Europe - PESTEL analysis

8/10/2019 Europe - PESTEL analysis

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PESTEL ANALYSIS ON EURO


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PreparedDr

. Syed

Ferh

Profes

PreparedAbdullah Atiq

Maruf Hassa

Rakib KhanArif Faisal

Rahimun Anik H

BBA 20, Se

INTERNATIONAL BUSINESS ENVIRONME

Institute of Business Administration

University of Dhaka


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2ND

SMALLEST CONTINENT

EUROPE


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3RD MOST POPULOUS CONTIN

EUROPE


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50 SOVEREIGN STATES

EUROPE


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DIVIDED IT INTO 4 SUB-REGIO

EUROPE


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BIRTHPLACE OF WESTERN CU

EUROPE


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MAJOR PLAYER IN THE GLOBASCENE SINCE THE RENAISSAN

EUROPE


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PESTEL

POLITICAL


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Political Factors Types of Government

Political Conflicts

European Alliances

Recent Events


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Types of Government

Parliamentary democracy

Parliamentary republic

republic

federation

Consitutional monarchy

republic and parliamentary democracy

Dictatorship


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Political Conflicts

Dissolution of Yugoslavia and Soviet Union

Crimean Crisis

Kosovo Unrest


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Dissolution of Yugoslavia


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Dissolution of Soviet Union

Stagnating Economy

Afghanistan Quagmire

Excessive Military Concern

Cherynobyl Disaster


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Crimean Crisis

Location of conflict- Crimean Peninsula

Conflict between Russia and Ukraine

Major population of Crimea are Russians, others are Ukrainia

Crimean Tatars.

Only 5 UN member states, including Russia, have recognized Cpart of Russia.


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Kosovo Conflict

Kosovo- partially recognized state

It is the disputed borderland between Serbia and Albania


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European Alliances


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European Alliances

Central European Free Trade Agreement

European Free Trade Association

Eurozone

European Union

EU Customs Union

Customs Union of Belarus, Kazakhstan, Russia

NATO


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Central European Free Trade Agreement (CEF

Trade agreement between non-EU countries in Southeast Eu

Current No. of Members: 7 (Albania, Bosnia and HerzegovinMacedonia, Kosovo, Moldova, Serbia and Montenegro.

Agreement Focus- Consolidating democracy and free-markeeconomics.


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European Free Trade Association(EFTA)

A free trader organization between four European countriesoperates in parallel with the EU.

EFTA members- Iceland, Liechtenstein, Norway, Switzerland

The association looks after the promotion of free trade and integration to the benefit of its four Members.


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Eurozone

Economic and monetary union

Eurozone members: 18

Common Currency- EURO


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European Union

28 member states

Common ground for laws andregulations.

Strong relationships within countries.


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Perception of Corruption

Denmark has a score of 90.

Greece has a score of 36.

The lower is the score, morecorrupt the nation is.


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Freedom of Press

Finland offers the most

freedom of press

Bulgaria is the least to offerfreedom of press


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Ease ofDoing

Business


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Recent Events

Islamic State Conflict

Britain, Belgium and Demark joining in attack with the US aIS forces in Iraq and Syria

Scotland independence

Believing Scotland and England are better off together

Unsure about the future after independence


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PESTEL

ECONOMIC


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GDP

GDP Growth Rate

GDP Per Capita

EURO Crisis

E-Economical Factors


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Central EuropeGDP, GDP per Capita, GDP growth rate

Switzerland has the highest GDP (PPP) standing at $371,200,00growth rate of 2% (2013 est.)

Contributing factors for Switzerlands high GDP- Watches, IndusAgriculture, Trade and Tourism.

Liechtenstein has the highest GDP per capital at $89,400.

Factors contributing for Liechtenstein- tax policy, free market ec


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Northern EuropeGDP, GDP per Capita, GDP growth rate

United Kingdom has the highest GDP of $2,387,000,000,000.

sector makes up for 73% of its GDP.

Norway has the highest GDP per capital of $55,400. The contrfactor is the countrys control power of the oil of North Sea.

Latvia has the highest GDP growth rate of 4%.

Contributing factors of the high GDP growth rate- geographicaallowing the transit services to be highly developed, ranks 21s

of Doing Business Index.


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Southern Europe

GDP, GDP per capita, growth rate Highest GDP- Spain- $1,389,000,000,000 Contributing factors for Spain- banking system, service sector

contribution, steady exports.

Highest GDP Growth Rate-Turkey - 3.8%

Contribution factor for Turkey- world's leading producer of ag

products; textiles; motor vehicles, ships and other transportatequipment; construction materials; consumer electronics andappliances.

Highest GDP Per Capita- Andorra- $37,200

Contributing factors- trade and tourism, tax policy.


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Eastern Europe

GDP, GDP per capita, GDP growth rate

Highest GDP- Russia- $2,553,000,000,000 Contributing Factors for Russia- Service and Industrial Sectors

and 36% contribution respectively)

Highest GDP Per Capita- Slovenia- $27,400

Contributing Factors for Slovenia- highly educated workforce,

developed infrastructure, and is situated at a major transport

Highest GDP Growth Rate- Moldova- 8.9%


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Western Europe

GDP, GDP per capita, GDP growth rate

Highest GDP- Germany- $3,227,000,000,000

Highest GDP per capita- Monaco- $85,500

Highest GDP Growth Rate- 0.9%

European Union


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European Union

Economic Freedom


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Economic Freedom Denmark ranks top

among the EU countriesin terms of Economicfreedom (EconomicFreedom Index, WSJ)

Economic freedom iscalculated keeping trade

policy and governmentintervention in mind.


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Income Equality

Denmark ranks top in terms

of income equality.

Portugal has the least incomeequality.


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Unemployment Rate

Eurozone- 12% (2014)

EU- 10.8% (2014) Bosnia and Herzegovina-

44.3% (2013)

Macedonia- 28.2%

(2014) Greece- 27.9% (2013)

Spain- 26.3% (2013)


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Euro Crisis

Started in Early 2009

Main issues shaping the crisis:

Weak actual and potential growth

Competitive weakness

Liquidation of banks and sovereigns

Large debt-to-GDP ratios

Considerable liability stocks (government, private, and nosector

Euro Crisis


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Euro Crisis


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PESTEL

SOCIAL

TOPICS COVERED


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TOPICS COVERED

Population Statistics

Ageing of European Population Religion in Europe

Ethnic Groups

Language in Europe

Education Healthcare

Human Development Index (HDI)

T t l P l ti (2014)


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Total Population (2014)

Population of Europe is 741.2 Million w

around 11% of the World Population

In terms of Population, Europe is Ranke

behind Asia and Africa

Source: World Population Prospects

T 10 M t P l t d C


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Top 10 Most Populated CounCountry Population European Ranking Wo

Russia 142,470,272 1

Turkey 81,619,392 2

Germany 80,996,685 3

France 66,259,012 4

United Kingdom 63,742,977 5

Italy 61,680,122 6

Spain 47,737,941 7Ukraine 44,291,413 8

Poland 38,346,279 9

Romania 21,729,871 10

Source: CIA World Factbook,

Pop lation in the E ropean U


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Population in the European U

Population of European Union is 511.4

which is 69% of the Total European Pop

Two most populated countries Russia a

Turkey are NOT part of the European U

Top 10 Most Densely Popula


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Top 10 Most Densely PopulaCountry Population Density (Per

Sq. km)

European Ranking Wo

Monaco 18,475 1

Malta 1,321 2

San Marino 531 3

Netherlands 406 4

Belgium 367 5

United Kingdom 262 6

Liechtenstein 230 7

Germany 226 8

Luxembourg 208 9

Italy 202 10

Source: United Nations Department of Econom

Top 10 Least Densely Popula


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Top 10 Least Densely PopulaCountry Population Density (Per

Sq. km)

European Ranking Wo

Iceland 3.15 51

Kazakhstan 6.31 50

Russia 8.42 49

Norway 15.6 48

Finland 18 47

Sweden 21.5 46

Estonia 30.2 45

Latvia 31 44

Lithuania 45 43

Montenegro 45 42

Source: United Nations Department of Econom

Population Density


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Population Density

Monaco is the most densely populated

sovereign nation in the world with 18,4

people living per square kilometer

Russia, the largest country in Europe in

of both area and population, is the 3rd ldensely populated country in Europe

Source: CIA World Factbook

Population Growth Rate (Top


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Population Growth Rate (TopCountry Population Growth Rate European Ranking Wo

Cyprus 1.48% 1

Ireland 1.20% 2

Norway 1.19% 3

Kazakhstan 1.17% 4

Luxembourg 1.12% 5

Turkey 1.12% 6

Azerbaijan 0.99% 7

Kosovo 0.93% 8

San Marino 0.87% 9

Liechtenstein 0.82% 10


Population Growth Rate (Bottom


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Population Growth Rate (Bottom

Country Population Growth Rate European Ranking Wo

Moldova -1.02% 51

Bulgaria -0.83% 50

Estonia -0.68% 49

Ukraine -0.64% 48

Latvia -0.62% 47

Montenegro -0.49% 46

Serbia -0.46% 45

Romania -0.29% 44

Lithuania -0.29% 43

Slovenia -0.23% 42


Population Growth Rate


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Population Growth Rate

Cyprus, the fastest growing country in E

is not even in the top 80 fastest growing

countries in the world

Interestingly, the bottom 10 countries a

ex-communist states

Projected Population (205


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Projected Population (205

Source: World Population Prospects

Continent Projected

Population (2050)

Percen

Global Po(20

Africa 2.4 billion 25

Asia 5.2 billion 55

Europe 709 million 7

Latin America &

Caribbean

782 million 8

North America 446 million 5

Ageing of the European Popul


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Ageing of the European Popul

European countries had Nine of the Top

highest median ages in national popula2005. Only Japan had an older populati

The U.S. Census Bureau estimates the

European Union will experience a 14%decrease in its workforce and a 7% decrits consumer populations by 2030.

Religious Belief in Europe


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Religious Belief in Europe

Believe in God- 51%

Believe there is some sort of spirit or lif

Force- 26%

Do not believe there is any sort of spirit

or Life Force- 20%

Declined to answer- 3%

Source: The Euro ba


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Islam in Europe


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Islam in Europe

The total number of Muslims in Europe

about 44 million (6%) excluding Turkey

The total number of Muslims in the Eur

Union in 2010 was about 19 million (3.8

Source

Ethnic Group in Europe


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Ethnic Group in Europe

1. Russians (ca. 95 million residing in Europe)

2. Germans (ca. 82 million)3. French (ca. 65 million)

4. Italians (5661 million)

5. British (55 million)

6. Spanish (4143 million)7. Ukrainians (3855 million)

8. Poles (ca. 38 million)

Languages of Europe


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Languages of Europe

German (90 Million)

Russian (82 Million to 95 Million)

French (80 Million)

English (67 Million) Italian (60 Million)

Literacy Rate


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Literacy Rate

Andorra, Finland, Liechtenstein, Luxem

and Norway have 100% Literacy Rate

43 Countries have 95% to 99.99% litera

Malta and Kosovo have literacy rates of

92.80% and 91.90% respectively


Healthcare (Top 10 Countri


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Healthcare (Top 10 CountriCountry European Ranking World R

France 1

Italy 2 2

San Marino 3 3

Andorra 4 4

Malta 5 5

Spain 6 7

Austria 7 9

Norway 8 1

Portugal 9 1

Monaco 10 1

Source: World H

Healthcare (Bottom 10 Count


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Healthcare (Bottom 10 Count

Source: World H

Country European Ranking World R

Russia 45 13

Georgia 44 1

Azerbaijan 43 10

FR Yugoslavia 42 10

Latvia 41 10

Armenia 40 10

Bulgaria 39 10

Moldova 38 10

Romania 37 9

Bosnia-Herzegovina 36 9

Healthcare


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Healthcare

Top 5 Best healthcare Countries in the w

(France, Italy, San Marino, Andorra, Main Europe

Former Communist States in East and C

Europe have the worst Healthcare syste

HDI by Country (Top 10)


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HDI by Country (Top 10)Country HDI European Ranking Wo

Norway 0.944 1Switzerland 0.917 2

Netherlands 0.915 3

Germany 0.911 4

Denmark 0.900 5

Ireland 0.899 6

Sweden 0.898 7

Iceland 0.895 8

United Kingdom 0.892 9

Liechtenstein 0.889 10

Source: Human Develop

HDI by Country (Bottom 1


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HDI by Country (Bottom 1Country HDI European Ranking Wo

Moldova 0.663 51Albania 0.716 50

Armenia 0.73 49

Bosnia and Herzegovina 0.731 48

Macedonia 0.732 47

Ukraine 0.734 46

Georgia 0.744 45

Serbia 0.769 44

Azerbaijan 0.747 43

Turkey 0.759 42

Source: Human Develop


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PESTEL

TECHNOLOGY

GLOBAL INNOVATION INDEX


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GLOBAL INNOVATION INDEX


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10 out of topcountries areEurope

Top 5 are Eur

countries

INTERNET


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Internet penetration 68.6%Accounts for 20% of the worlds internet users

INTERNET


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10 countries with most internet users

INTERNET


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Iceland 96.50

Norway 96.15

Denmark 96.08

Netherlands 96.08Luxembourg 95.05

6 countries with most internet penetration

INTERNET


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Internet penetration those in the middle

Poland

Bosnia and Herzegovina

Lithuania

SloveniaHungary

Spain

INTERNET


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6 countries with least internet penetration

Ukraine 3

Malta 4

Armenia 4

Moldova 4

Turkey 4Serbia 4

INTERNET SPEED


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INTERNET SPEED


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7 of the top 10 countries are from Europe

SMARTPHONE USAGE


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Gl

Norway

Sweden

United Kingdom

Denmark

Ireland

HI-TECH EXPORTS


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Germany $183,3

France $108,3

United Kingdom $67,78

Netherlands $63,9

Switzerland $50,

RESEARCHERS IN R&D


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FinlandIceland

Denmark

Luxembourg

NorwaySweden

* Per m

R&D EXPENDITURE


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Finland 3

Sweden 3

Denmark 2

Germany 2

Austria 2Iceland 2

*

PATENTS


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Germany

Russian Federation

United Kingdom

France

ItalyUkraine

* Patent a

BIGGEST INDUSTRIES


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Automobile industryAerospace

Defense

Chemicals

BiotechnologyFood

AUTOMOBILE INDUSTRY


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Total motor vehicles (world) 84.1m unit

Total motor vehicles (EU27) 16.2m unit

19%of world production

718.7

TRENDS


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AdvertisingMobile Purchase

Faster communicat

----------------------------------------------------------------------------------------------------

Cloud Get everything, eve----------------------------------------------------------------------------------------------------

Green Technology


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PESTEL

ENVIRONMENT

T O P I C S


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Some figures to get you started

Consumer mentality and behaviorTemperature analysis

Snowfall levels

Carbon Dioxide (CO2) emission

General effects and impacts on business

ENVIRONMENT

Are They Aware?


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- JanezPoto

It is good to see such solid and widespread

for the protection of the environment, even itimes. People are particularly concerned ab

and water pollution, chemicals and waste, a

feel that more must be done by everyone tothe environment.

European Commissioner fENVIRONMENT

Environmental Protection and Economic S


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74 %

80 %

75 %

77 %

people think protection of the environment can b

growth

consider that the economy influences their qualit

think the state of the environment has a similar im

of EU citizens believe that environmental problem

effect on their daily lives

ENVIRONMENT Source: Euroba

A couple more figures


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59 %

59 %

people believe that social and environmental factors should be as

as economic criteria in measuring progress in their coun

people think that the pu

their country should favofriendly considerations o

In relation to the spending and investmentof public authorities


Consumer Mentality


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75

93 %

ready to buy environmentally-friendly products,even if it means paying a little more

think that big polluters should make good the environm

they cause. Introducing heavier fines for offenders was d

most effective way of tackling environmental problems


Consumer Behavior


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85 %of Europeans believe they have a role to play inprotecting the environment

And people do so by the following 3 activities


separation of waste for recycling

cutting down energy consumption

cutting down water consumption

72 %

52 %

37 %

What About Businesses?


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77 %feel that big companies and industry are not doing enou

say they are ready to buy environmentally-friendly produ

even if it means paying a little more

75 %ENVIRONMENT Source: Euroba

Temperature


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City Average daytime temperature roun

the year (degrees C)

Stockholm 10.0

Minsk 10.6

London 14.8

Budapest 15.0

Paris 15.5

Bucharest 16.5

Barcelona 20.0

Rome 20.4

Lisbon 21.5

Athens 22.3

Valencia 22.3

Malta 23.2ENVIRONMENT


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Snowfall


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7 & 11 %decrease in snow cover extent in March and April respective

4 decades in northern hemisphere.

In winter and autumn no significant changes have occurred.

Model simulations project widespread reductions in the ext

of snow cover in Europe over the 21st century. However, the

uncertainties in the projections.

ENVIRONMENT Source: Europpean

7 %decrease in snow mass in northern hemisphere in March

From 1982 to 2009

In winter and autumn no significant changes have occurred.

Carbon Dioxide Emission


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ENVIRONMENT

Alternative Renewable Energy


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ENVIRONMENT

General Effects


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AGRICULTURE

HUMAN HEALTH

BIODIVERSITY

EFFECT ON SEA

ADJACENT COUNTRIES

changes in temperature, rainfall etc will pose a risk

increase in temperature, natural disasters (tornadoe

rise may lead to more water-borne diseases and ca

impacts from natural disasters may produce greater

water supply and food security

natural disasters and tornadoes may cause damage

infrastructure

ENVIRONMENT

Incidents


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2003

2007

2010

2011

EUROPE

GREECE

RUSSIA

FRANCE

hottest summer in at least 500 years

hottest summer since 1891

hottest summer since 1500

(Russian heat wave)

hottest and driest spring since 1880

70,000 de

wildfires

55,000 death

Grain harvest

Ban on whea

1% GDP lost

Grain harv

ENVIRONMENT

Impacts on Business


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RISKS TO CORE BUSINESS FUNCTIONS

Damage to physical structures and assets e.g. production facilities Increased costs of operations

RISKS TO THE VALUE CHAIN Availability of production units

Changing consumer demands

Availability and quality of natural resources water, utilities, logistics RISKS TO LOCAL COMMUNITIES

Affects the livelihood of local communities

Directly impacts corporate community investment programs

ENVIRONMENT

Businesses Likely to be Affected


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BUSINESSES DEPENDENT ON WEATHER SENSITIVE RESOURCES

agriculture, forestry, fishing, aquaculture and tourism. BUSINESSES WITH EXTENDED SUPPLY CHAINS

businesses that rely heavily on logistics and supply network

GLOBAL BUSINESSES

global supply chains are easily disrupted by problems in any

link in the chain. MSMEs

the impact of natural disasters can put these enterprises oubusiness

ENVIRONMENT


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PESTEL

LEGAL

EMPLOYMENT LAW


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EU Labor Law covers 2 main areas:Working conditions - working hours, part-time &

term work, posting of workers,

Informing & consulting workers about collectivredundancies, transfers of companies, etc.

EMPLOYMENT LAW


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The EUs Working Time Directive (2003/88/EC) requires EUto guarantee the following rights for all workers:

a limit to weekly working hours, which must not exceed on average, including any overtime

a minimum daily rest period of 11 consecutive hours in ev

a rest break during working hours if the worker is on dut

longer than 6 hours

Working Time


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TAXATION IN EUROPE


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EU remains a high tax area

The tax-to-GDP ratio exceeded pre crisis levels in 2012 and icontinue growing in 2013

Wide disparities in tax levels across Member States

Efficient tax system

DISPARITY IN TAX LEVELS IN MEMBER CO


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TAX REVENUES ARE RISING


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CORPORATE TAX


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PERSONAL INCOME TAX RATES


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VAT STANDARD RATES ARE RISIN


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ENVIRONMENTAL TAX


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SUMMARY ON TAXATION


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INTERNATIONAL TRADE


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EU trade policy is working to: Create a global system for fair and open trade

Open up markets with key partner countries

Make sure others play by the rules

Ensure trade is a force for sustainable development

TRADE BARRIERSExports

B gl d h


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Bangladesh

Registration, Documentation, Customs Procedures

Canada

Tariff Levels

Tariff Quotas

Quantitative Restrictions and Related Measures

Competition Issues

Government Procurement

Sanitary and Phytosanitary measures

Foreign Direct Investment Limitations

Legislation on Appellations of Origin and Geographic Indications

Enforcement problems on IPR

TRADE BARRIERS


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Imports

Tariffs Duties & taxes on imports of products into specific cou

Procedures and Formalities Procedures & documents required for customs clearan

partner country

JUSTICE, FREEDOM AND SECURIT


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Judicial cooperation in civil matters

Judicial cooperation in criminal matters Police and customs cooperation

Fight against terrorism

Fight against organised crime

Combating drugs

Europe - PESTEL analysis

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