Investment promotion essentials &Investment climate in CEE

Presenter: Wu xihan(Hansey)

GIPB – to start my presentation GIPB-global investment promotion

benchmarking. It evaluated each IPI’s ability to meet the

informational needs of potential investors during the site-selection process,

Resources based on IPI responses to two simulated inquires its Web site.

Support for Worldwide business IBPC (International Business Promotion Center)

Osaka Network Center --promote trade, industry, and communication between Osaka and cities on the Asian continent and throughout the world.

--provide various types of support for your business, in collaboration with partners in the BPC and WTC network

OSAKA vs. weak performers

To check more detail: http://www.ibpcosaka.or.jp/index_e.html

Compare to the top agency. We also have weak one. Here we can see the lesson from GIPB for

Papua New Guinea:http://www.youtube.com/watch?v=CvMekCAR3K0

(not only for PNG, but also for other country like Indonesia)

Why should pay attention to foreign investment?

Most governments depend on investment promotion agencies, economic development boards, industrial development agencies and other investment promotion intermediaries(IPIs)

to compete globally for critical foreign investment and the development benefits it brings

What sets the world’s best investment facilitators apart from the rest

“More than 70% of investment promotion intermediaries missing out on the foreign investment by failing to provide investors with accurate and timely information”

(Quote: the global investment promotion benchmarking 2009 report)----GIPB

Reason: “investment facilitation” ---one of the simplest and most cost effective functionAlways neglected at many agencies.

14 common practices

A new survey identified 14 common practices of top-performing agencies in the benchmarking study.

Benefit: Weaker performers can inexpensively

implement many of these practices to win a larger share of the trillion-dollar market for foreign investment.

Top-performing vs. the rest

Differences: Foster a private sector-minded

culture Accumulate deep business

knowledge Implement internal systems

Ensure the agencies can provide foreign investors with necessary information to influence their investment decision.

14 practices

Foster a private sector-minded culture

1. private sector experience:(build a staff with public and private sector experience) Great challenge of public sector IPIs is to

understand private sector service standard

Public agencies : task-orientedTop IPIs: hire staff with private sector experience

(74%)Weak IPIs: only have half (30%)

Private experience Key hiring criteria

2. Salaries and bonuses(offer salaries and bonuses closer to private sector standards)

Based on the demand of private experience

Public IPIsPrivate sector firms

Talented staff

Salary compare: Top IPIs (83%) >= public sector level Weak IPIs(62%)=public sector level

3.Operational freedom(secure operational freedom and high-level reporting channels)

The most successful IPIs are given focused mandates and then allowed to pursue them through result-oriented strategies with minimal interference and the freedom to allocate resources accordingly.

Autonomy helps to preserve a private sector-

like clarity of mission and means.

4.Strategic focus on a few priority sectors(establish and concentrate efforts in a few priority sectors)

Top IPIs: One of the most widely shared characteristics is they have identified a few priority sectors on which to focus the bulk of their promotion and facilitation efforts.

It is essential in permitting the development of the deep knowledge required to understand and speak to the needs of specific investors.

5.a. networks of subnational agencies(coordinate facilitation with networks and partners subnationally and overseas)---(cont’d)

At least 76% of the top IPIs fit into one of three categories:

Subnational agency National agency with subnational

offices National agency in a country with

separate province-level agencies, including special economic zones.

5.b.networks of overseas office

81% top IPIs have own office near potential investors

Dedicated staff in their countries’ embassies.

Advantages:1.deeping IPI knowledge of targeted

markets.2.developing many more face-to-face

relationships.3.Allowing more frequent visits to

investors.4.Improving responsiveness to inquires.

6.Compentency in English and other foreign languages “maintain English-speaking staff in

sufficient numbers and with the full range of facilitation skills.”

7.Continuous staff development(continually train and develop staff, especially in soft skills)

The “right people” have to be developed!

(People with internal potential)I have “ soft

skills”

Training & developing

I’m the“right

people”

Accumulate deep business knowledge

8.research capacity(establish a minimum level of in-house research

capacity)

For each person employed: In top IPIs: have on average 1.05 computers

with high-speed internet access. In weak IPIs: have only 0.6 computers per

personConclusion: the weak IPIs staff members have limited

access to the primary tool for research.

9.Account managers(develop account managers into reservoirs of knowledge on particular sectors)

88% of top IPIs have inquiries handled by a single person throughout the entire life cycle of the inquiry.

Putting a single account manager’s advantages:

1.build familiarity with potential investors. 2.take advantage of and build on the knowledge

of the IPIs sectoral specialists. 3.establish relationships with investors. 4.smoothly advance investor interest.

10.Knowledge and relationship management system(ensure the accumulation of knowledge and its relevant) Five common tools used by top IPIs: (for

knowledge management)

1.investor information systems 2.regular staff meetings 3.database of available land 4.directories of business service

providers 5.customer relationship management

software

11.Making facilitation a priority(within the overall strategy) 70%of the IPIs did not respond in the time

requested to one or both of two investors’ inquiries.

When the investors knock your door! (there’s no potential sales)

If fails to provide the basic information

Damage the image and actual performance

Summarize the last three points- (cont’d)

12.being accessible “maintain the equipment and practices to be

easily reached and to quickly return calls and emails”

13.a web site work plan “demonstrate professionalism and dynamism

through the web site with frequent news updates on the content, style, timeframe”

14.respones guidelines “follow detailed guidelines on the content, style,

timeframe and quality assurance of inquiry repones

An integrated system for inquiry handling

Thanks for your attention!