Péter Staviczky, Fatime Barbara Hegyi

European Structural and Investment Funds Journal, Volume 5 (2017), Issue 4, Page 264 - 276

This article highlights the relevance of State aid law both for policy makers and aid grantors when implementing smart specialisation strategies (S3). Smart specialisation involves member states or regions focussing their investments related to research and innovation on areas that will exploit emerging opportunities and market developments in a coherent manner, while State aid law contributes to the effective implementation of policies, controls the spending of public funds and prevents subsidy races between Member States, thereby enabling to the maintenance of effective competition on the internal market. The article aims to contribute to the cross-policy approach necessary for the efficient use of European Structural and Investment Funds. It also shows that complying with State aid law can be done with less administrative burden than in the previous programming period, however planning is needed to ensure compliance and to minimise risk of breaching the requirements. Thus, the right approach to State aid law is the early recognition of situations where State aid may be present and making the necessary steps to avoid the risk of repayment to the grantor (recovery).

Peter Wostner

European Structural and Investment Funds Journal, Volume 5 (2017), Issue 1, Page 84 - 96

The paper scrutinises the Smart Specialisation approach conceptually as well as its practical application in the case of Slovenian Smart Specialisation Strategy, the S4. It argues that Smart Specialisation still tends to be too narrowly applied and that its potential, on the EU level, is not yet fully exploited. The paper investigates where the roots of competitiveness in the modern world lie and argues that investment is a necessary but not a sufficient condition and that it is structural transformation that is at the heart of advancement. The Slovenian S4’s major contribution is not only in the setting of national priorities as regards innovation. What matters even more is that S4 is fundamentally transforming the way stakeholders on the ground interact with each other, creating value networks, but it is also transforming the way policy-making is done within the government. It is shifting the perception of the government as a source of financing to a facilitator of change. The paper demonstrates how fundamental is the difference between the financing of projects and the financing of policies. They are the flipside of the same coin as investment and structural transformation, with the former being a necessary but not sufficient condition for advancement of non-frontier regions and it is here that policies like Cohesion policy with their ex-ante conditionalities really make a difference. Finally, structural transformation is very hard to achieve, which is why putting external pressure for change but also a guarantee of longer term commitment through ex-ante conditionality, i.e. outside pressure, is critical.