2. SMALL
BUSINESS
EXPANSION
PROJECT
March, 2016
Funded by USAID and co-funded by the
Government of Switzerland
Implemented by CARANA Corporation
Four-year project (2012-2016)
Overarching goals: stimulating economic
growth, catalyzing job creation and mobilizing
regional funds for economic development
Operates in the Polog, Pelagonia, Vardar and
Northeastern regions of Macedonia, but has a
spillover effect into the rest of the country
4. SMALL
BUSINESS
EXPANSION
PROJECT
March, 2016
Stimulating economic growth through:
Optimization of assets
Supply chain interventions
Import substitution
Public-private partnerships
Six key initiatives:
Implementation of the LEADER Approach
Grow More Corn
Macedonia Adventure Travel
Collection of Wild-Gathered Products
Women in Business
Light Manufacturing
Aims for a real catalytic effect on the targeted
sectors through leveraging of funds from the
public, private and civic sectors partners
5. LEADER APPROACH | RESULTS
2012-2015 2016
• 5 pre-Local Action Groups (LAGs)
registered (3 in Pelagonia and 2 in
the Northeastern region);
• 5 LEADER pilot projects initiated:
• Vegetable seedling production in Bitola;
• Kokino tourism destination development
in Staro Nagoricane;
• Osogovo tourism destination
development in Rankovce, Kratovo and
Kriva Palanka;
• Prespa tourism destination
development in Resen;
• Paragliding site development in
Krivogashtani.
• +5 pre-LAGs registered;
• Network of pre-LAGs made operational,
leading toward the formation of a
National Rural Network as proposed by
the EU;
• Lobbying Ministry of Agriculture to
establish Register of Pre-Lags and
announce measure in National
Program;
• 2018-2021: Expected $10 M leveraged
funding for LEADER development
projects (2.7% SBEP cost-share).
6. LEADER APPROACH | CHALLENGES
• SBEP is working with the Government to facilitate the efficient implementation of
the LEADER approach, but there is a risk that the pace of policy implementation
will slow significantly without further support from SBEP;
• Because of an unsuccessful attempt to implement the LEADER approach in 2007-
2008, there is a risk that local stakeholders will lose their interest in participating if
the current implementation process proves unsuccessful;
• The Local Action Groups need further donor support to develop their institutional
capacities, including their project management capacities, to build up their
credibility and credit rating and not least to strengthen their capabilities to
administer/implement public (national) funds before LEADER is accredited as an
IPARD Measure by the EU.
• The local population, especially the private sector, need to witness the successful
implementation of LAG projects to become full convinced in the benefits of the
LEADER approach. The LAG members understand the benefits, but lack the
practical experience needed to take full advantage of them at this time.
7. ADVENTURE TRAVEL | INTRODUCTION
• The adventure travel market was valued at 263 billion USD in 2013 and is
growing rapidly (the market’s estimated value was 89 billion USD in 2009);
• This niche market of travelers leaves on average 65 cents of every dollar in
the destination, compared with an estimated 8-17 cents on every dollar for the
mass tourism market;
• Adventure travel consumers also place a high importance on responsible and
social development when planning their trips;
• Macedonia is perfectly positioned to take a piece of this market because
examples of adventure travel are prominent in Macedonia’s popular tourism
offerings, including hiking, horseback riding, mountain and road biking, and
paragliding.
8. ADVENTURE TRAVEL | INTERVENTION
• SBEP’s strategy for the development of the adventure travel industry in
Macedonia is based on the idea that the quality of the destination increases in
parallel with the quantity of tourists who visit it;
• The most cost-effective approach to attracting tourists to a destination is to
advertise to the members of the global adventure travel trade community. To that
end, SBEP partnered with the Adventure Travel Trade Association (ATTA) in order
to promote Macedonia and the Western Balkans as the new European frontier
in adventure travel;
• To support this process, SBEP is also helping local tourism service providers
improve the quality of their service and promotion with a focus on adventure
sports clubs who bring in a significant number of tourists through their
international networks of athletes and sport enthusiasts;
• This process is complementary with IME’s work on destination management, risk
management and service excellence on the side of inbound tour operators.
9. ADVENTURE TRAVEL | RESULTS
2014-2015 2016
• 3 paragliding sites equipped;
• 3 AdventureEDUs held;
• 1 AdventureWeek FAM tour held,
bringing 20 international tour operators
and media to Macedonia;
• 1 new adventure tour;
• Generated $1.6 M in international
media exposure;
• 10 adventure events supported,
increasing the number of visitors by
30% (total of 2,000 visitors).
• +1 paragliding sites equipped;
• +4 new adventure tours between 2016-
2017;
• In May, AdventureNEXT~Balkans will
bring 300 tourism leaders to Macedonia
for the first time;
• $10 M in expected media exposure;
• Official launch of the Via Dinarica
Macedonia during AdventureNEXT;
• Promotion of Prilep and Krushevo as a
regional paragliding hub;
• Expected 2016 leverage: $390,370
(28% SBEP cost-share).
10. Prilep Open, a new
paragliding competition
organized on Treskavec,
one of the 4 take-off site
equipped by SBEP
11. Tour operators and travel
journalists hike to the
village of Galicnik as a part
of the AdventureWeek FAM
tour of Macedonia
12. Travelers from the U.S. hike
up Mount Treskavec as a part
of the first Bike Tours Direct
tour in Macedonia – a result
of AdventureWeek
13. Over 500 cyclists
participated in the Mariovo
Off-road event – one of 10
outdoor adventure events
supported by SBEP in 2015
14. Hikers on the Shar
Mountains – a new
addition to the Via
Dinarica multi-country
hiking trail
15. AdventureNEXT~Balkans
• From 10-12 May 2016, Ohrid, Macedonia will host the first-ever regional
adventure tourism conference in Europe: AdventureNEXT~Balkans;
• AdventureNEXT~Balkans is expected to attract approximately 300 tourism
leaders and decision makers. This group will include 45 of the world’s most
promising international buyers (outbound tour operators and specialty travel
agents) and about 20 journalists;
• The event also aims to attract representatives from the entire tourism supply
chain in Southeastern Europe, including leading tour operators and travel
agencies, hotels, associations, active clubs, governmental and non-
governmental organizations, development agencies, media, etc;
• AdventureNEXT is an excellent example of regional tourism cooperation on
the Balkans with the governments of Macedonia, Kosovo and Albania co-
financing parts of the conference.
16. AdventureNEXT~Balkans
• The goal of the conference is to foster the development of adventure tourism
on the Balkans by:
• Advertising its destinations directly to industry representatives from all
over the world,
• Holding the biggest business-to-business (B2B) marketplace for
adventure travel businesses on the Balkans
• Building the capacity of adventure tourism businesses through
educational workshops and panel discussions with leading industry
professionals.
• In essence, AdventureNEXT~Balkans is a foreign direct investment (FDI)
conference because the biggest benefit for Macedonia and the region will
come from successfully attracting foreign investors in the adventure tourism
sub-sector.
17. ADVENTURE TRAVEL | CHALLENGES
• The sports clubs SBEP has been working with bring in a steady stream of
tourists to Macedonia, but they need further technical assistance if they are to
improve the quality of their services and increase the number of tourists they
can service;
• SBEP and the National Tourism Agency have been successful at bringing
almost all local tourism stakeholders together behind adventure tourism
development, but the National Tourism Agency still lacks the reputation and
capacity to manage this process on their own;
• Local tourism service providers will need to keep improving their service
quality and outreach efforts to take full advantage of Macedonia’s emergence
as a new adventure travel destination. This process is likely to slow down
without further donor support.
18. GROW MORE CORN | INTRODUCTION
• Macedonia’s low average corn yields of 4.3 t/ha of grain and 30 t/ha of silage
put the country at the bottom of productivity in both European and regional
contexts, resulting in 50,000 tons of imported corn annually (35% of the total
consumption), in addition to a deficit from related food products, such as
meat, eggs and dairy;
• The main corn-dependent supply chains are the focus of SBEP’s intervention
because they all suffer from a farm-level inefficiency that has a relatively
simple technological solution;
• The economic growth potential of this initiative became apparent during
SBEP’s early work with corn farmers and dairies in the Polog and Pelagonia
regions. Pelagonia, known as “Macedonia’s bread basket”, stands to gain the
most from a more efficient corn supply chain because agriculture and dairy
production significantly contribute to the region’s economy.
19. GROW MORE CORN | INTERVENTION
• By helping corn farmers to improve their production efficiency with the use of
SBEP-financed drip irrigation systems and good agricultural practices, the
Project initiated a catalytic reaction that is moving Macedonia towards full import
substitution of corn and the potential creation of more than 7,000 new jobs;
• SBEP is on the path to leveraging $24 million from farmers, the Ministry of
Agriculture and a new Development Credit Authority (DCA) Loan Facility by 2021,
resulting in 43 hectares of drip irrigation being installed for every hectare financed
by SBEP (the current ration is 1:1);
• To support the adoption of drip irrigation on corn, SBEP assisted the Government
in the process of modernizing Macedonia’s irrigation infrastructure by
commissioning feasibility studies for the irrigation systems “Strezevo” and
“Lisiche”, leading to an increase in the total agricultural area where water from
these systems can be accessed, as well as in the payment rate for their services.
20. Hectares of corn and
sunflower under drip in
Macedonia (end of 2015)
Farmers using drip
300+
SBEP investment
281 ha
50/50 subsidy
114 ha
Private investment
276 ha
Total
661 ha 2016 potential expansion
21. The difference between drip
(right) and furrow (left)
irrigated corn fields –
126 vs. 50 t/ha of silage
22. GROW MORE CORN | RESULTS
2012-2015 2016
• At least 661 hectares of corn and
sunflowers under drip irrigation
(9.6% of the 7,000 hectares goal
for full import substitution*);
• 210% increase in yields from
national average;
• Records: 18 t/ha grain, 126 t/ha
silage and 4 t/ha sunflower seeds;
• 900 new and retained jobs.
• +900 hectares of corn and sunflower
under drip (50/50 + own investment);
• National program applications and DCA
facilitation;
• IPARD farm expansion applications;
• ~20% increased yields;
• +1,200 new and retained jobs;
• Provide technical support for the use of
drip irrigation on a national level in
cooperation with all drip irrigation
suppliers in Macedonia;
• Expected 2021 leverage: $34,183,528
(2.4% SBEP cost-share).
4.2 t/ha 13 t/ha
23. Record Yields
Grain Silage
18 t/ha 126 t/ha
Average Yields (t/ha) Over Time
Silage
Grain
2012
(no DIS)
2013 2014 2015
Dairy farmers who adopted drip irrigation on
corn were able to enlarge their herds by
approximately between 2012 and 2015
24%
25. WOMEN IN BUSINESS
• Piloted in 2012
• Focused of women and youth in rural
areas – Polog region
• Targeting most vulnerable groups –
women that do not have access to
education nor the labor market
28. WOMEN IN BUSINESS
2012-2015 2016
• Accumulated $141.000 for the support
of women and youth entrepreneurs in
the Polog region;
• Supported 20 MSMEs owned by
women and youth entrepreneurs;
• 40% increase in revenues of supported
businesses;
• 43 new full-time and 39 new part-time
jobs;
• Established the Egalite foundation to
manage the Fund for Support of
Women and Youth Entrepreneurs.
• +10 additional MSMEs supported;
• +40 new jobs;
• Continuous fundraising with public and
private sector;
• Sustainability strategy (development of
new financial products);
• Egalite foundation received an
institutional grant aimed at building up
its organizational and advocacy
capacity;
• Expected 2016 leverage: $154,282
(32.7% SBEP cost-share)
29.
30. WILD-GATHERED PRODUCTS
2012-2015 2016
• Over 1,500 collectors trained;
• Supported the establishment of 4
new collection centers (1 in
Bogovinje and 3 in Mavrovo);
• 466 new and retained jobs (the 4
centers can employ up to 1,200
collectors).
• +500 collectors trained;
• +200 new and retained jobs;
• Support for 3 Collection Centers in
the Mavrovo National Park;
• Expected 2016 leverage: $30,000
(22.6% SBEP cost-share).
31. LIGHT MANUFACTURING
2012-2015 2016
• 180 companies catalogued in the
light manufacturing database;
• 95 leads found, 33 qualified and 3
finalized;
• $1.3 M in new transactions ($42 K
import substitution, $161 K exports
per annum and $1,1 M Foreign
Direct Investment);
• 28 new jobs.
• MAMEI – synergies with SIPPO
• +60 new companies catalogued in
database;
• +3 leads finalized;
• +100 new jobs (from the InBus bus
factory that will become operational
in 2016);
• B2B light manufacturing conference
will reveal new matchmaking
opportunities;