INSTRUMENT FOR PRE-ACCESSION ASSISTANCE 2014-2020 IPA CBC P ROGRAMME MONTENEGRO – ALBANIA ADOPTED ON 10/12/2014 IPA II Cross-border programme Montenegro Albania TABLE OF CONTENTS Programme synopsis ______________________________________________________________ 3 Section 1: Programme Summary _____________________________________________________ 5 1.1 Summary of the Programme ____________________________________________________ 5 1.2 Preparation of the programme and involvement of the partners _______________________ 7 Section 2: Programme Area ________________________________________________________ 10 2.1 Situation Analysis ___________________________________________________________ 10 2.2 Main findings ______________________________________________________________ 19 Section 3: Programme Strategy _____________________________________________________ 22 3.1 Rationale - Justification for the selected intervention strategy ________________________ 22 3.2 Description of programme priorities ____________________________________________ 25 3.3 Horizontal and cross-cutting issues _____________________________________________ 32 Section 4: Financial Plan ___________________________________________________________ 33 Section 5: Implementing Provisions __________________________________________________ 34 5.1 Programme Management Structure _______________________ Error! 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LIST OF ANNEXES __________________________________________________________________ ANNEX 1: Description and Analyses of the Programme Area_____________________________ 28 Situation and SWOT analysis ___________________________________________________ 29 Page 2 of 72 IPA II Cross-border programme Montenegro Albania Programme synopsis Programme title CBC Programme Montenegro - Albania 2014-2020 Programme area Montenegro: - Andrijevica, Berane, Petnjica, Plav, Gusinje, Rožaje, Podgorica, Cetinje, Danilovgrad, Budva, Bar and Ulcinj Albania: - Region of Shkodra - Region of Lezha - * District of Tropoja Programme overall To promote/strengthen good neighbourly relations and socioeconomic objective development of the border regions, through valorising its touristic potentials, an environmentally sustainable and socially inclusive economic development, with respect for its common cultural and natural heritage. Programme TP1: Encouraging tourism and cultural and natural heritage; thematic priorities TP2: Protecting the environment, promoting climate change adaptation and mitigation, risk prevention and management TP3: Promoting employment, labour mobility and social and cultural inclusion across the border TP4: Technical Assistance Programme specific - The competitiveness of the tourism sector is enhanced by the objectives economic valorisation of the cultural and natural heritage - The protection of environmental resources in lake and alpine areas is furthered - Employability and social inclusion is fostered - The effective, efficient, transparent and timely implementation of the programme and awareness raising is ensured Financial allocation EUR 11,900,000.00 2014-2020 Implementation Indirect Management (subject to the entrustment of budget implementation Page 3 of 72 IPA II Cross-border programme Montenegro Albania method tasks) Contracting Montenegro: Ministry of Finance Authority Central Finance and Contracting Unit (CFCU) Jola Piletica bb, 81 000 Podgorica Tel: + 382 (0) 20 230 630 Fax: + 382 (0) 20 230 657 Relevant authorities Montenegro: Ministry of Foreign Affairs and European Integration in the participating Stanka Dragojevića 2 IPA II beneficiaries 81000 Podgorica [Operating Tel: (+382 20) 224 439 Structures] Fax:(+382 20) - 224 449 Albania: Ministry for European Integration Rr. “Papa Gjon Pali II”, Tirana, Albania Tele: +355 4 22 286 45 Fax: + 355 4 22 562 67 JTS/Antenna The JTS will be located in Podgorica, Montenegro. Antenna will be located in Shkodra, Albania *Wherever the term District of Tropoja is mentioned in the text, it refers to the previous territorial division in Albania which includes Bajram Curri Municipality, Margegaj Commune, Tropoje Commune, Bujan Commune, Bytyc Commune, Fierze Commune, Lekbibaj Commune, Llugaj Commune. Page 4 of 72 IPA II Cross-border programme Montenegro Albania Section 1: Programme Summary The programme for cross-border cooperation between Montenegro (MNE) and Albania (AL) will be implemented under the framework of the Instrument for Pre-accession Assistance (IPA II). IPA II supports cross-border cooperation with a view to promoting good neighbourly relations, fostering union integration and promoting socio-economic development. The legal provisions for its implementation are stipulated in the following pieces of legislation: • Regulation (EU) No 231/2014 of the European Parliament and of the Council of 11 March 2014 establishing an Instrument for Pre-accession Assistance (IPA II) • Regulation (EU) No 236/2014 of the European Parliament and of the Council of 11 March 2014 laying down common rules and procedures for the implementation of the Union's instruments for financing external action • Commission Implementing Regulation EU No 447/2014 of 2 May 2014 on the specific rules for implementing the IPA II regulation 1.1 Summary of the Programme The Programme covers a territory of 11,970 km2 with a total population of about 749,257 inhabitants. Territory in Montenegro accounting for 52.1 % of programme area covers 12 municipalities spread in three geographic regions. The Albanian part is composed by three administrative units, the regions of Lezha and Shkodra and the district of Tropoja accounting for 47.9 % of the programme area. The length of borderline is 244 km of which 38 km are water border. Overall, the programming area has 23 municipalities and a total of 1,144 settlements – towns and villages. The programme area is characterized by a contrasted geographic and climate profile. It presents sharp contrasts as it alternates mountains, hills, rivers, lakes and sea coastline very close to each other. The programme area is home to several National parks, protected zones and landscapes reflecting the rich biodiversity and environmental differences. The population living in the programme area accounts for almost 61% of total population of Montenegro, and 13.5% of Albania. Population in the programme area is a balanced match with Montenegrin population accounting for 50.63%, and Albanian population with 49.37%. The composition of the population in the programme area shows that 50% of population belongs to the 15- 49 years old age segment. Main findings Main findings of the analysis rendering the preparation of the document are summarised below: The programming area features regional disparities in terms of socio-economic developments and the structure of economy is different on both sides of the border. While Albanian regions rely on agriculture, services, wholesale and retail markets, Montenegrin regions feature more developed industry, and the Page 5 of 72 IPA II Cross-border programme Montenegro Albania level of tourism is much more developed. Both regions are below their development potential, as they have yet to find ways, and opportunities to benefit from their comparative advantages. Business competitiveness is low on both sides of the border. The structure of economic operators in the programme area is dominated by small and medium enterprises. Higher productivity and further investment in know-how and use of innovation technologies is a precondition to becoming more competitive both nationally and internationally. Majority of the small and medium enterprises (SME) in both sides operate in the services sector. Strengthening of business support mechanisms remains a challenge. Agriculture is a major economic potential in both countries, but underutilized, with low productivity and competitiveness. In general rural economy is fragmented, to a higher degree in the Albanian programme area. But, small agricultural holdings face difficulties in accessing country and regional markets. Improving access to market and strengthening the food security system and inspection bodies will be important for increasing agriculture sector competitiveness. Tourism is a great potential for both countries, but unevenly developed. Montenegro is already a popular touristic destination while Albania has yet to become one, as tourism sector in the Albanian part of the programme area is poorly developed despite of the great potential. Obvious synergies, potentially to be supported by the cross-border cooperation (CBC programme), can be built between the regions in Albania and the coastal areas in Montenegro. There is a rich historic-cultural heritage in the bordering area that needs to be preserved. Further valorisation of historical and culture heritage could contribute to strengthening the identity of the area, but also as an asset for the economic development. Unemployment is relatively high in both Montenegro and Albania and still a major economic problem. Unemployment remains a sharp problem especially for the socially sensitive groups such as youth, women and rural population. Poverty has become an urban concern, indicating a sluggish performance of economy over the last years, while the revival of the already exhausted urban potential to lead economic growth has become imperative. Unequal educational level is present in the programme area, with illiteracy increasing in remote areas. Highly educated young people have a tendency to leave towards regions that provide more opportunities or abroad. The secondary education system is less attractive and accessible, especially for young rural population in the programme area. Research & Development and information and communication technologies (ICT) penetration is at a low level in Albania whereas in Montenegro follows the trend of continuous increase and is currently at the sufficient level. Insufficient investments, governmental, regional or local support activities for research and development (R&D) activities are present. Overall, health services in the programme are improving, but more needs to be done to ensure universal access to such services by poor households. Environment protection needs serious consideration in future development plans of the programme area. With the overall development of the programme area largely relying on natural resources, their environmental protection and preservation is crucial for the sustainable development of the area. Improved waste management, control of pollution, and improved land management are amongst the Page 6 of 72 IPA II Cross-border programme Montenegro Albania key priorities to be addressed. Further valorisation of natural resources in the view of economic development is a key issue for the development of the area. Main Areas of Interventions The overall objective of this cross-border programme is to promote/strengthen good neighbourly relations and socioeconomic development of the border regions, through valorising its touristic potentials, an environmentally sustainable and socially inclusive economic development, with respect for its common cultural and natural heritage. Based on the situation analysis and the Political, Economic, Social, Technological, Legal, and Environmental (PESTLE) and strengths, weaknesses, opportunities and threats (SWOT) analysis the following thematic priorities and specific objectives are regarded as instrumental to be supported through CBC initiatives: (1) Encouraging tourism and cultural and natural heritage:  The competitiveness of the tourism sector is enhanced by the economic valorisation of the cultural and natural heritage (2) Protecting the environmental, climate change adaption and mitigation, risk prevention and management:  The protection of environmental resources in lake and alpine areas is furthered (3) Promoting employment, labour, mobility and social and cultural inclusion across the border:  Employability and social inclusion is fostered. In addition to the three thematic priorities mentioned above, the programmes will include a specific Technical Assistance priority aiming at, amongst other purposes, ensuring the effective management and administration of the cross border programme. 1.2 Preparation of the programme and involvement of the partners The IPA CBC Programme 2014-2020 between Montenegro and Albania is the result of joint programming exercise work carried out by the participating countries’ representatives, including relevant stakeholders from the central level institutions, local level institutions of the programme area, Chambers of Commerce and Industry, entrepreneurs, and local organisations. A Joint Task Force has been established to prepare and implement the programming document under the leadership of Operating Structures. (OSs). Thus, the programme is managed by the Operating Structures - for Montenegro in the Ministry of Foreign Affairs and European Integration, and for Albania in the Ministry of European Integration. The programming process started in beginning of July 2013 and continued until end of May 2014. The programme was designed through a consultation process involving local stakeholders and potential beneficiaries from both sides of the border. Questionnaires were designed by the CBIB+ and disseminated by the OSs with the support of the JTS to institutions at central and local level, CSOs, to Page 7 of 72 IPA II Cross-border programme Montenegro Albania support the PESTLE and SWOT analyses for the programme and provide one of the indicators for the identification of joint priorities for the cross-border area. Out of 140 questionnaires sent (70 in Albania and 70 in Montenegro), 91 were received back. The overall response rate in the survey was approximately 65%. Clarification interviews were also conducted - 34 in Albanian and 9 in Montenegro. The first draft of the Programming Document was submitted to the Commission on 15 November 2013. During December 2013 two presentation meetings were held with local government representatives in the framework of the Public Consultation Process from the Albanian sidein Shkodra and Lezha with 15 participants. . On the other side, in October 2013, public consultations were held in Bijelo Polje and around 15 participants were present. During March-April 2014 a second wider circle public consultation process was organised by the Albanian OS in coordination with the Cross-border Institution Building Project (CBIB+) to present to civil society organisations, universities, civic activists, the second draft document of the programme between Albania and Montenegro in the eligible regions from Albania. Civil society actors and local government representatives strongly supported the thematic priorities selected for this programme and also provided details as regards the needs related to their respective regions that are duly reflected in the programme document. In addition, in order to coordinate the process at national level, a consultation meeting was also organised with the representatives from line ministries in Albania on the thematic priorities and activities proposed in the programmes. The following table summarizes the process of preparation of this programme. Table 1 -Meetings and consultations Timing and Place Activities and Scope 20-21 June 2013, Becici, Budva, in Intra Western Balkan programming meeting for the 2014-20 Montenegro 9 July 2013, Podgorica Programming Steps and requirements for the PESTLE and SWOT analysis with the OS MNE August – mid September 2013 Distribution of the questionnaires for the collection of data 16 September 2013, Tirana Kick-off Meeting with CBIB+ team and Coordination for the programming exercise IPA CBC 2014-2020. 25 September 2013, Podgorica CBIB+ Training on Strategy Development and Formulation (OS, EUD, JTS/A) 27 September 2013, Tirana CBIB+ Training on Strategy Development and Formulation (OS, EUD, JTS/A) 02 October 2013, Podgorica Meeting with Montenegrin Operating Structure – Coordination for the Programming exercise of IPA CBC 2014 – 2020, agreement on programming time-table 08 October 2013, Podgorica Meeting with various Montenegrin Authorities (line Ministries) – discussion on situation and strategic development prospects Page 8 of 72 IPA II Cross-border programme Montenegro Albania 14 October 2013, Tirana Meeting with Albanian Operating Structure – Coordination for the Programming exercise of IPA CBC 2014 – 2020, agreement on programming time-table, discussion on Situation and strategic development prospects 17 September – 24 October 2013, Data collection and elaboration, preparation of PESTLE, finalization of Tirana, Podgorica Situation Analysis and SWOT 25 October 2013, Tirana Meeting of the First Joint Task Force, presentation of the Situation Analysis and SWOT 30 October 2013, Bijelo Polje, Public Consultation meeting with more than 15 participants from the Montenegro programme area 15 November 2013 Submission of the first draft of the Programming Document to DG ELARG 21-22 November 2013 , Belgrade, Serbia Regional CBC Consultative Forum 12 December 2013 , Tirana, Albania Technical meeting of the programming process between OS, the Commission, EUD and CBIB+ - Discussion on the programme strategies for three programmes took place. Some suggestion regarding formulation of objectives, indicators and eligible areas were made by the EC 19 December 2013, Preliminary The programme document was presented, as well as the programming Public Consultation, Lezha, Shkodra process and rationale for selecting the intervention strategy with local region, Albania government with 15 representatives. The intervention strategy and the thematic priorities selected resulted to be in line with their view towards CBC needs January 2014 Review of the Programming Document based on the recommendations of the Commission 7 February 2014 Submission the Commission of the 2nd draft programming document 27 March 2014, Lezha region, AL Wider Public Consultation Meeting The programming process together with the programme priorities with Civil Society and Local Actors were presented to 27 civil society organisation and local government with 27 participants representatives in Lezha region followed by active discussions on the recommendation and suggestions from participants. The priorities resulted to be in line with their view towards CBC needs. 28 March 2014, Shkodra region AL, The programming process together with the programme priorities Wider Public Consultation Meeting were presented to more than 32 civil society organisation and local with Civil Society and Local Actors government representatives of Shkodra region followed by active discussions on the recommendation and suggestions from participants. The priorities resulted to be in line with their view towards CBC needs. 30 March 2014 The Commission comments on the 2nd draft document Page 9 of 72 IPA II Cross-border programme Montenegro Albania 16 April 2014, Tirana, AL, The programming process and programme priorities for the 3 borders, Consultation Meeting with the Line AL-KSV, MNE-AL, MK-AL were presented to the line ministries covering Ministries the priorities and activities in the documents. The aim was to consult with the current national programmes in the respective fields of action and not overlap, including possible synergies. The draft documents resulted to be in compliance also with the national strategies and conceived as highly important for the development of the regions by the participants. 17 April – 1 May 2014 Reflection on comments received from the Commission and the public consultations meetings 30 May 2014 Submission of the draft final version of the Programming Document to the Commission Section 2: Programme Area1 2.1 Situation Analysis The programme area for the Cross-Border Programme between Montenegro and Albania covers a territory of 11,970 km2 with a total population of about 749,257 inhabitants. The territory in Montenegro accounts for 52.1 % as against 47.9 % in Albania. The borderline is 244 km of which 38 km are water border. There are three operational border-crossing points between Albania and Montenegro along this borderline. The programme area in Montenegro covers municipalities: Andrijevica, Berane, Plav, Gusinje2, Petnjica3 and Rožaje; Podgorica, the capital of Montenegro and Cetinje, Danilovgrad, Budva, Bar and Ulcinj. The programme area in Albania includes the regions of Shkodra and Lezha and the district of Tropoja4. Overall, the programming area has 23 municipalities and a total of 1,144 settlements – towns and villages. 1This section provides a summary of main data from situation, PESTLE and SWOT Analysis. The full version of the analysis is annex to the programme document 2 Gusinje is a new municipality, introduced as an administrative division of the municipality of Plav; it is in its early stages of organisation 3Petnica is a new municipality, introduced as an administrative division of the municipality of Berane; it is in its early stages of organisation; Gusinje is also a newly established municipality. 4 Tropoja district has 1 Municipality of Bajram Curri, and 7 Communes – Bujan, Bytyc, Fierze, Lekbibaj, Llugaj, Margegaj and Tropoja Page 10 of 72