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Dusan Kulka, FDI Advisor Regional competitiveness Forum, November, 2006 (Foreign Direct) Investment (Regional) Competitiveness
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Dusan Kulka, FDI Advisor Regional competitiveness Forum, November, 2006 (Foreign Direct) Investment (Regional) Competitiveness.

Dec 18, 2015

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Page 1: Dusan Kulka, FDI Advisor Regional competitiveness Forum, November, 2006 (Foreign Direct) Investment (Regional) Competitiveness.

Dusan Kulka, FDI AdvisorRegional competitiveness Forum, November, 2006

(Foreign Direct) Investment

(Regional) Competitiveness

Page 2: Dusan Kulka, FDI Advisor Regional competitiveness Forum, November, 2006 (Foreign Direct) Investment (Regional) Competitiveness.

• (Overall) investment attractiveness is heavily influenced by national legislation & government performance.

• First significant investment activity has been / is mostly related to privatization of state owned enterprises.

• Followed by “spontaneous” (mostly resource and market seeking) investments investigating emerging markets’ potentials / conditions.

• If balance 1,2 and 3 provides satisfying feedback, first larger greenfield investments start searching for convenient location in the region / specific country.

• Manufacturers seeking efficiency represent vast majority of those FDI.

FDI in CEE Region

Page 3: Dusan Kulka, FDI Advisor Regional competitiveness Forum, November, 2006 (Foreign Direct) Investment (Regional) Competitiveness.
Page 4: Dusan Kulka, FDI Advisor Regional competitiveness Forum, November, 2006 (Foreign Direct) Investment (Regional) Competitiveness.

Basic info

Indicator (2005) Ukraine Czech Republic

Population 46 930 thousand 10 232 thousand

Territory 603 700 sq km 78 866 sq km

GDP €66,48 billion €99,99 billion

GDP per capita at PPP

€6 260 €17 260

Average monthly salary €126 €639

FDI stock €14,5 billion €50,4 billion

FDI stock per capita €310 €4 932

Source: The Vienna Institute for International Economic Studies; www.wiiw.ac.at

Page 5: Dusan Kulka, FDI Advisor Regional competitiveness Forum, November, 2006 (Foreign Direct) Investment (Regional) Competitiveness.

Export per capita in 2004

Export per capita

$0$1,000$2,000$3,000$4,000$5,000$6,000$7,000$8,000

Slove

nia

Czech

Rep

ublic

Hunga

ry

Slova

kia

Eston

ia

Lith

uani

a

Latv

ia

Polan

d

Croat

ia

Bulga

ria

Russia

Roman

ia

Turke

y

Ukrai

ne

World Europe EU15

$65.771.534.270Total exports

$32.672.195.000Total exports

Source: UNCTAD data; BermanGroup analysis; www.bermangroup.cz

Page 6: Dusan Kulka, FDI Advisor Regional competitiveness Forum, November, 2006 (Foreign Direct) Investment (Regional) Competitiveness.

Share of export as % of GDP

Export share in GDP

0%5%

10%15%20%25%30%35%40%

Slove

nia

Czech

Rep

ublic

Hunga

ry

Slova

kia

Eston

ia

Lith

uani

a

Latv

ia

Bulga

ria

Croat

ia

Polan

d

Roman

ia

Russia

Turke

y

Ukrai

ne

World Europe EU15

Source: UNCTAD data; BermanGroup analysis; www.bermangroup.cz

Page 7: Dusan Kulka, FDI Advisor Regional competitiveness Forum, November, 2006 (Foreign Direct) Investment (Regional) Competitiveness.

More than 600 investment projects successfully implemented

• 45% of employees in industry

• 55% of industrial production

• 65% of industrial exports

Once FDI feel happy

Page 8: Dusan Kulka, FDI Advisor Regional competitiveness Forum, November, 2006 (Foreign Direct) Investment (Regional) Competitiveness.

High potential versus poor performance

First big efficiency-seeking investments plus growing annual inflow of FDI

Still serious obstacles:

• Problematic business climate / poor image: unstable environment, red tape, …

• Low understanding of FDI business practice

• Very limited number of market-ready investment opportunities

• Lack of professional assistance to investors

Ukraine & FDI

Page 9: Dusan Kulka, FDI Advisor Regional competitiveness Forum, November, 2006 (Foreign Direct) Investment (Regional) Competitiveness.

Average FDI

UAH117.121

UAH57.057

Annual salesper employee

Average FDI

44%

25%

Share of exports

BAS Ukraine 2005

Page 10: Dusan Kulka, FDI Advisor Regional competitiveness Forum, November, 2006 (Foreign Direct) Investment (Regional) Competitiveness.

BAS Ukraine 2005

Average FDI

UAH871

UAH789

Average monthly salary

Average FDI

UAH105.087

UAH39.510

16%12.7%

Investments per employee and new jobs

Page 11: Dusan Kulka, FDI Advisor Regional competitiveness Forum, November, 2006 (Foreign Direct) Investment (Regional) Competitiveness.

• Network of large cities• Skilled and inexpensive labor

• Growing domestic consumption / markets

• Improving export performance

• Positive development in light industry and machinery

• Increasing interest of investors – productivity gains

• Slow but continual improvement of country’s business environment

• WTO accession expected

Ласкаво просимо

Page 12: Dusan Kulka, FDI Advisor Regional competitiveness Forum, November, 2006 (Foreign Direct) Investment (Regional) Competitiveness.