Business Climate Survey Macedonia 2016

Economic Relations Macedonia-Austria

MACEDONIA 2025, Vienna, 16 June 2016

Ms. Ingrid Valentini-Wanka, Regional Manager

South-Eastern Europe ADVANTAGE AUSTRIA

AUSTRIAN FEDERAL ECONOMIC CHAMBER

Austria's Trade Relations with Macedonia

TRADE IN GOODS (2015):

continuous growth, reaching a trade volume of EUR 190 mio. in 2015

Austrian exports to Macedonia +3,0% EUR 121 mio.

Austrian imports from Macedonia +0,3% EUR 69 mio.

Major export products to Macedonia: meat (beef), machinery, plastics

(window and door profiles etc), staple fibres, pharmaceutical products.

Major import products from Macedonia: textiles and clothing,

ferrosilicium, vegetable preparations.

TRADE IN SERVICES (2015):

Austrian exports to Macedonia - 13% EUR 33 mio.

Austrian imports from Macedonia + 9% EUR 38 mio.

Austria's FDI in Macedonia - Nr. 2 investor

Total amount of Austrian FDI in Macedonia: approx. EUR 500 mio.

Top-investors ranking: 1 .Netherlands, 2. Austria, 3. Greece,

4. Slovenia, 5. Hungary.

More than 50 companies with Austrian capital.

Over 6.000 employees and further employment effects in related

sectors.

Predominance in service sector high-qualified jobs and

contribution against brain drain.

Business Climate Survey Macedonia 2016

3rd yearly Survey conducted by Mr. Gerhard Schlattl and his team at

Commercial Section of the Austrian Embassy in Skopje

Period of Survey: November December 2015

Presented in press conference in Skopje mid-February 2016

Research Method: quantitative web survey

Target Group: approx. 100 Managing Directors of Austrian companies in

Macedonia

Number of participants: n = 48 (53% response rate)

1. How many people does your company employ?

?

23

%

25

%

0%

10%

20%

30%

40%

60%

52%

50%

1 - 20 21-100 +100

2. In which sector is your company active?

?

31%

0%

6%

21%

42%

0 0,05 0,1 0,15 0,2 0,25 0,3 0,35 0,4 0,45

Other/Drugi

Energy, Water Management, Waste Management/ energija,

menagment za vodostopanstvo, menagment za otpad

Construction/Gradeznistvo

Trade/trgovija

Services /uslugi

3. How would you assess the current general economic

situation in the Republic of Macedonia?

?

0%

36%

39

%

23%

3%

2%

44

%

44%

8%

2%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

bad/los

a

flawed/poor,nezadovolitelna

satisfactory/zadovolitelna

good/dobra

very good/mnogu dobra

2016 Survey

2015 Survey

4. How do you expect will the general economic situation

look like in the Republic of Macedonia in 2016

by comparison to 2015?

2016 2015?

3%

55%

40%

3%

2% 0%

23%

58%

13%

4%

0% 10% 20% 30% 40% 50% 60% 70%

much worse than in 2015/mnogu polosa od 2015

a bit worse than in 2015 /malku polosa od 2015

similar like in 2015/slicna kako 2015

better than in 2015/podobra od 2015

much better than in 2015/mnogu podobra od 2015

2016 Survey

2015 Survey

5. How will the specific sector of your company develop in

2016 by comparison to 2015? 2016

2015?

3%

13

%

26

%

54

%

0%

15

%

54

%

6%

5%

25%

0% 10% 20% 30% 40% 50% 60%

worsen substantially/mnogu ke se vlosi

worsen a bit /malku ke se vlosi

stay stable/ke ostane nepromeneta

improve a bit /malku ke se podobri

improve substantially/znacajno ke se

podobri

2016 Survey

2015 Survey

6. How do you assess the current economic situation of

your company in the Republic of Macedonia?

?

0%

16%

50%

2%

8%

52%

7%

3%

31%

32%

0% 10% 20% 30% 40% 50% 60%

bad/losa

flawed/poor,nezadovolitelna

satisfactory/zadovolitelna

good/dobra

very good/mnogu dobra

2016 Survey

2015 Survey

7. How will the following factors develop

in your company in 2016? 2016

?

8%

44%

48%

4%

54%

42%

7%

59%

34%

0%

10%

20%

30%

40%

50%

60%

70%

decreased/pad no change/nepromeneto increased/rast

Turnover/promet

Number of Employees/broj na

vraboteni Investments/investicii

8. How would you assess the development of the Republic of

Macedonia in terms of attractiveness for foreign investors?

?

10%

51%

26

%

23%

46%

31%

0%

13%

0% 10% 20% 30% 40% 50% 60%

flawed/poor,nezadovolitelna

satisfactory/zadovolitelna

good/dobra

very good/mnogu dobra

2016 Survey

2015 Survey

9. How IMPORTANT are the following framework conditions

and location factors on the Macedonian market?

..

?

(5 = very important, 1 = not important)

3,66

3,77

3,86

3,88

3,89

3,9

4,14

4,23

4,26

4,26

4,27

4,54

4,65

0 0,5 1 1,5 2 2,5 3 3,5 4 4,5 5

Public Subsidies and Investment Incentives/Drzaven sistem na subvencii

Approval Processes/procedura za dobivanje dozvola

Environmental Conditions/ekoloska situacija

Availability of local suppliers/ Dostapnost na lokalni dobavuvaci

Quality of local suppliers/ kvalitet na lokalni dobavuvaci

Flexible Labor Law/Flexibilen zakon za rabota

Customs and Administration/Carinski sistem i uprava

Infrastructure/infrastruktura

Availability of Human resources, Employees /Dostapnost na covecki resursi

,vraboteni

Quality of Human Resources, Employees/kvalitet na rabotnata snaga

Perspective on EU Accession/EU - integracija

Good Payment Behavior/platezen moral

Fight against Corruption/Borba protiv korupcija

10. How SATISFIED are you currently with the following

framework conditions and location factors on the

Macedonian market?

.. ?

(5 = very satisfied, 1 = not satisfied)

2,09

2,42

2,42

2,7

2,73

2,83

2,84

3,07

3,16

3,19

3,2

3,22

3,36

0 0,5 1 1,5 2 2,5 3 3,5 4

Fight against Corruption/Borba protiv korupcija

Perspective on EU Accession/EU - integracija

Good Payment Behavior/platezen moral

Infrastructure/infrastruktura

Environmental Conditions/ekoloska situacija

Public Subsidies and Investment Incentives/Drzaven sistem na subvencii

Customs and Administration/Carinski sistem i uprava

Flexible Labor Law/Flexibilen zakon za rabota

Approval Processes/procedura za dobivanje dozvola

Availability of local suppliers/ Dostapnost na lokalni dobavuvaci

Availability of Human resources, Employees /Dostapnost na covecki resursi

Quality of Human Resources, Employees/kvalitet na rabotnata snaga

Quality of local suppliers/ kvalitet na lokalni dobavuvaci

Framework Conditions: Importance vs. Satisfaction

:

(5 = very satisfied/important, 1 = not satisfied/important)

4,65 4,54

4,27 4,26 4,14

3,86

4,26 4,23

3,66 3,9 3,88

3,77 3,89

2,09

2,42 2,42

2,7 2,84

2,73

3,2 3,22

2,83

3,07 3,19 3,16 3,36

1,

5

2

2,

5

3

3,

5

4

4,

5

5

11. What are your expectations and wishes towards

the Macedonian government?

?

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Political Stability/politicka stabilnost 85%

Fight against Corruption/borba protiv korupcijata 77%

Legal Security/pravna sigurnost 69%

Reduction of Bureaucracy/namaluvanje na birokratijata 67%

More initiatives for the EU Accession/zabrzuvanje na EU integraciite 50%

Improvement of infrastructure/podobruvanje na infrastrukturata 50%

Transparent and simple Tax laws/poednostaveni i itransparentni

danocni propisi

Stable currency/stabilna valuta

Modernisation of Labor Law/modernizacija na zakonot za rabota 17%

Access to financial funds/pristap do finansiski fondovi 15%

35

29%

%

Core Findings of the Survey

Austrian companies in Macedonia are predominantly active in the services sector.

Nearly half of the Austrian companies assess the current economic situation in

Macedonia as flawed/poor. Most of them expect a similar situation in 2016.

For 2016, 48% of the companies expect an increase in turnover, more than 40%

plan to hire new employees and more than 30% plan to increase investments.

Austrian companies assess the attractiveness of Macedonia as a de