overview of the latest trends in fdi & focus on balkan countries hugues de cibon oco global,...
TRANSCRIPT
Overview of the
latest trends in FDI &
focus on Balkan countries
Hugues de Cibon
OCO Global, Paris
Belgrade – March 2015
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Introduction:
– OCO
– FDI? FDI trends
– World trends Focus on Balkan countries
Summary
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Specialist advisory firm providing economic development solutions to
Corporations, Governments, Economic Development Organisations (EDOs)
and Special Economic Zones (SEZs), worldwide
Since our inception in 2001, we have become a recognised authority in
foreign investment and we have worked successfully with leading
organisations such as UKTI, AFII, InvestHK, EFI Florida…
A multinational and multilingual staff of over 50 full time consultants and a
direct presence with offices in the first 5 FDI source countries
– USA, Germany, United Kingdom, France and Japan
A unique business model integrating, from strategy to implementation, a
comprehensive offer covering investment promotion strategy, organisation
development, business intelligence, proposition-based marketing and lead
generation & representation services
OCO Global
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References – Clients (examples, 2010-14)
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FDI (Foreign Direct Investment)?
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Different forms…– Greenfield
– Expansion
– Colocation
– (M&A)
– ("Invisible" internationalisation)…
"FDI"?
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Different ways to measure it… – indicators (KPI)– CapEx
– Number of jobs
– Number of projects
– Impact on the economy
• GVA, wages, value chain, knowledge…
Coverage:– Total (numbers) vs.
"Segments" (sector/function/area – market shares)
"FDI"?
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FDI trends – World
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FDI – Flows by UNCTAD (+OECD, WB, IMF…)
FDI flows including: Greenfield and Expansion projects,Acquisitions, Intra-company loans…
Source: UNCTAD, 2013
Foreign direct investment flows, annual, 1980–2012
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Number of projects
Capex (M USD)
Number of jobs
FDI (projects, capex and jobs)
Greenfield, Expansion & Colocation projects –excluding Retail, Construction & Extraction projects
Source: © fDi Intelligence, from the Financial Times Ltd 2014 – OCO Global (2014)
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Players:
– MNC vs SMEs Source markets:
– North America, Western Europe, Japan; brIC Sectors/Activities:
– Manufacturing vs. Services (tangible & intangible) Destination markets:
– Developing Asia (SE Asia, India and China) vs. W Europe;Eastern Europe vs. Latin America (+USA)
Forms/modes:
– Greenfield vs. Invisible forms; Size of the projects
Key trends
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Asia and Americas (North & South), favoured locations– dynamic markets, natural resources, low(er) costs…
Western Europe, recovery (but limited)– mainly a rich (but declining) market, and a high cost location
– potential for market related activities: Sales & Marketing, Logistics, Development… / European HQs vs. multiple subsidiaries
Eastern Europe, recovery (but limited)
– low(er) costs but dependence on Western Europe
Middle East
– diversification from Oil & Gas, Retail and Construction?
Africa
– natural resources, but increasingly HR/skills
Key trends – geography (destination)
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FDI – Destination World Regions – nb of projects
Greenfield, Expansion & Colocation projects
Source: © fDi Intelligence, from the Financial Times Ltd 2014– OCO Global (2014)
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FDI – Destination World Regions nb of jobs
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A large majority of projects in activities related to intangible services– a continuous increase in sales/business services focused projects
(Sales, Marketing & Support, Business Services, HQ/RHQ…)representing 55% of projects in 2013 vs. 35% in 2003
A strong decrease of the weight of manufacturing– 43% of projects in 2003 vs. 22% in 2013
(but still 60% of the employment generated)
A real globalisation of all the activities based on technical/scientific competences– R&D, engineering, "advanced manufacturing" ...
Key trends – functions/business activities
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DestinationWorld Regions(04-08 vs 09-13)
ManufacturingSales,
Marketing & Support
Research & Development
Logistics & Maintenance
Teleservices Total
Asia-Pacific 37,0% 34,8% 32,9% 31,1% 51,5% 38,3% 28,3% 24,5% 39,8% 27,7% 34,7% 31,1%
Western Europe 16,7% 13,0% 32,1% 28,8% 24,0% 26,5% 31,8% 28,5% 24,3% 23,9% 26,1% 23,8%
North America 8,6% 14,8% 8,1% 12,4% 8,2% 13,9% 8,2% 12,8% 6,9% 11,5% 8,5% 13,4%
Rest of Europe 23,4% 16,5% 12,8% 8,5% 8,0% 9,0% 20,3% 15,9% 14,9% 16,0% 16,4% 11,4%
Latin America & Caribbean
8,3% 13,2% 5,7% 8,4% 3,8% 7,4% 5,0% 8,8% 8,8% 14,4% 6,2% 9,6%
Middle East 2,1% 2,4% 5,2% 6,1% 2,8% 3,1% 3,6% 5,3% 1,7% 1,6% 4,4% 5,3%
Africa 3,9% 5,3% 3,2% 4,7% 1,7% 1,8% 2,7% 4,2% 3,5% 5,0% 3,6% 5,3%
Total 16 021 14 346 13 720 17 647 3 811 3 757 3 867 4 351 1 586 1 379 52 083 60 348
World –FDI (functions/business activities)Market share evolution 2008 2013
Greenfield, Expansion & Colocation projects – excluding Retail, Conctruction and Extraction
Source: © fDi Intelligence, from the Financial Times Ltd 2014 – OCO Global (2014)
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DestinationWorld Regions(04-08 vs 09-13)
Software &IT services
Automotive Components
ChemicalsSemi-
conductorsFinancial Services
Total
Asia-Pacific 34,7% 27,6% 35,6% 31,4% 46,8% 42,7% 66,5% 58,1% 34,2% 32,5% 34,7% 31,1%
Western Europe 36,7% 34,3% 15,0% 11,7% 21,9% 16,9% 17,7% 21,6% 22,9% 20,8% 26,1% 23,8%
North America 9,1% 15,5% 13,5% 21,3% 9,1% 12,8% 6,5% 8,7% 6,0% 9,5% 8,5% 13,4%
Rest of Europe 7,4% 6,5% 27,8% 19,2% 11,2% 9,2% 4,1% 5,2% 17,3% 10,7% 16,4% 11,4%
Latin America & Caribbean
6,4% 9,2% 5,9% 13,5% 6,0% 9,7% 2,4% 3,9% 4,9% 7,5% 6,2% 9,6%
Middle East 3,5% 3,9% 0,6% 0,5% 2,4% 5,0% 2,1% 2,4% 8,4% 8,3% 4,4% 5,3%
Africa 2,2% 2,9% 1,5% 2,3% 2,6% 3,7% 0,7% 0,0% 6,3% 10,7% 3,6% 5,3%
Total 6 836 7 920 2 164 2 145 2 168 2 364 945 458 5 644 6 261 52 083 60 348
World –FDI (sectors)
Greenfield, Expansion & Colocation projects – excluding Retail, Conctruction and Extraction
Source: © fDi Intelligence, from the Financial Times Ltd 2013 – OCO Global (2013)
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An increasing (and earlier) internationalisation of the SMEs– including start-up companies ("Born Global"),
a phenomenon no more limited to "high tech" companies
MNC building "global value chains" Increase of alternative forms of internationalization,
in particular in knowledge-intensive sectors :– joint ventures and non-equity partnerships – such as:
scientific collaborations, value added resellers...
Investors more and more demanding,seeking "solutions" (customised propositions)rather than simple "locations"
Key trends – Players
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FDI trends – Drivers
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Low(er) costs– especially labour (& energy, and taxation)
Flexibility– regulation – especially labour (> outsourcing)
External economies– supply chain/clusters
– R&D capabilities
Risk aversion– shift to flexible work patterns
– rationalisation and consolidation of existing operations
– regionalisation and globalisation rather than localisation
(Quality – skills, infrastructure)
Micro drivers & trends
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GDP– evolution of the economy, per country and per sector
Global value chains– fragmentation of the company/sector value chains
Sector trends:– ICT & Digital
– (Health)
– (Green – energy and environment)
– (Finance)
Government:– regulation, more than interventionism and public spending
Macro drivers & trends
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FDI in the Balkan countries
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FDI in the Balkan countries – global trend
Greenfield, Expansion & Colocation projects – Excluding building and real estate projets
Source: © fDi Intelligence, from the Financial Times Ltd 2014– OCO Global (2014)
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FDI in the Balkan countries – Source regions
Greenfield, Expansion & Colocation projects – Excluding building and real estate projets
Source: © fDi Intelligence, from the Financial Times Ltd 2014– OCO Global (2014)
Western EuropeWestern Europe
Rest of EuropeRest of Europe
Northern AmerciaNorthern Amercia Asia - PacificAsia - Pacific Middle EastMiddle East AfricaAfrica South America
& CaribbeanSouth America
& Caribbean
TOP 10 countriesGermanyUSAItalyAustriaSlovenia
France UK Greece Turkey Switzerland
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FDI in the Balkan countries – Business activities
Greenfield, Expansion & Colocation projects – Excluding building and real estate projets
Source: © fDi Intelligence, from the Financial Times Ltd 2014– OCO Global (2014)
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Financial services Food and beverage Alternative / renewable energy Business services Transportation Software and IT services Metals Textiles Industrial machinery, equipment & tools Automotive components
FDI in the Balkan countries – Top sectors
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Hugues de Cibon
Deputy Director,Paris
T: +33 (0)1 43 87 56 40
OCO Global Ltd (Head office)
6 Citylink Business Park - Durham St.
Belfast BT12 4HB, Northern Ireland
OCO Global (Europe)
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