisations, as
well as representatives of the European Commission may participate, if necessary, and may take expert
and/or advising role, because of the specific areas of support.

Secretariat of the Joint Body is responsible for organisation of meetings of the Joint Body and
preparation of minutes from those meetings.

ARTICLE 7: CHANGE IN STRUCTURE OF THE JOINT BODY

If change of member of the Joint Body occurs, institution participating in work of the Joint Body is
obliged to inform in writing the National IPA Coordinator regarding the change and, in the same time, to
appoint the new member.




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                  ANNEX U: List of partners & stakeholders consulted
This will be added following the full partner consultation in December 2010.




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                                   OP for Economic Development (Annexes), 2012-2013   2nd draft


                         ANNEX V: Results of partner consultation
This will be added following the full partner consultation in December 2010.




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                                     OP for Economic Development (Annexes), 2012-2013   2nd draft


     ANNEX W: Report of ex ante evaluation and strategic impact assessment
This will be added to the final draft of the OP.




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                                                                                       OP for Economic Development (Annexes), 2012-2013                          2nd draft


                           ANNEX X: Recent and ongoing assistance to Serbia under EU funds (2006-2011)
Title                                         Programme     Timescale    Budget*   Main activities
Technical support to Enterprise Policy        CARDS 2006   2008 - 2010    €1.5m    Activities include:
and Innovation project (EPI)                                                           Support to the Ministry of Economy and Regional Development (MoERD) in
                                                                                        the implementation of the Strategy for Competitive and Innovative Small and
                                                                                        Medium-sized Enterprises, 2008-2013
                                                                                       Provide technical assistance to MoERD and the National Agency for Regional
                                                                                        Development (NARD) in identifying opportunities and developing proposals
                                                                                        that would attract funding for Serbia’s SMEs under the EU Competitiveness
                                                                                        and Innovation Programme (CIP) and Framework Programme 7 (FP7) initiatives
                                                                                       Work with partner institutions in order to achieve practical solutions for SME
                                                                                        issues and bring about tangible improvements to the business environment
Technical assistance to quality               CARDS 2006   2008 - 2010   €1.2m     Activities include:
infrastructure institutions in the Republic                                            Support to the National Institute for Standardisation to fulfil the 9 conditions
of Serbia                                                                               to become a CEN and CENELEC member;
                                                                                       Assist the National Accreditation Board to implement international and
                                                                                        European requirements to comply with criteria for signing multilateral
                                                                                        recognition agreements and in the metrology area;
                                                                                       Support training for laboratories, accreditation of a selection of relevant
                                                                                        laboratories and the participation of the National Metrology Directorate in
                                                                                        international comparisons of measuring standards
Implementation of the European                 IPA 2007    2009-2011     €2.0m     Activities include support to the implementation of ECAA in air transport:
Common Aviation Area Agreement                                                         Development of the concept of operating licence, issuing of operating licences
                                                                                        and effective monitoring of their use;
                                                                                       Assisting in the implementation of the National Aviation Security Quality
                                                                                        Control Programme;
                                                                                       Establishing security audit programme;
                                                                                       Assisting in the areas of Flight Data Processing System in the context of the
                                                                                        new ATM system;
                                                                                       Assisting in finalising the new Aviation Law and subsequent development of
                                                                                        by-laws in line with the EU acquis;
                                                                                       Addressing Competition, State Aid in all issues of civil aviation;
                                                                                       Development and implementation of measures dealing with aviation safety,
                                                                                        aviation security and air traffic management.
                                                                                       Supply of equipment




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                                                                                   OP for Economic Development (Annexes), 2012-2013                          2nd draft




Supervision of Belgrade City Road By-     IPA 2007     2010-2012      €3.5m    Activities include:
Pass, Section B – Dobanovci to Bubanj                                              Assistance during the tender evaluation for the Works contract and during the
Potok, 37.3 km motorway                                                             contract negotiations with the successful bidder in accordance with EU
                                                                                    procurement procedures;
                                                                                   Monitoring the progress of the works by conducting on site inspection;
                                                                                   Conducting inspections periodically after completion of the works and assisting
                                                                                    the PIU in administrative matters related to the completion of the contract
Danube River Information System (RIS)     IPA 2007     2009-2012      €11.0m   Activities include RIS establishment:
                                                                                   Construction of communication towers;
                                                                                   Supervision of works;
                                                                                   Training of RIS operational staff
Strengthening administrative capacities   IPA 2007     2009-2011      €1.0m    Upgrading the system for air protection in Republic of Serbia in line with EU
for implementation of air quality                                              standards.
management system
Strengthening administrative capacities   IPA 2007     2009-2011      €1.0m    Development of system for Nature Protection in the Republic of Serbia in line with
for protected areas in Serbia (Natura                                          EU environmental acquis, achieve institutional strengthening and acquis
2000)                                                                          compliance in natural habitats sector
Technical assistance for development of   IPA 2007     2009-2011      €2.0m    Provide support to the Government of Serbia to achieve the goals of accession to
an Environmental Approximation                                                 the European Union and improvement of the environment by assisting in the
Strategy (EAS)                                                                 approximation of Serbian legislation with EU environmental acquis.
Supporting the Implementation of the      IPA 2007     2008-2014      €6.0m    Capacity building and institutional strengthening
Energy Community Treaty
Sewerage & wastewater strategic master    IPA 2007   January 2010 –   €3.0m    Support to the national authorities in institutional strengthening in solid waste,
plan for the West Morava River Basin                  January 2012             wastewater policy and strategy development
Study of flood prone areas in Serbia,     IPA 2007    March 2010 –    €2.0m    Development of relevant studies in institutional strengthening, policy and strategy
Phase 1                                                March 2012              development for flood prevention
Emissions reduction from Nikola Tesla     IPA 2007     2008 - 2014    €12.0m   Reducing the emissions from thermal power stations in Serbia, in order to comply
Thermal Power Plants                                                           with the legal obligations under Serbian Legislation and EU Directives through
                                                                               reconstruction of two electrostatic precipitators in power plants.
Support to private sector                 IPA 2007     June 2009 -    €3.5m    Activities include:
competitiveness and export promotion                 December 2011                 Develop the capacity of the MoERD, SIEPA, NARD and the Serbian Chamber of
(SECEP)                                                                             Commerce to support enterprises through cluster development, supply chain
                                                                                    development and export promotion;
                                                                                   Increase the competitiveness of Serbian enterprises through cluster
                                                                                    development;
                                                                                   Improve integration of Serbian enterprises into local and global supply chains;
                                                                                   Boost export activities of Serbian enterprises.


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                                                                                  OP for Economic Development (Annexes), 2012-2013                          2nd draft




Support to implementation of national       IPA 2007   2009 - 2011   €1.0m    Activities include:
strategy for tourism                                                              Support tourism development of Serbia and to implement a strategy and
                                                                                   policy framework ensuring the link between tourism potentials and economic
                                                                                   development;
                                                                                  Enhancement of tourist competitiveness, the attractiveness of tourist products
                                                                                   and positioning of Serbia on the world tourist market.
Regional socio-economic development         IPA 2007   2009 - 2011   €24.0m   Activities include:
programme (RSEDP) 2                                                               Supporting regional development at the national level;
                                                                                  Direct operational grants for Regional Development Agencies (RDAs);
                                                                                  Financing and implementing regional development projects (grant scheme);
                                                                                  Strengthening the capacities of RDAs and other regional stakeholders in
                                                                                   implementing the grant scheme.
Municipal Support Programme (MSP)           IPA 2007   2010 - 2013   €22.0m   Activities include:
                                                                                  Accelerating the decentralisation process by supporting development and
                                                                                   implementation of regulatory framework;
                                                                                  Improving capacities for good governance and municipal management at the
                                                                                   local level;
                                                                                  Improving local services to citizens and to enhance local economic
                                                                                   development; and
                                                                                  Strengthening capacities of SCTM, Ministry of Public Administration and Local
                                                                                   Self-Government and supporting local-central government cooperation.
Facilitating intermodal transport in        IPA 2008   2010-2012     €2.0m    Activities include:
Serbia                                                                            Creating an institutional framework and strengthening the capacity of the
                                                                                   relevant stakeholders in the intermodal sector, through the organisation of
                                                                                   activities between state bodies, public and private companies;
                                                                                  Awareness campaign and a management training course;
                                                                                  Preparation of project and tender documentation preparation for the
                                                                                   intermodal centre.
Harmonisation with acquis                   IPA 2008   2010-2012     €1.5m    Activities include:
communautaire in the field of transport –                                         Updating the Legal Action Plan regarding further harmonisation with the
Phase II                                                                           acquis
                                                                                  Application of the instrument for harmonisation of the national legislation with
                                                                                   the acquis- assessment table
                                                                                  Monitoring of work and assistance provided to already established and newly
                                                                                   established working groups for legislative drafting
                                                                                  Training Needs Analysis; training, internship and study tour planning
                                                                                  Setting up database


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                                                                                OP for Economic Development (Annexes), 2012-2013                         2nd draft




Technical assistance to support             IPA 2008   2010-2012   €4.0m    Activities include
implementation of infrastructure                                                Assistance to the PIU in PE Roads of Serbia (€1.5m);
projects in the Republic of Serbia – PIUs                                       Supervision of construction works of Žeželj Bridge on the River Danube in Novi
                                                                                 Sad (€2.5m).
System for the analysis of track            IPA 2008   2010-2013   €3.0m    Activities include:
conditions                                                                      Development of system procedures and GIS reference database ;
                                                                                Record key track data;
                                                                                Development of additional hardware needs;
                                                                                Training of personnel
Assistance in implementation of             IPA 2008   2010-2012   €1.5m    Contributing to the minimisation of adverse effects of chemicals on human health
Chemical Management System in Serbia                                        and environment (€1.0m - twinning contract; €0.5m – supply contract)
Assistance to Serbian Environment           IPA 2008   2009-2011   €1.6m    Increasing the capacity of the Serbian Environmental Protection Agency (SEPA) to
Protection Agency as national focal point                                   support Serbia in the realisation of its international environmental protection
institution for cooperation with                                            obligations
European Environment Agency in
strengthening the EIONET in Serbia
Hazardous waste management                  IPA 2008   2010-2012   €1.5m    Harmonisation of EU legislation and best practice in the field of hazardous waste
                                                                            management.
Treatment of healthcare waste               IPA 2008   2009-2011   €6.0m    The project shall aim contribute to the implementation of environmental and
                                                                            healthcare strategies that will ensure compatibility with EC legislation and best
                                                                            practices in sanitary standards. It shall assist the Ministry of Health to improve
                                                                            infectious healthcare waste management in 35 healthcare facilities in Serbia by
                                                                            completing the system for collection, storage, treatment and disposal of infectious
                                                                            healthcare waste as initiated under a CARDS Healthcare waste management project
                                                                            (€2m - service contract; € 4m - medical waste equipment & vehicles supply)
Environmental Protection at the Electric    IPA 2008   2009-2015   €17.0m   Fulfilling EC Directive 2001/80/EC for large combustion plants by modernising
Power of Serbia (EPS) company                                               specified Thermal Power Plants (TPPs), and EU Directive 96/59/EC by
                                                                            decontaminating facilities and replacing equipment using PBD – pyralene oils.




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                                                                                     OP for Economic Development (Annexes), 2012-2013                            2nd draft




Improved SME competitiveness and           IPA 2008    May 2010 -     €3.0m      Activities include:
innovation                                            October 2012                    Improving the quality, range and availability of business support services in
                                                                                       Serbia (for newly established and existing SMEs and entrepreneurs), by
                                                                                       creating a standardised model and strengthening the business support
                                                                                       infrastructure;
                                                                                      Establishing and implementing Quality Standards for delivery of Business
                                                                                       Support Services;
                                                                                      Supporting business environment that will foster development of innovative
                                                                                       and competitive SMEs;
                                                                                      Strengthening the institutional capacity and support framework for increased
                                                                                       level of innovation in enterprises;
                                                                                      Improving enterprise competitiveness by increasing their innovation capacities
Municipal Infrastructure Support           IPA 2008   2009 - 2012     €45 m       Activities include:
Programme (MISP)                                                                       To improve institutional and legislative framework for municipal
                                                                                        infrastructure services and to support transformation of public utility
                                                                                        companies;
                                                                                       To strengthen the municipal capacities in infrastructure development
                                                                                        planning and project preparation;
                                                                                       To implement selected municipal infrastructure projects
                                                                                  (Service contract - €9.5 million; four works contracts - € 35.5 million)
Further Advancement of Conformity          IPA 2008   2010 - 2012     €1.2m       Developing efficient and sustainable capacity of Serbia’s quality infrastructure to
Assessment in the Republic of Serbia                                              carry out conformity assessment activities in alignment with EU good practice
Žeželj Bridge – rebuilding Serbian         IPA 2009    2010-2012      €30.0m      Activities include:
infrastructure                                                          IPA +          Geotechnical & structural survey – preparation of EIA permit applications;
                                                                      €30.0m            validation of design specification; validation of design of steel superstructure
                                                                         co-            by fabrication workshop;
                                                                     financing         Superstructure fabrication (as per Lot 2 funded by EU) and then delivery to
                                                                                        site and assembly; construction of access ramps for the road, rail and
                                                                                        pedestrian; building connections to rail and road infrastructure
                                                                                       Installation utility services;
                                                                                       Demolition and removal of temporary bridge
Technical assistance for Hazardous         IPA 2009    2010-2012      €3.0m       Preparing project documentation for hazardous waste facility
Waste Treatment Facility
Preparation of design and tender           IPA 2010    2010-2012      €2.0m      Preparation of necessary project documentation, including development of
documentation for river training works                                           relevant studies and final project design, tender dossier, the major project request
and dredging on the critical sections of                                         for confirmation of rate of assistance (application form) for project implementation
the Danube River                                                                 within OP-ED.


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Removal of unexploded ordinances          IPA 2010    2011-2013   €3.8m    Activities include:
(UXO) from the Danube River                                                    Removing identified UXOs within the most priority areas1and conduct an
                                                                                efficient and effective supervision of their removal
Supervision of road construction works    IPA 2010    2010-2013   €10m     Activities include:
on the Corridor X                                                              Supervision of motorway construction works on the E-75 motorway-Corridor
                                                                                Xd (Grdelica – Vladicin Han section) in accordance with national and
                                                                                professional standards carried out successfully.
                                                                               Supervision of motorway construction works on the E-80 motorway-Corridor
                                                                                Xc (Ciflik – Pirot section) in accordance with national and professional
                                                                                standards carried out successfully;
                                                                               Supervision of progress on the tunnel construction works on the M-1 road to
                                                                                FYR Macedonia (E-75) – Corridor Xd (Grdelica – Vladičin Han section)
Strengthening Serbian environmental       IPA 2010    2010-2012   €2.5m    Improving the quality of the natural environment and the health of the population
inspection and relevant stakeholders                                       through the effective enforcement of environmental regulations (€2.0m - twinning
                                                                           contract; €0.5m – supply contract)
Supplies for environmental inspection    IPA 2008 &   2010-2012   €1.0m    Activities include:
and chemicals management in Serbia          2010                                     More efficient environmental inspection (EI), due to the availability and
                                                                                      effective use of equipment provided by the project.The exact needs for
                                                                                      monitoring and sampling equipment have yet to be determined; an
                                                                                      indicative budget of €0.5m has been earmarked and assistance is
                                                                                      available to determine EI’s requirements (e.g. mobile monitoring and
                                                                                      analytical equipment and vehicle, IT support, and vehicles for national
                                                                                      and provincial inspectors / services).
                                                                                     Laboratories for crucial operation of the system for chemicals
                                                                                      management and implementation of regulations have improved their
                                                                                      performance. Laboratory equipment is required for crucial operation of
                                                                                      the system for chemicals management and implementation of
                                                                                      regulations to improve laboratory capacities.
Construction of substation 400/110 Kv     IPA 2010    2010-2015   €28.0m   Building a new electricity substation at Vranje and extending the capability of the
Vranje-4 & Leskovac-2                                                      electricity substation at Leskovac.
Implementation of energy component of     IPA 2010    2010-2015   €2.5m    Building capacity in the energy sector which will lead to the implementation of the
the National Strategy for Sustainable                                      sustainable energy policy, implementation of the Kyoto protocol, rational use of
Development                                                                conventional fuels and increased use of renewable energy sources.




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Follow-up technical assistance to          IPA 2010    2010-2015      €1.5m     Activities include:
Srbijagas                                                                           Strengthening the capacity of Srbijagas company and gas transmission system
                                                                                     operator;
                                                                                    Implementing specific requirements of the Energy Community Treaty
                                                                                     concerning gas sector in Serbia;
                                                                                    Assisting in developing the company’s investment possibilities, with the focus
                                                                                     on gas interconnections.
Integrated innovation support              IPA 2010    2011 - 2013    €3.0m     Activities include:
programme                                                                           Enhancing institutional capacity for efficient support to product and process
                                                                                     innovation within SMEs and technology transfer;
                                                                                    Enhancing instruments for financing of SME innovation activities
Higher education training infrastructure   IPA 2010    2011 -2013     €25.0m    Activities include:
programme (HETIP)                                                                   Upgrading higher education institution’s infrastructure and teaching
                                                                                     equipment;
                                                                                    HRD for use of modern equipment and methodology in teaching process in
                                                                                     higher education; and
                                                                                    Upgrading equipment in research laboratories
European South and South West Serbia       IPA 2010    2010 - 2013    €17.3m    Enhancing governance, municipal and inter-municipal management capacity and
Support Programme (ESSWeSP) – with                                              social, economic and physical infrastructure in a holistic, area-focused fashion in
Swiss Development Corporation                                                   South and South-West Serbia
Municipal Infrastructure Support           IPA 2010    2011 - 2014    €41.12m   Activities include:
Programme (MISP)                                                                    Supporting project pipeline (SLAP) in area of local infrastructure;
                                                                                    Strengthening the municipal capacities in infrastructure development
                                                                                     planning and project preparation; and
                                                                                    Implementing selected municipal infrastructure projects
                                                                                (Service contract - €9.5 million; four works contracts - € 35.5 million)
Provisional
Preparation of project and tender          IPA 2011   Not yet known   €7.0m     Activities include:
documentation for the modernisation of                                              Preparation of project documentation for modernisation of the railway line
the railway line Novi Sad-Subotica-                                                  Novi Sad – Subotica within Corridor X
Hungarian border and construction of
bypass in the city of Niš
Access roads to the Žeželj bridge          IPA 2011   Not yet known   €5.5m     Activities include:
                                                                                    Construction of access roads on both sides of the Danube to the Žeželj bridge

Construction of waste water treatment      IPA 2011   Not yet known   €20.0m    Construction and commissioning Waste Water Treatment Facility at TPP Nikola
facilities at TPP Nikola Tesla B                                                Tesla B


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                                                                                                    OP for Economic Development (Annexes), 2012-2013                        2nd draft




                Law enforcement in the field of control     IPA 2011    2011-2013      €3.0m    Build and enhance capacity for enforcement of regulations aligned with the EU
                of industrial pollution and protection on                                       Environmental Directives, specifically for Industrial Pollution Prevention and
                chemical accidents and establishing the                                         Control (IPPC), prevention of chemical accidents and the EMAS.
                EMAS system
                Capacity-building for the Energy Agency     IPA 2011   Not yet known   €1.5m    Build the capacity of the AERS so that it is capable of developing and implementing
                of the Republic of Serbia (AERS)                                                regulatory policies and strategies, and overseeing the necessary reform of the
                                                                                                energy sector.
                Support to implementation of the            IPA 2011   Not yet known   €8.4m    Supporting implementation of the Scientific and Technological Development
                Scientific and Technological                                                    Strategy of the Republic of Serbia through capacity building of the main
                Development Strategy                                                            stakeholders and strengthening competitiveness of the Serbian economy by
                                                                                                improving linkages between public research and development and business sector
                Support socio-economic development of       IPA 2011   Not yet known   €21.0m   Activities include:
                the Danube Serbia Region                                                            Support to generation of new employment opportunities in local
                                                                                                     municipalities by improvement of agriculture production, environment and
                                                                                                     tourism management along the Danube river and developing new practices
                                                                                                     and capacities in relation to agriculture, environment
                                                                                                    Improving visibility of the Danube Serbia Region in order to activate the
                                                                                                     Danube potentials in accordance with the global trends
                                                                                                    Support to preparation and implementation of a grant scheme for inter-
                                                                                                     municipal projects that will develop socio-economic potentials in local
                                                                                                     municipalities in the Danube Serbia Region
                                                                                                    Support to respective municipalities and other relevant stakeholders in the
                                                                                                     identification, screening and preparation of project documentation and
                                                                                                     tendering documentation related to the Danube potentials in the area of
                                                                                                     competiveness (tourism, business infrastructure and R&D etc.) and
                                                                                                     environment
                                                                                                    Implementation of infrastructure projects (water supply system '
                                                                                                     transportation infrastructure, water supply and sewerage installations,
                                                                                                     electricity and telecommunications and tourism infrastructure)
                Municipal Environmental Grant Loan          IPA 2011   Not yet known   €20.0m   Supporting the execution of municipal environmental development
                Investment Programme                                                            projects that will improve service delivery to citizens and compliance with
                                                                                                the EU acquis in the environmental field while building municipal capacity
                                                                                                to plan capital investments, formulate and manage projects and operate
                                                                                                and maintain installations
* Total budget including national co-financing




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                                                                                        OP for Economic Development (Annexes), 2012-2013                             2nd draft


                            ANNEX Y: Recent and ongoing bilateral and multilateral assistance to Serbia
Title                                     Donors          Timescale       Budget       Main activities
Serbian energy efficiency project        World Bank      2004 - 2011    $49.0m (soft   Improving energy efficiency in heating buildings in order to make heating more
                                                                            loan)      affordable, as well as improve the functional and health environment of the
                                                                        + $6.0m co-    users. An important associated objective is to reduce the local and global
                                                                         financing     environmental impact of the use of dirty fuels for heating buildings in Serbia.
Norwegian energy efficiency assistance     Norway        2005 - 2008      €0.36m       Activities include:
to Serbia                                                                                  Raising capacity of Serbian Institutions to develop Programmes for
                                                                                            realisation of Serbian Energy Sector Development Strategy, in particular
                                                                                            programmes, action plans and financial instruments for setting up and
                                                                                            achieving energy efficiency and RES policy goals;
                                                                                           Identifying, developing and implementing programmes/activities aiming to
                                                                                            promote energy efficiency and wider use of renewable energy sources;
                                                                                           Preparing the programmes for realisation of Serbian Energy Sector
                                                                                            Development Strategy;
                                                                                           Creating market for energy efficiency business
Municipal economic growth activity       United States   2005 - 2010      € 26.5m      Activities include:
(MEGA)                                                                                     Providing technical assistance to key national-level partners in the process
                                                                                            of local economic development (LED) related legislative drafting, facilitating
                                                                                            stakeholders' input into the legislative process and supporting partners in
                                                                                            advocating for adoption of key LED legislation;
                                                                                           Providing support to the local governments in developing own source
                                                                                            revenue and land management policies;
                                                                                           Supporting key advocacy partners in their organisational strengthening and
                                                                                            enhancement of advocacy capacities;
                                                                                           Establishing or enhancing municipal Offices for Local Economic
                                                                                            Development (OLEDs), defining their roles and carrying out their functions;
                                                                                           Supporting partner municipalities to strengthen their ability to mobilise LED
                                                                                            resources from the public and private sectors, and to deploy these
                                                                                            resources more effectively in helping to improve the local business climate
                                                                                            and grow the local economy.
Support for the Energy Efficiency           Spain        2007 - 2008       €0.2m       Strengthening the Centre for Renewable Sources of Energy in the SEEA, through
Agency                                                                                 theoretical and practical training in the field of wind energy utilisation in Serbia

BIOM ADRIA project                         Central-      January 2007     €0.07m       Use of biomass as a primary energy source, as well as co-operation and
                                          European        - June 2008                  networking of Serbian institutions at all levels: scientific, technological and
                                          Initiative                                   industrial



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                                                                               OP for Economic Development (Annexes), 2012-2013                         2nd draft




Biodiversity strategy, action plan and     UNDP     January 2007 -   €0.17m   Preparing the first Biodiversity Strategy and Action Plan (BSAP) and the first
national report                                       December                National Report as the initial step to follow up on the national commitments to
                                                        2010                  the Convention of Biodiversity ratified in 2002.
Local economic development in the         Denmark    2007 - 2011     €10.0m   Economic development in the south, in the city of Niš. Activities include:
Balkans (LEDIB) programme                                                         Supporting local authorities in developing an enabling business
                                                                                   environment for SME development. The support will promote public-
                                                                                   private dialogue and support business organisations advocating for the
                                                                                   needs of SMEs;
                                                                                  Supporting SMEs through support to cluster development;
                                                                              Supporting development of business development services
Introduction of the new energy            Norway     May 2008 -      €0.16m   Activities include:
efficiency policy and establishment of              October 2009                  Implementing energy efficiency policy and programmes;
energy planning on a local level                                                  Identifying, developing and implementing projects/activities aiming to
                                                                                   increase energy efficiency;
                                                                                  Securing major improvements of energy efficiency in buildings;
                                                                                  Creating market for energy efficiency business, particularly in buildings;
                                                                                  Transferring knowledge in the area of strategic planning on a local level;
                                                                                  Maximising local and regional involvement, together with transfer of
                                                                                   knowledge in creating national energy policy, by creating network of energy
                                                                                   managers on national, regional and local level;
                                                                                  Coordinating with the network by MoME.
Study of capacity building of the         Norway     2008 - 2010     €0.23m   Activities include:
Republic of Serbia in the field of                                                Increasing the capacity in the field of strategic energy planning in Serbia;
strategic planning in the energy sector                                           Improving the quality of the Strategic documents (the Energy Strategy &
                                                                                   the Energy Strategy Implementation Programme); and
                                                                                  Better implementation and monitoring of energy policy.
Rehabilitation of the district heating    Germany    2008 - 2010     €25.5m   Sustainable and more efficient supply of district heating to its users.
system in Serbia (Phase III)
Support to the sustainable regional       Austria    2008 - 2011     €1.95m   Establishing cooperative network of public and private actors in joint leveraging
development of Jablanica and Pčinja                                           economic development of South Serbia by:
Districts                                                                         Strengthening capacities of RDA;
                                                                                  Public and private actors cooperation in prioritising investments in the
                                                                                   region;
                                                                                  Establishing concrete data and knowledge resources, planning tools and
                                                                                   procedures for regional coordination




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                                                                                             OP for Economic Development (Annexes), 2012-2013                          2nd draft




Regional development of Bor District         EBRD & World     2008 - 2013       €24,3m      Support Serbian government in revival of Bor and Majdanpek municipalities
                                                 Bank                         EBRD loan +   through:
                                                                                $6.6m            Managing environmental problems and cleaning of inherited polluted sites;
                                                                               IDA loan           and
                                                                                                 Promoting socio-economic development through employment inducement
                                                                                                  and development of private sector
Project implementation plan -                Netherlands     January 2009 -     €0.12m      Providing guidance to the Ministry of Mining and Energy in the implementation
sustainable biomass and biofuels in                           March 2010                    of EU directives on renewable energy, with a focus sustainable production and
Serbia                                                                                      use of biomass, including biofuels.
Development of CDM pilot projects in           Norway         2009 - 2010       €0.37m      Activities include:
the energy sector in Serbia                                                                      Building capacity of the Energy Efficiency Centres (REECs) in Serbia to
                                                                                                  independently develop CDM projects and assist Serbian industry in
                                                                                                  identifying projects and obtaining carbon financing eligible for CDM
                                                                                                  finance;
                                                                                                 Increasing interest for CDM in the industry by preparing pilot projects
Feasibility study for the 5 MW biomass       United States    2009 - 2010       $0.25m      Assisting the Government in the design of and soliciting offers for the
combined heat and power plant project                                                       construction of the new biomass combine heat and power plant.
Feasibility study for the City of Niš gas-   United States    2009 - 2010      $0.434m      Analysing the supply and demand for both heat and power in the city of Niš, to
fuelled combined heat and power plant                                                       determine the best location within one of the five municipalities that service the
project                                                                                     city’s thermal needs, to examine the size of the gas turbine and extraction steam
                                                                                            needed for the plant, and to determine the cooling system for the steam
                                                                                            turbine.
Study for introduction of energy                Japan         2009 - 2011       €1.2m       Activities include:
management in energy consumption                                                                 Acquiring and analysing comprehensive data regarding the energy
sectors in Serbia                                                                                 efficiency in order to identify technical measures and steps necessary for
                                                                                                  introduction of environmental management;
                                                                                                 Recommending and justifying the necessary organisation, steps and
                                                                                                  measures for introduction of the energy management in Serbia by taking
                                                                                                  into consideration the existing institutional framework;
                                                                                                 Proposing a solution that would further strengthen relations between
                                                                                                  relevant institutions;
                                                                                                 Defining their role in the introduction of energy management (regional
                                                                                                  approach should also be taken into consideration).
Financing energy efficiency investment       United States    2009 - 2011      $0.035m      Activities include:
for climate change mitigation                 & UNECE                                            Identifying and developing investment projects;
                                                                                                 Strengthening energy efficiency and renewable energy policies;
                                                                                                 Promoting opportunities for commercial banks and companies to invest.


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                                                                                      OP for Economic Development (Annexes), 2012-2013                         2nd draft




Peace building and inclusive local         Norway,      2009 - 2012     $7.92m      Activities include:
development (PBILD)                        Sweden,                                       Enhancing community cohesion and human capital;
                                         Switzerland,                                    Improving provision and equitable access to public services;
                                          UNDP, UN                                       Strengthening economic development;
                                          MDG Fund                                       Improving migration management
Strengthening capacities for inclusive      UNDP        2009 - 2012     €3.78m      Reducing existing development disparities between Pčinja and Jablanica districts
local development In southern Serbia                                                and the rest of Serbia.
                                                                                    Activities include:
                                                                                          Improving the connections between community and human capital in
                                                                                           employment
                                                                                          Improving access to public services
                                                                                          Strengthening economic development
                                                                                    Developing mechanisms for migrations management
Development of website                      UNDP         2010 (6       $0.025m      Developing website standardisation rules for e-Government, which aims at
standardisation rules for e-Government                   months)                    unifying practice of Serbian public authorities in providing information through
                                                                                    web pages and making a step further toward second stage of development of
                                                                                    citizen – oriented e-Government services
Capacity building for monitoring,         Germany       2010 - 2012   Not known     The general objective is transformation of the energy efficiency market, and the
verification and evaluation system of                                               specific objective is establishment of a monitoring, verification and evaluation
the energy efficiency policy in SEE                                                 system for energy efficiency policy
countries in terms of the EU accession
process
Municipal economic development in         Germany       2010 - 2013     €4.0 m      Activities include:
the Danube Region                                                                       Improving cooperation between local, regional and national level in order
                                                                                         to stimulate local and regional economic development;
                                                                                        Strengthening capacities of national, regional and local institutions dealing
                                                                                         with regional development;
                                                                                        Improving administrative services and procedures for the benefit of
                                                                                         business sector;
                                                                                        Promoting development of tourism and entrepreneurship;
                                                                                        Promoting municipal technical capacities
Modernisation of the monitoring and      Switzerland    2010 - 2014   28.6m Swiss   The purpose is to increase the energy efficiency of TENT B, reduce the emissions
control system of Nikola Tesla Thermal                                   Francs     of pollutant gases, including greenhouse effect gases and increase the reliability
Power Plant B                                                                       of TENT B.




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                                                                                            OP for Economic Development (Annexes), 2012-2013                          2nd draft




Improving R&D infrastructure in Serbia           EIB          2010 - 2015      €200m +     Activities include:
                                                                                220.8m          Adaptation of existing buildings and laboratories
                                                                                Serbian         New capital equipment for research
                                                                              government        Human Resources Programme aimed at attracting some of the around
                                                                                                 1400 Serbian scientists working abroad
                                                                                                Creation of Centres of Excellence in priority research fields: energy and
                                                                                                 energy efficiency, environmental protection and climate change, materials
                                                                                                 science and nanosciences, agriculture and food, biomedicine and
                                                                                                 information and communication technologies
                                                                                                Upgrade of the Academic Computer network and infrastructure for the
                                                                                                 “Supercomputing Initiative”
                                                                                                New apartment buildings for young researchers in Belgrade, Novi Sad, Nis
                                                                                                 and Kragujevac
                                                                                                Creation of Science and Technology parks in Belgrade, Nis, Novi Sad and
                                                                                                 Kragujevac
Modernisation and reconstruction of         Czech Republic   2010 - ongoing    €120.0 m    Modernisation and reconstruction or railway line Niš-Dimitrovgrad, with
Corridor X                                                                                 financial support from the Czech Republic
Completion of road Corridor X               EIB, EBRD and    2009 - ongoing   €1,600.0m    Rehabilitation of roads and bridges and construction of new sections of roads
                                                  WB                                       and the Danube bridge within Corridor X (E-80, E-75, Belgrade), with financial
                                                                                           support of IFIs.
Railways reconstruction I                        EIB          2003-2006        €70.0 m     Rehabilitation of different sections of railway lines on Corridor X
Railways reconstruction II                       EIB         2008-ongoing      €80.0 m     Rehabilitation of railway lines on Corridor X, modernisation of three sections:
                                                                                           Batajnica-Golubinci, Gilje - Paracin, Dzele Kula- Stanicenje
Assistance in developing infrastructure        Norway         2010-2011        €0.33m      Implementing environmental legislation in Serbia in the field of hazardous waste
environmental project: hazardous                                                           management, by supporting preparatory phase of environmental infrastructure
waste treatment facility                                                                   project “Construction of Hazardous Waste Treatment Facility” and thus reducing
                                                                                           the amount of untreated hazardous waste in Serbia
Preparation of a feasibility study,             Spain         July 2010 –      €0.20m      Preparing project documentation for the provision of collection, treatment and
environmental impact assessment,                              November                     disposal facilities for the solid waste from the municipalities of Valjevo, Ub,
conceptual design, and staff training for                        2010                      Lajkovac, Ljig, Mionica, Osecina, Vladimirci, Koceljeva, Barajevo, Lazarevac and
the construction of the Kolubara district                                                  Obrenovac, serving a population of 440,000 inhabitants.
regional landfill
Assistance for development of the              Norway         2008-2010        €0.12m      Improving capacities and raising awareness about use of CDM projects, as
national strategy for incorporation of                                                     possible ways to encourage sustainable development and to enable faster
the Republic of Serbia into the clean                                                      implementation of Kyoto Protocol in the Republic of Serbia
development mechanism (CDM) under
the Kyoto Protocol


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                                                                                 OP for Economic Development (Annexes), 2012-2013                           2nd draft




Feasibility study on efficient ways for       Spain      July 2010 –   €0.2m    The overall objective of the project is to support the Republic of Serbia in
GHG emissions reduction under the                        November               contribution to the main objective of the UNFCCC and preparation for full
post-Kyoto framework                                        2010                membership in EU through preparation of a comprehensive national mitigation
                                                                                programme.
Enabling activity for the preparation of     UNDP        2008-2011     $0.30m   Generating, analysing and communicating information relevant for the
Serbia and Montenegro's Initial                                                 preparation and submission of Serbia’s Initial National Communication,
National Communication to UNFCCC                                                including:
                                                                                    Compilation of the national greenhouse gases inventory;
                                                                                    An update of analysis of potential measures to abate the increase in
                                                                                     greenhouse gas emissions;
                                                                                    A vulnerability assessment and analysis of adaptation options.
Remediation of Grand Bačka canal             UNDP        2008-2010     $2.12m   Finalising remaining part of the waste water collector for communal and
                                                                                industrial water for the territories of municipalities of Vrbas and Kula, promoting
                                                                                policy integration in the field of environmental protection, and increasing supply
                                                                                of professional services in this field.
Promoting renewable energy at the            UNDP        2007 – June   $0.06m   Estimation of wood biomass (wood residues in forests and wood waste in wood
local level                                                 2010                processing industry and other sources) in Serbia (selected municipalities /
                                                                                regions), including:
                                                                                    Developing the capacity to create a valid policy of targeting the use of wood
                                                                                     biomass;
                                                                                    Developing capacity for the inclusion of plans for the use of renewable
                                                                                     energy sources in local development plans;
                                                                                    Improving the joint use of information on the availability of wood biomass
                                                                                     and campaigns to raise awareness
Energy based on wood for sustainable         UN FAO      Not known     $0.35m   Macro- and micro-economic aspects of energy from trees in Serbia.
rural development
Updating the National Profile for          SAICM Quick   2007-2009     $0.02m   Identifying national priorities related to the integrated chemicals management
Chemicals Management, the                      Start                            in Serbia
development of assessments of national     Programme
capacity for strategic approach to          Trust Fund
international chemicals management
and organising seminars to determine
national priorities for chemicals
management in Serbia




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                                                                                       OP for Economic Development (Annexes), 2012-2013                            2nd draft




Chemicals risk management in Serbia           Sweden        2008-2010      SEK 7m     The main goals are the introduction of a system for classification, labelling and
                                                                                      providing safety data sheets in industry and that relevant stakeholders are
                                                                                      engaged in the introduction of these systems as well as establishment of the
                                                                                      core administration for chemicals risk management. This project will also
                                                                                      provide basic knowledge on REACH, risk assessment and EU comitology.
Enabling Activities for the Development         GEF         2005-2009     $386.876    Strengthening the capacity of Serbia to implement the Stockholm Convention.
of a National Plan for Implementation                                                 The purpose is to build capacity in Serbia to fulfil all obligations that result from
of the Stockholm Convention on                                                        this convention, in particular to develop a National Implementation Plan (NIP).
Persistent Organic Pollutants (POPs)                                                  The implementation agency of this project is United Nations Environment
                                                                                      Program (UNEP).
Strengthening local self-government on       Germany       March 2010 –    €0.1m      Activities include:
planning for sustainable municipal                          December                       Conducting training of the appointed municipal energy managers to collect
investment in the area of rational use of                     2010                          data necessary for preparing local energy balance and for base line
energy in Serbian municipalities                                                            assessment;
                                                                                           Conducting training of the appointed municipal energy managers for
                                                                                            preparing municipal energy efficiency projects;
                                                                                           Enforcing inter-municipal cooperation along with the knowledge transfer by
                                                                                            creating the network of energy managers at the national and regional
                                                                                            levels;
                                                                                           Enabling easier access of municipalities to expert support in data collection
                                                                                            and municipal investment planning;
                                                                                           Initiating the preparation of municipal energy efficiency projects
Danube River enterprise pollution           UNDP (Global     December      €14.5m     Activities include:
reduction (DREPR)                           Environment     2005 – May    (+ €1.0m         Regulatory reform and capacity-building;
                                             Fund), EU,        2010        added in        Investment in nutrient reduction, water and soil quality monitoring;
                                              Sweden       (extended to   December         Public awareness-raising and replication strategy; and
                                                             December       2009)          Project management, implementation and monitoring
                                                               2010)                  MAFWM contributes 11% of the total value of theproject, except for investments
                                                                                      in schools, farms and slaughterhouses; World Bank controls the implementation
                                                                                      of the funds




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                                                                  OP for Economic Development (Annexes), 2012-2013                        2nd draft




USAID Compete programme   United States   2007 - 2011   $14.7m   Reinforcing the competitiveness of sectors through policy reforms, workforce
                                                                 development, and communications efforts through:
                                                                     Targeted sales and marketing efforts, such as trade shows, market
                                                                      research, and B2B meetings;
                                                                     Enhancing the long-term competitiveness of a sector, such as supporting
                                                                      firms to attain international certifications and standards;
                                                                     Building industry groups/associations to advocate on behalf of a sector;
                                                                     Implementing workforce development initiatives which build technical skills
                                                                      and international branding efforts to increase awareness of the benefits of
                                                                      investing in Serbia.
EVALINA                     Norway        2011 - 2013   €0.62m   Activities include:
                                                                  Designing a system for monitoring and evaluation of innovation activities;
                                                                  Building capacity of institutions responsible for implementation of the
                                                                    system for monitoring and evaluation of innovation activities;
                                                                  Preparation of methodology, techniques, measures and instruments for
                                                                    monitoring and evaluation of innovation activities tested through Pilot
                                                                    exercise




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