Azijos Šalių Ekonomikos Forumas

Transcript

1. WELCOME ASIAN BUSINESS FORUM
2. OPENING REMARKS Mr. Artūras Zuokas, Vilnius City Mayor
3. THE CITY OF VILNIUS: OPEN FOR BUSINESS AND GROWTH Mr. Miroslavas Monkevičius, City Council Secretary Vilnius City Municipal Government
4. ASIAN BUSINESS FORUM 2014 MIROSLAVAS MONKEVIČIUS CITY COUNCIL SECRETARY VILNIUS CITY MUNICIPAL GOVERNMENT
5. THE CITY OF VILNIUS: OPEN FOR BUSINESS AND GROWTH
6. VILNIUS: FACTS AND FIGURES WHY INVEST IN VILNIUS?
7. VILNIUS REGIONAL LEADER q  16 Million inhabitants in a 300 km radius. q  Vilnius Country generates approximately 40% of Lithuania’s GDP. q  As of 2011, Vilnius’ economy reached 11,78 billion Euros
8. EASY ACCESS TO BOTH EASTERN AND WESTERN MARKETS SEA AND AIR - 4 International Airports; it takes 2-3 hours to get to Lithuania from the major European cities - Klaipeda State Seaport is the northern-most ice-free port in the Baltic Sea
9. WHY INVEST IN VILNIUS? HIGHLY EDUCATED AND MULTILINGUAL TALENT POOL WORLD CLASS ICT INFRASTRUCTURE EASY ACCESS TO BOTH EASTERN AND WESTERN MARKETS BUSINESS - FRIENDLY ENVIRONMENT HOME TO WORLD LEADERS IN LIFE SCIENCES HIGH QUALITY OF LIFE
10. HIGHLY EDUCATED AND MULTILINGUAL TALENT POOL The Most Educated Labour Pool in the EU: ▪ Labour pool size: 1.5 million1 1st in the EU: 93% of population have secondary or higher education2 12th in the World: 77% of population aged 20-24 are enrolled in tertiary education3 2nd in the EU: 47% of population aged 24 - 29 have a university degree2 1st in the World for the share of female labor force2 Foreign Language Knowledge4: ▪ 92% of population speaks at least 1 foreign language* ▪ 52% of population speaks at least 2 foreign languages* ▪ Languages spoken: Russian (80% ), English (38%), Polish (19%), German (14%) LABOUR POOL STRUCTURE STUDENTS AT UNIVERSITIES AND COLLEGES 2012-2013 Source 1: Statistics Lithuania Source 2: Eurostat, 2011 Female labour force, as percentage of total labour force (50,29%) Source 3: Global Competitiveness Index 2011-2012 Source 4: European Commission, 2012 * EU average: 54% of population speak 1 foreign language, 25% speak 2 foreign languages
11. WORLD CLASS ICT INFRASTRUCTURE 1st for Internet upload and 3rd for download speed in the EU1 1st in the World Competitiveness Rankings for communication technology2 1st in Europe for density of network of public Internet access points (875) 3rd in the EU for the share of fixed broadband lines equal to or above 30Mbps3 •  The most up-to-date ICT technologies (LTE technology, 3G mobile communications infrastructure, mobile WiMAX 4G Internet etc.) fully implemented and functioning in the entire country •  93% of financial operations are performed via e- banking4 •  Among Top 10 countries in the world for cloud readiness5 17%   12%   11%   11%   10%   8%   8%   8%   8%   7%   Top 10 Countries by Internet Upload Speed (Mbps) Hong  Kong   South  Korea   Singapore   Macau   Lithuania   Republic  of  Moldova   15%   12%   11%   10%   9%   9%   9%   9%   8%   8%   Top 10 Countries by Internet Download Speed (Mbps) Hong  Kong   Singapore   Romania   South  Korea   Sweden   Macau   Source 1: Ookla Netindex, 2013 Source 2: IMD, The Word competitiveness yearbook, 2011-2012 Commun. techn. rank evaluates how communications technology (voice and data) meets business requirements Source 3: European Comission, 2012 Source 4: Statistics Lithuania, 2012 Source 5: Cisco Global Cloud Index, 2013. The Index evaluates Consumer and Business Fixed Network performance and Consumer and Business Mobile Network performance
12. HOME TO WORLD LEADERS IN IT IT Sector in Lithuania Today: 24,500 employed IT professionals 2,185 IT enterprises Large Talent Pool: ▪ 6,200 IT students at 7 universities and 14 colleges ▪ 1,750 IT graduates each year High Growth Potential: ▪ 2.98 mln. citizens - 4.53 mln. mobile subscribers by 2012, i.e. penetration of 152% ▪ From 2009 to 2011 Lithuania went from 10-20 apps developed per year, to 200-300 <y(Plan   2nd biggest App store globally with over 2 billion downloads. 3rd best-selling mobile application on the Mac App Store. Apple Design Award 2011. MagicDraw UML - 1st Java based UML tool trusted by multinational businesses and NASA; distributed in more than 70 countries. 1st commercial digital signature pilot for mobile in the World. 1st in the World with an online banking application using Natural User Interface (NUI). World's first mobile only event booking app, has recently raised a $12 million for expansion in the US. No. 1 social network in Nigeria with 6 M+ registered users and 13 M+ registered users across the World, focusing on the mobile customers in emerging markets.
13. EASY ACCESS TO EASTERN & WESTERN MARKETS Advanced Logistics: ▪ Logistics accounts for 11.7% of GDP1 25,000 truck fleet*2: _ 75% comply with Euro-3/4/5 exhaust emission requirements _ International road transit accounts for 90% of total road transit > 850,000 m2 of logistics and warehousing facilities 2-3 hour flights to major European cities and Moscow Shuttle cargo services: direct railroads to Russia, Belarus, Latvia, Poland, Germany, Ukraine and Asia (incl. China) Ice-free Klaipeda State Seaport Reliable and High-Quality Infrastructure: ▪ NATO's Northern Distribution Network: 3,100-miles of sea, road, and rail routes connect Klaipeda (Lithuania) with central Asia q  1 day q  2 days q  3 days q  4 days * vehicles for international cargo shipment/transportation
14. COST-EFFECTIVE BUSINESS DEVELOPMENT LOCATION Wages  in  the  IT  Industry  in  2013     Wages  in  the  Produc8on  Industry  in   2013     Source : Grafton Recruitment 2013 The information provided in this document constitutes a guide to salaries being paid against particular job titles/functions in Vilnius in average The salaries are stated gross in Euro per Year, the salaries are not including benefits / bonuses IT Manager 27,500-34,300 Technical Support (mid-level) 13,700-16,000 Java Specialist (3-5 yrs experience) 22,900-28,800 Java Specialist (1-3 yrs experience) 14,400-22,900 .Net / C # (3-5 yrs experience) 23,000-27,500 .Net / C # (1-3 yrs experience) 14,400-18,000 Web Developer 18,300-24,000 Software Engineer 23,000-27,500 Network Engineer (3-5 yrs experience) 23,000-31,200 System Analyst 18,300-20,000 Average Yearly Gross Salary, EUR Position in the IT Industry Production Manager 22,590-45,180 Quality Manager 13,550-31,630 Quality Engineer 11,300-22,590 Manufacturing Shift Leader 9,040-13,550 Machine Operator 5,420-9,040 Logistic Manager 22,590-31,630 Transport Co-ordinator 11,300-15,880 Warehouseman 5,270-6,780 Senior Buyer 9,040-15-810 Junior Buyer 5,420-9,040 Position in the Production Industry Average Yearly Gross Salary, EUR
15. Business-Friendly Environment Incentives for Investment into New Technologies and R&D3: q  R&D and experimental expansion expenses are fully deductible three times q  very short depreciation periods and fast depreciation methods for equipment used for R&D activities Incentives for Foreign Businesses Investing in: q  production of export-oriented high-quality services/products/R&D activities q  creation of new qualified jobs Incentives for employment of youth: 23.3% of salary of a first-time employee (aged16 to 29) is reimbursed to employers for up to 12 months TAX RATE SNAPSHOT 1,2 Source 1: PricewaterhouseCoopers Source 2: KPMG, Deloitte, 2012 Source 3: AmiCorp, “Lithuanian Company as Intellectual Property Holding”, January 2012 TAX  RATES Corporate profit tax 15% VAT 21% Dividends* Up to 15% Personal income tax 15% Employee's social security tax 9% Social security tax paid by the employer 30.98% Real estate tax Up to 3%
16. SPECIAL TERRITORIES FOR BUSINESS DEVELOPMENT 2 Special Economic Zones (SEZ): q  0% corporate tax for the first 6 years q  50% discount on corporate tax over the next 10 years q  0% tax on dividends q  0% tax on real estate
17. GREAT PLACE TO LIVE, EAGER TO CHANGE, FAST TO INNOVATE q  Vilnius is among 10 least expensive EU cities to live in1 q  Among Top 40 countries in the World for the quality of life2 q  17th in the World in the Environmental Performance Index 20123 q  62% of citizens either walk, bike or take a bus as a mode of transportation in the capital city Vilnius q  10th place in the World in Smart City rankings4 q  Vilnius’ Old Town, a UNESCO World Heritage site, is vibrant and pedestrian-friendly Source 1: Mercer Cost of Living Index 2012 Source 2: Quality of Life index, International Living 2011 Source 3: Environmental Performance Index , Yale Center for Environmental Law and Policy 2012 Source 4: Hip Cities That Think About How They Work’, The International Herald Tribune 2011
18. FOREIGN DIRECT INVESTMENT FROM ASIAN COUNTRIES
19. FOREIGN DIRECT INVESTMENT IN LITHUANIA FROM ASIA COUNTRIES €86 million direct investments, 120 created jobs
20. THANK YOU FOR ATTENTION!
21. BUSINESS CO-OPERATION BETWEEN LITHUANIA AND ASIAN COUNTRIES: STRATEGY AND PERSPECTIVES Vice - Minister Kęstutis Trečiokas The Ministry Of Economy of The Republic of Lithuania
22. Business Co-operation between Lithuania and Asian Countries: Strategy and Perspectives Kęstutis Trečiokas Vice minister of Economy
23. Lithuania: in the Center of Europe Size: 65,300 sq. km1 Population: 2.98 million Capital: Vilnius Official language: Lithuanian (One of the oldest languages in the world, originating from Sanskrit) Dominant foreign languages: English, Russian, German, Polish Currency: Lithuanian Litas (LTL) Pegged to EUR since 2002 1 EUR/3.45 LTL 1 USD/0.7339 EUR4 1 USD/2.5341 LTL4 From command economy to free market in 20 yrs. §  21rd freest economy in the World2 §  17th in the ease of doing business3 §  16th in the overall attractiveness for FDI in the World5 Source 1: Statistics Lithuania Source 2: Heritage Foundation, Economic Freedom Index, 2014. Index measurements: Rule of Law, Limited Government, Regulatory Efficiency, and Open Markets Source 3: World Bank Doing Business Index,2014. The index looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle Source 4: bank of Lithuania, 4 February 2013 Source 5: The Baseline Profitability Index , 2013. Index measures: asset growth, preservation of value, and repatriation of capital
24. Key Milestones o  Key Milestones EU Presidency EU and NATO Membership OSCE Chairmanship Goal to join the Eurozone 1990 2001 2002 2004 2007 2009 2011 2012 2013 2015 Lithuania regained Independence WTO Membership Investment Grade Ratings from Moody’s, S&P and Fitch Schengen Area Membership Lithuania’s Millennium Celebration European Basketball Championship
25. A Growing Economy Real GDP growth rate in Selected Economies 2012-2013 Source: Eurostat -8 -6 -4 -2 0 2 4 6 2012 2013
26. The Lithuanian Economy Main Characteristics o  Export Oriented Growth o  Technologically Advanced & Hi-Tech Oriented o  High Skilled Talent Pool o  Entrepreneurial Culture o  Incentives for R&D & Investment
27. Recent Achievements o  17th in the ease of doing business1 o  21st freest economy in the World 2 o  1st in the overall attractiveness for FDI in the Baltic states and 2nd in Europe for expected investment returns3 o  9th Best Country for Business in Eastern Europe and Central Asia4 Source 1: World Bank Doing Business Report, 2014 Source 2: Heritage Foundation, Economic Freedom Index, 2014 Source 3: The Baseline Profitability Index , 2014 Source 4: Best Countries for Business By Bloomberg Rankings, 2014
28. Lithuania’s merchandise exports to Asia, million EUR 332   666   758   695   934   655   825   1,102   1,346   1,665   00   200   400   600   800   1,000   1,200   1,400   1,600   1,800   2004   2005   2006   2007   2008   2009   2010   2011   2012   2013   Source: Statistics Lithuania
29. Areas for cooperation between Lithuania and Asia o  Laser industry o  Biotechnology o  Wood-processing industry o  Processed food o  Construction sector o  Machinery and electronics o  Transport and logistics
30. Asia's FDI in Lithuania, million EUR 16.03 40.21 43.3 76.59 149.39 154.33 201.14 246.99 243.29 215.38 0 50 100 150 200 250 300 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Source: Statistics Lithuania
31. Thank You!
32. DOING BUSINESS WITH JAPAN Amb. Kazuko Shiraishi - Japan
33. June  6,  2014   Asian  Business  Forum   Kazuko  Shiraishi,  Ambassador  of  Japan  to  Lithuania  
34. 1.  Recent  Economic  Situa8on  in  Japan   2.  Trade  and  Investment  between  Lithuania  and  Japan   3.  Success  Stories   4.  Key  Factors  for  Doing  Business  with  Japan   5.  Contacts    Informa8on   Contents
35. Ø Japan  is  seeking  to  get  rid  of  deflaSon  and,  at  the  same  Sme,   to  steadily  reduce  government  debt,  while  we  are   faced  with  a  unique  challenge—a  society  aging  at  an   unprecedented  rate,  with  a  consequent  reducSon  in  the   naSon’s  work  force.     Ø To  overcome  these  challenges,  Prime  Minister  Shinzo  Abe     has  taken  an  iniSaSve  of  a  decisive  economic  strategy   consisSng  of  three  pillars,  dubbed  “the  three  arrows”.  These   three  arrows  consist  of  aggressive  monetary  policy,   flexible  fiscal  policy  and  structural  reform  of  the  economy. Abenomics
36. 8,830   15,627   12,445   16,291   14,485   8,000   9,000   10,000   11,000   12,000   13,000   14,000   15,000   16,000   17,000   36 Abenomics : Effectiveness of the two arrows GDP  Growth  Rate ConsumpSon Capital  Investment   (nominal  terms) July-­‐September  2012 January-­‐March  2013 April  -­‐  June  2013 July-­‐September  2012 October-­‐December  2013 Minus  3.1% Plus  4.8% Plus  3.9% Plus  1.1% Plus  0.7% July-­‐September  2012 April-­‐June  2013 Minus  1.0% Plus  1.7% (ContribuSon  of  final  consumpSon  expenditures  by   households  (in  real  terms)  of  GDP) July-­‐September  2012 April-­‐June  2013 October-­‐December   2013 Minus  1.0% Plus  0.1% Plus  0.7% (Change  from  previous  quarter  and  these  numbers  are  annual   rates) (real  terms) The  dissoluSon  of   the  Lower  House   (2012/11/16) 2012/11/15 2013/5/22 2013/12/30 2013/6/13 Change  in  Nikkei  Sｔock  Average 2014/5/1 Went  up  about   64% January-­‐March  2014 Plus  1.5%
37. 37 Target of the third arrow, “Growth Strategy” The  Third  Arrow The  First  Arrow The  Second  Arrow The  New  Growth  Strategy:     Realize  a  2%  real  GDP  growth  rate  on   average  over  10  years 1.  PromoSng  private  investment  based  on  bold  regulatory  &   structural  reform   2.  Maximizing  uSlizaSon  of  human  resources  of  women  and   elderly   3.  CreaSng  new  growth  industries  and  overseas  markets Bold  monetary  policy:  Ending   Defla8on   Flexible  fiscal  policy:  S8mula8ng  the   economy   Copyright (C) 2014 JETRO. All rights reserved.
38. India China Korea Japan AUS・NZ Peru Chile Canada Mexico EU Regional  Comprehensive   Economic   Partnership（RCEP） Trans Pacific Partnership （TPP） U.S. Note：Made  by  JETRO  from  various  materials   ※Among  ASEAN:  Singapore,   Malaysia,  Vietnam,  Brunei   par8cipates  in  TPP  nego8a8ons Japan-­‐EU・EPA ASEAN Acceleration of FTAs: TPP, RCEP, Japan-EU EPA Japan-Australia EPA
39. 0   5,000   10,000   15,000   20,000   25,000   30,000   35,000   40,000   2007   2008   2009   2010   2011   2012   2013   Furniture   OpScal  instruments   TexSle   Dairy  products   Tabacco   Fish  and  crustaceans   Processed  food   Organic  chemicals   Others   +33% (thousad  EUR) Export from Lithuania to Japan +44% +31%
40. Japanese companies investing Lithuania
41. Success Story 1 Windows  &  Doors  Producer   Medical    Equipments  Producer  
42. Success Story 2 TexSle  Producer  
43. Success Story 3: Mangalica "Mangalica  Pig"  -­‐  Hungarian   eatable  naSonal  treasure  
44. Key Factors 1.  High  Quality  (Technique,  Design,  Safety  etc.)   2.  Bland  Image   3.  Pa8ence      
45. Contacts Information Embassy  of  Japan  in  Lithuania  
46. POLICY ON COMMERCIAL AND TRADE POTENTIAL BETWEEN LITHUANIA AND INDONESIA Mrs. Ima Siti Fatimah, Trade Attache Embassy of Indonesia, Copenhagen
76. DOING BUSINESS WITH DELHI: GREAT POTENTIAL FOR ALL Mr. Vijay Mehta, President Indo-Polish Chamber of Commerce, Delhi
77. SESSION II ASIAN BUSINESS FORUM
78. THAILAND: ECONOMY, POTENTIAL & OPPORTUNITIES Ms. Ketsuda Supradit, The Minister of Economy And Finance for U.K. And Europe The Royal Thai Embassy In London
115. INVESTMENT OPPORTUNITIES IN INDONESIA Mr. J. S. Meyer Siburian, Head of Indonesia Investment Promotion Center (IIPC), London
156. LITHUANIA – ASIA: BUSINESS PARTNERSHIP OUTLOOK Mr. Aleksandr Izgorodin, Analyst of Economic And Finance, Lithuanian Confederation of Industrialists
157. Aleksandr Izgorodin Analyst Lithuanian Confederation of Industrialists LITHUANIA – ASIA BUSINESS PARTNERSHIP OUTLOOK 2014-06-06
158. LPK: MAIN FACTS •  2105 member companies. 52 business associations 1 •  LPK members generate over 60% of Lithuanian GNP and employ over 30% of Lithuanian workforce 2 •  Number one business advocate (lobbyist) in Lithuania (survey of magazine “Veidas”, 2011) 3 •  Strong participation in government and ministry working groups, Tripartite Council, etc. 4 •  More than 30 business missions to more than 40 countries since 2000 5 •  One of the most quotable organizations in Lithuania 6
159. LPK: THE VOICE OF BUSINESS IN LITHUANIA p  Lithuanian Confederation of Industrialists (LPK) is the biggest business organization in Lithuania, established in 1989. LPK is the business voice in Lithuania. p  LPK is a member of: n  International Organization of Employers (151 employer organizations from 144 countries all over the world); n  BUSINESSEUROPE (main horizontal business organization at EU level. 41 member organizations from 35 countries. 20 million companies); n  International Congress of Industrialists and Entrepreneurs.
160. LITHUANIAN EXPORT IS POORLY DIVERSIFIED 10% 14% 12% 7% 11% 9% 9% 9% 8% 9% 74% 68% 66% 68% 63% 67% 64% 64% 63% 60% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Lithuanian export structure, 2013 EU OTHER CIS 160 Source: Lithuanian Statistics Department
161. LITHUANIAN TRADE BALANCE IS NEGATIVE 305 121.7 165.35 0 50 100 150 200 250 300 350 China Japan ASEAN Export, mln. Lt, 2013 1951.7 88.2 184 0 500 1000 1500 2000 2500 China Japan ASEAN Import, mln. Lt, 2013 Source: Lithuanian Statistics Department
162. LITHUANIAN EXPORT TO ASIA ACCOUNTS FOR 1,21% OF TOTAL EXPORT 0.63 0.25 0.17 0.05 0.04 0.03 0.02 0.02 0.01 0.00 0.00 0.00 0.00 0.10 0.20 0.30 0.40 0.50 0.60 0.70 Export structure, 2013, % Source: Lithuanian Statistics Department
163. LITHUANIAN EXPORT IS 40 % ABOVE PRE-CRISIS LEVEL, BUT EXPORT GROTH IS DIMINISHING Export – Overall CIS EU (without Latvia and Estonia) Latvia and Estonia Other countries Food products -7,2 11,1 -0,5 15,8 -37,0 Chemical products, plastics -17,6 0,5 -17,6 -0,4 -43,0 Wood products and furniture 16,1 10,6 8,9 26,9 69,4 Textile and leather 10,1 -12,7 11,2 -6,7 25,2 Metals and electric mashines 11,8 -11,3 12,6 -26,4 86,3 Transportation vehicles -23,4 -12,6 -30,7 -1,3 66,8 Other 13,7 9,6 13,3 6,2 21,1 Export - Overall -1,4 3,1 -0,3 6,2 -13,8 Source:
164. New business opportunities for Lithuanian products in Asia: Malaysia Kazakhstan China
165. LITHUANIA – MALAYSIA
166. LITHUANIAN – MALAYSIAN BUSINESS COUNCIL p  Lithuanian – Malaysian business council was established in March 2013 with the provision of LPK p  Paulius Kunčinas is the president of this council – a graduate of Oxford University p  He currently is the head of “Oxford Business Group”, which is a consultancy and publishing company based in Great Britain p  Paulius constantly monitors economic, business and political movement in Mongolia, China, India, Indonesia, Malaysia, Thailand, Phillipines, Vietnam and Myanmar.
167. The counicil obojective is to encourage Lithuanian – Malaysian economic – trade realationships. September 2013 – visit of Lithuanian delegation to Malaysia led by Minister of Economy Evaldas Gustas organized. During the visit meetings with Malaysian government and business officials were held – overall 23 meetings. LITHUANIAN – MALAYSIAN BUSINESS COUNCIL
168. Although Lithuania and Malaysia are small countries in the context of EU and Southern Asia their export accounts for 84% and 130% of GDP respectively. Both countries are pursuing to extend the levels of foreign trade diversification Lithuania is targeting the Southeastern Asian markets, whereas Malaysian businesses are concentrating on EU and CIS trade routes. Despite similar strategic objectives Lithuanian and Malaysian businesses do not compete in most of world wide markets.
169. MALAYSIA IS PREPARING TO BECOME A DEVELOPED COUNTRY UNTIL YEAR 2020 A stable government, orientated to new business projects Supports high added value business Encourages foreign direct investment In 2012 GDP growth reached 5,6% - an all time high Consumption grows 7,2% annually Unemployment and inflation are as low as 3% and 1,7% respectively Stable interest rates From the year 2015 Southeastern Asia will start to act similary to EU Tariff and other trade bariers will be abolished A unified Southeastern Asian product and service market will be introduced Malaysia is a good base for entering the Southeastern Asian counties
170. MALAYSIA IN THE DOING BUSINESS 2014 RATING TOOK 6TH PLACE 11 39 75 6 28 68 56 15 17 44 17 16 43 21 35 1 4 36 5 30 42 6 0 10 20 30 40 50 60 70 80 Lithuanian and Malaysian comparison. Doing Business 2014 components. Lithuania Malaysia
171. ACCORDING TO THE WORLD WIDE BOING BUSINESS RATING MALAYSIA IS TAKING THE 6TH PLACE. Source:  „Doing  Business  2014”   1 12 18 79 99 120 133 138 163 1 6 18 59 99 120 137 108 159 0 20 40 60 80 100 120 140 160 180 Singapore Malaysia Thailand Brunei Vietnam Indonesia Cambodia Phillipines Laos PDR Doing Business 2014 rating 2013 2014
172. LITHUANIA-MALAYSIA BUSINESS OPPORTUNITIES p  Medicine p  Construction (energy-efficient housing) p  Renewable energy p  Export – dairy, chocolate, beverages p  ICT, laser industry p  Joint venture companies in Lithuania, production in Lithuania with the goal to export into ASEAN region
173. LITHUANIA - KAZAKHSTAN
174. KAZAKHSTAN IS THE DRIVETRAIN OF EXPORT TO THE CIS REGION     Russia   Ukraine   Belarus   Kazakhstan   CIS  -­‐ overall       63  %  of  all   Lithuanian  export   to  CIS  countries   11  %  of  all   Lithuanian  export   to  CIS  countries   16%  of  all   Lithuanian  export   to  CIS  countries   6%  of  all   Lithuanian  export   to  CIS  countries       Food  products   11,1   -­‐5,7   -­‐27,4   138,2   11,1   •  Meat  and  meat  products   -­‐21,2   -­‐   -­‐93,5   -­‐   -­‐23,5   •  Milk  and  milk  products   12,5   -­‐15,1   -­‐33,3   73,3   11,5   Chemicals  and  plasScs   54,8   -­‐44,9   -­‐5,6   -­‐66,5   0,5   Wood  products  and  furniture   9,6   -­‐9,4   22,3   118,1   10,6   TeSle  and  leather   -­‐21   -­‐11,8   -­‐8,9   -­‐1,5   -­‐12,7   Metals,  electrical  pruducSon   3,6   -­‐53,5   -­‐16,9   -­‐37,4   -­‐11,3   TransportaSon  vechicles   -­‐33,3   -­‐27,1   -­‐15,4   1143,3   -­‐12,6   Other   16,3   -­‐26,2   -­‐1,7   123,9   9,6   Export  -­‐  Overall   12   -­‐36,8   -­‐9,4   42,1   3,1  
175. WHY KAZAKHSTAN? p  Kazakhstan market has good potential: 1.  Big market – 16,7 mln. citizens 2.  Forecasted GDP growth 2014-2018: 5,6%; 3.  Low level of unemployment and growing purshasing power; 4.  Kazakhstan has reached 21 place on Doing Business rating; 5.  Cultural business aspects are familiar. 62.77 16.43 10.92 5.68 1.15 0.99 0.86 0.4 0.36 0.33 0.1 0 10 20 30 40 50 60 70 Export to CIS, 2013, % Source: Lithuanian Statistics Department
176. THE MOST PERSPECTIVE INDUSTRIES FOR EXPORT TO KAZAKCHSTAN 1.  Food industry (milk products, “Halal” food products) 2.  Alcochol drink industry 3.  Machine industry 4.  Wood industry 5.  Metal industry 6.  Electrical industry 7.  Optical device sector 8.  Education services 9.  Transportation and logistics services p  Kazakhstan is a leading economy in the Central Asia and positions itself as a bridge from China to Europe p  The most perspective sectors of Kazakhstan product export to Lithuania are the following: oil industry, textile industry (cotton), metal industry (iron and steel, cooper), sulphur extraction, transportation and logistic services.
177. LITHUANIA - CHINA
178. ESTABLISHMENT OF LITHUANIA-CHINA BUSINESS COUNCIL (1) p  The intention of Lithuanian companies to diversify trade and strengthen economic relations with developing markets has increased significantly. The interest in strengthening economic relations with China is particularly high among Lithuanian companies p  The survey of 150 biggest Lithuanian manufacturing companies conducted by LPK shows that in 2014 one in five (18,7%) Lithuanian manufacturers intent to strengthen economic relationship with China p  Lithuania-China economic relations are insufficiently developed so far – for example, the share of Lithuanian export to China in 2013 accounted for only 0,34% of total Lithuanian export and stood at LTL 304 mln. p  However, there is a strong will on both sides to significantly strengthen bilateral economic relations between Lithuanian and China
179. ESTABLISHMENT OF LITHUANIA-CHINA BUSINESS COUNCIL (2) p  Lithuanian Confederation of Industrialists has a significant experience in operating of various business councils. Thus, in order to strengthen and develop economic relations with China, the Lithuania-China Business Council (Council) under the auspices of Lithuanian Confederation of Industrialists has been established p  The establishment of the Council has been actively coordinated between Lithuanian Confederation of Industrialists, Government of Republic of Lithuania and Embassy of People’s Republic of China in Lithuania p  The Council will seek to contribute significantly to strengthening of bilateral Lithuania-China economic relations, both in terms of bilateral trade and attracting of FDI from China
180. ESTABLISHMENT OF LITHUANIA-CHINA BUSINESS COUNCIL (3) p  The biggest potential for Chinese FDI in Lithuania n  Extraction of natural resources n  Public and private infrastructure projects n  Investments into already operating companies (establishment of joint-ventures, acquisitions of the companies) n  Investments in order to increase Chinese exports (establishment of new companies, production lines, increases in operating capacity) using Lithuania as a production hub and exploiting the advantages of “made in EU brand” as well as inwards processing procedures (customs and tariffs are not applied) p  Lithuanian export opportunities: n  Ecological and natural food products; n  High-added value, niche market products; n  ICT; n  Wood and timber.
181. ACHIEVEMENTS SINCE ESTABLISHMENT OF THE COUNCIL p  The Council has organized a business mission to Ningbo region, which will accompany the Minister of Economy of Lithuania during his visit to China p  The Council has met with 4 official and business delegations from China from Tianjing, Ningbo, Hangzhou, Xinjiang regions p  Business trip of Chairman of Lithuania-China Business Council has been organized. Connections with Chinese stakeholders established p  The Council, together with Enterprise Lithuania, has organized a seminar on increase of Lithuania-China bilateral trade for Lithuanian companies p  The Council is in close and constant contact with Lithuanian government, Lithuanian embassy in China, Chinese embassy in Lithuania p  Internet site of the Council is being created
182. CONTACT INFORMATION Aleksandr Izgorodin Analyst Lithuanian Confederation of Industrialists T.: +370 698 74451 Email: Aleksandr.Izgorodin@lpk.lt www.lpk.lt
183. Thank you for your attention!
184. WHAT YOU CAN LEARN FROM INDIAN BUSINESSES IN EUROPE Mr. Jawahar Jyoti Singh, President of Indo Polish Chamber of Commerce & Industry, Poland
185. SESSION III ASIAN BUSINESS FORUM
186. Logistics Between the Regions: a Challenge Requiring a Long Term Strategy DISCUSSION I
188. GLOBAL  &  REGIONAL   DISTRIBUTION  NETWORK   Network  of  the  Southern  part  of  the   BalSc  Sea  region  serves  2.3%  of  Asia  -­‐   Europe  trade  segment.   INTERNATIONAL  TRADE  VOLUME  OF  EAST-­‐WEST  TRANSPORT  CORRIDOR  (552  bln.   €)  
189. STRATEGIC    LOCATION   340  mn   WESTERN   EUROPEAN   POPULATION   250  mn  CIS   POPULATION   110  mn   BALTIC    SEA   REGION   POPULATION   Lithuania   is   a   strategic   loca8on   with   very   business-­‐friendly   dynamics.   The   country  offers  easy  and  rapid  access  to   three  important  markets:  the  Bal8c  Sea   Region,   the   European   Union   (EU)   and   the   Commonwealth   of   Independent   States   (CIS).   This   amounts   to   approximately   750   million   consumers   on  Lithuania’s  doorstep.  
191. Developed  solu5on:       AB  Lietuvos  paštas  acts  as  a  transit  postal  operator  for   delivery  of  parcels  from  China  to  EU  /  CIS  countries.   E-­‐COMMERCE  
193. TOMAS KERŠIS Commerce Department Director Lithuanian railways LITHUANIAN  RAILWAYS  -­‐       YOUR  PARTNER  FOR  LOGISTICS  
194. LITHUANIAN  RAILWAYS   •  Track  gauges  –  1520  mm  and  1435  mm   •  Number  of  stations  –  108   •  Representatives  of  JSC  Lithuanian  Railways  work  in  China,  Russia  and  Belarus   •  Number  of  employees    –  10.600     •  100%  of  the  company's  shares  belong  to  the  State       •   Railway  infrastructure  manager   •  150-­‐year  experience  in  advanced  complex  logistic  solutions   Freight  carrier,  m  t     2008   55   2009   42,7   2010   48,1   2011   52,3   2012   49,4   2013   48,03   Passenger  carrier,   m  pass.     2008   5,1   2009   4,4   2010   4,4   2011   4,7   2012   4,8   2013   4,9    
195. FREIGHT  VOLUME   86%   5%   7%   2%   Railway  freight  transport  in  Lithuania   by  region     Eastern  European   countries   Western  European   countries   The  BalSc  States   Asian  region   113,317   15,088   2,322   0   20,000   40,000   60,000   80,000   100,000   120,000   2009   2010   2011   TOP10  in  EUROPE  
196. WHY  LITHUANIA?   MODERN  AND  EFFICIENT   TRANSPORT  AND   LOGISTICS  SOLUTIONS  
197. PORT  OF  KLAIPEDA   •         The  port  fully  operates  24  hours  a  day,  7  days   a  week,  all  year  round   •         The  annual  port  cargo  handling  capacity  is  up   to  60  million  tons   •         Biggest  container  terminals  in  Baltic  states   and  MSC  hub   •  Ice-­‐free  port   OK  
198. EU  AND  CIS  BORDER  CROSSING  IN  30  MINUTES   Kena   Station  is  fully  modernized  and  developed:     tracks  for  long  trains,  IT  systems  for  declaration  and  control  of  wagons,  automated  switch  system,  commercial   control  system,  electronic  dynamic  scales,  radiation  meter,  X-­‐ray  and  other  modern  equipment   All  implemented  measures  let  perform  border  crossing  procedures  fast  and  precisely  
199. RAIL  BALTICA   Latvia   Estonia   Lithuania   Belarus   Ukraine   Russia   Finland   Poland   Czechia   Slovakia   Hungary   Austria   Germany   Track gauge 1435 mm Rail Baltica EU member states Non EU member states Track gauge 1520/ (1524) mm Helsinki   Warsaw   Track gauge 1435 mm (reconstruction) Rail Baltica II (project) Track gauge 1435 mm (building a new line) Riga   Kaunas   Tallinn  
200. CONTAINER  TRAINS  NETWORK  
201. SUN  TRAIN   The  main  purpose  of  intermodal  train  “SUN  train”  is  to  establish   effective  logistic  chain  between  East  and  West.    
202.   VIKING  TRAIN       Award:     “Best  intermodal  project”   Istanbul  –  Kapi  Kule  (~220  km)/Svilengrad  izt.  fr.   –  Ruse  fr.  (406  km)/Giurgiu  Nord  –  Dornesti  (605   km)/Vadul  Siret  –  Berezhest  (852  km)/Slovechno   –  Gudogai  (554  km)/Kena  –  Draugyste  (427  km)-­‐   Scandinavia 8  Day  
203. ŠEŠTOKAI  RAILWAY  STATION  AND  TRAIN  –   ŠEŠTOKAI  EXPRESS     •  Reloading  cargo  from  standart  (1435  mm)  to  wide  (1520  mm)  gauge  railway   •  Bulk  cargo  terminal  project   •  ŠEŠTOKAI  EXPRESS  –  intermodal  train  from  Poland  to  Russia     Intermodal  train  –    ,,Šeštokai  Express”   Route:     Warsaw  –  Sestokai  –  Minsk  –   Sestokai     Distance:     1126  km   Transit  8me:     3  days     State  partners:     Russia,  Belarus,  Lithuania,  Poland   Operator:     Hupac  Intermodal  SA,  Intermodal   Express  
204. MERCURY  TRAIN   •         Currently,  container  train  “Mercury”  is  operating  on  the  route  Klaipėda-­‐Moscow   twice  a  month.  
205.   BALTIC  WIND       •       Travel  time  -­‐  5  days.       •       Main  purpose  of  the  “BALTIC  WIND“  train  is  to  provide   regular   shipment   service   in   containers   to   various   clients   from   Lithuania   to   Central   Asia   and   broaden   the   possibilities  of  Russian  Freight  passing  from  one  country  to   another  through  a  third  country.     •        Going   further   the   frequency   of   the   train   departure  is  planned  at  2-­‐3  times  per  month.      On  26  September  2013  hirst  train  with  automotive  components   departed  from  the  Paneriai  station  of  the  Lithuanian  railways  to   the  Kustanay  station  of  the  Kazakhstan  railways.    
206. CONTAINER  TRAINS  NETWORK   TRAIN  NAME   2012   2013   CHANGE,  %   Viking  train   49.178   38.173   -­‐22,4   Vilnius  shuple   3.986   10.697   +168,4   Šeštokai  Express   1  034   2  139   +106,9   Mercury  train   361   1.633   +352,4   Saulė   354   1.188   +235,5   Bal8ka-­‐Tranzit   387   503   +30,0   Bal8c  Wind   -­‐   428   New  Project  
207. •   “Nemunas”  project  is  a  contrailer  train  by  which  trucks  with   semitrailers  are  transported   •     Routes:     •   Kaunas  (Palemonas)  –  Vilnius  (Paneriai)  –  Minsk   (Koliadichi)  –  Vilnius  (Paneriai)  –  Kaunas  (Palemonas).     “NEMUNAS”  PROJECT  IS  AN  EXCELLENT  SOLUTION  FOR  ROAD   TRANSPORT  –  THE  WAY  TO  AVOID  TRAFFIC  JAMS  AT  STATE  BORDER   CROSSING  POINTS   •  One  of  the  problems  in  organizing  transportation  by  roads  between  Lithuania  and  Belarus  is   long  queues  at  the  state  border.   •  To  solve  this  problem  JSC  Lithuanian  Railways  together  with   its   partners   offers   new   service   called   “Nemunas”   contrailer   train.   ALTERNATIVE   “NEMUNAS”     contrailer  train   Time  of  delivery   up  to  10  hr   Length  of  train:                                                         30  trucks  with   semitrailers   Passenger  wagon  for   drivers   Thursday  morning  –  from   Minsk  to  Vilnius/Kaunas.   Friday  evening  –  from   Kaunas/Vilnius  back  to   Belarus  
208. PUBLIC  LOGISTIC  CENTERS  
209. PUBLIC  LOGISTIC  CENTERS   VILNIUS  PUBLIC  LOGISTIC   CENTER   KAUNAS  PUBLIC  LOGISTIC   CENTRE   KLAIPĖDA  PUBLIC  LOGISTIC   CENTER        Storage  –  1  500  TEU    Storage  –  550  TEU      Storage  –  1200  TEU      Loading  area  –  600  m                                                                         (1st  stage)  and  1000  m  (2d  stage).      Loading  area  –    4  x  442  m    4  railways  1000  meters  length  each      Loading  capacity  –  more  than   100.000  TEU  per  year    Loading  capacity  –50.000  TEU  per     year      Loading  capacity  –80.000  TEU  per     year          Will  be  hinished  in  2014        Will  be  hinished  in  2014      Plan  to  start  third  stage  intermodal   terminal  is  in  2015  
210. PUBLIC  LOGISTIC  CENTERS  (VILNIUS)   Finished  46%  
211. TOMAS KERŠIS Commerce Department Director Lithuanian Railways LET‘S  DO  LOGISTICS  TOGETHER  
212. SESSION IV ASIAN BUSINESS FORUM
213. Lithuanian Business Sectors Bringing the Most Value DISCUSSION II
214. Asian Countries in Lithuania: the Specifics of Doing Business in Lithuania DISCUSSION III
215. The Specifics of doing business in Lithuania Dovile Burgiene LAWIN Lideika, Petrauskas, Valiūnas ir partneriai Head of the Lithuania Corporate and M&A practice group Partner T. +370 52681826 M. +370 68677649 E. dovile.burgiene@lawin.lt Vilnius, 6 June 2014
216. Doing Business / World Bank / 2014 216 Rank % distance to frontier * Change in Rank 2014 17 75.79 8 2013 25 73.54 2.25 /  Doing business provides objective measures of business regulations and their enforcement across 189 economies. Overall ease of doing business Starting a business * Distance to frontier – distance of each economy to the "frontier," which represents the highest performance observed on each of the topics across all economies included in Doing Business. An economy’s distance to frontier is indicated on a scale from 0 to 100, where 0 represents the lowest performance and 100 the frontier. Rank % distance to frontier * Change in Rank 2014 11 93.23 94 2013 105 83.47 9.76
217. Corporate presence Most popular type of company – private limited liability company, in Lithuanian – uždaroji akcinė bendrovė (UAB) /  Incorporation: •  Time – 3 business days as of signing of incorporation documents •  Expenses: o  LTL 10,000 (EUR 2,900) – minimum share capital o  LTL 1,000 (EUR 290) – notarization and registration costs •  VAT payer registration – 3 business days, free of charge /  Shareholders: •  1 – 249 •  Lithuanian or foreign individuals or legal entities •  Limited liability except when company cannot discharge its obligations due to unfair actions of shareholders /  Management: •  Must to have 1 CEO – to be employed or seconded •  Board of Directors – not compulsory /  Accountancy: •  Must to have accountant – employee or service provider •  Annual financial reporting to local company register, tax declarations •  Audit of financial accounts – if required /  Public trading in securities prohibited. If preferable – choose another company type – public limited liability company (in Lithuanian – akcinė bendrovė) 217
218. Employment Employment contracts /  Generally – open-ended contracts /  Termination at no fault of employee (economic, technological reasons, etc.): •  notice period 2 – 4 months •  severance payment 1 – 6 monthly salaries /  Alternative – temporary employment through employment agencies Working time /  Regular – 40 working hours per week /  Overtime: •  in exceptional cases •  not more than 4 hours in 2 consequent days and 120 hours per year •  pay (for overtime and night work) – minimum 1.5 times salary /  Alternative – shift work under more flexible aggregate time scheme, avoidance for paying extra /  Vacation: minimum paid 28-35 calendar days per year Wages / Minimum monthly salary gross – LTL 1,000 (~ EUR 290) / Average monthly salary gross – LTL 2,305 (~ EUR 668) 218
219. Immigration EU citizens /  Schengen area – generally EU citizens enjoy freedom of movement and work permits are not required /  Formal requirement to declare place of residence when stay in Lithuania exceeds 3 months within 180 days Non-EU citizens /  Generally no visa if stay does not exceed 3 months within period of 6 months (subject to international treaties) /  If longer stay – temporary residence permit or national long-term visa required (issues Lithuanian consulate or immigration office in Lithuania) /  May be subject to work permits (issues State Labor Exchange). But many exceptions may apply, for example: •  No work permit required if employee works in Lithuanian subsidiary / branch / representative office of foreign company up to 3 years, provided such professional has minimum 1 year’s work experience in foreign group company •  No work permit may be required for highly-qualified employees provided their salary amounts to not less than 2 state average salaries gross (currently, LTL 4,610 (~ EUR 1,335) and their university diplomas are recognized by respective recognition authority in Lithuania 219
220. MAIN TAXES 220 Corporate income tax – 15% /  Possibility to transfer tax losses between group companies /  CIT incentive for investments into s u b s t a n t i a l t e c h n o l o g i c a l improvements /  Cost related to R&D may be deducted 3 times from income VAT – 21% /  Full deduction of input VAT available as long as all income is earned from VAT taxable activities /  Possibility to refund VAT within ~1 month from submission of request to refund VAT Personal income tax – 15% Dividends 0% – 15% Employment related taxes 30,98% – 32,60% - social insurance 9% - health insurance 0,2 % - guarantee fund Real estate tax 0.3 % – 3% Imposed on real estate (except for land) located in Lithuania and owned by Lithuanian or foreign companies
221. Subsidies EU funding /  Investors eligible for funding – foreign investors interested in locating business in Lithuania as well as foreign companies already operating on Lithuanian market but eager to further expand /  Distribution of EU support for period 2014 – 2020 has not yet started (EU Commission has to approve the Operational Programme for Lithuania) /  Support for big companies in current period will be reduced and generally will be available in sector of research and development (R&D) and innovation (Smart Specialisation) /  Support to foreign investors is planned under the measure – SMARTINVEST LT+ (only project is available) •  Aid intensity – up to 80% (small and medium companies) and up to 65% (big companies) •  Maximum support – up to LTL 10 million (~EUR 2,9 million) National subsidies /  Lithuania is currently preparing national measures, designed for foreign investors, these would be available only at the end of this year (4th quarter) /  Currently there is so called “transitional period” - no actual measures are available, because the funds from the programming period of 2007-2013 have already been used and the funds under 2014-2020 period are still not available 221