CZECH REPUBLIKUPDATED | 11| 2014

2014 | 2020EU BUDGETS

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Global Europe

Administration

Compensation

Security & Citizenship

€ 199.828

€ 959.988in current prices: € 1.082.555

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The five European Structural and Investment Funds;

| The European Regional Development Fund

| The European Social Fund

| The Cohesion Fund

| The European Maritime and Fisheries Fund

| The European Agricultural Fund for Rural Development

ESI FUNDSTHE 5

| EU Member States are required to draw up and implement

strategic plans with investment priorities covering the five ESI

Funds.

| These Partnership Agreements (PAs) are negotiated between the

European Commission and national authorities, following their

consultation of various levels of governance, representatives from

interest groups, civil society and local

and regional representatives.

AGREEMENTSPARTNERSHIP

Regions covering 88.10% of the population of the Czech Republic

will continue to be eligible for regional investment aid at a maximum

aid intensity of 25% of the eligible costs of the relevant investment

project.

| Whereas overall aid intensities have slightly decreased as compared to

the previous aid map (between 5 and 15 percentage points, depending on

the region), the population coverage remains nearly identical. This is in line

with the overall approach of the regional aid guidelines, which aim at

supporting the most disadvantaged regions of Europe.

AID PERCENTAGESMAXIMUM

| The region of the City of Prague, where 11.9% of the Czech population

lives, has a GDP per capita exceeding 100% of the EU average and will

thus not be eligible for regional aid between 1 July 2014 and 31 December

2020.

| This does not alter the current situation, since this region ceased to be

eligible for aid under the current map in 2009, after a transitional period

where aid was allowed in part of the region with a 10% aid intensity.

AID PERCENTAGESMAXIMUM

CU

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UP

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TU

STotal number

of OP s submitted

per country

Countries have

their OP s

adopted:21 OP >Denmark

1 OP >Lithuania

| Partnership Agreement Adopted 26 – 08 – 2014

| 8 Operational Programme’s submitted

| Adoption of OP’s by European commission in Q4 2014

| Exp.1st grant calls Q1 2015 for funding priorities related to OP’s

OPs should be submitted by Member States within 3 months following the

submission of the Partnership Agreement.

The Commission makes observations within 3 months and adopts the OP

no later than 6 months from the date of its submission.

PLANNING

The PA focuses on following financing priorities:

| Promoting efficient and effective employment services that will contribute

to increase the employment rate, particularly of vulnerable groups.

| Supporting high-quality education system (lifelong learning) to produce

qualified and adaptable labour force.

| Enhancing research & innovation system based on high-quality research,

interconnected with the application sphere and targeted at

commercialisation of results.

PRIORITIESFUNDING

| Supporting actions leading to an increase in private sector research &

development investments, helping SMEs to be competitive in a global

market and contributing to the shift towards a low-carbon economy.

| Investing in sustainable infrastructure facilitating business

competitiveness and adequate territorial serviceability.

| Promoting a transparent and effective public administration with less

administrative and regulatory burdens capable of responding to

emergencies.

| Fostering social inclusion of vulnerable groups and combating poverty.

| Promoting landscape protection and climate change adaptation policies.

PRIORITIESFUNDING

ESIF support will predominately contribute to the Czech Republic'

effort to reach Europe 2020 objectives:

| Attainment of the target of the Digital Agenda for Europe: 100% coverage

of 30mbps internet and creation of conditions for the achievement of the

100 mbps internet usage target

| Providing a significant contribution in reducing energy consumption in

buildings and enterprises in order to achieve a 20% reduction in primary

energy consumption by 2020.

RESULTSEXPECTED

| Increasing the employment rate, reducing poverty and exclusion,

improving adaptation of education to labour market needs.

| Enhancing the business environment by reducing administrative burden.

| Supporting the establishment of firms and competitiveness in international

markets.

RESULTSEXPECTED

| In 2014-2020, EUR 22 billion is allocated the Czech Republic for

Cohesion Policy (ERDF, ESF, Cohesion Fund) including EUR 340 million

for European Territorial Cooperation and EUR 13 million for the Youth

Employment Initiative.

| An additional EUR 2 billion will be invested in the development of the

agricultural sector and rural areas by the EAFRD, and EUR 31 million in

the fisheries and aquaculture sectors by EMFF.

ALLOCATIONSFINANCIAL

Cohesion policy will be implemented through 8 operational

programmes:

| 2 national operational programmes co-financed by ERDF (Enterprise and

Innovation for Competitiveness; Integrated Regional)

| 2 national operational programmes co-financed by ERDF and CF

(Transport; Environment)

ARCHITECTUREPROGRAMME

| 2 national operational programmes co-financed by ESF and ERDF

(Research, Development and Education; Prague Growth Pole)

| 1 national operational programme co-financed by ESF (Employment)

| 1 national operational programme co-financed by CF (Technical

Assistance)

Moreover there is 1 EAFDR rural development programme and 1 EMFF

fisheries programme.

ARCHITECTUREPROGRAMME

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FUNDING PRIORITIES

THEMATIC OBJECTIVE& BY FUNDALLOCATION BROKEN DOWN BY

THEMATIC OBJECTIVE& BY FUNDALLOCATION BROKEN DOWN BY