Technical cooperation with central banks includes the transfer of knowledge and experiences with the aim of institutional capacity building of the beneficiary central bank. The implementation of technical cooperation may take several forms and methods, and CNB experts are most commonly involved in the following forms of cooperation:
Bilateral technical cooperation is realised based on a direct agreement between two institutions, and, in principle, it is financed from their own budgets. It most frequently takes the form of short study visits or online consultations on a pre-agreed topic.
TAIEX (Technical Assistance and Information Exchange) is the instrument of the European Commission for the transposition of legislation as well as facilitating the sharing of EU best practices. It is implemented through short workshops, expert missions or study visits and it delivers tailor-made expertise to address the issues of the beneficiary institution at short notice.
Twinning projects are the most complex form of implementation of technical cooperation and they are also EU-funded. Twinning was conceived to assist the candidate countries to acquire the necessary knowledge and experience to adopt and implement EU legislation.
Technical cooperation by means of which the CNB transferred its knowledge and experiences to other institutions, in particular to the central banks of the Western Balkan countries, had begun well ahead Croatia's becoming an EU member state. At that time, the CNB received requests for short study visits of central bank experts from the region to the CNB, mostly on topics that the banks had recognised as important and which they deemed to be beneficial to draw from the experience and knowledge of the CNB.
After Croatia's accession to the EU, several TAIEX expert missions and study visits were implemented. However, the CNB made the largest contribution to technical cooperation through the participation of its experts in several twinning projects and the Regional programme for the central banks of the Western Balkans. With regard to the complexity and the size of twinning projects in general, the CNB participated in the project activities as a junior partner alongside the German central bank, Deutsche Bundesbank, as the project leader.
Below is the basic information on all major EU-funded technical cooperation projects in which the CNB has been or still is a participant.
Twinning project for the financial sector in Montenegro
- For the purposes of the project, a consortium was set up consisting of the central banks of Germany, Croatia and the Netherlands and the financial services supervisory agencies of Germany and Croatia (BAFIN and HANFA). The Central Bank of Montenegro, the Insurance Supervision Agency and the Capital Market Authority were the beneficiary institutions.
- The project duration was 27 months, beginning in April 2018 and ending in July 2020.
- In terms of expert days, the Croatian institutions delivered almost 60% of project activities (the CNB and HANFA had approximately the same number of expert days).
- Project budget – EUR 1,410,000.
- CNB experts participated in the area of further alignment of the regulatory framework for the banking sector with the acquis and the strengthening of administrative capacities of the Central Bank of Montenegro in financial stability-related activities.
- For the purposes of the project, the CNB also provided the Resident Twinning Advisor who coordinated all the main project activities in Montenegro. This is the first twinning project in which an expert from the Republic of Croatia played this role.
Twinning project for the National Bank of Serbia
- For the purposes of the project, a consortium was set up consisting of Deutsche Bundesbank, Banca Naţională a României (Romanian central bank) and the CNB. Since one of the project activities related to the insurance sector (within the competence of the central bank in Serbia), the project also included the engagement of the experts of the Croatian Financial Services Supervisory Agency (HANFA).
- The project duration was 18 months, beginning in September 2018 and ending in March 2020.
- The number of expert days was divided among the consortium members in approximately three equal parts.
- Project budget – EUR 800,000.
- CNB experts participated in developing action plans for monitoring the effects of the liberalisation of capital flows, the optimisation of the collection of statistics from banks and the harmonisation of the Bank’s international relations function with ESCB standards.
Twinning light project for the Republic of North Macedonia
- Deutsche Bundesbank was the partner in the twinning light project "Strengthening the Capacities of the System for Fight against Counterfeiting of Euro" for the Republic of North Macedonia. CNB experts, among others, were also engaged in the project implementation. The beneficiary institutions included the Ministry of Interior and the National Bank of the Republic of North Macedonia.
- The project duration was 8 months, beginning in November 2018 and ending in June 2019.
- Project budget – EUR 250,000.
- The overall objective of this project was to establish efficient systems for the monitoring of the counterfeiting of the euro and the protection of the financial interests of the Republic of North Macedonia and the EU. CNB experts participated in the project component that covered the analysis of the functioning of the system for fight against counterfeiting of banknotes and coins.
Twinning project for the National Bank of the Republic of North Macedonia
- For the purposes of the project, a consortium of Deutsche Bundesbank and the CNB was set up.
- The project was launched in September 2019 and ended in March 2021.
- In terms of expert days, the CNB experts delivered almost 50% of project activities.
- Project budget – EUR 600,000.
- CNB experts were engaged in the area of financial accounts statistics and in the part of project activities that concern payment systems and the implementation of the banking regulation and practices related to liquidity coverage ratio, ILAAP and non-performing loans.
- The CNB has also provided the Resident Twinning Advisor for this project.
Regional programme for the Western Balkan central banks
- CNB experts, together with experts from 20 other central banks of the ESCB, led by Deutsche Bundesbank, participated in the regional “Programme for Strengthening the Central Bank Capacities in the Western Balkans with a View to the Integration to the ESCB”.
- The programme was launched in March 2019 and ended in December 2021.
- Programme budget – EUR 2,000,000.
- The CNB participated in two of the programme components, training events for experts from beneficiary institutions and bilateral measures:
- The first component included the holding of a total of 20 training events on topics from the area of central banking. Central banks, members of the ESCB, have hosted these training events. The CNB hosted three training events on the following topics: monetary statistics (May 2019), payment systems (October 2019) and financial stability (February 2020).
- The second component foresaw the implementation of two bilateral measures with each of the beneficiary institutions. The CNB has implemented two bilateral measures, of which one with the central bank of Montenegro and one with the central bank of North Macedonia.
Technical cooperation activities at the level of the ESCB central banks is coordinated by the Working Group on Central Bank Cooperation (WG CBC), the International Relations Committee (IRC) substructure of the ESCB. The WG CBC is a forum for the exchange of information on central bank cooperation of non-EU and non-ESCB countries and a forum for the coordination of projects implemented by central banks. Deutsche Bundesbank provides guidance as well as expert and logistic support to the work of the WG CBC.
In December 2017, the Working Group published a document on the International Central Bank Cooperation: ESCB Best Practices, specifying the reasons for such activities, the principles on which cooperation is based and examples of such cooperation.
In February 2020, the Working Group provided additional information on the international cooperation of central banks by publishing the document on approaches to evaluating such activities at the level of the ESCB.