Integration of Ukrainian clusters into European industrial ecosystems
This report summarizes the progress of the Ukrainian Cluster Alliance clusters 3 months after the Košice Clusters meet regions conference in March 2023, which set a clear course for integration into the EU industrial ecosystems. The criteria for evaluating the progress of Ukrainian clusters and SMEs correspond to the strategic initiatives developed in June 2022 in the UCA strategy “Export and Internationalization”. This report also serves as a task for better coordination and communication with our key partners from the Ukrainian government, leading business associations, as well as the European Commission and European cluster associations.
Assessment of progress in European integration by key areas
Involvement of Ukrainian clusters, their members, SMEs into European projects and programs
Special programs of the European Commission focused on Ukraine
Business Bridge
In April, UCA, together with 4 European partners, took part in the EU competition to support 1,500 Ukrainian SMEs in their integration into the European space. The total cost of the call is EUR 4 million, the results are expected in July.
EIC Startups Fund
In May, the winner of the EIC competition to support 200 Ukrainian startups was announced. It was a consortium of 22 participants, including 6 Ukrainian ones. The leaders are the Ukrainian Startup Fund (USF) and the Funding Box Accelerator from Warsaw. Ukrainian Cluster Alliance (UCA) took part in this competition, together with 6 European and 5 Ukrainian companies, but did not succeed. UCA expects active participation of our innovative SMEs and startups in this program and will promote their involvement.
Participation in European Cluster Collaboration Platform events
The UСA service team regularly involves Ukrainian clusters and their members in ECCP events. In particular, since March, systematic work has been established to announce and involve Ukrainian clusters into EU Clusters Talks, which take place online every second Wednesday.
Participation in EU grant programs for the innovative development of Europe
In the first half of 2023, UCA clusters took part in joining 4 Horizon Europe projects, and also submitted 2 projects to the Visegrad Fund. As a part of cooperation with EIT, UCA also participated in several EIT Manufacturing events. Active work is carried out by the UCA service and project center, involving more than 10 clusters and SMEs every month in writing grant applications for open EU calls.
Participation in Interreg Next programs
Clusters Podillya Fashion Clusters, Kyiv Hi-Tech Cluster and the Carpathian Eco-Energy Cluster lead the Burshtyn+ program, which has already found support of partners in Slovakia, Poland and Germany.
to study foreign experience and establish partnerships. Sokołów Podlaski.
Work is underway with Slovak and Polish partners, Ukrainian clusters will be submitted to the Interreg Next program. UCA has started exchanges and some coordination with the Kyiv’s Institute of International Policy, which is responsible for the Interreg Next program in Ukraine.
Participation in Eastern Partnership programs
Cooperation of clusters within the framework of the EU4Business program, operated in Ukraine by the German federal company Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, continues. 8 clusters received funding in the amount of 25,000 euros to develop their capabilities for 2023. By the end of the year, GIZ plans to support several more UCA clusters and the executive directorate of the alliance.
For example, as part of the project “Creation of an innovative industrial platform “Professional Alternative Dnipro”, a delegation of a publishing and printing cluster from Dnipro made a business visit to the EU, visiting Slovakia, Germany, and France. As a result, several agreements on joint partnership activities and a memorandum of cooperation on the development of cluster partnerships were signed. More details here.
New programs jointly with European partners for recovery of Ukraine
UCA projects and programs
The number of projects presented in the UCA portfolio reached 52. In May, 4 Smart.City projects were added. In fact, UCA is one of the first large business associations of Ukraine, which systematically produces and promotes project proposals for a number of sectors, industries, and their ecosystems. UCA continues vigorous movement of these projects, positioning them as key cluster initiatives for the Recovery of Ukraine.
From April to May, UCA most actively promoted projects in the Smart.City / Smart.Regions sector. This promotion took place as a part of the visit to the Czech Republic, as well as at conferences in Kyiv and Lviv.
As a result of the visit to the Czech Republic, there are several project areas, which UCA is starting to develop together with Czech partners at the level of municipalities of five cities. The results of the Lviv conference with the participation of Polish and German clusters are also smoothly converted into joint projects.
Participation in other programs
Active work in the first half of the year is carried out by the Resource Center “Dual Use Technologies” (RC ‘Dual Use’) of UCA. The center consolidated applications from 16 leading innovators, members of the UCA clusters, contributed to the creation of the “Photonics” cluster initiative, and actively communicated these projects to key stakeholders, including at the state level. As a result, RC ‘Dual Use’ joined the accelerator of the Ministry of Defense of Ukraine. In the context of European integration, this center closely coordinates activities with German and Polish clusters in the area of photonics. In particular, the Ukrainian cluster initiative “Photonics” was created in May, whose representatives will present Ukraine at a conference on quantum technologies in Warsaw in March 2024. The partners are also working on better access of Ukrainian innovators to the EDF and ENDR funds.
Cooperation with European clusters — integration and construction of joint chains
Cooperation with Eastern European clusters and partners
Cooperation with cluster associations of Poland, the Czech Republic and Romania was most active in the first half of the year. In particular:
- UCA launched the Ukraine-Poland bilateral cooperation committee in the field of Industry 4.0. From the Polish side, it included the State Agency for Industry 4.0 (FPPP), Cluster Association (PCA), eDIH Mazovia, as well as other stakeholders.
- A big conference on sustainable regional development was held in Lviv together with the clusters of Poland, Germany and Greece (see report). An important result of the conference is the establishment of tracks — strategic lines of development that are subject to monitoring (follow-up) and further growth of partners. In particular, two conferences with participation of Ukrainian clusters have already been planned for the fall of 2023 in Krakow and Warsaw. The conference in Lviv was made possible thanks to financing and cooperation with the EEN-Ukraine consortium, that APPAU, one of UCA co-founders, is a member to.
- UCA participated in several exchanges with Romanian clusters, in particular in Hack4Restart matchmaking events.
- Two UCA clusters (APPAU and Kyiv Hitech cluster) took part in the Smart.City business mission to the Czech Republic in April. This is the 1st of 3 missions organized in the Czech language by CzechInno with the support of the Czech government, and aimed at the development of Ukrainian-Czech relations in the Smart.City, Smart.Industry and Cybersecurity sectors. UCA considers this visit as a benchmark for repetition with other countries and in other sectors.
- UCA began to develop platforms and online channels of permanent networking on the Solved platform, which was kindly offered by the Slovak partner with a similar name. In particular, the first such permanent exchange platform was created on the topic of “Sustainable regional development”.
In addition to the above, relations within the framework of the MoU signed in Košice were actively developed: in particular, the Kyiv Hi-Tech Cluster cooperates with the Slovak ZAIT (Žilina IT Cluster), and several medical clusters develop relations with Polish and German clusters. Most of these indicators of growth and development can be considered the result of the implementation of the MoU signed by UСA in Košice with 4 countries of Eastern Europe (Poland, Romania, Czech Republic, Slovakia) and Lithuania.
Cooperation with clusters and business associations from other EU countries
UСA contributed to the creation of agreements between the Spanish state agency in the field of cyber security INSIBE and the The State Service of Special Communications and Information Protection of Ukraine. The parties envisage involvement of funding from the government of Spain, as well as the European Union, to address the current challenges of Ukraine’s cyber security during the war. Development in this area is important in the context of the creation of a new UCA cluster initiative on cyber security. The decision was made in June.
APPAU continued to develop relations with the American CSIA. It was thanks to the sponsorship funds of this association that UCA managed to maintain service support team, implement a number of projects and survive the difficult year of 2022. In May 2023, APPAU together with the CSIA management created the mechanism of “honorary membership” in APPAU, which made it possible to expand the number of participants who support APPAU and UCA within the framework of the Professionals4Ukraine initiative.
Improving capacity of Ukrainian SMEs and clusters
Cluster support program by GIZ
8 UCA clusters received funding in the amount of 25,000 euros from the operator of the EU4Business GIZ program. A separate grant is planned for the UCA executive team (48,000 euros). Together, this significantly strengthens the financial capacity of UCA clusters to improve services for their SME participants, including areas of internationalization.
Other cluster support programs
In April-June, a number of international organizers announced programs to support internationalization of SMEs, including their business associations. USAID programs are the most attractive. In particular, this donor announced two major export-internationalization support programs – business missions and exhibitions.
As part of the implementation of the project “Promoting economic growth in the Kamianets-Podilskyi community”, the city plans to launch three clusters (tourism, creative industries and agri-food) by July 2025. The project is financed by the funds of the European Union (EU) within the framework of the “Measures for Economic Growth” program.
Creation of new UCA cluster initiatives
"Photonics" cluster initiative
The Photonics cluster initiative has been actively developing since the beginning of the year. It is initiated and supported by the German OptecBB cluster and its manager Mike Richardson.
In June, a merger of the Kyiv and Lviv ecosystems took place, which consists mainly of categories of scientists. The coordinator of the initiative is Oleksandr Bondarenko, associate professor of the Department of Electronic Engineering at KPI, one of the leading experts in the BOWI project.
“Advanced materials” cluster initiative
One of the results of the Lviv’s conference is the start of the cluster initiative “Advanced materials”. In its initiation, there is also a noticeable trace of foreign partners, in particular the Polish and German clusters of composite materials. Active exchanges with them took place during the Lviv conference. The coordinator of the initiative is Andrii Strelchenko, CEO of 3D Prostir from Lviv, one of the most experienced specialists in the Ukrainian space in the field of new materials and additive technologies.
“Cyber Security” cluster initiative
Cluster initiative on cyber security is being formed throughout June. UCA held several meetings both internally and with foreign partners, including the directorate of the European Clusters Alliance. Formation of this initiative is necessary both from the point of view of internal challenges and interests, and in the context of the conference already planned for December in Prague on this topic. The coordinator of the initiative is leading Ukrainian cyber security expert Ihor Kotsyuba, CEO of iSolutions.
Main results and areas of growth
UCA key achievements
Summarizing the above facts, the greatest progress after Košice can be considered the development of Eastern European initiatives, primarily with Poland and the Czech Republic. UCA begins to systematically apply a number of internationalization tools, namely existing memorandums of cooperation, grant opportunities, business missions, regular exchanges, joint committees and working groups, joint conferences, while trying to convert them into concrete projects. This activity covers at least 10 UCA clusters, and where, in addition to the mentioned countries, Romania, Slovakia and Lithuania appear as European partners.
The launch of clusters funding under the EU4Business program is another big step forward – we have been waiting for it for a very long time.
The emergence of new cluster initiatives, which are immediately synchronized in their activities with European partners, should be considered another important achievement of UCA. Equally important is the development of relations with EIT Manufacturing – this is the only structure out of 9 EITs with which we have concrete shifts in cooperation.
The third achievement of internationalization is the development of relations with EIT Manufacturing – this is the only structure out of 9 EITs with which we have concrete shifts in cooperation.
In the context of the still insufficient cluster capabilities and weak internal resources, the focus of the UCA on using synergistic internal capabilities is important, for example:
- Inter-clusters cooperation in generation of joint projects and their implementation. The most representative example of the project is Burshtyn+.
- Use of common resources in the form of UCA Resource Centers or Committees. The best example here is the coordination of projects and areas of activity within the Smart.City – Smart.Regions RC.
- Proper delegation and distribution of roles and functions with foreign partners. For example, the work of committees or working groups with Poland and the Czech Republic.
- Better segmentation and creation of new cluster initiatives. All the above examples demonstrate this effect of coordinated decentralization.
Another progress in European integration concerns the continuation of the Professionals4Ukraine initiative. The list of our ambassadors who actively promote the Ukrainian agenda has been replenished with new faces. The proposal of the UCA Executive Directorate to the Board is to expand the list of ambassadors with the following experts:
- Mike Richardson, project manager of the German OptecBB cluster, de facto initiated the creation of the Photonics cluster initiative in Ukraine. In the first half of the year, Mike visited Ukraine 4 times, and each time it was a trigger for the activation and unification of our specialists in this segment, as well as in Dual-use. Mike Richardson was instrumental in establishing the UCA’s relationship with the Republic of Taiwan.
- Andrzej Chulak, head of the composite materials cluster from Krakow, became co-coordinator of the Lviv conference from the Polish side and organized the arrival of 30 representatives of Polish business in Lviv. For the first time during the war, UCA, our clusters and businesses had the opportunity to conduct such wide-ranging exchanges on a whole range of issues.
- Irena Lobocka, head of the Sustainable Infrastructure cluster from Krakow together with Andrzej Chulak, Irena demonstrated high activity in establishing business relations with our “Smart City – Smart Regions” resource center. The parties started discussing specific projects.
- Florian Andrews, a leading expert of the German consulting agency Gruner Hering, first visited several cities of Ukraine in June and was a co-organizer and active participant of the Lviv conference. Florian contributed to the development of the pro-European sustainable development agenda, demonstrating his full readiness to provide the best European experience and practices to Ukrainian partners.
- Sotiris A. Bouzeas, head of the Greek-Canadian supercluster TIASI creates a new agenda between the Greek and Ukrainian clusters in several tangential segments of industrial high-tech. Sotiris visited Ukraine twice (in April and June) where he was an active participant and speaker of the Lviv Conference.
When specifying new partners, it is worth updating the list of ambassadors from 2022.
- Tereza Shamanova, CEO of Czech Inno is developing the UСA “benchmark” from the point of view of effective bilateral cooperation. The 1st business mission in Prague in April this year is exemplary in terms of organization, conduct and first results at the level of B2B exchanges.
- Tristan Evans, GR director of ITC, published the book Post-war Foreign Direct Investment to Ukraine in June, with comments by Oleksandr Yurchak (CEO of UСA) and Olga Trofymova (Director of Internationalization) in the foreword.
- Alex Chausovsky, together with Jose Rivera and Luigi de Bernandini continued active promotion of APPAU at the annual conference of the American CSIA. This association is currently the only “window” to the US and Canadian markets for the EAM and APPAU clusters. Partners have introduced a new mechanism of honorary membership, which opens up new opportunities for financial support.
- Krzysztof Krystowsky together with the leadership of the Polish state agency FPPP created the Ukraine-Poland Committee on Industry 4.0. He immediately began to account for and coordinate activities in 10+ directions and projects that were included in the list for monitoring.
- Marek Przeor, head of the cluster direction in DG GROW of the European Commission and Antonio de Novo, president of the European Clusters Alliance, continued to actively support UCA at the level of preparing new projects and involvement in important events. In particular, the UСA management joined the EC’s focus group on support for Ukraine.
Thus, the network of ambassador partners includes 18 partners today, and all of them continue active cooperation with UCA.
Another achievement of UCA is the improvement of relations and coordination of actions with the EEN – Ukraine consortium. The consortium was a top partner of UСA in holding the Lviv conference, and we also coordinated a number of European online events in April and May.
Together, all these achievements demonstrate the obvious progress of UСA in the field of internationalization, which could only have been dreamed of a year ago.
UСA zones of growth
For the second half of the year, the Executive team proposes to the Board and UCA clusters to consider three priority areas of growth:
1. A more intensive and focused search for touch points, establishment and development of relations, and projects with key Europrograms in Ukraine.
Deployment of the project to support 200 startups (EIC), activity of 9 EIT-associations, projects of the Eastern Partnership (EU4xxx), the future Business bridge project, other large-scale events that are being developed by the European Union specifically to support and restore Ukraine. They involve hundreds and thousands of Ukrainian SMEs, many of which are already participants in UCA clusters. Accordingly, the establishment and development of constructive relations with most of the named projects is a big challenge for UCA. With rare exceptions (for example, EIT Manufacturing or cooperation with GIZ in EU4Business), these relationships are not established, although these programs are directly and directly related to UCA.
2. Conversion of events results into specific projects. UCA already has sufficient experience in conducting or participating in European events, which provide a quick integration of our clusters into the European context and establish relations. At the same time, conversion of these relations into concrete development projects is not an obvious result. It takes time, but also an effective follow-up plan, with the appropriate focus and concentration of forces and resources. In the 1st half of the year, we did not receive any such conversion and this is definitely a growth area for the 2nd half of the year. Meanwhile, UCA has something to show its European partners — the creation of a portfolio of 52 project proposals is another important achievement of UCA, and this work has been ongoing since November 2022. It is now the time to convert these proposals into real projects.
3. Better coordination with all partners of European integration — government structures, other business associations, communities, scientists and researchers, etc. This cooperation is necessary in the areas of developing strategic positions regarding future reforms, better European integration, profiling of Reconstruction projects, development and support of new cluster initiatives in the regions of the country. In particular, all the UCA initiatives in the field of integration into the European innovation space, which are provided in our Export-Internationalization strategy, look very relevant. So far, we have not seen the reaction of pro-government structures to our proposals for the development of a network of DIHs and other structural elements of innovative ecosystems.
To face these challanges, UCA will develop a special action plan for the 2d half of 2023.
Summing up UCA’s achievements “after Košice”, as well as within the framework of the 1st year of the Export-Internationalization strategy, it is worth noting the unconditional progress and high dynamics of UCA clusters in the field of European integration.
The area of European integration remains the top priority of the UCA general strategy. The executive team and the Board of UCA will make maximum efforts to implement the plans for the 2nd half of the year.