THE 7th INTERNATIONAL CONFERENCE

"CIVIL ENGINEERING - SCIENCE AND PRACTICE"

GNP 2020 – Kolašin, Montenegro, 10-14 March 2020

Strahinja Trpevski1

PLANNING OF DEVELOPMENT TECHNOLOGY PARK ON A CASE IN

THE NORTHEAST REGION IN REPUBLIC OF NORTH MACEDONIA

Abstract
The process of spatial planning and utilizing its potentials today is a priority in the development
of the regions in the Republic of Northern Macedonia. In the last 60 years, since the technology
parks have been operating globally, and especially in the last three decades, they have had a
significant impact on the development and competitiveness of local (regional) or domestic
economies. It can be concluded that in some regions of the world they are an important tool in
spatial planning and development. It is a period in which knowledge has become a key driver of
development, and knowledge-based industries and innovation have become dominant in the
market. Such companies have also become highly attractive to foreign capital.
The purpose of this research is to analyze the opportunities for accelerated development of
small and medium entrepreneurship, based on the application of high technologies using the
spatial and economic potentials of the region. The immediate/indirect goal is to reduce
unemployment in the region and stop the depopulation of the region. Taking into account the
spatial, economic and social characteristics of the region, the setting up of a technology park
considers the interest of the local government, the interest of some of the private sector and the
universities located near the region itself. The effective resolution of the problems of local
economic development through the establishment of technology parks in this paper is based on
the available information on the effects of the operation of projects of this kind in the world and
the region.
In terms of the industries covered by the technology park analysis, the emphasis is but is not
limited to the creative industries as well as the food processing industry. Considering these
areas as the most important drivers of economic development and competitiveness of the
economy and considering that there are appropriate potentials in the region, the research has
shown the possibility of systematically linking knowledge and entrepreneurship through the
opening of a technology park.
Keywords
Spatial planning, development, technology park, innovation, knowledge, region

1
Assoc.Prof.Dr.sc Faculty of Architecture, University of "Ss’ Cyril and Methodius", Partizanski odredi No: 24, Skopje, -
Republic of North Macedonia, strahinja_trpevski@yahoo.co.uk

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1. INTRODUCTION

The issue of opening technology parks has been in our country for several years now. From
a regulatory perspective, this issue is covered by the Law on Stimulating and Assisting
Technological Development in the Technological Infrastructure Section. According to the law, the
organizational forms of technological infrastructure include Research and development units in the
economy; Innovation Centers (IC); Technology transfer centers (technology center/technology
core); Science and technology parks and Information and Communication Technology Centers.
Attempts to systematically and institutionally foster entrepreneurship development and
SMEs in our country were made through the establishment of several business incubators and
business start-ups. They were mostly established with the financial support of international donors
or were part of donor projects. Their role in raising awareness of an organized approach to
supporting the development of entrepreneurship is undeniable. They also helped build human
resources capable of coordinating similar projects and participating in their management and
administration.
It should be borne in mind that, in general, innovation systems consist of public and private
investors, technology development organizations, science education institutions, business
development organizations, business associations, state industrial/intellectual property offices,
government support agencies. development, foundations, research centers, etc.
The main goals of this study regarding the establishment of a technology park in the
Northeast Planning Region can be summarized at several levels:
• The Technology Park should create the conditions for accelerating the technological
development of the economy in the region by enabling effective synergy between knowledge
(concentrated at universities) and business (companies) and contribute for increasing the
competitiveness of the economy in the region and reducing unemployment.
• The Technology Park should contribute to the animation of the entrepreneurial spirit and
to the opening of companies to scientific institutions and foreign partners/investors;
• Technology Park will contribute to the development of research and development cores in
companies, which as a driving force of company progress would contribute to improving the export
potential of companies;
The study aims to identify a technology park project implementation model as well as to
propose project organization and financing strategies

2. TECHNOLOGY PARK CONCEPT

The core goals of technology parks are to create a place that enables companies to
seamlessly connect with knowledge and ensure the efficient transfer of knowledge and
technologies within an innovative process. The concept of a technology park is characterized by
the following elements:
1. Founders: The founders of technology parks are, as a rule, the entities that are most interested
in local and regional development, as well as those who are knowledge carriers. These are municipalities
and universities-research institutes. At the same time, universities/research institutes should deal with
fundamental, developmental and applied research and have the most competent high technology experts.

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The work of the park should include companies that employ highly specialized professionals who are
ready to work on the development and commercialization of new products. Founders can also be state
institutions (ministries), large companies, chambers of commerce and so on. Technology parks set up by
the local community, state and universities are non-profit entities. Technological parks formed by
companies (known as company incubators) or other private investors are profitable entities.
2. Objectives: Technology parks can be established for the development of small and medium
enterprises based on high technologies. This form is known as technology incubator parks. If the park is
established for the development of new products and technologies, its form is known as the science and
technology park. Finally, if the park is established for the purpose of carrying out research and
development projects in the field of industry, its form is known as a technology hub. 3. Infrastructure:
Technology parks are housed in separate, usually, large locations/facilities with a resolved infrastructure
and equipment provided by the founder. These are state-of-the-art equipment (laboratories, sophisticated
machines, computers, libraries, etc.) for research in the areas for which the park has been established.
4. Service Users: Technology Parks provide their customers (“tenants”) with: discounted
rates for accommodation (if users are “tenants” of the park) or equipment use; use of the park's
overall infrastructure, including utilities; Internet access; computers and tracking equipment;
telephones, fax machines, copiers; conference and meeting rooms, seminars, presentations and
workshops; park website; organized nutrition and drinks, etc.
5. Benefits: Technology parks provide advisory services to their customers/tenants. These
are usually company startup advice, business plan or investment elaborate, accounting and
financial services, legal advice, finance/credit access advice, marketing advice, IT advise,
organization and engineering, etc.
6. Technology Park Service Rates: Discounted rates are on a predetermined timeframe
(usually covering a time span of between 3 and 5 years). After the commercialization of the
product/service that is “born” in the park, the owner-owner of the innovation can use the park
services at market prices.
7. Other Services: Technology parks provide their users/tenants with various administrative
services (administrative management, secretarial services, archive, translation, etc.).

3. CHARACTERISTICS OF THE NORTHEAST PLANNING REGION

The North-eastern Statistical Region is one of eight arbitrary statistical regions in the
Republic of North Macedonia. It borders Kosovo and Serbia to the north and Bulgaria to the east,
while internally, it borders the Skopje and Eastern statistical regions. Figure 1.
Figure 1.-Geographical location of the North-eastern region

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The total area of the region is 2,310 km2, or 8.98% of the total territory of Macedonia,
making it the second-smallest region by area in the State. According to estimates by the State
Statistical Office for 2015, the region has 176,204 inhabitants, or 8.52% of the total population in
Macedonia, making it the third smallest region by population in the country. The population
density is 76.3 inhabitants / km2 and is lower than the country's average (80.5 inhabitants / km2),
while the average age of the population is 37.6 years lower than that of Macedonia - 38.5 years.
The North-eastern Statistical Region is characterized by the following elements:
1.Geographic-demographic indicators: The region has 6 municipalities, comprising 192
settlements, of which 189 are rural settlements. The communication with the neighboring countries
is via the border crossings Tabanovce (Kumanovo) and Prohor Pcinski (Staro Nagoricane) to
Serbia and Deve Bair (Kriva Palanka) to Bulgaria, while to the neighboring planning regions
through the A1, A2 (Skopje region) and20 highways and R2232 (towards the Eastern region). The
region has a positive natural population growth of 1.2 promil, which is larger than the state - 0.7
pro mil (SSO, 2017). However, it must be emphasized that the region has pronounced intra-
regional differences: Kratovo, Rankovce and Staro Nagoricane have high negative, Kriva Palanka,
low negative, while Kumanovo and Lipkovo, high positive natural growth. 2.Economic
characteristics: According to SSO data on Gross Value Added and the Bureau of Regional
Development on the level of development, the North-eastern region is the least economically
developed region in Macedonia. Gross value-added, investment in fixed assets and number of
active business entities are much lower in relation to the percentage of territory and population.
However, if the gross value added is broken down by sectors, it will be seen that in certain sectors
(construction, real estate and wholesale trade, motor vehicle repair, transport and storage), the
Region is more competitive, while in others (information and communication, vocational, scientific
and technical activities and arts, entertainment and recreation it lags behind in competitiveness.
Table 1. Source: Decision of the Government of the NRM for classification of the planning regions
according to the level of development and development indices for the period 2013-2017
Development index in Coefficient in relation Participation in state
Planning region relation to the average to the region with the aid for regional
of Macedonia highest average development (in%)
Skopski 151,0 1,000 7,2
Southeast 97,1 0,643 11,1
Eastern 96,1 0,437 11,3
Pelagonia 91,2 0,604 11,9
Polog 82,4 0,546 13,2
Southwest 81,4 0,539 13,3
Vardar 73,5 0,487 14,7
Northeast 62,7 0,415 17,3

The Region is in a subordinate position to the other regions and according to the average net
wage paid. According to the SSO (State Statistical Office) data for 2015, it is 16,848 denars in the
Region and is by a quarter lower than the state average of 21,906 denars. There are large
differences in the average net wages paid per activity. Namely, the regional net wage in the
"information and communications" sector is half of the national one and is the lowest compared to
the other sectors, while the one paid in the "agriculture, forestry and fisheries" activity is higher
than the national one by 2% and it is the highest compared to the other activities. It is therefore
surprising that only 4% of the workforce in the Region is engaged in this activity, although the

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average wage is higher than the national average. In 2015, 4,139 active business entities were
registered in the Region, which represents 5.9% of the total number of active business entities in
the Republic of Macedonia. Most of them are micro-enterprises (up to 9 employees) with a 90.6%
share, which is identical to the percentage at the national level. They are also carriers of the
economic development of the Region. Firms are predominantly oriented towards trade and
manufacturing (dominated by food, chemical and metal) and least to agriculture.

4. STRUCTURE OF THE TECHNOLOGY PARK DESIGN PROPOSAL

The definition of the technology park design/structure proposal is based on a number of

research findings. In the region, there is a real need for an organized form to enable effective
transfer of technologies and know-how to companies and individuals with innovative business
ideas. There is a political will for local government to realize this type of initiative, which is
supported by government program documents for projects of this type that are incorporated as
models to foster regional and local development. In the Northeast Planning Region, there is a
concentration of companies that employ highly qualified specialists ready to work on conquering
new products and commercializing them. Potential industries that would initially be supported by
technology park activities are a) the creative industries and b) the manufacturing industry. This
means that the University of Skopje could be involved with the faculties whose curricula and
research potentials are most in line with the nature of these industries. There are banking
institutions in the country that can be involved in investing in high technology product
development programs.
There are locations where a technology park can be organized, but they are without
adequate communal infrastructure. It is realistic to expect that municipalities can be founders of the
technology park. In the initial phase of the park's operation, it would operate at a lower capacity.
On the basis of such assumptions, it is proposed to establish a technology park with an
incubator included.
The main service areas of the departments directly related to the nature of the technology
park business define the technology park design proposal that would have the following
departments:
1. Technology Center is focused on technological research and analysis; laboratory analysis;
technology assessment; technology transfer; process optimization; use of special software
applications; development of new products; etc. This section should include all the most up-to-date
development research equipment/laboratories in the aforementioned industries. The required space
for the operation of this center should not be less than 100m2. The department should be located in
the immediate vicinity of the administrative department and the technology incubator.
2. The Technological incubator would house companies (mostly new companies) that would
come from individuals with a high technology product idea. The incubator's premises would have a
total surface of 600m2 and would be divided into rooms, ie offices. It is necessary to allow the
space to be redistributed depending on the needs of the tenants. Ensuring easy communication
between incubator companies and easy access to other departments, and in particular, the
technology hub is a prerequisite for the efficient operation of this department. In addition to the
office space, it is also necessary to provide warehouse space for the needs of companies with a
minimum area of 50m2 altogether.
3. Department of Business Counseling and Education Center are two departments that
would use common facilities to carry out their activities. The total required area is 100 m2 and

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would consist of one larger room to host a minimum of 40 persons and two smaller rooms for 8-10
persons. The larger room would host training, conferences, seminars, exhibitions, presentations,
etc. While the two smaller rooms would be used for meetings, business consultations and more.
These rooms need to be located on the ground floor in order to utilize both indoor and outdoor
space during breaks.
4. The Administrative department is responsible for the day-to-day operation of the park
and the maintenance of hygiene and infrastructure, then providing the park itself and providing
administrative services to park users. This department also manages the park's facilities, such as the
incubator, meeting and conference room, training facilities and all other common facilities. Doing
marketing and promoting the park's activities is also the responsibility of the administrative
department. The administrative department should have an office space for management and staff
accommodation, it must be about 150m2. The Park Management Department should employ 6
people and apart from the General Manager who would be housed in a separate room, the others
would be housed in a shared room (ocean system) with other staff (one in each department). It is
necessary to provide a room of 50 m2 for the common use of all employees and users of the park
(break, food, etc.). Outsourcing does not require the accommodation of hygiene and infrastructure
maintenance personnel.
An average of 25% of the space provided for each department should be shared space.
Common area includes Public space (corridors, stairs, elevators), Warehouses, Male, female toilets
and toilet for handicapped persons, Basement rooms for electromechanical equipment. The
estimation of the required areas is based on the existing standards for such facilities and in total is
1000m2. This area is only a proposal and should not be a limiting factor when implementing the
project. If an existing facility is being redeveloped, it is necessary to make changes to the facility's
spatial capabilities, but care should be taken to ensure the functionality and operability of the park.
An adequate number of parking spaces should be provided within the park in accordance with the
urban norms for business buildings.

4.1. TECHNOLOGY PARK MANAGEMENT, FINANCIAL ASPECTS, AND

PROJECT BUDGET ESTIMATION
Technology Park would function as a non-profit organization since the founders would be
public entities (local government, university). The pre-feasibility that follows this feasibility study
will need to identify the legal framework for the functioning of the park, the form of organization
and registration of the park as a legal entity. At this stage, it is suggested that management be
resolved as follows:
1. The highest governing body shall be the Board of Founders with a Chairperson, a Vice-
Chairperson, and members, comprising representatives of the founders. The Board will be
responsible for designing and adopting strategic goals, plans, and decisions for the park, as well as
finance and building relationships with third parties.
2. The Park Council of Members shall have an advisory role in the creation of technologies
and know-how in relation to the needs of the region's economy.
3. The Park Director shall be responsible for enforcing Board decisions and for the day-to-
day functioning of the Park.
4. Each department shall have its own director/supervisor who shall ensure the normal
functioning of the department.

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The park will be able to enter into cooperative, partnership or other forms of relationship
with third parties (similar or related organizations from the region, EU or beyond) for capacity
building, participation in joint projects or exchange of experiences.
The following is an overview of the supposed financial aspects of the Technology Park
establishment and operation project for the first five years, calculated from 2021. Initial (rough)
estimates are made for: Initial investments and start-up costs (table.2); Revenues of the
park(table.3); Monthly and annual costs of the park. The basic assumption is that the local
government (or central government) will provide the office building of the park, for which no
compensation will be required.
Table 2 Initial investments and start-up costs
Technology Park Investment and Initial Costs (€)
Supply of facility 0
Renovation of the building 300000
Procurement of equipment (office and laboratory) 80000
Employee training 10000
Promotion of the park 5000
Total investment and start-up costs 395000

Table 3 Revenues of the park

Technology Park Revenue (€)

year 2021 2022 2023 2024 2025
Revenue from renting office space 12000 18000 22000 28000
Proceeds from renting a conference hall 2400 2400 2400 2400
Revenue from renting equipment 10000 15000 18000 20000
Registration fees (seminars,training) 15000 17000 18000 20000
Total revenue 39400 52400 60400 70400

The costs of the park are projected according to a realistic scenario, which does not include
possible discounted prices for utilities, which local government can pledge. Costs include:
office expenses, insurance, internet, maintenance of IT system, telephony, depreciation of
equipment, furniture depreciation, heating, maintenance of hygiene, maintenance of space around
the building, electricity, water, salaries (gross, for 11 employees), fees for consultants and
lecturers, which in total per year is 166.920 €.
From the point of view of the sustainability of the park, in the first five years, the revenue is
not expected to be able to cover operating costs. It is estimated that in the fifth year revenue will be
able to cover about 40% of the park's costs. It should be noted that such scenarios are characteristic
of non-corporate (ie, non-commercial) technology parks in general. Experiences from the region
also show similar performance to technology parks (Slovenia, Croatia). According to data from the
EU and developed countries, parks can expect 90 percent or more of their own-income costs to
cover their tenth year of operation. The difference is usually covered by the founder (local
government or central government). The appropriations for this purpose are mandatory for the

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founders' annual budgets. Also, some of the costs can be covered by sponsorships, grants or
donations.

5. CONCLUSIONS WITH RECOMMENDATIONS

Analyzing the situation in the field of technology transfer and the use of advanced scientific
knowledge in the region's economy, the conclusion is that the region needs an organized system of
support for the development of knowledge and technologies. A technology park can be a strategic
instrument for achieving this goal. The promotion of the park, its services, and the opportunities it
offers to stakeholders should be a continuous process, but a more detailed elaboration of the
project idea in front of all stakeholders is needed prior to the start of the project. The establishment
of a technology park presupposes the strengthening of relations between local government, the
economy and the university. This can only be achieved through a transparent process of designing
and planning a park work program and a transparent system of cooperation within the application
programs between the economy, the university and the technology park. Given the modest
experience in the country, the park's effectiveness will be much greater if it cooperates with any of
the technology park networks in the region and developed countries. Attracting innovative
individuals to the park should begin by giving university students the opportunity to practice in a
technology park.
The Technology Park shall respond to the purposes for which it is based only if it employs
educated, professional and motivated individuals. The evaluation of the economic performance of
the park, which indicates the need for longer-term financing of a significant part of the costs by the
founders, should not discourage the decision to establish the park. This is because the economic
effects of technology parks are, as a rule, visible over a period of 10 or 15 years. A more precise
definition of the park profile can be made possible by a feasibility study involving a conceptual
architectural design for the park. This research should be considered as a starting point for
understanding the situation in the region and identifying the feasibility of the project.

LITERATURE

[1] Dr.A Karajev, J.Daskalov: "Innovation Hub: Comparative Advantage for Greater Competitiveness - A
Study on the Opportunity to Establish a Technology Park in the Northeast Region", U-M-F training
2018, 17-42p
[2] A. Hunjet, E. Ivetić, G. Kozina, "The Role of Technology Parks in the Entrepreneurial Process: The
case of technology park Varazdin", University North, Varaždin, Croatia,2016, 208p
[3] Min-Ren Yan and Kuo-Ming Chien, "Evaluating the Economic Performance of High-Technology
Industry and Energy Efficiency: A Case Study of Science Parks in Taiwan", Energies 2013,412-418p
[4] R. Valovic, "Methodology for establishing of science – technological park in Slovak Republic",
Slovak Journal of Civil Engineering 2014, 36-44p
[5] www.tp-lj.si – Tehnološki park Ljubljana

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