Table 11. R&D Personnel (in full-time equivalents) from 2002 to 2011 by sectors of performance.

#### 2.5.3. Innovation potential and innovation policy

Innovation is often considered key to maintaining our competitiveness on the global market, creating jobs and improving the quality of life. One of the main objectives of European policies is to encourage innovation in Europe, by providing incentives to stimulate and improve this economic driver [8].

As it can be seen from Table 12 among the eligible areas, the higher shares of innovative enterprises during the period 2008–2010 were observed in Austria (56% of all enterprises); in line with Carinthia, which has the same amount of innovative enterprises. In the EU 27 member states (excluding Greece), more than half of all enterprises (53%) reported innovation activity; hence, Austria reported innovation activity above, Slovenia below the EU 27 average.

As regards the types of innovation that enterprises engage in, Table 13 shows innovation broken down by three categories of innovators: product and/or process innovators only (excluding organisational and/or marketing innovation), organisational and/or marketing innovators only (excluding product and/or process innovation) and enterprises that developed both categories, product/process innovation and organisational/marketing innovation.

In Austria and Slovenia, as well as in the Austrian NUTS 2 regions, the share of innovative enterprises that combine product/process and organisational/marketing innovation is the highest.

In terms of combined product/process and organisational/marketing innovation by size class, Table 14 shows that this combined innovation activities are also developed by a large group of small enterprises. However, it is also important not to lose sight of business structure of the regions, whereas 64% of Austrian and 57% of Slovenian enterprises are characterised by smalland medium-sized enterprises.

2 Including enterprises with abandoned/suspended or ongoing innovation activities.

3 All Core NACE activities related to innovation activities (B, C, D, E, G46, H, J58, J61, J62, J63, K and M71).

Table 13. Enterprises by size class, 2008–2010.

#### 2.6. Environment and energy

One of the key goals of the European Union is the protection of the environment and the conservation of the natural heritage like rare and valuable natural phenomena such as minerals and fossils, subterranean caves, gorges, springs, waterfalls, rapids, lakes, bogs, streams and rivers with banks, seaside and landscapes. In order to achieve this aim, the European Union launched various policies, programmes and projects and adopted several environmental legislations in order to diminish air, water and land pollution, to reduce waste and noise and to guarantee an overall sustainable economic, social and environmental development for member state citizens and people beyond the EU border.

Environmental protection is an increasingly important item on the Austrian social and economic policy agenda. Because of the complex nature of the problems related to environmental pollution and the traditional distribution of public tasks among a number of regional authorities, measures for protecting the environment are taken by the federal authorities and by province governments and municipalities [10].

In the field of environment, Austria is one of the leading countries in Europe. The standards in force in Austria are very stringent by European comparison. In the fields of waste management, chemicals or air pollution is related to boiler installations. Also in agriculture ecological criteria have increasingly been taken into account. The Environmental Information Act aims at enhancing transparency in the field of environmental information and access to environmental data. Since 2003 Austria has been a party to the Aarhus Convention, therefore information is available to the public, and the collection of data about the environment is computer based. Austrian legislation is thus increasingly taking citizens' health and environmental concerns into account [10].

4 Including enterprises with abandoned/suspended or ongoing innovation activities.

Due to the implementation of EU Water Framework Directive, the water quality of Austria's lakes was raised to excellent levels. In order to classify the system, a detailed, state-of-the-art computer-based documentation of all Austrian rivers and lakes was prepared. For environmental protection Austria elaborated a national concept for the rehabilitation of protective forests and took the specific steps with respect to emissions of airborne pollutants that led to considerable reductions [10].

Active care of the environment in Slovenia is included into spatial planning and into any other planning of activities affecting the environment. For reducing adverse environmental impact, economic instruments in the forms of environmental tax based on the "polluter pays" principle or an environmental tax reduction in the case of investment in environmental protection have been introduced [11].

With the Environmental Protection Act in 2004, two chapters concerning the control and reduction of environmental emissions and the phasing-out and substitution of hazardous substances were defined. The main aim of the mentioned act is the promotion of development and the use of technologies that prevent, eliminate or reduce environmental burdens.

A lot of areas within the environment and energy can represent a cooperation field within programme area. One of them could be NATURA 2000 areas, another natural park, renewable energy, etc.

2.6. Environment and energy

Table 13. Enterprises by size class, 2008–2010.

Source: Refs. [1, 3].

Innovative enterprises4 of total enterprises

204 Management of Cities and Regions

NUTS 1 and 2

member state citizens and people beyond the EU border.

Including enterprises with abandoned/suspended or ongoing innovation activities.

province governments and municipalities [10].

into account [10].

4

One of the key goals of the European Union is the protection of the environment and the conservation of the natural heritage like rare and valuable natural phenomena such as minerals and fossils, subterranean caves, gorges, springs, waterfalls, rapids, lakes, bogs, streams and rivers with banks, seaside and landscapes. In order to achieve this aim, the European Union launched various policies, programmes and projects and adopted several environmental legislations in order to diminish air, water and land pollution, to reduce waste and noise and to guarantee an overall sustainable economic, social and environmental development for

Thereof product/process and organisational/marketing

Burgenland 49% 53% 62% 31% 7% Kärnten 56% 50% 64% 25% 12% Steiermark 51% 57% 61% 25% 14% Austria 56% 55% 64% 27% 10% Slovenia 49% 50% 57% 32% 12%

Thereof product/process and organisational/ marketing innovationby size class

> From 50 to 249 employees

250 employees or more

From 10 to 49 employees

innovation

Environmental protection is an increasingly important item on the Austrian social and economic policy agenda. Because of the complex nature of the problems related to environmental pollution and the traditional distribution of public tasks among a number of regional authorities, measures for protecting the environment are taken by the federal authorities and by

In the field of environment, Austria is one of the leading countries in Europe. The standards in force in Austria are very stringent by European comparison. In the fields of waste management, chemicals or air pollution is related to boiler installations. Also in agriculture ecological criteria have increasingly been taken into account. The Environmental Information Act aims at enhancing transparency in the field of environmental information and access to environmental data. Since 2003 Austria has been a party to the Aarhus Convention, therefore information is available to the public, and the collection of data about the environment is computer based. Austrian legislation is thus increasingly taking citizens' health and environmental concerns In the past 25 years, one of the central working areas has been the conservation of European Union's biodiversity. Beside on that the European Union launched the NATURA 2000 initiative, one of the biggest challenges is to interact the conservation of NATURA 2000 areas with humans' everyday activities. Of course it is crucial that also other policy fields like transportation, tourism, industry, agricultural or energy became sustainable as well [12]. To overcome mentioned challenges, cross-border cooperation for transferring best practices is needed.

One of the cooperation fields could be natural parks, and others could be cooperation for improving air quality, quality of water, reducing the noise and waste, etc.

The air quality has diminished since the industrial revolution. The main cause of the worldwide climate change is anthropogenic greenhouse gas emissions. Negative consequences of these phenomena represent a bear to humans and the environment itself. Health deterioration in a form of lung problems, drought and floods became a part of the everyday agenda. An important step in reducing the anthropogenic greenhouse gas emissions especially CO2 has been taken in 2005 with the implementation of the EU ETS. Since then, the Slovenian CO2 emissions have decreased from 20,309 tCO2 to 19,509 tCO2 in 2011, and Austria CO2 emissions have decreased from 92,895 tCO2 to 82,842 tCO2. This thematic field thus represents a possible cooperation area especially as most of the CO2 emissions come from the industry. Companies from both sides of the border could work together and exchange experiences, thoughts and even technologies in order to make their production environmentally friendly [13].

Very important field for cooperation could also be the renewable energy. Promoting the use of renewable energy sources is important both to the reduction of the countries' dependence on foreign energy imports and in meeting targets to combat global warming.

Table 14. Renewable energy share of gross final energy consumption.

The data of renewable energy share of gross final energy consumption between 2004 and 2011 is shown in Table 14.

In Austria renewable energy share of gross final energy consumption amounts to 30.9% in 2011 against 30.6% in 2010; this represents an increase of 0.3 point. In Slovenia the renewable energy share of gross final energy consumption fell from 19.6% in 2010 to 18.8% in 2011.

Activities like traffic, constructions or even recreation activities create noise, which can be harmful and unpleasant for humans, animals and the whole environment. Despite that the European Union has taken measures on this topic, noise is a problem, which is considered to be best handled on the regional or local level. Thus this is also an important thematic field, which can be handled within the programme cooperation area.

#### 3. SWOT analysis

The key strengths, weaknesses, opportunities and threats of the Slovene regions have been identified through:

Moreover, regional studies and recent direct information of relevant authorities have been taken into regard. Thus, SWOT analysis offers a wider view than the statistics and analyses of the programme area description.

In order to give a clear and complete overview, the strengths, weaknesses, opportunities and threats identified are presented in Table 15 for the main sectors/fields identified in Regional Development Programmes 2014–2020, also highlighting specific issues of individual NUTS 3 areas where appropriate.

Regions analysed are those eligible NUTS 3 regions from the core programme area in 2007– 2013 period including Gorenjska, Koroška, Savinjska, Podravska and Pomurska on the Slovene side. The NUTS 3 area Osrednjeslovenska is included in the programme on the basis of Art 21 (1) of the Regulation No. 1080/2006 on the European Regional Development Fund.

Regional Analysis for European Structural and Investment Funds on the Case of Slovenia-Austria Cross-Border… http://dx.doi.org/10.5772/intechopen.70257 207

The data of renewable energy share of gross final energy consumption between 2004 and 2011

NUTS 1 2004 2005 2006 2007 2008 2009 2010 2011 EU 27 8.1 8.5 9.0 9.7 10.4 11.6 12.5 13.0 Austria 22.8 23.8 25.3 27.2 28.3 30.2 30.6 30.9 Slovenia 16.1 16.0 15.6 15.6 15.0 19.0 19.6 18.8

In Austria renewable energy share of gross final energy consumption amounts to 30.9% in 2011 against 30.6% in 2010; this represents an increase of 0.3 point. In Slovenia the renewable energy share of gross final energy consumption fell from 19.6% in 2010 to 18.8% in 2011.

Activities like traffic, constructions or even recreation activities create noise, which can be harmful and unpleasant for humans, animals and the whole environment. Despite that the European Union has taken measures on this topic, noise is a problem, which is considered to be best handled on the regional or local level. Thus this is also an important thematic field,

The key strengths, weaknesses, opportunities and threats of the Slovene regions have been

Moreover, regional studies and recent direct information of relevant authorities have been taken into regard. Thus, SWOT analysis offers a wider view than the statistics and analyses of

In order to give a clear and complete overview, the strengths, weaknesses, opportunities and threats identified are presented in Table 15 for the main sectors/fields identified in Regional Development Programmes 2014–2020, also highlighting specific issues of individual NUTS 3

Regions analysed are those eligible NUTS 3 regions from the core programme area in 2007– 2013 period including Gorenjska, Koroška, Savinjska, Podravska and Pomurska on the Slovene side. The NUTS 3 area Osrednjeslovenska is included in the programme on the basis of Art 21

(1) of the Regulation No. 1080/2006 on the European Regional Development Fund.

which can be handled within the programme cooperation area.

Table 14. Renewable energy share of gross final energy consumption.

is shown in Table 14.

206 Management of Cities and Regions

Source: Ref. [3].

3. SWOT analysis

identified through:

• Regional analysis

areas where appropriate.

• The analysis of the statistical data

the programme area description.

• Existing regional and national development plans

Austria

Sector Strengths

• Ageing of population in peripheral territories

• Loss of population in peripheral territories

• Increasing shares of commuters

low value-added products • Low survival rate of startups

infrastructure in Slovenia Human resources/employment • Comparatively low level of population with tertiary education in Austria (due to education system)

> higher education • Low level of self-employment

Education/research and innovation • Innovation activities of enterprises are highly concentrated

market in Slovenia

programming area

Traffic infrastructure and mobility • Third development axis missing and poorly maintained state and local road network

Austria

Environment and energy • Absence of a regional planning in Slovenia

financial supporting mechanisms

Economy/urban development • Inward orientation, insufficient cooperation within region

• Low inflow of FDI

• Negative natural and immigration growth (except for CenSI)

• Export limited primarily to traditional nearby markets • Low share of knowledge-based services in GDP and exports

• Companies adjusting too slow to increased competition and globalisation

• SMEs: lack of entrepreneurial spirit, low level of internationalisation, new SMEs do not grow, lack of financial resources for SME development • Low level of R&D investments with the exemption of urban areas • Low level of innovativeness in companies (especially SMEs), lack of innovation culture, lack of management/marketing competencies despite high self-evaluation, low share of hi-tech products in exports and high share of

• Relocation of economic activity abroad due to cheaper labour force in mature sectors, bankruptcies of companies in mature sectors and lack of

• High prices of land for business use, lack of suitable sites ready for business activities, non-utilisation of abandoned industrial buildings and

• Level of registered unemployment above average and still growing,

• Structural imbalances in labour markets and slow adjustments of educa-

• Lack of integration among the economy, universities and research and development institutions in parts of the programming area • Education systems at all levels are rigid and do not react to needs of labour

• SMEs are poorly included in educational and training programmes • Lack of effective investment into research and development which is

• There are no comprehensive development strategies and protection for

• Bad connections in terms of public transport in peripheral territories in

defined areas of "natural landscape" in Slovenia • Regulatory barriers for renewable in regional energy markets • Lack of business models for prosumer markets in the field of renewable

• Poor and inefficient public transport system in Slovenia

reflected in poor transfer of knowledge back to the economy in parts of the

tional programmes to labour market needs

unfavourable age and educational structure of unemployed (above 50 and under 29, long-term unemployed) and growing share of unemployed with

• Too weak linkages between research, education and economy • Long-lasting procedures for obtaining construction permits

Demography/demographic change/

208 Management of Cities and Regions

settlements

Table 15. SWOT analysis.

Sector Strengths

Sector Threats

Demography/demographic change/

settlements

Tourism and leisure/cultural heritage

210 Management of Cities and Regions

and cultural resources

• E-mobility and innovative service-based transport solutions as response to

• The sustainable use of natural and cultural heritage together with existing knowledge and skills in the environment, development of eco-tourism and

• Increase the quality of integrated tourist products and joint promotional appearances in order to raise the profile of destination, the development of common brands and their promotion and mobile e-services for the mar-

• Integration of agriculture, tourism, complementary activities and other

• Accelerated processes of ageing population with the exemption of urban

neighbouring cross-border regions could increase pressure for relocation and diversion of FDI potential by providing better conditions elsewhere • Scarcity and lack of competitiveness of locations in the region would further decrease the attractiveness of the region for foreign investment • Relocation of low-technology manufacturing activities abroad due to

• Increased development gap with the west/central Slovenia and

• Newly developed public transportation system (S-Bahn) in Austria

• Regional centres of tourism as local development incubators

development of green tourism in Natura 2000 areas • Activation of cultural and artistic potential of the region

• Comprehensive revitalisation of cultural heritage

urban congestion problems

keting of tourist destinations

• Depopulation of peripheral territories

• Credit crunch—insufficient supply of capital • Limited development and investment funds

• Failing in successfully restructuring stagnant industries

• Emigration of trained/skilled personnel from the region

• Insufficient enrolment rates in science and engineering at universities • Continued rigidity of the secondary education system without linkage to

• Danger of one-size-fits-all instruments for a very heterogeneous program-

• Lack of cooperation of regional research and development institutions in international consortia due to development gap in Slovenia • Partly slow response of research institutions/departments in companies to new technologies and new research subareas within nanotechnology, bio-

• Limited access to education and health services

• Low enrolment to deficient education programmes

technology, environmental technology, etc.

Environment and energy • Climate change (increased water shortages for irrigation, hail and floods)

services in rural areas

• Brain drain

Human resources/employment • Shortage of skilled labour force as barrier to growth

RDI

• Social exclusion • Rising unemployment

agglomerations

cheaper labour costs

• Loss of values and identity Education/research and innovation • Budgetary austerity could hamper necessary public future investments in

economic sector

ming area

Economy/urban development • Excessive rise of real estate prices in urban agglomerations

#### 4. Conclusion

Economic growth in the future must be knowledge driven due to globalisation. Technology improvement, upgrading services and cost efficiency are challenges for all countries, and some of them are easier to overcome with cooperation between countries.

Regional and SWOT analyses show a lot of opportunities for strengthening cross-border cooperation between Austrian and Slovenian regions.

#### 4.1. Demography

Demographic analysis shows that urban areas in both countries are more attractive to inhabitants [1, 2]. Working and educational opportunities, infrastructure and access to social services and health care are the main factors when deciding the place of living. A modest birth rate combined with a progressing life expectation consequently leads to population ageing, which is a big problem in the whole programme area. On January 1, 2013, the ageing index for all named regions exceeded 100.

Economic analysis of the participating regions shows that there is an increasing need for the economic cooperation and network building in the border regions, especially in areas such as innovation and technological development, research, renewable energy and protection of cultural and natural heritage.

#### 4.2. Education, research and development

Good and diverse supply of education on one hand and the problem of lack of knowledge of RDI partners on the other are showing that research and development in the participating regions could play a strong role in cross-border cooperation in the future. Austria has more advantageous positions in the field of research and development, but as both countries are spending for research and development more than EU 27 average and regarding the good infrastructure for research and development in all participating regions, these could present a good base for strengthening research, technological development and innovation. Research and innovation potential together with high educational level of population in participating regions could serve as the basis for cross-border cooperation with an aim of fostering and strengthening innovation activities in the regions.

As a tool for strengthening innovation activities between Austria and Slovenia, networking will be used. Collaboration between the regions' education and business sectors with the innovation poles is here essential.

#### 4.3. Competitiveness of SMEs

Due to the fact that 64% of Austrian and 57% of Slovenian enterprises are characterised by small- and medium-sized enterprises, one key driver of sector-oriented economic development is the industry clusters, especially among SMEs. To a large extent, the economic undertakings in the cross-border area are covered by various clusters, which take up the role as key players in boosting the progression of economic and innovation activities due to cross-border cooperation.

The primary objective of the cross-border cooperation in the field of SMEs is to strengthen their competitiveness. Within this aim the following activities should be included:

#### 4.4. Environment and resources

The global pollution of the environment is exposing the necessity to take precautionary steps in order to protect and preserve the world's resources. Active care of the environment can be seen in Austrian and Slovenian participating regions. Austria is characterised with high ecological awareness, but also Slovenia has shown a great and increasing interest in the field of protecting the environment during the last few years. Rich natural heritage, biodiversity, good capacity for dealing with environmental problems and strong potential for the use of renewable resources are the main strengths participating regions have in the field of environment and energy; therefore cross-border cooperation in the mentioned fields could play an important role in the next period.

Close cooperation between regions will be useful for transferring know-how and thus for implementing cross-border solutions in the field of environment and resources.

#### 4.5. Institutional capacity and an efficient public administration

According to the EC, "the quality of public administration has a direct impact on the economic environment and is thus crucial to stimulating productivity, competitiveness and growth" [14]. Consequently, the need for increasing the efficiency and effectiveness of public services and the increased quality of public administration should also be one of the areas for cross-border cooperation between Slovenian and Austrian regions.

Strengthening existing networks as well as the creation of new ones is highly important. Therefore, as already mentioned, novel opportunities should be establishing in order to encourage and foster administrative cooperation as well as cooperation between inhabitants and institutions.

One of the objectives within this field will indubitably be the decrease of administrative burden and thus the contribution to a more effective communication between inhabitants and public sector organisations.

#### Author details

4.2. Education, research and development

212 Management of Cities and Regions

strengthening innovation activities in the regions.

• Transferring the knowledge and technology

innovation poles is here essential.

4.3. Competitiveness of SMEs

4.4. Environment and resources

tant role in the next period.

cooperation.

Good and diverse supply of education on one hand and the problem of lack of knowledge of RDI partners on the other are showing that research and development in the participating regions could play a strong role in cross-border cooperation in the future. Austria has more advantageous positions in the field of research and development, but as both countries are spending for research and development more than EU 27 average and regarding the good infrastructure for research and development in all participating regions, these could present a good base for strengthening research, technological development and innovation. Research and innovation potential together with high educational level of population in participating regions could serve as the basis for cross-border cooperation with an aim of fostering and

As a tool for strengthening innovation activities between Austria and Slovenia, networking will be used. Collaboration between the regions' education and business sectors with the

Due to the fact that 64% of Austrian and 57% of Slovenian enterprises are characterised by small- and medium-sized enterprises, one key driver of sector-oriented economic development is the industry clusters, especially among SMEs. To a large extent, the economic undertakings in the cross-border area are covered by various clusters, which take up the role as key players in boosting the progression of economic and innovation activities due to cross-border

The primary objective of the cross-border cooperation in the field of SMEs is to strengthen their

The global pollution of the environment is exposing the necessity to take precautionary steps in order to protect and preserve the world's resources. Active care of the environment can be seen in Austrian and Slovenian participating regions. Austria is characterised with high ecological awareness, but also Slovenia has shown a great and increasing interest in the field of protecting the environment during the last few years. Rich natural heritage, biodiversity, good capacity for dealing with environmental problems and strong potential for the use of renewable resources are the main strengths participating regions have in the field of environment and energy; therefore cross-border cooperation in the mentioned fields could play an impor-

Close cooperation between regions will be useful for transferring know-how and thus for

implementing cross-border solutions in the field of environment and resources.

competitiveness. Within this aim the following activities should be included:

• Promoting innovation and development of common services

Vito Bobek1,2\* and Anita Maček1,3

\*Address all correspondence to<EMAIL_ADDRESS>
1 Institute of International Management, University of Applied Sciences FH Joanneum, Graz, Austria

#### References

[7] Eurostat. Tertiary Education Statistics [Internet]. 2012. Available from: http://epp. eurostat.ec.europa.eu/statistics\_explained/index.php/Tertiary\_education\_statistics

[8] Eurostat. Innovation Statistics. [Internet]. 2013. Available from: http://epp.eurostat.ec.

[9] Eurostat. CIS; Community Innovation Survey. 2010. [Internet]. 2013. Available from:

[11] Slovenian Environment Agency [Internet]. 2013. Available from: http://www.arso.gov.si/

[12] European Commission. Environment. Nature and Biodiversity [Internet]. 2013. Available

[13] Agencija RS za okolje. Kakovost zraka v Sloveniji v letu 2012. Ljubljana: Ministrstvo za

[14] European Commission. Promoting Good Governance. European Social fund Thematic

[10] Federal Chancellery. Austria: Fact and figures. Vienna: Federal Press Service; 2013

europa.eu/statistics\_explained/index.php/Innovation\_statistics

http://epp.eurostat.ec.europa.eu/portal/page/portal/microdata/cis

from: http://ec.europa.eu/environment/nature/index\_en.htm

paper. Luxembourg: Publications Office of the European Union; 2014

en/environmental%20protection/

kmetijstvo in okolje; 2013

214 Management of Cities and Regions

### *Edited by Vito Bobek*

Cities and regions represent the driving force of development in economic, social, and cultural life and reflect the spatial organization of human society. Furthermore, strategic urban regions are becoming increasingly important players in the global economy, as the impact of national states decreases while the impact of cities and urban regions is increasing. The process of globalization is reflected in the tendency for gaining competitiveness and efficiencies of global trends.

Once cities and regions have identified where they are, they need to decide where they want to be in the future. And to do this, they need to understand the significant trends that will influence the direction in which the future unfolds. Managing the identified capitals (four of them are subject of the sections in this book) effectively means taking a holistic approach, since each of the capitals depends on the others. The necessity of taking a holistic approach is one of the themes to emerge particularly strongly from the knowledge-based economy.

Photo by Arnaud Jaegers / Unsplash

Management of Cities and Regions

Management of Cities

and Regions

*Edited by Vito Bobek*