of enterprise estonia for exporting...
TRANSCRIPT
Servicesof Enterprise Estonia
for exporting companies
(EASi teenused eksportivatele ettevõtetele)
Eero Raun
Enterprise and Export Centre
at the BPW Estonia seminar
June 10, 2015 - Chamber of Commerce
» www.tradewithestonia.com
» www.eas.ee
Michel Sittow (1469-1525), painter from Tallinn
• 1492-1504 court portrait painter
for Isabelle of Castille in Toledo
(painting: Catherine of Aragon),
• 1515-1518 for Fernando II and
Carlos I in Valladolid
(painting: don Diego de Guevara)
High Position in Business Environment
Rankings
Source: World Bank – Doing Business 2015
13
5 6 7 8 911
1417
20
23 24
2932
44
54
Ease of Doing Business Ranking 2015
1st in International Tax
Competitiveness Index 2014 Tax
Foundation
8th in Index of Economic
Freedom 2015 /2nd in Europe Wall
Street Journal / The Heritage Foundation 2015
6th in Trading Across Borders 2015
World Bank
2nd in the Internet Freedom Freedom
House 2014
29th in Global Competitiveness
Report 2015 World Economic Forum
26th in Corruption Perceptions
Index 2014 Transparency International
Low risk –Politically and Economically Stable
Political stability. Estonia is seen
as the most stable country in CEE.
Lowest government debt in
Europe. Government debt was 10.0%
in 2013 compared to 54,8% in Finland or
38% in Latvia for example.
A balanced and future
oriented state budget with a
growing interest in entrepreneurs and
foreign investors.
9.078.39 8.13
7.48
6.54 6.496.07
5.49 5.31 5.24
0
1
2
3
4
5
6
7
8
9
10
Risk of political instability, global rank
Source: IMD World Competitiveness Yearbook 2014
The higher the rank, the lower the risk
Simple and Favourable Tax System
* 0% Corporate income tax on reinvested profits
All distributions are subject to income tax at the rate of 20%
of the amount of taxable payment
Personal income tax: flat rate 20%. The same rate applies
for expats
VAT: 20%
Social tax: 33% (20% for social security and 13% for health
insurance)
Unemployment insurance: 2,6% of the gross salary. (The
employer pays 0,8% of the salary and the employee 1,6%.)
No property tax
The land tax is from 0,1% to 2,5% on the assessed value of
the land, rate established by local government (i.e in Tallinn
2,5%).
Easy administration - All the taxes can be declared via E-
tax/e-customs (an electronic service desk of the Estonian
Tax and Customs Board)
Source: KPMG
29.6%
24.5%
23.0%
22.0%
19.0%
19.0%
19.0%
15.0%
15.0%
0.0% *
0.0% 10.0% 20.0% 30.0% 40.0%
Germany
Finland
UK
Sweden
Poland
Czech Rep
Hungary
Latvia
Lithuania
ESTONIA
Tax rate on corporate income, 2014
Information Society Indicators
100% of schools and government organizations are ICT equipped
Entire country is covered with a broadband connection
97% of businesses use computers
80% of homes have broadband connection
99,8% of bank transfers are performed electronically
95% of income tax declarations are made via the e-Tax Board
25% of votes were cast over the internet on 2013
66% of the population participated in the census via internet in 2012
More than 93% of the population has an ID-Card
Estonia is Part of the Nordic
Electricity Market
Estonia is part of Nordic electricity market and Estonian electricity
system is connected also with Russia and Latvia.
Estonian energy system is the only predominantly oil-shale-based
energy production system in the world.
The biggest energy producer in Estonia is Eesti Energia, a 100%
state-owned company.
The price of electricity consists of four components: electricity,
network service, renewable energy support and excise duty.
Electricity market is 100% open starting January 2013.
Natural Gas Market
Natural gas is imported into Estonia
from Russia and Latvia.
Estonian natural gas company is
Eesti Gaas.
Network services to all participants
of the natural gas market on the
territory of Estonia are provided by
EG Võrguteenus.
The price of gas consists of three
elements: gas, network service and
excise duty.
The price for industrial users is a
matter of negotiations.
99.3
9.9 9.9 10.110.6
10.9
12.2 12.212.8
0
2
4
6
8
10
12
14Gas price for industries, 2013 (EUR per GJ)
Source: Eurostat
Labour Market and Education
System Total labour force: 674,400
The unemployment rate: 6,3% in Dec
2014
General working time: 8 hours a day, 5
days per week. The duration of one shift
may not exceed 12 hours
Overtime is allowed by mutual agreement
The duration of the annual vacation: 28
days
10 Public holidays a year
The average wage in Estonia in 2014 is
EUR 1 039. The monthly minimum wage
for full-time work is EUR 390 / 2.34 €/h.
7 universities (6 public, 1 private) - ca
49,400 students
University of Tartu – 15,800 students
Tallinn University of Technology – 12,900 students
Tallinn University – 10,300 students
Estonian University of Life Sciences –
4,300 students
Estonian Academy of Arts – 1,130 students
22 other professional higher
education institutions – ca 15,400 students
48 vocational schools - ca 26,200 students
214 gymnasiums (high schools) - ca
24,000 students
7 universities (6 public, 1 private) - ca
43,647 studentso University of Tartu – 14,179 students
o Tallinn University of Technology – 12,926
students
o Tallinn University – 9,391 students
o Estonian University of Life Sciences – 3,905
students
o Estonian Academy of Arts – 1,102 students
o Estonian Academy of Music and Threatre –702 students
o Estonian Business School – 1,442 students
17 other professional higher education
institutions – ca 11,500 students
47 vocational schools - ca 25,200 students
204 gymnasiums (high schools) - ca
23,400 students
Main Economic Indicators, 2012-2014
2012 2013 2014
GDP real growth (%) 3.2 0.8 0.5
GDP (current prices, billion EUR) 17.0 18.4 19.5
Consumer price index (%) 3.9 2.8 -0.1
Labor force (thousands) 624.4 621.4 624.8
Growth of labour productivity 0.7 -0.2 0.3
Unemployment rate (ILO) 10.2 8.6 6.3
Average wage (EUR) 887 948 1,039
Wage real growth (%) 1.7 4.9 6.3
Source: Statistics Estonia
Estonian Export by Country
Spain: 17th position, 0,9 % from total foreign trade
turnover (as of 2014)
Estonian Export by Sectors
Estonia and Spain: export and import
Estonia and Spain: foreign trade in 2014
Main articles of Estonian export to Spain in 2014:
• machinery and equipment - 66.2% (mobiles, engines and generators)
• Wood and wood products - 6.2% (log houses)
• Other industrial products - 4.2% (rare metals – niobium etc)
• mineral products - 3.5% (peat products - fertilizers)
Main articles of import from Spain in 2014:
• prepared food and beverages - 20.5%
• machinery and equipment - by 15.1%
• textile products - 15.0%
• Vehicles, transport equipment - 10.7%
Strong in niche markets
FDI Inflow by Country and ActivityStock as of 31.12.2014
Source: Bank of Estonia (27.03.2015)
Sweden 26%
Finland 22%
Netherlands 10%
Norway 6%
Russian
Federation6%
Cyprus 3%
Denmark 3%
Lithuania 3%
Latvia 3%
USA 2%
United Kingdom 2%
Germany 2%
Austria 2%
Other 10%
Financial and insurance activities 27%
Real estate activities 17%
Wholesale and retail trade; repair of motor
vehicles and motorcycles15%
Manufacturing 13%
Professional, scientific and technical activities 8%
Transport and storage 6%
Administrative and support service activities 3%
Information and communication 2%
Agriculture, forestry and fishery 2%
Electricity, gas, steam and air conditioning supply 2%
Other 5%
2014: Spanish FDI to Estonia: 23 mio € (0,2% from all FDI to Estonia),
2014: Estonian FDI to Spain: 72 mio € (1,4% from all FDI from Estonia)
Estonian business support organizations
• Enterprise Estonia - EAS.ee
• Estonian Development Fund - Arengufond.ee
• Kredex (state financial institution) Kredex.ee
• Agricultural Registers and Information Board - PRIA.ee
• Rural Development Foundation - MES.ee
• Environmental Investment Center - KIK.ee
• Ministry of Foreign Affairs MFA.ee
Enterprise Estonia
Development of:
• new enterprises
• tourism
• regions and society
• production and export
• foreign direct investments
• 280 employees
• 2014 budget €70 million
Enterprise Estonia promotes
business and regional policy
in Estonia
Representations of Enterprise Estonia
• Tallinn, Estonia
• Silicon Valley, USA
• Helsinki, Finland
• Stockholm, Sweden
• Oslo, Norway
• Rotterdam, Netherlands
• London, UK
• Munich, Hamburg,
Germany
• Tokyo, Japan
• Shanghai, China
• Moscow, St Petersburg, Russia
• Copenhagen, Denmark
• Paris, France
- 15 offices, 12 countries
- A global network of partners
and service providers
Incentive programmes until 2015
Incentive schemes for entrepreneurs include:
Incentives for start-up enterprises
Incentives for development of enterprises
Support and development of clusters and incubators
Support for export marketing
Innovation and product development grants
Technology investment grants for high-impact industrial investors and subcontractors
Enterprise Estonia offers enterpreneurs
monetary subsidies, consultations,
cooperation and training programmes
Export objectives
Increased export volume
+
Higher value added
+
More better paid jobs
=
Increased tax revenue for state, i.e. better living standard
What are the main issues?
• Lack of knowledge about exporting and
export markets
• Lack of access to business opportunities
abroad
• Lack of business contacts at export
markets
How we assist?
Export training and info
Export consultancy
Business opportunities
Trainings and info
• Sector and country reviews
• Market seminars
• Electronic ‘Export Handbook’
• Trainings (different aspects of exporting)
• Distance learning program for Export
Managers
Business opportunities
• Portal www.tradewithestonia.com
• Sourcing
• Trade missions (for Estonian companies)
• National Joint Stands and International
Exhibitions (10-15 fairs in a year)
Mobile World
Congress
Feb 2014
Barcelona
Garry Kasparov in MWC 2014
Estonia at Smart City EXPO Nov 2015, 2016
Export consultancy of foreign advisors
• Initial consultancy on market entry
• Contact search (database)
• Export Partner Search (to find dealer, end
customer, representative, importer etc)
• Export Bulldozer program
• Events support
Geographic strategy
Business Ambassador
Network
Second tier markets
Key export markets
Key markets - top export destination markets
+ markets with good potential (ca 10). We
deliver our own services with own staff.
Second tier – markets further away, where
we as a state want companies to export to
(ca 15-20). We deliver services through
partners.
Business Ambassador Network – rest of the
World. Voluntary and free of charge ‘door
opening’ to far away markets
e-resident.gov.ee
e-Residents can:
• Digitally sign documents and contracts
• Verify the authenticity of signed documents
• Encrypt and transmit documents securely
• Administer the company from anywhere in the world.
• Conduct e-banking and remote money transfers. Establish an Estonian company online within a day.
• Access online payment service providers
• Declare Estonian taxes online
• e-Residency does not confer citizenship,
• tax residency, residence or right of entry to Estonia or to the European Union. The e-Resident smart ID card is not a physical identification or a travel document, and does not display a photo.
What can we do together?
• Increasing interaction (e.g. BPW, Chambers of Commerce)
• Establishing contact points (honorary consuls)
• Political delegations accompanied by business delegations
• Separate business delegations
• Trade missions and contact visits
• Sourcing - pass on information on companies who want to
buy something from Estonia
• Investments with export potential – new knowledge and skills
• Exhibitions and country promotion events
