The Croatian Employers' Association (HUP) on Tuesday warned that funds need to be found as soon as possible to increase allocations for research and development (R&D) projects that are funded by the European Union.

HUP’s branch of professionals for EU funds said in a press release that it had approached the competent ministries with an appeal for additional funds to be secured for 45 projects that have applied for the “Increasing the development of new products and services arising from R&D activities – Phase II” programme.

The ministries have recognised the great need for support for private investments in R&D and the significance of prepared and positively assessed projects, however the final decision on financing has still not been made, HUP said.

Five months have gone by since the call for applications closed, HUP underscored, in which time applicants were required to start implementing their projects, procure equipment, and some applicants had to employ foreign experts which led to an increase in overall costs.

Any new job is more than necessary in the crisis caused by the coronavirus pandemic, when conditions on the market are unfavourable and when many employers are experiencing difficulties in creating jobs or in financing demanding projects on their own, HUP said.

The director for support for investors at the Apsolon company, Marko Andabaka, believes that it is important to conclude project evaluation as soon as possible and ensure funding for projects that have passed a very competitive and demanding selection process thanks to their quality and innovativeness.

HUP warned that entrepreneurs have invested numerous resources to prepare IRI projects. They have invested their own resources for dimensioning, finding partners, engaging experts, creating projects and employing project staff, supplying equipment and investing existing employees’ time in preparing project activities.

It is important to know that each call for applications is very complex and they are not repeated often, and if the necessary €100 million is not secured soon, jobs that were created will have to be shut down, and competitiveness will fall for products and services that will not be developed on time, HUP underlined.

The biggest loss will be that entrepreneurs will be discouraged from applying for future project applications because of the high initial costs and uncertainty of whether their financial plans will be approved, HUP said.

HUP recalled that Croatia is one of the countries with the lowest rates in the EU for investments in R&D, adding that without specific investments in R&D and innovation, Croatia’s competitiveness is declining and it is losing any advantage it may have in Europe and the world.

HUP appeals to the government to invest additional effort in finding the necessary funds so that quality, ready and launched investments can be implemented.