Chapter 8. Standards and technical regulations (Dimension 7) in the Western Balkans and Turkey

This chapter assesses the quality infrastructure systems and procedures required in the Western Balkans and Turkey to facilitate small and medium-sized enterprises’ (SMEs) access to the EU Single Market. It starts by outlining the assessment framework, then presents the analysis of Dimension 7’s three sub-dimensions: 1) overall co-ordination and general measures, which assesses the strategic documents and institutional framework for quality infrastructure co-ordination; 2) harmonisation with the EU acquis, which analyses the capacities of quality infrastructure institutions as well as their alignment with international and European rules for technical regulations, standardisation, accreditation, metrology, conformity assessment and market surveillance; and 3) SME access to standards, which explores government initiatives to enhance and support access. Each sub-dimension section makes specific recommendations for increasing the capacity and efficiency of quality infrastructure systems in the Western Balkans and Turkey.

    

Key findings

  • Overall co-ordination of quality infrastructure policies has significantly improved across most economies. However, challenges remain in a few economies, particularly in integrating market surveillance into the co-ordination mechanism of quality infrastructure pillars.

  • Most governments have renewed their strategic documents for adopting quality infrastructure legislation and transposing EU directives. However, monitoring and evaluation is largely ineffective and insufficient in all economies.

  • All governments have taken steps to conclude mutual recognition agreements and participate in international quality infrastructure structures. As a result, their quality infrastructure systems are increasingly consistent with the established principles in the EU and internationally.

  • Much focus has been placed on strengthening institutional and human resource capacities, though several economies will need to make additional investments. Maintaining and expanding the current level of accreditation, conformity assessment and metrology services remain challenges.

  • Policy makers are not exploiting synergies at the regional level. Although some co-operation is taking place regionally, there has been no attempt to collaborate to provide cost-effective quality infrastructure services at a regional level.

  • All governments have made progress in removing trade barriers by transposing European standards. Nonetheless, national standards bodies in the Western Balkans have not succeeded in increasing their own revenues, and given the relatively small size of their economies, they struggle to reduce their dependence on public funding.

  • SMEs’ access to standardisation in the WBT economies remains inadequate. SMEs are not systematically informed about new standards or involved in their development. Effective programmes remain scattered, and very few economies have targeted and regular programmes to support SME awareness of and participation in standard development.

Comparison with the 2016 assessment scores

Overall, the regional average score in the area of standards and technical regulations stands at 3.83, which is slightly lower than the previous assessment of 3.92. The progress made in aligning with the EU acquis has been offset by poor performance in facilitating SMEs’ access to standardisation, resulting in only minimal changes to the overall scores (Figure 8.1). Turkey and Serbia continue to lead the way, reflecting their more comprehensive provision of programmes and instruments for enhancing SMEs’ access to standardisation.

Figure 8.1. Overall scores for Dimension 7 (2016 and 2019)
Figure 8.1. Overall scores for Dimension 7 (2016 and 2019)

Note: Scores for 2019 are not directly comparable to the 2016 scores due to a methodological change increasing the focus on implementation. Therefore, changes in the scores may reflect the change in methodology more than actual changes to policy. The reader should focus on the narrative parts of the report to compare performance over time. See the Policy Framework and Assessment Process chapter and Annex A for information on the assessment methodology.

Implementation of the SME Policy Index 2016 recommendations

The small changes in the overall scores since the 2016 SME Policy Index can be explained by the limited implementation of its recommendations (Table 8.1). While almost all the assessed economies have renewed their strategic documents for adopting and implementing EU legislation, establishing a single central source of information for SMEs about exporting to the EU market remains a challenge for most. The assessed economies have also not made any significant improvements in monitoring and evaluation practices for technical regulations and legislation.

Table 8.1. Implementation of the SME Policy Index 2016 recommendations for Dimension 7

Overall 2016 recommendations

SME Policy Index 2019

Main developments during the assessment period

Regional progress status

Develop and adopt strategic documents

Almost all the assessed economies have either finished drafting or adopted strategic documents. The only exception is Bosnia and Herzegovina, where the Committee for Technical Regulation has been in political deadlock since 2012. As a result, strategic documents on the transposition of EU sectoral legislation on industrial products and technical regulations in priority sectors are yet to be renewed.

Moderate

Provide single central sources of information

Little progress has been made in providing single sources of information specifically targeting the needs of SMEs when exporting to the EU market. However, Serbia has been operating a designated website since 2011. It provides relevant information concerning standards, conformity assessment and other elements needed for exporting to the EU market. Although not covering all of Bosnia and Herzegovina, a similar website in the Republika Srpska has been operating since 2009. Turkey also operates a single contact point for exporters to the EU Single Market.

Limited

Regularly evaluate technical regulations and legislation

Regular monitoring and evaluation of technical regulations and legislation remains an area for major improvement. These activities remain sporadic across the Western Balkan economies, and sometimes depend on the availability of donor funding; only Turkey conducts an annual evaluation.

Limited

Introduction

Technical regulations and standards promote public policy objectives such as protecting human health or the environment. They also underpin global markets by helping to remove trade barriers. When well-harmonised among trading partners, standards and technical regulations can facilitate cross-border trade by reducing uncertainty and building trust among market players.

The diffusion and implementation of technical regulations and standards cannot be ensured merely by adopting them, however. Relevant institutions are needed to evaluate and confirm compliance levels. Through services such as certification, testing, inspection and calibration, conformity assessment bodies evaluate and confirm compliance with requirements set out in the technical regulations and standards. Accreditation, metrology and market surveillance further complement the system and increase public confidence in product safety. Figure 8.2 summarises the structure of a national quality infrastructure system, in which interrelated elements build on each other to maximise their impact.

Figure 8.2. A national quality infrastructure system
Figure 8.2. A national quality infrastructure system

Source: Blind, K. and C. Koch (2017[1]), Introduction to Quality Infrastructure Management, lecture at Technische Universität Berlin.

Against this backdrop, the Western Balkan economies and Turkey need to provide the necessary structures and fulfil their obligations regarding the free movement of goods in the lead up to European Union (EU) accession. Where products are governed by different national regulations, their free circulation in Member States will be hindered. Therefore, before joining the EU, governments need to make sure to align their product legislation with the EU acquis and transpose European standards into national ones while withdrawing contradictory national standards.

Improvements in quality infrastructure systems have the potential to further boost trade with the EU. In 2017, EU trade with the Western Balkan economies reached EUR 49 billion, while trade with Turkey reached EUR 154 billion. Although trade volume has doubled over the last 10 years, the openness of the WBT economies to trade remains low given their size, level of development and geographical location (Sanfey and Milatovic, 2018[2]). This untapped potential to expand trade with the EU was also confirmed by the recently adopted European Commission Strategy for the Western Balkans (EC, 2018[3]). In 2016, the Commission also proposed modernising and expanding the Customs Union with Turkey (EC, 2016[4]).

Currently, however, SMEs in the WBT economies do not fully benefit from the opportunities provided by the EU Single Market. This is partially because they lack information about the rules applied in the EU, as well as sufficient language skills. The cost of meeting the requirements to enter the Single Market are also often another obstacle.

In this context, ensuring SMEs in the WBT economies have access to reliable and efficient quality infrastructure services will be critical to improving their products and stimulating demand from the EU Single Market. Moreover, in light of the globalisation of value chains, technical regulations and standards are becoming important beyond the EU market (Blind, Mangelsdorf and Pohlisch, 2018[5]). The ability of firms, sectors and economies to absorb, adapt and disseminate up-to-date technology and participate in global value chains hinges on investments in quality infrastructure institutions and mechanisms (Doner, 2016[6]). Compliance with technical regulations and standards is not only a prerequisite for increasing exports, but also for industrial upgrading and ultimately promoting sustainable economic growth (Swann, 2010[7]; Guasch et al., 2007[8]).

Realising the benefits of technical regulations and standards and exploiting their economic potential means establishing an entire network of interdependent organisations and instruments of national quality infrastructure. This combines a system of public and private organisations with the relevant legal and regulatory framework, and the practices needed to support and enhance the quality, safety and environmental soundness of goods, services and processes. In establishing this network, it will be extremely important to pay special attention to SMEs’ needs and challenges (UNIDO, 2017[9]).

Assessment framework

Structure

The overall objective of Dimension 7 (standards and technical regulations) is to analyse whether the economies have a well-functioning quality infrastructure system, how far it is aligned with the EU rules, and how governments are endeavouring to improve SMEs’ access to the EU Single Market. The analysis revolves around the following three sub-dimensions:

  • Sub-dimension 7.1: Overall co-ordination and general measures looks at general policies and tools for overall policy co-ordination and strategic approaches to adopt and implement EU legislation. The assessment also evaluates if all relevant information on requirements for exporting to the EU is accessible to SMEs.

  • Sub-dimension 7.2: Harmonisation with the EU acquis explores the national quality infrastructure systems by examining the main elements of their key pillars – technical regulations, standardisation, accreditation, metrology, conformity assessment and market surveillance – in six thematic blocks. More specifically, it analyses their institutional capacity, adoption and implementation of strategic documents and integration into international structures. It also examines if the legislation and instruments are subject to regular monitoring and evaluation.

  • Sub-dimension 7.3: SME access to standardisation evaluates government efforts to increase SME awareness of standards and facilitate their participation in developing standards. It also considers the availability and scope of the current financial support programmes aimed at enhancing implementation of standards in the SME population.

    Figure 8.3 illustrates how the sub-dimensions and their constituent indicators make up the assessment framework for the standards and technical regulations dimension.

Figure 8.3. Assessment framework for Dimension 7: Standards and technical regulations
Figure 8.3. Assessment framework for Dimension 7: Standards and technical regulations

Note: The outcome indicators serve to demonstrate the extent to which the policies implemented by the government bring about the intended results, and they have not been taken into consideration in the scoring. By contrast, quantitative indicators, as a proxy for the implementation of the policies, affect the overall scores.

The assessment framework is prepared in full accordance with the Small Business Act (SBA) principle of encouraging SMEs to benefit more from the opportunities offered by the Single Market. This principle calls for government efforts both to promote SME participation in standardisation, and also to disseminate information on the use and benefits of European standards to SMEs (EC, 2008[10]).

The assessment was based on qualitative data collected with the help of questionnaires filled out by governments and independent consultants in the Western Balkans and Turkey. Face-to-face interviews were also held with SME owners and managers to uncover the challenges of complying with EU standards and technical regulations (see Annex C). In addition to qualitative inputs, the assessment draws on quantitative data from the national statistics offices in the assessed economies. For more information on the methodology see the Policy Framework and Assessment Process chapter and Annex A.

Key methodological changes to the assessment framework

Since the 2016 assessment, a number of changes have been introduced to the assessment framework (Table 8.2). A new sub-dimension has been added to gauge government measures aimed at improving SMEs’ access to standardisation, while the structure and scope of the other sub-dimensions have been extended. In this assessment cycle, the first sub-dimension (overall co-ordination and general measures), now asks whether authorities have designated a body to co-ordinate the policies of all the quality infrastructure pillars. All the other sub-dimensions from the previous cycle have been consolidated into one sub-dimension (harmonisation with the EU acquis), which now also analyses education on standardisation and measures to facilitate SME access to conformity assessment.

In order to better evaluate the economies’ performance on the revised Dimension 7, and in particular to capture the state-of-play of the new sub-dimension, the weights for the first two sub-dimensions have been adjusted.

Table 8.2. Key changes in the composition of Dimension 7

Sub-dimensions

Key changes since 2016 assessment

Sub-dimension 7.2: Harmonisation with the EU acquis

Consolidates the previous sub-dimensions on technical regulations, standardisation, accreditation, metrology, conformity assessment and market surveillance

Sub-dimension 7.3: SME access to standardisation

New sub-dimension introduced to evaluate government efforts for improving SMEs’ awareness of the benefits of standards to facilitate their participation in developing standards and to reduce their financial burden when implementing standards.

Other sources of information

The main findings of the European Commission’s EU accession progress reports for the Western Balkans and Turkey have been referred to throughout the chapter. In particular the progress made under Chapter 1 of the EU negotiations (free movement of goods) has been reflected in the analysis whenever relevant (EC, 2018[11]).

Analysis

Performance in EU trade

Outcome indicators play a key role in examining the effects of policies, and they provide crucial information for policy makers to judge the effectiveness of existing policies and the need for new ones. Put differently, they help policy makers track whether policies are achieving the desired outcome. The outcome indicators chosen for this dimension (see Figure 8.3) are designed to assess the WBT region’s trade with the European Single Market, whose success hinges on good policies for standards and technical regulations, among other things. This analysis section starts by drawing on these indicators to describe the economies' trade performance with the European Union.

Trade has been a key aspect of the Western Balkans and Turkey’s integration into the EU, and the EU has progressively concluded bilateral free-trade agreements with the Western Balkans and signed the Customs Union agreement with Turkey.

The Western Balkan economies were granted autonomous trade preferences in 2000 (renewed in 2015 and valid until 2020), leading to a substantial surge in exports to the EU Single Market. Autonomous trade preferences allow unlimited and duty-free access for almost all Western Balkan exports to the EU. The exceptions are wine, sugar, and certain beef and fisheries products for which preferential tariff quotas apply.

As for Turkey, the Customs Union agreement on industrial products with the EU entered into force in 1995. The agreement stipulated that Turkey needs to transpose the acquis communautaire concerning the abolition of technical barriers. This has resulted in early alignment efforts and the strengthening of Turkey’s quality infrastructure system. In December 2016, the Commission proposed modernising the Customs Union agreement and extending it to areas such as services, public procurement and sustainable development. At the time of writing, this proposal was being discussed at the European Council.

The EU is already the largest export market for the majority of the WBT economies and accounts for around 70% of total exports in Albania, Bosnia and Herzegovina, the Republic of North Macedonia, and Serbia. It is also Turkey’s largest export market, accounting for 47% of exports. While exports from most of the economies have increased modestly or remained stable, Kosovo* and Montenegro’s exports to the EU Single Market have fallen as a share of total exports and remain below pre-crisis volumes (Figure 8.4). In both cases, this reflects a bigger increase in exports to the Central European Free Trade Agreement (CEFTA) region.1 Despite this declining share, in Kosovo the volume of exports to the EU actually grew modestly over the period 2006-17.

* This designation is without prejudice to positions on status, and is in line with United Nations Security Council Resolution 1244/99 and the Advisory Opinion of the International Court of Justice on Kosovo’s declaration of independence.

Figure 8.4. Share of EU exports in total WBT exports (2007-17)
Figure 8.4. Share of EU exports in total WBT exports (2007-17)

Note: Due to unavailability of 2007 data for Bosnia and Herzegovina, data for 2008 were used instead.

Source: Adapted from Eurostat (2018[12]), International Trade of EFTA and Enlargement Countries dataset, https://ec.europa.eu/eurostat/web/products-datasets/-/ext_lt_intercc.

 StatLink http://dx.doi.org/10.1787/888933937565

Greater access to the EU Single Market has allowed the Western Balkans and Turkey to steadily increase trade with the EU since the early 2000s. Although the crisis of 2007 did not have significant negative effects on WBT exports to the EU Single Market, the Eurozone crisis of 2009 depressed export volumes in most WBT economies, which slumped by 21% on average. The first half of 2010 saw a vigorous rebound and has resulted in steady average growth ever since (Figure 8.5). In 2017 alone, the trade in goods volume grew 13.5% compared to the previous year (EC, 2018[13]).

Figure 8.5. WBT exports of goods to the European Union (2007-17)
EUR million
Figure 8.5. WBT exports of goods to the European Union (2007-17)

Source: Adapted from Eurostat (2018[14]), Comext database, https://ec.europa.eu/eurostat/web/international-trade-in-goods/data/focus-on-comext.

 StatLink http://dx.doi.org/10.1787/888933937584

Manufactured goods continue to dominate trade with the EU, reaching 80% of the Western Balkan economies’ exports to the EU Single Market in 2017 and 77% of imports (Eurostat, 2018[15]). Considering the strict requirements for manufactured goods exported to the EU Single Market, this trade composition further strengthens the case for facilitating SMEs’ access to relevant standards across the WBT economies.

Against the backdrop of facilitated access to the EU Single Market, there is still potential to increase current trade volumes. Doing more to harmonise the economies’ legal and institutional quality infrastructure frameworks with the EU acquis and to provide targeted support to SMEs for complying with standards and technical regulations would contribute to the WBT governments’ efforts to further increase the trade volumes.

Overall co-ordination and general measures (Sub-dimension 7.1)

The overall co-ordination of quality infrastructure can improve the allocation and use of public resources, facilitate inter-agency information sharing and help to detect potential shortcomings in the system. Since a quality infrastructure system includes inter-related pillars and involves various public institutions, designating a body to co-ordinate services can also improve their effectiveness.

This section considers the extent to which the WBT economies have ensured the overall co-ordination of their quality infrastructure system. Similar to the previous assessment, Turkey continues to lead the way, while Kosovo, Montenegro, and Serbia have made significant progress in this policy aspect (Table 8.3).

Table 8.3. Scores for Sub-dimension 7.1: Overall co-ordination and general measures

ALB

BIH

KOS

MKD

MNE

SRB

TUR

WBT average

Overall co-ordination and general measures

2.75

1.83

2.75

2.50

3.00

4.00

5.00

3.12

Note: See the Policy Framework and Assessment Process chapter and Annex A for information on the assessment methodology.

The inter-institutional co-ordination of quality infrastructure is stronger

With the exception of Bosnia and Herzegovina, all WBT governments have functioning bodies to co-ordinate quality infrastructure processes. Nonetheless, the existence of a dedicated body does not always translate into effective co-ordination. For instance, in Kosovo, the Division for Quality Infrastructure at the Ministry for Trade and Industry has only three employees, rendering effective co-ordination challenging. Meanwhile, co-ordination of the quality infrastructure systems in both Albania and North Macedonia excludes market surveillance – hindering the holistic co-ordination of all of the quality infrastructure pillars.

The majority of WBT governments have also adopted and renewed strategies and action plans to transpose EU legislation for industrial products. Albania and North Macedonia are in the process of renewing their strategic documents. The political stalemate in the Committee for Technical Regulations of Bosnia and Herzegovina as the body involved in preparing programmes of transposition, persists due to disagreement over state and entity competences for issuing technical regulations and appointing conformity assessment bodies.2

The progress made in ensuring overall quality infrastructure co-ordination in the WBT economies has not been complemented by support systems for exporters (for more information, please refer to Chapter 12 on internationalisation of SMEs). Most economies lack designated web portals or single points of contact. Information about applicable EU laws and regulations remains fragmented, which not only creates potential discrepancies in the information but also forces SMEs to search for and contact the relevant institutions and agencies individually.

Only Serbia and Turkey have designated portals that provide specific information to SMEs interested in exporting to the EU Single Market. In Serbia, a user-friendly website called TEHNIS provides comprehensive information on export requirements and government support mechanisms for exporters (Box 8.1). Likewise, information concerning compliance with export requirements is also provided in Bosnia and Herzegovina, although only in the Republika Srpska (RS). Turkey has established a single contact point for exporters, which enables SMEs to directly contact the Ministry of Trade experts via phone, on line and via a mobile phone application. It also allows SMEs to find the relevant forms for exports and to reach Turkey’s trade representations abroad. Kosovo’s Private Sector Development Strategy 2018-2022 envisages the establishment of a single point of contact for trade in services, but no such initiatives seem to be in preparation for trade in products.

Box 8.1. TEHNIS: Serbia’s information portal and database

In most of the economies, information on export requirements and compliance mechanisms, where available, are fragmented. There are no dedicated websites containing all the necessary information and guidance for SMEs to navigate through the regulations and standards requirements. Equally, SMEs often lack information on the support schemes available to them. A well-designed and comprehensive pool of information would therefore benefit SMEs, which often do not have the time, resources or the personnel capacity to gather information from various sources, institutions and websites. This poses another challenge to SMEs when accessing international markets and upgrading their production.

The TEHNIS website in Serbia is a good practice example that stands out in the region. TEHNIS was developed by the Ministry of Economy (Sector of Quality and Product Safety) with the objective of establishing a single enquiry point for technical legislation in Serbia. It provides information on all elements of quality infrastructure and guides SMEs in meeting product requirements and regulations. Legislation is presented thematically, providing information about the respective directives, e.g. in the field of machinery, as well as corresponding guides on how to comply with the requirements. The TEHNIS database also contains registers of valid technical regulations, draft technical regulations, designated and authorised conformity assessment bodies, and recognised foreign certificates. SMEs can also find contact information for all the relevant quality infrastructure institutions, brochures and latest news.

Source: Ministry of Economy (2018[16]), Sector for Quality and Product Safety website, www.tehnis.privreda.gov.rs.

The way forward for overall co-ordination and general measures

Although overall co-ordination of quality infrastructure policies has significantly improved in the WBT economies, there is scope to improve general measures to support exporters. In particular, governments should:

  • Establish a single source of tailored information for SMEs. This could consist of single web portals or trade help-desks and could include guidance in local language(s) for SMEs on health, safety, marketing and the technical standards their products need to meet. Coverage could also be extended to include the necessary shipping forms when exporting or to provide information on trade agreements and trade representations abroad.

Harmonisation with the EU acquis (Sub-dimension 7.2)

In the course of accession to the EU, the candidates are required to transpose the EU technical regulations into national legislation. Harmonising national regulations with EU product legislation ensures the free movement of goods across the EU Single Market. It also benefits businesses by reducing regulatory burdens and ensuring a predictable legal framework. A series of directives and regulations defines the essential requirements that each product, process or service must fulfil before being placed on the EU market.

This section examines the extent to which quality infrastructure rules and procedures in the WBT economies are harmonised with the EU acquis – i.e. the fundamental framework to enable SMEs to access the EU market. The assessment considers all six quality infrastructure pillars, from technical regulations to standardisation, accreditation, conformity assessment, metrology and market surveillance (Table 8.4)

Table 8.4. Scores for Sub-dimension 7.2: Harmonisation with the EU acquis

ALB

BIH

KOS

MKD

MNE

SRB

TUR

WBT

average

Technical regulations

3.53

2.47

4.13

3.00

3.93

5.00

5.00

3.87

Standardisation

4.25

2.88

3.88

3.50

4.00

4.50

4.75

3.97

Accreditation

4.15

3.44

4.62

4.92

4.69

4.92

5.00

4.53

Conformity assessment

3.53

2.07

3.60

2.80

4.00

4.73

4.80

3.65

Metrology

4.33

3.89

3.94

4.11

5.00

5.00

5.00

4.47

Market surveillance

4.20

3.80

3.80

4.60

5.00

4.60

5.00

4.43

Weighted average

4.00

3.09

3.99

3.82

4.44

4.79

4.93

4.15

Note: See the Policy Framework and Assessment Process chapter and Annex A for information on the assessment methodology.

Overall, the level of preparation in the WBT economies for the free movement of goods has improved. Of the seven economies, Serbia and Turkey are most advanced in their harmonisation efforts, particularly in transposing and enforcing technical regulations. Albania has made the most progress by improving its market surveillance activities. In Bosnia and Herzegovina, strategic documents on the adoption and implementation of EU legislation for industrial products and technical regulations in priority sectors have not been renewed. Following prolonged political deadlock in North Macedonia, new strategies and action plans are currently being developed.

Most governments have aligned their technical regulations, although regular monitoring and evaluation are often lacking

With the exception of Bosnia and Herzegovina, progress has been made across all WBT economies in transposing EU technical regulations. In Bosnia and Herzegovina, the process has stagnated since the aforementioned Committee for Technical Regulations responsible for stopped convening in 2012. As a result, EU legislation has not been aligned in a uniform manner, leading to inadequate harmonisation with the EU acquis.

The training needs of the institutions implementing technical regulations have been assessed in all the WBT economies, except North Macedonia. In Serbia and Turkey, the staff of government ministries and agencies are trained in new regulations and their implementation; however, this training is usually one-off and sporadic in nature.

Most of the economies have weak mechanisms to monitor and evaluate the impact of the implementation of technical regulations. Regular monitoring and evaluation only take place in Serbia and Turkey – in other economies the arrangements are more ad hoc.

Adoption of European standards is progressing, though mostly by endorsement

The national standards bodies in the WBT economies have increased their efforts to adopt EU standards. However, the region shows two distinct levels of performance, with Albania, North Macedonia, Serbia and Turkey achieving much higher adoption rates (Table 8.5).

Table 8.5. Adoption of European standards in the Western Balkans and Turkey

 

Adoption rate

ALB

98%

BIH

85%

MKD

98%

KOS

50%

MNE

72%

SRB

98%

TUR

98%

Source: National standards bodies in the Western Balkans and Turkey.

In most cases transposition involves issuing an “endorsement notice”3 or by translating only the cover page – the “cover page method”. As a result, standards are usually not available in local languages making it hard for SMEs to find the relevant standards, fully grasp their content and implement them correctly. This finding was further reinforced in the interviews conducted with private sector. For instance, Turkey has only fully translated 3 686 EU standards – just 18% of all adopted EU standards. The share is even lower in the Western Balkan economies.

In spite of linguistic similarities in the Western Balkans, regional co-operation has not been used as a cost-effective way to translate European standards.

National standards bodies lack funding and human resources

National standards bodies (NSBs) in the Western Balkans and Turkey grapple with financial issues, since they struggle to raise their own funds and continue to depend largely on public funding. The challenge is that these bodies collect very little revenue from sales of standards and other services offered to the private sector. Moreover, in certain cases, the revenues they collect are funnelled into general government budgets, further undermining their already weak incentives to diversify revenue sources. For instance, the Kosovo Standardisation Agency is administratively part of the Ministry of Trade and Industry and lacks its own budget or bank account, and the income it generates from the sales of standards goes entirely to the state budget.

Some NSBs have already cited lack of staff due to limited and fluctuating budgets as a significant obstacle to carrying out their activities. This is the case for regular activities in Bosnia and Herzegovina, Kosovo and Montenegro, while the NSBs in Albania and North Macedonia foresee a need for a more employees in order to strengthen and diversify their services.

Turkey’s national standards body, the Turkish Standards Institution (TSE), provides conformity assessment services, thereby raising additional revenue to support its other standardisation activities. Currently, the TSE is the only national standards body in the WBT region that does not rely on public funding. Although the direct engagement of public NSBs in conformity assessment has certain benefits, such as offering competence-building activities for private conformity assessment bodies (CABs) and generating financial resources for standardisation services, there are also certain risks. First, it might crowd out private investment in CABs; and second, it might create biased incentives for NSBs to develop unnecessary standards just to generate some certification business. It is therefore crucial to maintain a clear separation between NSBs’ activities in standardisation and conformity assessment, and also to ensure that NSBs only offer conformity assessment services in specific sectors which have major relevance for the society and economy in general, and where there is no business case for private CABs to offer those services.

National standards bodies are well integrated into European structures and co-operate regionally

All national standards bodies except the Kosovo Standardisation Agency actively participate in the European standards system. The national standards bodies of North Macedonia, Serbia and Turkey are members of the European Committee for Standardization (CEN) and European Committee for Electrotechnical Standardization (CENELEC), allowing them to represent their economies’ interests on their technical committees. The other economies have affiliate status. In 2017, Kosovo signed an agreement with CEN and CENELEC for direct access to EU standards. All the WBT governments except Bosnia and Herzegovina have also carried out needs assessments into the investment and technical expertise required to participate in the European standards system.

Regional co-operation among national standards bodies has also been deepening in the Western Balkans and Turkey. For example, CEN has been running a project aimed at the full implementation of EU product legislation for electrical/electronic equipment and construction products in the six economies of the Western Balkans. The project is financed by the Swedish International Development Cooperation Agency (Sida) and the European Free Trade Association (EFTA). It includes the organisation of workshops and training, networking events, and proficiency testing. However, regional co-operation is not limited to donor-funded initiatives. For example, in 2018 the national standards bodies of Turkey and Serbia signed a memorandum of understanding (MoU) to facilitate co-operation in the certification of management systems and products (e.g. halal), as well as in organising training and expert exchanges.

Education in standardisation is almost non-existent

Standards have the potential to achieve public objectives (e.g. protecting human health or the environment), while also facilitating trade by reducing market uncertainty and information asymmetries between producers and consumers. This potential can only be fully harnessed if the relevant actors in the standardisation process (regulatory authorities, standards developing organisations, academia, businesses and consumers) are able to participate and make informed decisions (Wilfried and de Vries, 2011[17]). Since the process entails a significant level of technical knowledge, education in standardisation can help businesses and consumers to take on a contributory role and enhance the effectiveness of overall participation.

Education in standardisation in the WBT economies is limited to small-scale and irregular activities and lacks a coherent approach, thereby depriving the economies from fully realising the advantages of standards. While various programmes have been prepared to educate and train businesses in implementing standards, they usually do not cover topics related to developing them. Moreover, education about standardisation has not been well established in academic programmes or curricula. While national standards bodies and public universities have signed co-operation agreements in several of the economies, they are limited to irregular seminars. Furthermore, these seminars are not complemented by attractive study materials and rarely include practical classes.

Standardisation education is not included in government strategies or action plans in the majority of the economies. Only Serbia and Turkey have defined clear government actions to systematically improve and expand education activities (Box 8.2).

Box 8.2. Standardisation education by the Turkish Standards Institution

Education is vital to enable SMEs to exploit the benefits of implementing and developing standards. The first step is to raise awareness of the topic through training and targeted workshops, including on the strategic relevance of standardisation, especially in the EU, as well as how to participate in standardisation in order to shape the content of future standards.

The Turkish national standards body, the Turkish Standards Institution (TSE), has taken active measures along with its education department to address the low level of awareness of standards and standardisation. The TSE’s activities stand out in the region, and demonstrate that targeted and specific activities can reach current and future stakeholders and raise the general awareness of standards and standardisation.

Striving to bring the topic into higher education curricula, the TSE is co-operating with four universities through activities such as delivering lectures on standards and quality infrastructure. The co-operation involves lectures by TSE staff members, either on site or through distant-learning programmes, as well as training for university staff in specific standards (such as ISO 9001), statistical process control, and sector-specific content such as medical instrument tests and calibration.

To raise awareness sustainably, activities have also been specifically targeted at children to introduce them to standards and standardisation – an approach which stands out in the region and also within the EU. A quarterly journal, containing specifically designed cartoons, introduces children to the world of standards and standardisation in a playful way.

The general public is reached through monthly online journals on standards and standardisation.

Source: TSE (2018[18]), Turkish Standards Institution website, https://en.tse.org.tr/.

Accreditation infrastructure is solid and conformity assessment services have increased in priority sectors

The increasing number of specific EU standards and technical regulations has brought about a need for effective systems in the Western Balkans and Turkey to evaluate compliance. National accreditation bodies provide an authoritative statement on the competence and credibility of conformity assessment bodies (CABs), which in turn evaluate whether products fulfil the requirements of the EU Single Market (European Accreditation, 2018[19]). SMEs often need to show proof of their compliance with the requirements set out in standards and regulations. For this, they depend on the availability of reliable conformity assessment services, such as certification.

National accreditation bodies in the assessed economies have increased their participation in European accreditation systems. They are either full members of the European co-operation for Accreditation (Albania, Montenegro, North Macedonia, Serbia and Turkey) or associate members (Bosnia and Herzegovina, and Kosovo). Likewise, most WBT economies are signatories of the European Accreditation Multilateral Agreements (EA MLA)4 or Bilateral Agreements (EA BLA). These agreements provide confidence that national accreditation is operated in a manner that is harmonised and consistent with accreditation procedures in the EU. This means that conformity assessments carried out by accredited CABs in the WBT economies are accepted across borders, opening up markets for SMEs. Having been tested or certified once, SMEs do not need to re-test or re-certify their product. In the region, the EA MLAs of Turkey and Serbia cover the highest number of scopes, seven and six respectively (Table 8.6).

Table 8.6. Scope of European accreditation agreements in the WBT economies

Accreditation scopes

ALB

BIH

MKD

SRB

TUR

Calibration

X

X

X

X

Testing and medical examination

X *

X *

X *

X

X

Product certification

X

X

X

Management systems certification

X

X

X

X

Certification of persons

X

X

Inspection

X

X

X

X

X

Validation and verification

Proficiency testing providers

X

Notes: Kosovo and Montenegro are not EA MLA or BLA signatories, * Signatory for testing laboratories only; not signatory for medical laboratories.

Source: European Accreditation (2019[20]), Directory of EA Members and MLA Signatories, https://european-accreditation.org/ea-members/directory-of-ea-members-and-mla-signatories/.

The WBT economies have also concluded co-operation agreements with each other. In October 2018, Bosnia and Herzegovina and Serbia signed an MoU to mutually recognise documents issued by accredited laboratories for industrial non-food products, which will further remove trade barriers and facilitate exports for SMEs.

Almost all WBT governments have adopted legislation on conformity assessment in line with the EU acquis. Their legislation has also moved towards the principles applied in European harmonised legislation, i.e. the presumption of conformity, self-certification and absence of mandatory standards. In Bosnia and Herzegovina, the effectiveness of the law on conformity assessment remains limited, since the Republika Srpska continues to develop and implement its own legislation separately. As with other quality infrastructure pillars, the legislation on accreditation and conformity assessment in the WBT economies is generally not subject to regular monitoring and evaluation.

While most governments declare their accreditation body to be fully operational, in Bosnia and Herzegovina and Kosovo, additional staff will be required to maintain the current level of accreditation services. Accreditation of new CABs remains a major issue for Kosovo’s accreditation body, which currently employs only three auditors. As the number of CAB applications continues to increase, Serbia foresees the need for additional staff and Albania has allocated increasing funds to hire auditors and technical experts for their accreditation.

Since many economies do not need or cannot afford CABs in all sectors, the focus of WBT governments has primarily been to ensure the existence of conformity assessment services in mandatory areas and their priority sectors.5 Although the number of CABs has increased across the WBT economies, SMEs in certain sectors still need to seek conformity assessment abroad in several economies. For instance, conformity assessment services are not available for the food and electrical equipment sectors in Albania, or for lift and lift parts manufacturers in Kosovo.

SMEs in all WBT economies can check the availability of conformity assessment bodies and services through online CAB registries.

Several metrology bodies in the WBT economies lack resources

Metrology ensures that reliable measurement systems and equipment are used in production, and tests whether products and processes adhere to standards and regulations.

All the WBT governments have established institutions responsible for metrology and they are well integrated into European and international organisations. With the exception of Kosovo, their metrology bodies are associate members of the European Cooperation in Legal Metrology and members of the European Association of National Metrology Institutes (EURAMET). Their integration and co-operation with these bodies ensures alignment in industrial as well as legal metrology, providing SMEs with access to reliable metrological services such as equipment calibration.

However, it is debatable whether the Western Balkan economies all need their own metrology bodies, given the difficulty of financing metrology bodies in smaller economies (Guasch et al., 2007[8]). The need for additional financial resources has consistently been voiced by national metrology bodies in the region – with the lack of laboratories and adequate premises notably highlighted as obstacles in North Macedonia and Montenegro respectively.

Co-operation among metrology bodies in the region is well developed. A number of MoUs have been signed, most recently between the Institute for Metrology of Bosnia and Herzegovina and North Macedonia’s Bureau of Metrology (in August 2018). Several WBT metrology bodies also participate in EURAMET’s inter-laboratory comparison programmes, which allow test results to be compared and the quality assurance of testing services. For example, Albania, Bosnia and Herzegovina, Kosovo, Montenegro, and North Macedonia all participate in regional volume comparisons.

Market surveillance activities have increased, but focus mainly on enforcement rather than supporting compliance

An important challenge for governments is achieving high levels of compliance with regulations, while reducing the burden on enterprises. Although the ultimate goal of market surveillance remains protecting consumers from unsafe products, a well-formulated system will also protect businesses from disproportionate costs and unfair competition.

All WBT economies have legislation on market surveillance that is in line with the EU acquis. Implementation has mainly focused on enforcement – recalling products and imposing penalties. In this context, market surveillance authorities have concentrated their resources on increasing the number of inspections and hiring new inspectors, without developing upstream measures to support and encourage SMEs to comply with technical regulations. They have also made only limited efforts to provide information and guidance on legal requirements for products in order to promote compliance among enterprises. One exception is the annual guide for economic operators produced by the Market Surveillance Agency of Bosnia and Herzegovina, which serves as a good practice example of how to help economic operators to place safe products on the market (Box 8.3).

Box 8.3. Bosnia and Herzegovina’s guide for economic operators

Since 2016 the Market Surveillance Agency of Bosnia and Herzegovina has published guides to help manufacturers, importers and distributors to bring non-food consumer products into compliance with the regulations and applicable standards. The guide is published annually in local languages and English. It provides information on the most common risks for users and areas of non-compliance for each product that will be the focus of surveillance in the year of publication.

So that companies can avoid penalties and the withdrawal of their products from the market, the publication provides detailed guidelines on labelling of products, information to be included in instructions for use and functionality of products. Since it includes the list of products that pose certain safety risks, consumers may also use the publication to make informed purchases.

The agency also publishes brochures for individual products with more detailed information to help manufacturers, importers and distributors in Bosnia and Herzegovina fulfil their obligations arising from the regulations and the standards applicable in Bosnia and Herzegovina.

Source: Market Surveillance Agency of Bosnia and Herzegovina (2018[21]), Publications, http://annt.gov.ba/Za_poslovne_subjekte/publikacije/Archive.aspx?langTag=en-US&template_id=172&pageIndex=1.

The majority of the WBT economies have also made progress in co-ordinating market surveillance activities through a designated co-ordination body. However, in Kosovo and North Macedonia, overlapping competences in secondary legislation and a large number of competent authorities are increasing government expenses as well as the compliance burden for enterprises. Acknowledging this problem, Albania established the State Inspectorate for Market Surveillance in 2016, merging various market surveillance activities and clearly defining its competences and tasks. Meanwhile, Kosovo is planning to decrease overlapping and parallel inspections by merging the current 36 market surveillance directorates into 15. Although improving, the overall effectiveness of market surveillance in North Macedonia is inhibited by the multiple pieces of legislation which continue to regulate inspections.

Cross-border collaboration also remains a challenge. While discussions continue in various forums on developing a module for exchanging information about dangerous products (test reports, checklists, risk assessments, etc.), no steps have been taken to implement it.

The way forward for harmonisation with the EU acquis

The WBT governments have taken positive steps to enhance their quality infrastructure systems. However, several issues related to operating self-sufficient quality infrastructure bodies and sustaining efforts in harmonisation with the EU acquis warrant further attention:

  • Explore regional collaboration and consider taking steps to establish the common use of quality infrastructure at the regional level. Establishing fully fledged national quality infrastructure requires considerable investment and ties up resources over the long term. For many economies with limited financial means and a relatively modest demand for some of the quality-related services, this is neither feasible nor useful. Instead, the common use of a shared and complementary infrastructure or intensified expert exchange appear to be better approaches (BMZ, 2004[22]). A first step could be to consider the costs of and demand for quality infrastructure services to find out which services individual economies should establish themselves, and which could be provided at the regional level.

  • This SBA assessment reveals the scope to step up regional co-operation for the following quality infrastructure pillars in the Western Balkans and Turkey:

    • Accreditation: since national accreditation bodies require substantial resources to cover all conformity assessment areas, the economies could consider only providing accreditation services for their priority sectors. An individual economy should base its decision to add or remove specific areas of accreditation on a cost-benefit analysis of market priorities, demand for auditing and availability of audit experts. Where accreditation would not be effective and efficient, governments could consider regional solutions, such as recognising foreign accreditation or contracting with another accreditation body in the region to undertake accreditation on their behalf.

    • Metrology: operating a metrology body in smaller economies is a costly endeavour. Policy makers should therefore conduct a cost-benefit analysis to assess which services are essential in their national economies. For instance, it would not be economically reasonable for national metrology bodies to develop a system for metrological traceability in all areas of metrology. Stronger regional co-operation in metrology activities would therefore reduce the financial burden of maintaining current levels of investment in national metrology bodies.

    • Standardisation: regional co-operation could be further stepped up by building on existing bilateral co-operation agreements between some national standardisation bodies in the WBT region. A regional database and network covering applicable local and international standards in the region could be established to improve information and knowledge sharing. This would also facilitate intra-regional trade, and contribute to the efforts of the WB governments under the Multi-Action Plan for the Regional Economic Area6. Moreover, given the linguistic similarities in the region, standardisation bodies could create synergies by translating the relevant EU standards, and sharing the cost among themselves.

    • Conformity assessment: if not available locally, governments should facilitate SMEs’ access to conformity assessment in neighbouring economies. Government support could include measures to cover extra costs incurred by SMEs when seeking conformity assessment abroad. This would also reduce the costs of providing those services in their economy.

    • Market surveillance: in order to establish predictable and consistent enforcement of regulations across the WBT economies, market surveillance authorities should enhance their co-operation by exchanging information on unsafe products and measures carried out by national authorities (as well as producers or distributers). To achieve this, national authorities could establish contact points to improve the co-ordination of market surveillance activities. The WBT economies would also benefit from mapping sector-specific challenges and establishing region-wide working groups to produce guidelines for joint action.

  • Scale up the revenue-earning services of national standards bodies. NSBs could diversify their revenue-earning services by preparing packages and subscriptions tailored to the needs of SMEs in particular sectors. Such offers in the Western Balkans and Turkey would make it easier and less expensive for SMEs to implement the standards they require while generating additional revenues for national standards bodies. NSBs in the WBT region should also aim to offer innovative services to SMEs, which could bring them additional sources of revenue and support their regular standardisation activities (see Box 8.4 for some EU/OECD examples).

Box 8.4. Innovative products and solutions offered by national standards bodies in the EU and the OECD

National standards bodies in the EU have moved towards providing innovative tools and services to help SMEs implement standards. Some of the services include:

  • Online management of standards by Austrian Standards International. This innovative solution, known as effects 2.0, is convenient for managing the standards and norms applied on line. SMEs can quickly access documents and stay informed of their current status of standardisation through automatic updates.

  • The online standards collection viewing service by the Estonian Centre for Standardisation (EVS). Standards change over time, reflecting progress in science, technology and systems. Keeping up with those changes is often an inconvenient and time-consuming task. The EVS offers a standards monitoring service which allows SMEs to create a list of relevant standards and receive e-mail notifications about any changes in these standards. Notifications include replacement of the selected standards with newer ones, amendments, correction, withdrawals, or translations into the national language.

  • E-learning by the Polish Committee for Standardization (PKN). In addition to traditional classroom training, the PKN has introduced training for those who prefer distance learning. This type of training translates traditional presentations into user-friendly screen-based forms. The training courses combine course material with tests to certify participants’ knowledge.

Sources: Austrian Standards (2018[23]), www.austrian-standards.at/home/; Estonian Centre for Standardisation (2018[24]), www.evs.ee; Polish Committee for Standardization (2018[25]), www.pkn.pl.

  • Include standardisation topics in national secondary and tertiary curricula. The role of education in standardisation could be improved through a number of measures. First, the relevant standardisation topics could be embedded in high school courses as well as university programmes (such as electrical, mechanical or civil engineering; and economics). Second, co-operation between national standardisation bodies and academic institutions could facilitate the exchange of experience and expertise. As an example, the Rotterdam School of Management hosts a Chair in Standardization – endowed by the Netherlands Standardization Institute (NEN) – to give courses at bachelor’s and master’s levels, as well as supervising master’s and doctoral projects. Co-operation could extend to organising practical classes to improve the skills required for standardisation processes.

    All the relevant stakeholders need to engage in developing study materials that are attractive to both students and teachers. The CEN and International Organization for Standardization (ISO) have repositories of teaching materials (for primary, secondary and higher education) with examples of the different materials used throughout the world.7

  • Complement the enforcement of regulation with measures to increase transparency and compliance. Regulatory enforcement agencies, in close co-operation with business associations, should develop and publish guidance notes or toolkits that help SMEs understand regulations and how to comply with them in the most common situations and sectors. For instance, the Consumer Product Safety Program of Canada publishes guides and holds webinars specifically for manufacturers, distributors and retailers to introduce them to their regulatory responsibilities (Government of Canada, 2018[26]). Governments could also introduce “self-check” tools to allow SMEs to understand their ability to comply with the regulations. These publications and tools should be tailored to specific sectors of operation.

SME access to standardisation (Sub-dimension 7.3)

Governments across WBT economies can improve the growth and competitiveness of SMEs by fostering the use of standards. SME involvement in the standardisation process gives them a head start in adapting to market demands and new technologies. However, evidence shows that many SMEs still fail to profit from using standards and face a series of barriers when participating in their development (de Vries et al., 2009[27]). As a key engine of the WBT economies, SMEs need to receive adequate and sustained support in order to benefit from standards and standardisation.

This section gauges whether the existing policy frameworks foster SME awareness of the benefits of standards, facilitate their participation in developing standards and reduce the financial burden of implementing standards (Table 8.7).

Table 8.7. Scores for Sub-dimension 7.3: SME access to standardisation

ALB

BIH

KOS

MKD

MNE

SRB

TUR

WBT

average

Awareness raising and information

4.25

3.97

3.50

4.50

4.33

4.83

4.33

4.24

SMEs’ participation in developing standards

2.50

1.00

2.50

2.50

2.50

3.50

3.50

2.57

Financial support to SMEs

1.80

1.93

1.80

2.00

1.80

3.60

3.80

2.39

Weighted average

2.85

2.30

2.60

3.00

2.88

3.98

3.88

3.07

Note: See the Policy Framework and Assessment Process chapter and Annex A for information on the assessment methodology.

Overall, performance varies across the three aspects of this policy area. While basic measures are in place for awareness raising, the participation of SMEs in standards development and financial support instruments still leaves room for improvement. Serbia and Turkey currently provide the most advanced support in enabling SME access to standardisation.

Authorities are improving awareness of standards and their benefits

SMEs are often unaware that by using standards they can boost efficiency, increase confidence in their clients and open new markets. The potential benefits of using standards remain overshadowed by perceptions that they are an onerous burden.

All WBT governments have also introduced initiatives to promote the benefits of standards and standardisation. The current programmes remain focused on promotional campaigns and training events for SMEs. However, they are infrequent and irregular in Albania, Bosnia and Herzegovina, and Kosovo. In addition, SMEs are often uninterested unless the events are tailored to their very specific segment or group. National standards bodies often disseminate generic materials prepared by international standards organisations, instead of producing practical guides with instructions and solutions tailored to the local context. Therefore, there is still significant room for improvement when it comes to preparing relevant materials that present success stories from the region. The Living Standards Award by the national standards body of Austria is one example of how the use of standards can be promoted by identifying and showcasing local success stories (Box 8.5).

While all WBT authorities have ensured easy access to their database of national and European standards, identifying relevant standards remains an issue for SMEs. Since standards are frequently revised and new ones adopted, SMEs need to know how to keep track of relevant standards for their area of operation. The monthly journal published by Turkey’s national standards body stands out as a positive example of how this can be achieved. Offered in print and online versions, the journal caters for SMEs in the manufacturing industry and aims to improve implementation of standards specific to this sector. Meanwhile, in Serbia, the Institute for Standardisation offers SMEs free consultations to learn about the relevant standards for their operations, and the Serbian Chamber of Commerce organises regular meetings with SMEs operating in particular sectors to inform them about the latest relevant standards.

National standardisation bodies increasingly co-operate with business associations to provide a communication channel with SMEs. In Montenegro, North Macedonia, Serbia and Turkey, such co-operation is regular and business associations send updates to their members concerning new developments and upcoming events. Nevertheless, joint promotional campaigns or sectoral roadshows remain sporadic across the economies.

Box 8.5. Austria’s Living Standards Award

In an effort to promote standardisation and raise awareness about the benefits of standards, Austrian Standards International presents annual awards to innovative enterprises, private and public-sector organisations, and start-ups. ASI aims to promote the use of standards in an exemplary way, as well as to promote strategic considerations in the development of standards. The award is also used as an opportunity to prepare promotional materials and showcase success stories in implementing standards. The award criteria usually include:

  • strategically oriented application of standards

  • strategic management of standards at several locations

  • exemplary development of new/existing standards at the national/international level

  • successful implementation of an innovative project involving the application/development of standards

  • early consideration of standards in an emerging topic (early adopter)

  • other extraordinary achievements in the context of standards (e.g. scientific paper).

Source: Austrian Standards (2018[28]), Living Standards Award 2019, www.austrian-standards.at/en/our-events/living-standards-award-2019/.

SME participation in the development of standards is weak

SMEs’ involvement in standardisation remains low across OECD and EU countries, even though evidence shows that it has a positive impact on their profits (Wakke, Blind and Ramel, 2016[29]). SMEs often regard the standardisation process as being inflexible, as it does not take into account the limited time, personnel or financial resources at their disposal (de Vries et al., 2009[27]).

Across the Western Balkans and Turkey, NSBs struggle to get SME representatives to participate in technical committees for standards development. Interviews conducted in the region reveal that SMEs perceive their participation as futile, and that such meetings keep them away from their “real work”.

To encourage SME participation, Serbia’s NSB extends invitations to technical committee meetings through phone calls, and organises them in different cities across the country. In a similar vein, Turkey’s NSB has signed a co-operation protocol with the Union of Chambers and Commodity Exchanges to facilitate the effective participation of SMEs through regular and sector-specific meetings. In North Macedonia, the NSB has established a working group to develop an action plan to increase SMEs’ participation, which is planned to be completed by 2019.

While the other economies largely lack any proactive approaches to increasing SME participation in standards development, they do publish calls for feedback on drafts of standards during their development (although in Bosnia and Herzegovina, the drafts are yet to be made publicly available for feedback). However, SME participation in these public calls remains low, which might be partially attributed to the fact that national standards bodies do not produce any follow-up reports specifying how private sector feedback was taken into account in the standards development process. Similarly, the involvement of SMEs is rarely monitored and evaluated, with the exception of Serbia, which regularly produces reports on their participation in the standardisation process.

Financial support for SME access to standardisation exists but varies in scope

Given SMEs’ limited resources, financial support programmes are essential to help them acquire and implement standards, as well as to ensure their overall participation in standards development.

Only Serbia and Turkey offer standards at reduced prices for SMEs. In other economies, discounts for the acquisition of standards are limited to members of technical committees. Although SMEs could also benefit from these discounts, they are less likely to participate in technical committees than larger enterprises, so they rarely do.

Programmes supporting the implementation of standards differ significantly across the seven economies in their source, level and scope. With the exception of Kosovo, all governments operate some financial support programmes, albeit often small-scale and irregular. This support is usually provided within the scope of assisting SME exporters and improving SME competitiveness.

For instance, in Albania, the Competitiveness Fund run by the Albanian Investment Development Agency (AIDA) supports SMEs exporting their products to foreign markets by reimbursing up to 70% of their costs for product certification, other conformity assessments and introducing quality management systems. However, the requirement to demonstrate the ability to finance the entire project costs can deter SMEs from applying. Likewise, the Development Agency of Serbia (RAS) runs a programme to support SME exporters, covering up to 50% of the costs of implementing standards, and the certification or recertification of products.

Montenegro operates a state-funded national programme to enhance regional and local competitiveness through compliance with international business standards. It aims to support SMEs financially, in particular those from less developed municipalities, to comply with international product standards by reimbursing up to 70% of the costs of certification.8 The programme is expected to continue until 2020.

Turkey’s Small and Medium-Sized Industry Development Organization (KOSGEB) supports the implementation of standards and management systems under its General Support programme.9 The admissible costs also include certification tests, analyses and calibration. In North Macedonia, SMEs can benefit from a voucher scheme operated by the Innovation Fund to support quality infrastructure investments, including implementation of standards and certification.10

In Bosnia and Herzegovina, financial support for implementing standards is provided at the entity level. While the Federation of Bosnia and Herzegovina (FBiH) supports the implementation of international quality standards through annual grants, in the RS the focus is on sector-specific funds (e.g. wood processing).11

Finally, when it comes to financial support to help SMEs to participate in standards development, the majority of WBT economies allow SMEs to join technical committees at no cost (Albania, North Macedonia, Serbia, Turkey). In Serbia, technical committee meetings are held in different cities to lower SMEs’ cost of participation (e.g. travel costs). Turkey is exploring the potential of using digital tools to ease SME participation. Furthermore, the Turkish Ministry of Economy (now the Ministry of Trade) has initiated a support programme for companies entering new markets. If they can provide evidence that participating in standardisation is necessary to enter the new market, SMEs are offered a reimbursement of 50% of their relevant participation expenditure.

The way forward for SME access to standardisation

Despite the existence of some initiatives across the region aiming to increase SME’s access to standardisation, governments need to ensure they are better targeted:

  • Disseminate successful case studies that highlight benefits of standardisation in a local context. In addition to publishing guides on the use of standards, governments should disseminate successful case studies that highlight the advantages of standardisation for improving market results in a local context. The measures introduced by the Dutch standards development organisation are a good example of how to increase SMEs’ awareness of standards and their benefits (Box 8.6).

Box 8.6. How the Dutch standards development organisation increases SME access to standards

Perceiving low awareness of standards among SMEs, as well as a lack of participation in standards development, the Dutch standards development organisation (NEN) strives to improve SME access to standards and standardisation through a variety of measures:

  • As young businesses are generally not aware of the use and benefits of standards, NEN prepares information material to distribute to start-ups when they register officially.

  • Brochures are provided on successful cases of SME participation to motivate their peers.

  • A translation initiative was launched to ease SMEs’ access to standards.

  • The NEN and the Netherlands Electrotechnical Commission have enhanced communication with SMEs by preparing sector-specific electronic newsletters to announce new standards and share information on standards-related events.

  • The NEN promotes standardisation by communicating through social media, such as YouTube, Twitter and LinkedIn.

After establishing this programme, the sales of standards translated into local languages tripled. Revenues from the sales of standards more than offset the respective costs. These practices show that national standards bodies can increase awareness of standards and SME participation in their development through simple but well-targeted measures.

Source: de Vries, H. et al. (2009[27]), SME Access to European Standardization, www.unms.sk/swift_data/source/dokumenty/technicka_normalizacia/msp/SME-AccessReport.pdf.

  • Allow SMEs to participate in standards development through digital tools or by covering their travelling costs. SMEs often do not have the time, personnel or financial resources to engage in standards development. National standards bodies should therefore consider the provision of digital platforms, allowing for online participation, feedback and comments to reduce time and travel costs. For example, the German standards development body, Deutsches Institut für Normung (DIN) offers SMEs the opportunity to join the meetings of technical committees via web conference to increase their participation rates (Box 8.7). Additionally, the WBT governments should consider providing funds to cover the travel costs of SMEs attending technical meetings. The Swedish Electrical Commission provides such support and requests the grantees to prepare a report on their participation to be published in its magazine.

  • Scale up financial support programmes to help SMEs implement standards. Support for implementing standards is currently provided through general programmes for enhancing competitiveness, and the number of SMEs benefitting from the programmes remains low. Therefore, governments should scale up funding and ensure their programmes are better targeted. The authorities should also strive to develop long-term financing schemes based on SMEs’ needs when exporting to the EU Single Market, as well as on the evaluation of programmes already conducted.

Box 8.7. Increasing SME access to standardisation in Germany

Germany’s national standards body, DIN, together with the Federal Ministry of Economy, has established a SME committee (KOMMIT) comprised of representatives from SMEs, chambers of commerce, business associations and the public sector. Following an analysis of how to maximise the benefits of standardisation for SMEs, KOMMIT has developed the following:

  • An SME Help Desk, which serves as a point of contact for SMEs for questions on standards and standardisation. It also assists SMEs in applying standards and consults those that are interested in participating in standards development.

  • Web conferencing, to enable SME participation in technical committees by allowing real-time engagement without incurring travel costs. Standardisation meetings are either completely virtual, or else individual members can join through the web-conferencing tool. A dedicated portal allows SMEs to read and comment on draft standards without having to be members of technical committees.

  • An online database where SMEs can freely search for standards, technical rules and other documents in DIN’s web shop. Summaries and a table of content are provided to help SMEs identify the right standard for their purposes.

  • Standard flat rates for SMEs to reduce the financial burden in acquiring standards. SMEs have the option to purchase an unlimited number of standards at a fixed annual flat rate or a package of a fixed number of standards (e.g. 25 or 50) within one year.

KOMMIT is a good example of how a multi-stakeholder working group dedicated to the needs of SMEs can help to analyse and implement measures to increase their participation in the standardisation process.

Source: DIN (2018[30]), SMEs and Standardization, www.din.de/en/about-standards/benefits-for-the-private-sector/sme-commission-kommit.

Conclusions

All the WBT governments have taken positive steps to strengthen their quality infrastructure systems further.

Overall, the co-ordination of quality infrastructure policies has improved across most of the economies. However, the quality infrastructure of some economies still does not encompass all the elements needed. Participation in international quality infrastructure structures has increased, bringing quality infrastructure procedures further in line with harmonised principles in the EU and internationally. As a result, SMEs benefit from growing confidence among foreign consumers and authorities in local assessments and certifications.

However, maintaining and expanding the current level of accreditation, conformity assessment and metrology services remains a challenge. Although much focus has been placed on enhancing institutional and human resource capacities, several economies will need to make additional investments. Policy makers are yet to consider taking the first steps towards developing a regional approach for quality infrastructure services based on a cost-benefit analysis of their individual market needs.

Governments have also strengthened the enforcement of technical regulations by increasing inspections, penalties and product recalls. However, implementation of measures to promote compliance remains limited, and in some economies overlapping laws implemented by numerous market surveillance authorities subject SMEs to parallel inspections. SMEs’ access to standardisation in the WBT economies also remains inadequate. They are not systematically informed about new standards or involved in their development. Moreover, effective programmes to support SME awareness and participation in the development of standards remain scattered.

The recommendations put forward in this chapter address policy reform priorities for quality infrastructure in the WBT economies. Their implementation will improve the reliability and effectiveness of the quality infrastructure institutions and processes, while also creating better services for SMEs and increase their competitiveness in international markets.

References

[23] Austrian Standards (2018), Austrian Standards website, https://www.austrian-standards.at/.

[28] Austrian Standards (2018), Living Standards Award 2019, Austrian Standards website, https://www.austrian-standards.at/en/our-events/living-standards-award-2019/.

[1] Blind, K. and C. Koch (2017), Introduction to Quality Infrastructure Management, lecture at Technische Universität Berlin.

[5] Blind, K., A. Mangelsdorf and J. Pohlisch (2018), “The effects of cooperation in accreditation on international trade: Empirical evidence on ISO 9000 certifications”, Journal of Production Economics, Vol. 198, pp. 50-59, https://doi.org/10.1016/j.ijpe.2018.01.033.

[22] BMZ (2004), Quality Infrastructure, Conformity Assessment – Metrology, Standardization, Testing, Quality Management (MSTQ): A Reference Framework, Bundesministerium für wirtschaftliche Zusammenarbeit und Entwicklung.

[27] de Vries, H. et al. (2009), SME Access to European Standardization: Enabling Small and Medium-Sized Enterprises to Achieve Greater Benefit from Standards and from Involvement in Standardization, Rotterdam School of Management, Erasmus University, http://www.unms.sk/swift_data/source/dokumenty/technicka_normalizacia/msp/SME-AccessReport.pdf.

[30] DIN (2018), SMEs and Standardization, Deutsches Institut für Normung website, https://www.din.de/en/about-standards/benefits-for-the-private-sector/sme-commission-kommit.

[6] Doner, R. (2016), “The politics of productivity improvement: Quality infrastructure and the middle-income trap”, Thammasat Economic Journal, Vol. 34/1, http://www.tej.econ.tu.ac.th/TUEconJournal/journal/1.the%20politics%20of%20productivity%20improvement_tej_34-1-59.pdf.

[3] EC (2018), A Credible Enlargement Perspective for and Enhanced EU Engagement with the Western Balkans, European Comission, Brussels, https://eeas.europa.eu/regions/western-balkans/39711/credible-enlargement-perspective-and-enhanced-eu-engagement-western-balkans_en.

[11] EC (2018), European Neighbourhood Policy and Enlargement Negotiations, https://ec.europa.eu/neighbourhood-enlargement/countries/package_en (accessed on 17 January 2019).

[13] EC (2018), European Union, Trade in Goods with Western Balkans 6, European Commission, http://trade.ec.europa.eu/doclib/docs/2006/september/tradoc_111477.pdf.

[4] EC (2016), Press Release: Commission Proposes to Modernise the Customs Union with Turkey, European Comission, Brussels, http://europa.eu/rapid/press-release_IP-16-4468_en.htm.

[10] EC (2008), Think Small First: A Small Business Act for Europe, Commission of the European Communities, Brussels, http://ec.europa.eu/transparency/regdoc/rep/1/2008/EN/1-2008-394-EN-F1-1.Pdf.

[24] Estonian Centre for Standardisation (2018), Estonian Centre for Standardisation website, https://www.evs.ee/.

[20] European Accreditation (2019), Directory of EA Members and MLA Signatories, European Accrediation website, https://european-accreditation.org/ea-members/directory-of-ea-members-and-mla-signatories/.

[19] European Accreditation (2018), European Accreditation website, http://www.european-accreditation.org/ (accessed on 5 September 2018).

[31] European Commission (2018), Horizon 2020 data, http://ec.europa.eu/research/participants/portal/desktop/en/projectresults/index.html.

[14] Eurostat (2018), Comext database, Eurostat, https://ec.europa.eu/eurostat/web/international-trade-in-goods/data/focus-on-comext.

[12] Eurostat (2018), International Trade of EFTA and Enlargement Countries dataset, Eurostat, https://ec.europa.eu/eurostat/web/products-datasets/-/ext_lt_intercc.

[15] Eurostat (2018), Western Balkan Countries-EU: International Trade in Goods Statistics, Eurostat Statistics Explained website, https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Western_Balkan_countries-EU_-_international_trade_in_goods_statistics (accessed on 5 September 2018).

[26] Government of Canada (2018), Meeeting Canada Consumer Product Safety Act Requirements, Government of Canada website, https://www.canada.ca/en/health-canada/services/consumer-product-safety/legislation-guidelines/acts-regulations/canada-consumer-product-safety-act.html.

[8] Guasch, J. et al. (2007), Quality Systems and Standards for a Competitive Edge, World Bank, Washington, DC, http://dx.doi.org/10.1596/978-0-8213-6894-7.

[21] Market Surveillance Agency of Bosnia and Herzegovina (2018), Publications, Market Surveillance Agency of Bosnia and Herzegovina website, http://annt.gov.ba/Za_poslovne_subjekte/publikacije/Archive.aspx?langTag=en-US&template_id=172&pageIndex=1.

[16] Ministry of Economy (2018), Sector for Quality and Product Safety website, Ministry of Economy, Republic of Serbia, http://www.tehnis.privreda.gov.rs/.

[25] Polish Committee for Standardization (2018), Polish Committee for Standardization website, https://www.pkn.pl/.

[2] Sanfey, P. and J. Milatovic (2018), The Western Balkans in Transition: Diagnosing the Constraints on the Path to a Sustainable Market Economy, European Bank for Reconstruction and Development.

[7] Swann, G. (2010), “International standards and trade: A review of the empirical literature”, OECD Trade Policy Papers, No. 97, OECD Publishing, Paris, http://dx.doi.org/10.1787/5kmdbg9xktwg-en.

[18] TSE (2018), Turkish Standards Institution website, Turkish Standards Institution, https://en.tse.org.tr/.

[9] UNIDO (2017), UNIDO Partners with Technical Institutions on Quality Infrastructure to Achieve Sustainable Development Goals (SDGs), United Nations Industrial Development Organization, https://www.unido.org/news/unido-partners-technical-institutions-quality-infrastructure-achieve-sustainable-development-goals-sdgs.

[29] Wakke, P., K. Blind and F. Ramel (2016), “The impact of participation within formal standardization on firm performance”, Journal of Productivity Analysis, Vol. 45/3, pp. 317-330, http://dx.doi.org/10.1007/s11123-016-0465-3.

[17] Wilfried, H. and H. de Vries (2011), White Paper: Academic Standardisation Education in Europe, European Academy for Standardization, http://www.euras.org.

Further reading

Abdelkafi, N. et al. (2016), “To standardise or to patent? Development of a decision making tool and recommendations for young companies”, International Journal of Innovation Management, Vol. 20/08, https://doi.org/10.1142/S136391961640020X.

Blind, K. and S. Drechsler (2017), European Market Needs for Education in Standardisation/Standardisation-Related Competence, Publications Office of the European Union, https://doi.org/10.2873/540387.

Blind, K. and A. Mangelsdorf (2013), “Alliance formation of SMEs: Empirical evidence from standardization committees”, IEEE Transactions on Engineering Management, Vol. 60/1, pp. 148-156, https://doi.org/10.1109/TEM.2012.2192935.

Blind, K. et al. (2018), “Standards in the global value chains of the European Single Market”, Review of International Political Economy, Vol. 25/1, pp. 28-48, https://doi.org/10.1080/09692290.2017.1402804.

Directorate for European Integration (2018), Answers to the Questionnaire, Directorate for European Integration, Bosnia and Herzegovina, http://dei.gov.ba/dei/direkcija/sektor_strategija/Upitnik/odgovoriupitnik/Archive.aspx?langTag=en-US&template_id=120&pageIndex=1.

EC (2017), Good Practice for Market Surveillance, European Commission, Brussels, http://ec.europa.eu/DocsRoom/documents/23041.

Harmes-Liedtke, U. (2010), “The relevance of quality infrastructure to promote innovation systems in developing countries”, Discussion Paper, No. 3/2010, Physikalisch-Technische Bundesanstalt, Braunschweig, Germany, www.ptb.de/cms/fileadmin/internet/fachabteilungen/abteilung_9/9.3_internationale_zusammenarbeit/publikationen/303_Discussion_3_Innovation/PTB_Q5_Discussion3_Innovation_EN.pdf.

PROSAFE (2010), Best Practice Techniques in Market Surveillance, Product Safety Forum of Europe, Brussels, www.prosafe.org/index.php/best-practice/item/best-practices-techniques-in-market-surveillance.

UNIDO (2016), Guide for the Development of National Quality Policies, United Nations Industrial Development Organization, Vienna.

World Bank (2017), “Faster growth, more jobs” Western Balkans Regular Economic Report, No. 11, World Bank, Washington, DC, http://pubdocs.worldbank.org/en/310431491458109659/WBRER-11-v6.pdf.

World Bank (2017), The Western Balkans: Revving Up the Engines of Growth and Prosperity, World Bank, Washington, DC, www.worldbank.org/en/region/eca/publication/revving-up-engines-of-growth-and-prosperity-in-western-balkans.

Notes

← 1. In Montenegro, it is also due to a steep decline of exports to Montenegro’s two main pre-crisis export destinations in the EU. In the course of 2016, Montenegro’s exports to Italy fell from EUR 129.4 million to EUR 17.3 million and exports to Greece from EUR 53.2 million to EUR 0.7 million (MONSTAT, 2018).

← 2. For a description of the complex administrative set-up in Bosnia and Herzegovina and how this was handled in the scoring process, please refer to Annex B.

← 3. Endorsement of a European standard can be achieved either by publication of an endorsement sheet or by an announcement in the national standards body’s official journal.

← 4. The EA Multilateral Agreement (EA MLA) is signed between the EA Full Members; signatories recognise and accept the equivalence of the accreditation systems operated by the signing members, and also the reliability of the conformity assessment results provided by conformity assessment bodies accredited by the signing members. EA MLA scopes include: testing and medical examination, calibration, products certification, certification of persons, management systems certification, inspection, validation and verification, and proficiency testing providers.

← 5. Mandatory provisions represent a departure from the general principle that standards are voluntary in order to ensure that certain public interests such as health, safety, consumers or the environment are effectively protected.

← 6. The leaders of Western Balkans Six economies endorsed the Multi-annual Action Plan on Regional Economic Area in the Western Balkans Six (MAP) in 2017. The MAP actions are designed to help the private sector reap the economies of scale of an almost 20-million market, and to refocus the growth model towards more indigenous, long-term driven growth.

← 7. See www.cencenelec.eu/standards/Education/Pages/repository.aspx and www.iso.org/sites/materials/teaching-materials/education_materials-higher-edu.html.

← 8. While 34 SMEs benefitted from the programme in 2017, the draft action plan to implement the new Strategy for Development of MSMS Enterprises in Montenegro 2018-2022 foresees the number to increase to 100 SMEs, with the overall programme value amounting to EUR 420 000.

← 9. In 2017, 1 213 SMEs benefitted from the programme, with a cumulative total of 7 829 since 2010. While reimbursement rates range from 50% to 70% of the incurred cost (depending on the region of SMEs’ registration), costs related to conformity assessment are fully reimbursed. The upper support limit of the programme is set at TRY 30 000 (Turkish lira; approximately EUR 5 400).

← 10. In 2016, 9 companies used 13 vouchers to implement standards, falling to 6 companies and 11 vouchers in 2017.

← 11. In 2017, the FBiH supported 12 SMEs to introduce international quality standards through the annual Strengthening SME Competitiveness grant scheme. In the same year, 11 companies from the RS benefitted from sector-specific grants (e.g. wood processing and textiles) that are provided in co-operation with USAID’s Workforce and Higher Access to Markets Activity project.

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