Saturday, 15 August 2020

Czech Development Agency's projects facing challenges amid coronavirus

Prague Daily Monitor |
27 May 2020

Projects supported under the B2B Program are facing a number of restrictions and challenges in connection with the coronavirus crisis

The current coronavirus crisis and associated restrictive measures put in place to a varying extent all over the world are resulting in a great number of restrictions and challenges for projects supported under the B2B Program. Given the rules governing the provision of grants from the state budget, unfortunately, in consequence of these objective circumstances, which are completely out of the implementers’ control, projects cannot be extended into the following year. However, it is possible to apply for changes to a project, particularly those concerning a shift in the schedule (still within the framework of the relevant year), the transfer of funds within the approved budget or changes to activities to be carried out in order to achieve project objectives in an alternative manner.

Shortly after the outbreak of the crisis, the Czech Development Agency (CzDA) called upon implementers to draft changes as soon as possible and to consult possible solutions with program managers or, where applicable, with the staff of the embassies in the individual countries through an intermediary. “We are constantly in contact with implementers and provide them with information and advice on these changes. Despite the fact that it is difficult to predict how the situation will develop further, we are delighted to say that for now all these projects are so far still under way and, although certain activities, particularly those involving travel abroad, have been postponed or cancelled, the implementers assume that these projects will be successfully completed,” says Dominika Caputová, manager of the B2B Program of the Czech Development Agency.

Given the nature of these projects, which are focused on developing enterprise activities in difficult territories where personal contact is often the only way of establishing cooperation and building the trust of a business partner, the inability to travel is a fundamental setback for all types of projects under the B2B Program. This fact has the greatest impact on projects that in 2020 require a partner to be identified, the local business conditions to be mapped out, a longer-term contract to be agreed on, a license to be acquired, etc. Projects prepared in previous years, so-called implementations, where cooperation is already under way between a Czech and local company on a particular development project, also face specific challenges.

Online training is easing complications caused by travel restrictions

Travel restrictions are causing problems in training for local workers, given the fact that in the vast majority of cases this involves new technologies or production processes that need to be demonstrated on site. One example is the project implemented by Sunnycold, s.r.o., which aims at transferring Czech technology for battery storage production to Indonesia, which, owing to its unique location and the fact that it is spread across islands, shows a strong need for decentralized electricity generation. However, this is almost impossible to achieve for economic reasons. Therefore, most Indonesian islands still struggle with a shortage of energy and are dependent on subsidized diesel aggregates. The current prices of alternative technologies from abroad are far higher than what the local market can afford. In response to the fact that it is impossible to travel and train the partner company’s staff in how to connect up and use the technology on site, Sunnycold has produced a special training unit to enable the technical staff of the partner Indonesian company to be trained online so that in the future it can produce battery storage itself locally and thus offer a suitable alternative for replacing conventional sources of electricity with renewable sources or streamline current electricity generation facilities.

“In many cases the local branches of firms acting as partners in the project were closed for health and hygiene reasons, so no local production, harvests or expert analyses can be carried out. Given that the operation of the national and regional authorities is limited, there are also delays in the certifications needed for export to the Czech Republic, and thus to the EU in general. There is no universal solution to this problem. In order to alleviate the impact of this, implementers are planning alternative solutions, always depending on the nature of the project or the specific conditions in the countries in which they operate,” explains Dominika Caputová, adding that companies that are already established in the relevant region and can rely on already trained key local managers and technical and specialized workers have a great advantage.

Implementers may consult CzDA at any time about their current problems

These firms do not have to postpone their activities in the target countries and can at least temporarily transfer them to their local teams (possibly with extra staffing), who have the professional support and backing of their Czech partners. For three years now, AAA Techlabs, s.r.o., for instance, has been working on the production and further development of special DOT Glasses (formerly Spectaler), which are the cheapest solution to refractive vision defects in the world and are thus affordable to users even in the poorest and most remote areas in developing countries. After years of development work with the company, and also thanks to the support from the B2B Program, injection moulds have now been made for the production of frames for these glasses. Now, within the framework of ongoing pilot programs, the product is being further refined and a partner distribution network is being set up. Thanks to existing contacts and backing in India, to where the company is also planning to move its production, local retailers and distributors can also get involved and positions can be created for local senior sales consultants. Overall, however, the company’s sales plans are to be postponed by several months, given the fact that local distribution partners are unable to move around and healthcare partners are fully occupied with the current crisis. The company is using this time to develop an order application and a new website to present its new products. An article about this project supported by the CzDA can be found here.

For now, firms that do not yet have this kind of backing in place have to postpone partial activities in their target countries and focus on activities that can be implemented from the Czech Republic – e.g. analyses, preparing a marketing strategy, developing sales channels and PR, creating e-shops, etc.

In cases where the key phases of a project call for highly specialized work that should be carried out by Czech experts, such as conducting hydrological analyses, taking and analyzing samples, preparing the source documentation for certification, etc., in certain countries local specialists can be hired to carry out these activities. However, this option is only open to some firms, such as those operating in the Balkans, for example, or in specific regions of Asia or Africa, where an adequate expert base already exists.

One example of such a company is Vodní zdroje, a.s., which is working on the remediation of dumping grounds in the Serbian city of Pančevo. The specialized hydrogeological works associated with the risk analysis, which would include a description of the potential spread of contamination outside the sludge dump and which under standard conditions would be carried out by the company’s own specialists as part of their mission, will most probably be outsourced in Serbia.
“The implementers of the projects we support can contact us at any time to discuss their current problems. We are flexible and operative as regards approving justified changes within the framework of the set rules and wish everyone plenty of strength, success, and especially health. We are delighted that they are not giving up,” adds Dominika Caputová.