AN AUSTRIAN MARKET...
Transcript of AN AUSTRIAN MARKET...
“POLITICAL RISKS
from
AN AUSTRIAN MARKET PERSPECTIVE”
Christian Gessl
Regional Director Central and Eastern Europe
Austrian Federal Economic Chamber
at
Lloyds’s class of Business Event : Political Risks
Vienna, 18.04.2013
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Overview
AUSSENWIRTSCHAFT AUSTRIA (Advantage Austria)
Austria‘s Economy
Austria and Central & Eastern Europe
Austria: Import - Export
Austria: Foreign Direct Investment
OeKB – Österreichische Kontrollbank
OeEB – Österreichische Entwicklungsbank
AUSSENWIRTSCHAFT AUSTRIA
The Austrian Agency for Internationalization
ADVANTAGE AUSTRIA
In Austria
• AUSSENWIRTSCHAFT Head Office in AFEC
• Cooperation with 9 Foreign Trade Departments of
regional economic chambers
Abroad
• 117 Representation offices worldwide
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www.advantageaustria.org Austria’s Internet Platform — Overview
• 197 country sites
• 28 languages (special focus on East European languages)
• 10 Content Partners
• Market place with profiles of 18,000 Austrian businesses
• Business opportunities with more detailed company information
• Listings of all events abroad with details of participating
companies
• Overview of 30 industry sectors
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Information on Foreign Markets
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Put the world markets into your pocket!
Download the new ExportService-App of
Advantage AUSTRIA
Source: ABA
Heart of Europe &
Gateway to the East
• Area: 4.3 mln. km2
• Population: 500 million
• Members: 27 (28)
• Languages: 23 (24)
Austria at a glance
• 83,871 km²
• About 8.3 mio. inhabitants
• Geographical heart of the
European continent
• 8 neighbouring countries (6 EU
members, 1 EEA, 1 EFTA)
• Gateway between Central and
Eastern Europe (CEE) and
Western Europe
• 9 provinces
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Austrias wealth
and it‘s Foreign Trade & Investment
0
5
10
15
20
25
30
35
40
45
1950 1970 1990 2000 2011
% o
f G
DP
Austria is one of the world‘s richest countries
Export tradionally grows much faster than the GDP
Grafik: Exportquote in % des BIP; Datenquelle: Stat. Zentralamt
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How was/is this possible?
..creative companies, competitive education and training systems, Opening of the East, EU membership, good economic and fiscal policy, competitive salaries…
+ export support (AusfFG, AFFG by BMF and OeKB-Gruppe), AFEC/Advantage Austria:
Advantages for Austrian companies through
• perfect institutional Design of OeKB-group and
• Fast and coordinated actions by politics, AFEC, banks and OEKB-group
Austria and the EU
• Member since 1.1.1995 (referendum
on 12 June 1994 with 66.64% votes in favour of EU
accession)
• Austria benefited from EU membership
• additional annual economic growth of 0.5 % of GDP
• FDI has increased threefold
• Exports have more than doubled
• Some 130,000 additional jobs have been created
• Introduction of the Euro
• Rise of exports due to 2004/2007-EU enlargement
Austrian Federal Economic Chamber
(WKÖ)
346,000 active members
Austrian Chamber of Agriculture
(LKÖ)
190,000 members*
Austrian Federal Chamber of Labor
(BAK)
2,700,000 members
Austrian Trade Union Federation
(ÖGB)
1,400,000 members
Employers Employees
The Austrian Social Partnership Member-based organizations
* Number of agricultural enterprises according to
the study “Agrarstrukturerhebung 2003”
• 440.000 businesses (2013, 99.6 % Small Medium
Enterprises – SMEs) – and growing
• approx. 3,4 mio. employees
• small and medium size
• many ‘Leading Competence Units (clusters)
• Social Partnership
Austrian Business Sector – Very Briefly
GDP-Growth 2010-2013
GDP per capita 2012 – Austria TOP 3 in Europe
Origin of GDP 2011 by sectors
Employer Enterprises 2011 by section
Employees by section
Industrial production – Top-5-branches
• high per-capita income requires high value added
• small domestic market requires an customer oriented approach
(international)
• changing drivers of growth (source of economic impuls)
• presence in growth markets
• from technology absorbing/diffusing/ follower to source of
technology (driver)
Strategic Conditions for Austrian
Business
Tourism
• Vital part of Austria‘s economy
(historic function after WW II)
• Share of tourism-induced gross value added 10% of GDP
• One of the world‘s favourite tourist destinations (almost
20 million guests / year) – among top 10 worldwide
• 2012: 125 mio. overnight stays
• N°1 worldwide of visitors per capita
Overnight stays 2000-2011
Public deficit 2012,
% of GDP
Public debt
2012
Structure of public expenditure 2011
Unemployment
rates 2012 (% of labour force)
Austria: East-West Business Interface
EU foothold for CEE companies
CEE headquarters for Western companies
• Exploit the advantages at the interface
• No longer a one-way street: Eastern European
firms are looking for an EU base
• Bottom-line business location advantages
• www.headquarters-austria.at
Austrian Business in CEEC
• historic advantage 1989 (open boarders), 1995 (AT > EU), 2004
(EU-accession of neighbours) – sustained above average
growth
• fast outgoing/active direct investment
• > 1.000 companies with CEEC headquarters in AT
• > At central position in certain sectors (logistics, banking,
energy, retail, automotive supply)
300 international companies …
… including 28 Fortune 500 firms
– make Austria the pre-eminent CEE headquarters
• Proximity to the target market
• Infrastructure
• Productivity and motivation
• Stability
• Tax advantages
• Quality of life
Number of exporters
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12500
15000
18000 19000
22500
26000
29000 30000
34000
38000
40000
42000
44000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Trade balance / Exports
• Traditional deficit of trade balance (goods), deficit of direct investment balance
• BUT CHANGE: 2002 and 2007 – surplus of trade balance (goods)
• 6 out of 10 Euro are earned outside the borders of Austria
• Export is the “growth-engine” of Austria’s economy
• 8% of Austrian companies (about 30 000) are exporting
• 2006: 57.5 bn. Euro FDI outgoing – 53.3 bn. Euro FDI incoming
• 2009 exports with value of 94,2 bn. Euro, imports 97,8 bn. Euro
Importance of Austrian exports
EUR 123.4 bn export of goods 2012
EUR 131.9 bn import of goods 2012
44,000 exporters: 10% of all Austrian companies
56.2% export quota / GNP: 6 in every 10 EUR
USD 21.994 export per capita: world’s 7th largest exporter
Sources: 1) Statistics Austria, 2) AWO, 3) UNO, 4) WTO
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machinery 26,1%
motor vehicles 8,3%
medical andpharmaceutic products5,9%iron & steel 5,7%
made of metal 5,2%
other products 4,8%
Top-Export products 2012
2/3 of total exports
Source: Statistic Austria
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Austria‘s exports of goods 2011 (by world regions, %-share)
Austria‘s imports of goods 2011 (by world regions, %-share)
Austrian Exports to Eastern Europe 2012 (2012 = preliminary data)
118.003
141.036
178.239
640.971
1.951.457
2.298.557
2.652.280
3.444.460
3.692.926
4.456.190
Estonia
Latvia
Lithuania
Bulgaria
Romania
Slovenia
Slovakia
Poland
Hungary
Czech Rep.
in t
housa
nds
of
EU
R
Source: Statistics Austria
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Austrian Exports to Western Europe 2012 (2012 = preliminary data)
184.308
284.207
310.976
394.978
487.541
685.231
1.296.785
1.703.287
1.862.147
1.876.825
3.387.058
5.630.643
8.444.863
37.838.586
Luxembourg
Ireland
Portugal
Greece
Finland
Denmark
Sweden
Belgium
Spain
Netherlands
United Kingdom
France
Italy
Germany
in t
housa
nds
of
EU
R
Source: Statistics Austria
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25.161.470
25.896.723
37.693.428
83.881.188
85.625.071
89.811.943
114.541.787
192.909.883
220.310.795
548.434.139
Ethiopia
Angola
Mali
Tunisia
Libya
Morocco
Nigeria
Egypt
Algeria
South Africa
EU
R
Austrian Exports to Africa 2012 (prel. data)
„Source: Statistics Austria“
„Source: Statistics Austria“
52.465.550
100.522.558
128.924.424
142.727.456
152.809.166
194.176.266
512.542.178
871.086.893
1.061.387.880
6.937.115.649
Uruguay
Peru
Colombia
Venezuela
Chile
Argentina
Mexico
Canada
Brasilia
USA
EU
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Austrian Exports to America 2012 (prel. data)
„Source: Statistics Austria“
298.431.632
368.821.733
408.720.483
578.315.453
579.905.662
595.837.561
626.115.980
945.986.899
1.313.378.096
3.031.812.972
Taiwan
Singapur
Malaysia
Saudi Arabia
U.A. Emirates
Hongkong
India
Korea,Rep.
Japan
China
EU
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Austrian Exports to Asia 2012 (prel. data)
Austria‘s Import Origins
goods
source: Statistics Austria
Austrian imports in %
Austrian FDI in Eastern Europe
Investor
Ranking
Total Inward
Investment
(in EUR billion)
Austrian Share
%
Latest
available
data
Slovenia 1 10.8 47.9 2011
Croatia 1 26.2 28.9 2011
Bosnia-Herzegovina 1 4.9 19.7 2011
Serbia 1 12.8 18.5 2011
Romania 2 52.6 17.8 2011
Slovak Republic 2 37.6 16.0 2011
Bulgaria 2 36.2 15.4 2011
Czech Republic 3 96.2 12.9 2011
Hungary 3 67.9 12.8 2011
Albania 4 2.6 13.7 2011
Macedonia 4 3.4 11.1 2011
Montenegro 5 4.1 8.7 2011
Ukraine 5 33.7 6.1 2011
Poland 9 150.4 3.7 2011 Source: OeNB
Foreign Direct Investment 2011 20.1
06
7.2
03
5.8
38
21.9
05
106.8
70
113.3
07
132.3
70
154.0
17
4.6
82
6.6
97
3.2
20
10.1
63
106.4
39
119.8
36
118.5
71
114.9
93
FDI-Flows2008
FDI-Flows2009
FDI-Flows2010
FDI-Flows2011
FDI-Stock2008
FDI-Stock2009
FDI-Stock2010
FDI-Stock2011
Valu
e in M
illion E
UR
Austrian DI FDI in Austria
Source: OeNB
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The OeKB Group
• OeKB AG mainly „Federal Government Business“
• OeKB Versicherung AG mainly export credit insurance – Non -OECD
• PRISMA Kreditversicherungs-AG mainly export credit insurance - OECD
• „Österreichischer Exportfonds“ GmbH mainly working capital credits for SME‘s
• Oesterreichische Entwicklungsbank AG finances sustainable projects in Developing Countries
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Instruments
• export credits and FDI
• insurance for credits and credit lines
• for short, medium and long term contracts
• production time and credit period
• for manufacturing and services (except nuclear and military sectors)
• commercial credits and soft loans
• for project financing
• for Bonds and others
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Legal framework
• International: WTO, OECD, EU,
Berne Union
• Export credit act(AusfFG): 50 billion Euro
• Export financing act (AFFG):
45 Mrd. Euro
• Export support regulations
• General terms and conditions
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Insurance
: : : :
Exporter/ Bank A
Exporter/ Bank B
: :
Project
1
Project
2
Project
3
AusfFG
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The way / Scheme of (Export) Guarantee
• Exporter / Bank / Investor applies (easy forms - auch as download on webpage)
• OeKB checks economic and political risks
• Board in the Ministry of Finance evaluates the proposal of OeKB promise for guarantee or guarantee
• OeKB follows project development
• Project runs smoothly Guarantee ends
• In case of problems eventualy total loss, new credit
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Risikoanalisis: OeKB checks...
• Destination Country
• Buyer, collaterals, project
• payment conditions
• Austrian content
• Exporting companies
• Environmental impact
• if applicable „aid quality assessment“
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Insurable Risiks
• War, civil war, revolution or expropriation
• Cancellation or default of payment by a state, a central bank or an institution working on behalf of a government
• Lack of foreign currency, delayed transfer of foreign currency
• Cancellation or default of payment by private companies
• Insolvency (unability to pay)
• legal cost
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Country credit rating according to OECD
by December 2012
Country Category
Risk
1 2 3 4 5 6 7 0
Australia
Japan
Korea Rep.
Poland
Slowenia
Cayman Islands
Hongkong
Taiwan
Chile
China
Qatar
Kuwait
Malaysia
Saudi Arab.
Algeria
Brazil
India
Indonesia
Lituania
Marocco
Mexico
Russia
Tunesia
Uruguay
UAE
Egypt
Dom. Rep.
Gabun
Ghana
Jordania
Kasachstan
Droatia
Macedonia
Mongolia
Nigeria
Paraguay
Vietnam
Argentina
Belarus
Bosnia-Herzegowina
Irak
Iran
Kosovo
Cuba
Libya
Pakistan
Ukraine
Venezuela
(Korea DPR)
(Sudan)
(Syria)
Albania
Armenia
Bangladesch
Bhutan
Georgia
Kenia
Montenegro
Serbia
Usbekistan
Bulgaria
El Salvador
Columbia
Latvia
Philippines
Rumänia
Turkey
(actual ratings on ttp://www.oekb.at)
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Example 1
Brasil:
• Buyer orders machinery for 2 mio. EUR and asks for a 4
year credit
• 15 % Down Payment, 85 % credit in 8 installments
• Guarantee „G1“ in favor of the exporter
• sale of claim to a bank
• Guarantee „G 9“ in favor of the bank
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Example 2
Bosnia-Herzegovina:
• communal water treatment for 3 Mio. EUR
• poor households, no industry
• Austrian Exporter
• soft loan with 15 years credit period, the first 5,5 years
grace period
• Interest : 0 % p.a.
• State guarantee
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Example 3
Serbia:
• Establishing a 100 % - subsidiary company
• Investment volume 5 Mio EUR:
• Cash 0,5 Mio EUR +
• second hand equipment for 1 Mio EUR +
• credit (similar to equity) for 3,5 Mio EUR
• Guarantee G 4 for 6 years, progressiv pay back,
Quota 95 %
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Oesterreichische Entwicklungsbank - OeEB
• operative since 2008
• not only for Austrian investors and exporters
• Project need to have a development goal
• Goal: more sustainable jobs in local privat sector in
developing countries
• Funds: equity, Mezzanincapital, credits, grants
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Project financed by OeEB and KfW (Germany)
Consultancy for the Bank of Georgia (BoG) on the development of share
hydro power plans in Georgia
Component 1: Consulting on small hydro power plants (technical)
Support for developers, owners and Managers of small hydro power
plants including feasibility studies, credit applications and the support
for the implementation
Componente 2: Bank of Georgia Consulting (financial)
Capacity building in BoG to check applications for credit, monitoring,
risk managment for small hydro power plant projects
Cooperations & Consortia
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AusfFG – Usage (in billion EUR)
0
10
20
30
40
50
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011Bills of Exchange Investmentguarantees G4 Exportguarantees (no G4) Restructuring OeEB
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Financing exports
Bank A
: : : :
Bank B
: :
Project 1
Project 2
Project 3
Capital Market
AFFG
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Export Financing
• Refinancing commercial banks
• at market conditions and „soft loans“
• insured business as a basis for financing
• mainly AFG-Guarantees and exchange guarantees,
• but also Austria Wirtschaftsservice GmbH (AWS),
international Organisations gemäß AFFG 81, private
insurers
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Example 5
• Producer of optical equipment
• Turnover: 4 mio. EUR, including 3 Mio. EUR export
• Sales in Germany, Japan, Slovenia
• Financing need: 1,3 mio. EUR
• Exportfondscredit via Bank over 900.000 EUR
• Guaranteed through export sales
• Bank guarantee over 180.000 EUR
• Guarantee by two company owners
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Exportfonds credit
• „core funding“ for exporting SMEs
• Financing for Export
• credit line for 30 % of export turnover
• through commercial bank
• minimum risk of commercal bank 20 %
• revolving, 18-month bill of exchange
• Austrian content, minimum 25 %
• interest rate: 1,50 % per year
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Market Environment
• Competition also in the sector of the so called „non-
marketable risks“
• private Credit Insurers ...
• Local Banks (example: confirmation of letter of credit) ...
• local financial markets, international financial markets ...
• IFIs (like EBRD, IFC, MIGA) ...
• Self Insurance, Captives ...
• EULER-HERMES, COFACE, EXIMBANK ...
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Contacts to OeKB-Group and to AFEC
Oesterreichische Kontrollbank AG
• Ferdinand Schipfer / Exportgarantien – Projektgeschäft
• + 43 (1) 531 27 – 2610 [email protected]
OeKB Versicherung AG +43 (1) 531 27 – 2664
PRISMA Versicherungs-AG +43 (0)5 01 02 – 2222
Entwicklungsbank AG +43 (1) 533 12 00
Exportfonds +43 (1) 712 61 51
AFEC / Carl de Colle +43 05 90 900 - 4186 • [email protected]
Thank you for your attention!
Any questions?
Christian Gessl
Regional Management CEE & Baltics
T: +43 590900 4325
F: +43 590900 118139
Wirtschaftskammer Österreich
Wiedner Hauptstrasse 63a
1045 Wien