Report - 2002 Edition Theme: Entrepreneurship and...

Report - 2002 Edition

� Theme: Entrepreneurship and Sustainable Development in an Enlarged Europe

Congress and Networking

Knowledge partners

Public affairs

Consulting

www.ebsummit.org

Report - 2002 edition

� Theme: Entrepreneurship and Sustainable Development in an Enlarged Europe

Congress and Networking

- 2 - European Business Summit Report - 2002 Edition

TABLE OF CONTENTS

FOREWORD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

WORDS OF THANKS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

HOSTS AND PARTNERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

SUPPORTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

CONGRESS PROGRAMME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Interactive Panel Sessions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Economic Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Social Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Environmental Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

R & D Session . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Candidate Country Presentations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Bulgaria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Czech Republic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Estonia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

Hungary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

Latvia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

Lithuania . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

Malta . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Poland . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

Romania . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

Slovak Republic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Slovenia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

Turkey . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

Plenary Sessions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

NETWORKING VILLAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

SATELLITE ACTIVITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

PRESS CLIPPINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

FACTS AND FIGURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

- 3 -European Business Summit Report - 2002 Edition

FOREWORD

Dear Sir,Dear Madam,

It was a pleasure to see again so many participants at the second EuropeanBusiness Summit on 6-7 June 2002. The presence of about 2,000 European-minded people underlined the need to bring together business leaders, policymakers and civil society for a dialogue on the main themes for Europe.

This year’s theme of “Entrepreneurship and sustainable development in an enlarged Europe” encouraged both the speakers and participants to a reflection on a sustainable future for a Europe with more than 25 members. The discussionsshowed that business has a key role to play in a sustainable society and thateconomic growth and environmental and social improvements are mutuallydependent.

Further enlargement of the European Union is coming closer every day. The manyrepresentatives of candidate countries at the European Business Summit andEuropean Commissioner for Enlargement, Günter Verheugen made it absolutelyclear that accession can and should not be delayed for those countries that areready to join.

This Report offers you an overview of all the interactive discussions and countrypresentations held at the European Business Summit. It will help to refreshpaticipants’ memory and to allow those that were unable to attend to discover therichness of the debates.

We hope that the Report will convince you of the importance and the many added-values of attending the European Business Summit. We are looking forwardto welcoming you at the next Summit in March 2004.

Best regards,

Luc Vansteenkiste Georges JacobsPresident VBO-FEB President UNICE


WORDS OF THANKS

I would like to take this opportunity to say a word of thanks to all those people and organisations that contributed to the success of the second European Business Summit.

I would like to thank the European Commission, and in particular DG Enterpriseand DG Enlargement, for their very active support and co-operation. The presenceof so many Commissioners in the panels and of so many officials on site allowed us to meet our goal of creating a dialogue between European policy makers andthe business world.

A discussion on enlargement without hearing the candidate countries would not have been a real discussion. I would like to thank the many political, business andother representatives from the candidate countries. Their presence allowed us todraw a real picture of the enlarged Europe.

Thanks also to those NGO’s and other representatives of civil society, who were sobrave to accept our invitation to participate in the debates. The European BusinessSummit does not want to be the “sole” voice of big business; it wants to promotedialogue between all those parties interested in Europe. NGO’s and civil societyrepresent an important voice. I hope the next European Business Summit will allowthis dialogue to continue and that many more representatives of civil society will bepresent.

Needless to say that I am particularly grateful to the main sponsors and partners,who made it financially possible to organise this major event. Thanks also to themedia partners, supporters and all UNICE member federations for helping inpromoting the event around Europe and beyond.

Finally, I would like to thank the many men and women, who worked behind thescenes and who made it possible to realise this ambitious project. A sincere word of thanks as well for the Federation of Enterprises in Belgium. Without its support,the European Business Summit would never have been possible.

I am looking forward to a renewed collaboration at the next European BusinessSummit in March 2004.

Best regards,

Didier MalherbeFounder & Managing DirectorEuropean Business Summit


HOSTS AND PARTNERSHosts

with the support of

and with the high patronage of H.M. King Albert II

Main sponsors

Partners

Media partners

www.feb.be www.unice.be

The European Commission

The Brussels-CapitalRegion

The Belgian Government

The City of Brussels

Official carrier


SUPPORTERS

Peter MitterbauerVÖI

Luc VansteenkisteVBO-FEB

Bojidar DanevBIA

Michael ZivanarisOEB

Stanislav KázeckySPCR

Johan SchrøderDI

Niels FogDA

Matti HonkalaPT

Jyrki JuuselaTT

Ernest Antoine SeillièreMEDEF

Dieter HundtBDA

Michael RogowskiBDI

Ulysses KyriakopoulosFGI

János BerényiCEHIC

Finnur GeirssonSA

Vilmundur JósefssonFII

William BurgessIBEC

Emma MarcegagliaCONFINDUSTRIA

Charles KrombachFEDIL

Joseph Zammit TabonaMFOI

Jens Ulltveit-MoeNHO

Henryka BochniarzPKPP

Rui Nogueira SimõesCIP

Jorge Rocha de MatosAIP

Franco CapicchioniANIS

Michal L’achAZZZ SR

José María Cuevas-Salvador

CEOE

Sören GyllSCE

Fritz BlaserUPS

Andres F. LeuenbergerEconomieSuisse

Jacques H. SchravenVNO-NCW

Refik BaydurTISK

Tuncay ÖzilhanTÜSIAD

Iain VallanceCBI

AECA, American European CommunityAssociation

Belgium-Japan Association & Chamber ofCommerce asbl, a non-profit organisationthat promotes business and culturalrelations between Belgium, Europe andJapan, www.bja.be

BEPOLUX, Belgian-Luxembourg-PolishChamber of Commerce, promotes foreigntrade and exports to Poland

BIAC, Brussels International AirportCompany, www.brusselsairport.be

British Chamber of Commerce in Belgium,the driving force for the promotion of its300 members’ interests in Belgium,www.britcham.be

Canada Europe Round Table for Business(CERT), a forum for dialogue among senior business leaders, Canadian and European,and among business leaders andgovernments, www.canada-europe.org

Cordis, Community Research andDevelopment Information Service,www.cordis.lu

CSR Europe, the Business Network forCorporate Social Responsibility,www.csreurope.org

EastWest Institute, since 1981, the largestindependent transatlantic network workingfor European integration and stability,www.iews.org

EU Committee of the American Chamber ofCommerce in Belgium, represents Americanbusiness interests towards the institutionsof the European Union,www.eucommittee.be

EUROCHAMBRES, the network of EuropeanChambers of Commerce and Industry,www.eurochambres.be

European-American Industrial Council(EAIC), CEOs of the European operations ofmajor American companies broughttogether by a shared concern to improvethe competitiveness of Europe,www.eaic.org

European Movement, association for theestablishment of a unified, federal Europe,www.europeanmovement.org

European Round Table of Industrialists(ERT), a forum of 47 European industrialleaders aimed at promoting thecompetitiveness and growth of Europe’seconomy, www.ert.be

European Services Forum (ESF), theorganisation representing the interests ofthe European service industries in thecontext of WTO Services negociations(GATS), www.esf.be

Eurowards, European Trophy forEntrepreneurship, Award for YoungEuropean Entrepreneur,www.eurowards.com

Finmeccanica, Italy’s largest industrialgroup, active in the aerospace, defence,energy, transportation and IT sectors,www.finmeccanica.it

GrowthPlus, Europe’s Top 500 Job CreatingEntrepreneurs, www.growthplus.org

International Chamber of Commerce (ICC),the world business organisation,www.iccwbo.org

Medea, European Institute for Research onMediterranean and Euro-Arab Cooperation,www.medea.be

MedeaTrade, Mediterranean and Euro-ArabTrade, www.medeatrade.com

Union of European Federalists, for aEuropean Federal Constitution,www.euraction.org

Vlerick Leuven Gent Management School,your reference for doing business theEuropean way, www.vlerick.com

Yes for Europe, Young Entrepreneurs forEurope, www.yes.be

Young European Federalists (JEF), politicalmovement working for an all-Europeanfederation, www.jef-europe.org

Young Presidents Organisation (YPO), international organisation promotingbetter leaders through education and ideaexchange, www.ypo.org

The UNICE Councilof Presidents


CONGRESS PROGRAMME

In two plenary sessions and 12 interactive panel discussions, over 120 speakers discussed the theme of “Entrepreneurship and sustainable development in an enlarged Europe”.

The panel discussions were grouped under three main headings– economic, social and environmental performance – to reflectthe entrepreneurial aspects of sustainable development.Enlargement was the horizontal theme of all the sessions.

To underline the importance of the upcoming EU enlargement,all candidate countries were invited to present their economicand business climate during a one-hour country presentation.Twelve candidate countries accepted the invitation and werepresent with a high-level political and business delegation.

Several sessions were concurrent. The following summaries will therefore help to discover the content of the discussions ofall the sessions.

The European Business Summit would like to thank itsKnowledge Partners McKinsey & Company and WeberShandwickfor their help in summarising the interactive panel discussionsand the plenary sessions.

Interactive Panel Sessions Economic Performance

Social Performance

Environmental Performance

R & D Session

Candidate country Presentations

Plenary Sessions


CONGRESS PROGRAMME

� EU financial markets in a wider Europe

Speakers Lutgart Van den Berghe, Member of the Supervisory Board of ING Group (Moderator)Olivier Lefebvre, Executive Vice-President of EuronextTonio Depasquale, Chief Officer Credit Management and Retail Business at the Bank of Valletta Chris Lebeer, Chief Executive Officer of BanksysAlfred Steinherr, Chief Economist at the European Investment Bank

Summary of the discussionThis discussion focused on the prospect of an integrated EU financial market and the way in which candidate countriescould participate in it.

Prof Lutgart Van den Berghe started the discussion by pointing out that the role of financial intermediaries vs. financialmarkets, the role of the stock exchange and the ownership concentration varied substantially between geographicalareas. Thus, the average EU market capitalization as a percentage of Gross Domestic Product was more than four timeshigher than that of the Central and Eastern European candidate countries in 2000, Van den Berghe said. In terms ofownership concentration, the UK and the US have a much lower concentration than other EU or candidate countries.Finally, it is important to understand the differences in corporate governance and ownership structures across countries,and to analyse the development of capital markets, she said.

Olivier Lefebvre pointed out that capital market integration is needed since equity market clients have moved fromtraditional country investments to sector investments. However, at the moment cross-border transactions within Europeare still too expensive. At the same time, investors want to tap larger markets, but they do not want to be cut from thelocal information base. Therefore, Euronext wants to leave liquidity where it is and expand through mergers &acquisitions and partnerships, thus building the infrastructure to facilitate cross-border trade. In this way, Euronextcurrently works in equity markets under four different jurisdictions. Integrating Eastern Europe into this picture is moredifficult, since the critical mass there is still relatively limited, Lefebvre said. Necessary conditions for them to integrate arean established legal system, sufficient IT tools and functioning clearing and settlement systems.

Tonio Depasquale presented the example of Malta, which is an open economy with strong trade links with the EU. The main pillars of the Maltese financial services infrastructure are the Central Bank of Malta, the Malta Financial ServicesCentre and the Malta Stock Exchange. The Central Bank’s primary role is that of monetary policy, maintaining financialstability and managing the exchange rate system. The Malta Financial Services Centre is the unified regulator for banking,financial institutions, investment funds and insurance companies. The Stock Exchange has strongly increased its role inthe raising of capital over the last decade. Finally, Malta is in an advanced stage to satisfy the Maastricht criteria, makingit even more attractive for foreign companies and investors, Depasquale said.

Interactive Panel Sessions - 1Economic Performance

Chris Lebeer,Olivier Lefebvre,Tonio Depasquale,Alfred Steinherr,Lutgart Van den Berghe.


CONGRESS PROGRAMMEChris Lebeer illustrated the consolidation trend in Euroland with electronic payments. In order to efficiently operate apayment system, full alignment has to be achieved between each element of the value chain: cards, access devices,networks, and central hosting systems. Furthermore, in order to profit from economies of scale, a single architecturalconcept has to be designed, he said. Currently, competition in the payment business is increasing, driven by consolidationof the banking industry, merchants with significant cross-border payment needs and changing customer loyalty. Yet, morecompeting alternatives are needed while standardising the underlying architecture. It should be noted that the cost-efficiency of payment systems is highly non-linear. One strategy to become efficient is mass customization, as has beendone in the telecommunication industry. New standards such as the EMV (Europay, MasterCard and Visa)-standard maybe the way forward. But in the end, consolidation will probably be selective rather than European-wide, focusing onstakeholders sharing the same security and performance requirements, Lebeer said.

Alfred Steinherr pointed out that of the foreign investment into Central and East European countries, 90 percent camefrom private companies. The other 10 percent came from institutions such as the EIB, the largest provider of money tothe region. The question for the EIB was whether to focus on developing the banking system or the financial market.Since the former is easier to develop and needed anyway, priority was given to the banking system, Steinherr said.Hungary provided a good example, he noted. Foreign banks were allowed to take over Hungarian ones and this led toquick results. If one wanted to create an efficient financial market, there were five conditions to be met: institutionalinvestors for monitoring, sufficient size, trading platforms, clearing and settlement systems and market integrity. Fulfillingall five condtions is very difficult. The way out for Central and Eastern Europe may be to hook up to European financialmarkets while keeping services at the local level, Steinherr said.

� E-business and e-government in the new Europe

Speakers Erkki Liikanen, European Commissioner for Enterprise and Information SocietyJan Muehlfeit, Regional Director of Microsoft EMEAMichael Treschow, Chairman of the Board of Directors of Ericsson (Moderator)Nikolay Vassilev, Deputy Prime Minister of Bulgaria

Summary of the discussionThe discussion on e-business and e-government was a free-flowing exchange of ideas. The central theme was the multi-faceted benefits of the technological revolution, and the need to channel this energy by a working public-private partnership.Sponsoring research and development, and the dissemination and cross-fertilisation of new ideas should be the basis throughwhich governments and the ICT sector, together, can foster growth and innovation. All participants agreed that e-business isstill in its starting blocks. One should therefore avoid an overregulation of a technology that is not yet mature. Governmentsshould give markets time to develop themselves before they start interfering in them. The e-Europe 2005 Action Plan pointsEurope in the right direction, the participants agreed.

European Commissioner Erkki Liikanen pointed out that a comparison between the US and the EU showed that, in order forthe EU to catch up with productivity growth, investments are needed in both research and ICT. The e-Europe 2005programme does so by taking those policy decisions that really make a difference. The programme focuses on three areas: e-government, e-learning and e-health, which together make up more than half of each government’s budget. E-governmentis much more than putting governments on-line. Liikanen said. It should in particular lead to a reforming of the back offices.E-learning focuses on life-long learning, while e-health wants to liberate medical personnel from non-medical activities andthus boost productivity and limit the sharply rising cost. Finally, on the supply side, there should be competition from differenttechnologies to offer broadband access, with the EU should be assuring a level playing field, the Commissioner said.

Jan Muehlfeit linked the Internet revolution and e-Europe in a technological context. While the penetration of theautomobile or the telephone took 40-50 years to reach a fifth of Europe’s population, the PCs, the Internet and the cell phonedid it in less than 20 years. To maintain this momentum, the technological industry should continue to invest in infrastructure,because high-speed connections are essential for the growth of e-government and e-business. In addition, unbundling thelocal loop and guaranteeing access to the last mile are critical. Muehlfeit stressed that e-government should also assist theprocess of digital inclusion, reaching out to the unemployed, disabled and elderly. Examples of initiatives in government-to-public in the UK, government-to-business in Spain and government-to-government in Croatia showed that access andefficiency can be improved, but only if the set-up processes are transparent and if they adhere to neutral procurement rules.


CONGRESS PROGRAMME

Michael Treschow began with some R&D examples of his own experience at Ericsson. He noted that the mobile phoneunit would soon be a centerpiece for moving pictures or a sensor for a plethora of applications. The new generation ofdevices will move away from a mere SMS-chatboard – today SMS still accounts for 15 to 20 percent of mobile operators’revenue – to more sophisticated applications as the bandwidth and the transmission speed increase. The economic effectsof these changes have been studied in detail, but few are looking at other effects, such as environmental ones, Treschowsaid. New applications will, for instance, minimize the unnecessary small car travels within the city.

Nikolay Vassilev moved to the topic of the future member states. Eastern Europe had missed a part of the industrialrevolution, but now had a chance to catch up on the electronic side. “The Eastern part of the continent is neither lesstalented in technical skills nor less hungry for technological development,” Vassilev said. All participants agreed on theexisting intellectual assets in Central and Eastern Europe, but they believed that politics was too involved, while regulatorswere not independent enough. Eastern Europe no longer needs hardware transfers (as technology is omnipresent), butgood marketing and business skills, the panel agreed. Too much political involvement is not helping here. However,twinning programmes are designed to do both: transferring skills and subtracting politics out of these processes.

� Strategic alliances and competition

Speakers Mario Monti, European Commissioner for Competition Jean Lemierre, President of the European Bank for Reconstruction and DevelopmentDominic Casserley, Director, McKinsey & Company LondonBojidar Danev, Chairman and Executive President of the Bulgarian Industrial AssociationPierre Jean Everaert, Chairman of the Board of Directors of Interbrew (Moderator)

Summary of the discussionStrong competition authorities and strategic alliances together guarantee the correct functioning of the markets, increaseproductivity, and serve customers. This discussion addressed key strategic and organisational considerations in theenlarged Europe involved in the creation and management of inter-firm strategic alliances and competition.

European Commissioner Mario Monti highlighted that the prospect of enlargement had already triggered majorstructural changes in many candidate countries. There is now increased legal certainty, while a modern administration isin place in many of them. Issues still exist, however, regarding competitive regulations. Although anti-trust regulationshave been applied and an independent agency exists in most countries, the regulation of state aid still is problematic,especially regarding the restructuring of the steel industry and the issue of tax competition, Monti said. As regardsstrategic alliances and mergers, the candidate countries are already cooperating with the EU in several specific cases, e.g. in the case of the merger between Südzucker and St Louis, he noted.

Jean Lemierre described the essential role of the EBRD – “the single largest investor in the region” – in the developmentof the candidate countries’ economy. This institution establishes a bridge between the private and public world, andbetween a centralized and a market economy. In this sense, the EBRD’s objective is not to compete with the privatesector but rather to complement it, by assuming its share of the initial risks of the funded ventures, Lemierre said. TheEBRD also plays a role in creating the right conditions for competition in the candidate countries’ markets. For instance,the EBRD serves competitors, favouring none above the others. In many instances, it also takes part in the policy dialoguewith the authorities, he said.

Dominic Casserley expressed the view that strategic alliances – both alliances and M&A – are crucial to competesuccessfully in a globalising economy. This is even more relevant for Eastern European countries with the liberalisation offormerly public monopolies, the change of ownership from public to more demanding private investors, the need of a

Michael Treschow, Erkki Liikanen, Jan Muehlfeit,

Nikolay Vassilev.


CONGRESS PROGRAMMEmassive upgrade of the infrastructure, and the introduction of global brands. Over time, however, different types ofstrategic transactions are likely to be used. As privatisation opportunities disappear, competition will increase and the skillgaps between candidate countries and current member states will also disappear. Lastly, Casserley outlined that the skill-set that companies will need in order to succeed in strategic transactions, and the framework that regulators will need todevelop, will become increasingly important and complex.

Bojidar Danev discussed the status of strategic alliances in Bulgaria. Although the legal framework is in place, severalaspects inherent in the country – its distance to key European markets, for instance – still hamper the full development of strategic alliances. Nevertheless, Bulgaria has known several recent success stories that should encourage candidates. The country also presents significant opportunities such as in the electricity sector, Danev said. He further outlined the key factors that are beneficial for strategic alliances in Bulgaria: the presence of highly skilled manpower, of adequateinfrastructure, and access to markets, as well as a favourable business climate with low taxes, an efficient administrationand a functioning legal system.

Pierre Jean Everaert argued that strategic alliances can be a valid alternative to mergers and acquisitions. He gave twoexamples. The “European Retail Alliance” formed in the ‘90s between Casino, Ahold and Argyll is a good example thatsuch an alliance can lead to significant value creation for all partners, even if the ultimate objective of the alliance(merging) is not reached, and without infringing on competition law, he said. Such value creation was also demonstratedwith Philips, Sony and Matsuhita, whose alliance resulted into the revolutionary launch of the CD, CD-ROM and DVD,even though the alliance was ultimately dismantled. Four factors can push a company to enter into an alliance: theprohibitive cost of “doing it alone”, the opportunity to benefit from a groundbreaking innovation, the fact that somemarkets would not understand the company’s absence, and territorial advantages linked to a brand, Everaert said.

� The enlarged single market in a globalised economy

Speakers Michel Tilmant, Vice-Chairman of the Executive Board of ING GroupDaniel Janssen, Chairman of the Board of Solvay (Moderator)Petras Austrevicius, Chief Negotiator for LithuaniaPascal Lamy, European Commissioner for TradeMartti Ahtisaari, Chairman of the EastWest Institute and former President of Finland

Summary of the discussionThis discussion focused on both the enlargement of the European market and the changing context, notably the aspectof globalisation. In doing so, the discussion moved from the specific to the general.

Michel Tilmant started the discussion by pointing to the important role that financial institutions such as ING played indeveloping the capital markets in Central and Eastern Europe. A strong financial sector is needed for sustainable growth,including up-to-date regulations, good supervision and accounting standards and a strengthening of domestic capitalformation. Financial institutions played a valuable role in bringing both expertise (in asset management, insurance andbanking) and capital to these countries.

Daniel Janssen presented a different case example, namely the Solvay case in Bulgaria. In 1996, Solvay had the chanceto buy the biggest single soda ash production unit in the world, Sodi Devnya in Bulgaria. At the time, Bulgaria wasbankrupt and had again a communist government. Nevertheless, Solvay decided to move forward with the EBRD and a

Pierre Jean Everaert,Mario Monti, Jean Lemierre, Dominic Casserley, Bojidar Danev.


CONGRESS PROGRAMMETurkish group as minority partners. They indeed purchased the plant, modernised it, and turned it into a profitable plant,which is currently exporting 90% of its production around the world.

Lithuania’s Petras Austrevicius moved towards a more macro-economic perspective. He pointed at Lithuania’s solidmonetary policy resulting in a low inflation rate, exchange rate stability and a high degree of predictability, which hasbeen one of the cornerstones of its economic success. On top of that, lower production costs make it an attractiveinvestment country, especially when after EU enlargement the removal of customs procedures will make trade eveneasier. Finally, he noted that after enlargement the EU’s border with Russia would expand two times, which meant thatthe Baltic experience of beneficiary cooperation also with non-EU neighbors could be an important asset.

European Commissioner Pascal Lamy addressed the question of how enlargement would affect the trade aspects of theEU. He started by pointing out that the average trade-weighted custom tariffs in the candidate countries were still abouttwice as high as those in the EU, meaning that the candidate countries would have to lower their level of protection.Secondly, global trade and economic integration would facilitate the integration of the candidate countries into the EU,since the Doha agenda based on increased trade openings and the strengthening of competition rules is in line with theEuropean social model. Finally, enlargement would enhance Europe’s weight in the multilateral trade system, since the EUwould speak with one voice as of the first day of enlargement (no derogations, no transition periods). This one voicerepresenting 25-28 countries would obviously weigh heavier than that of the current EU-15, Lamy said.

Martti Ahtisaari took an even more global perspective. He started from the observation that the global economy isbecoming a force that has an ever-stronger impact on international politics. At the same time, just advancing tradeliberalisation is not enough: we need to develop global institutions and international justice as well, he said. The EUexperience in this process of globalisation is a paradox: while the EU is one of the most influential actors, it does notexercise a visible influence on the process of globalisation. Improved coordination of the EU policies in crisis management,development cooperation and trade relations is needed in order to increase the EU’s impact in the global arena. The importance of the EU’s experience is broader than for Europe alone: many of the principles that the Union is basedon are principles we would also like the globalised world to respect. Finally, better coordination with the EU’s partners isneeded. Since the global economy and international relations are often not a zero-sum game, it is important that the EUsupports Russia in becoming a member of the WTO and that it avoids a trade war with the US, Ahtisaari said.

During the Q&A session, the speakers touched upon the role the EU could play in addressing the increased insecurityafter 11 September. Ahtisaari argued that the biggest EU influence could come from influencing the world as a globaleconomic power, since it would not become a military power. In order to do so, it is imperative that the EU maintains itscompetitiveness, also after enlargement. Lamy pointed out that the increased security checks had led to obstacles totrade and to increased costs. The question is how high a cost we are prepared to pay for that, he said. In the longerterm, the imbalances in the world to which the insecurity is linked should be addressed by further trade openings underthe WTO rules, he added.

Daniel Janssen, Michel Tilmant,

Petras Austrevicius, Martti Ahtisaari,

Pascal Lamy.


CONGRESS PROGRAMME

� Consumer confidence and safe food products

Speakers: David Byrne, European Commissioner fot Health and Consumer Protection Antony Burgmans, Chairman of Unilever (Moderator)Dimitris Daskalopoulous, Chief Executive Officer and Vice-Chairman of Delta HoldingRoland Vaxelaire, Permanent Delegate of the Carrefour Group to the EU Jim Murray, Director of the EU Consumers’ Organisation BEUC

Summary of the discussionEuropean Commissioner David Byrne underlined the huge challenge that constitutes the forthcoming enlargement of theEU. The Commission planned to publish a series of reports setting out its collective view on the state of readiness of each ofthe Candidate Countries for accession in 2004. The European Council would make the final decision in December 2002. Thechallenge is to bring standards in the Candidate Countries up to current EU standards – and not to tolerate any weakeningof food safety levels within the enlarged internal market, Byrne said. Candidate countries must be involved in the currentdebates on food safety in order to ensure harmonised food quality all over the enlarged Europe, he added.The Commissioner also presented the work of the Commission in the area of food safety for the last two years, while awhole range of new Commission proposals concerning the whole spectrum of food-related issues – including food hygiene,feedingstuffs, food supplements and GM foods were currently in the legislative process. The Commissioner identified three areas of key concern for food safety in the context of enlargement: 1. A major shift in the geographical borders of the EU with the need for a revised network of Border Inspection Posts toguard against potential threats from imports; 2. TSEs (including BSE) and the need for Candidate Countries to enforce the same rules of public health as those currently inforce in the EU;3.The upgrading of agri-food establishments in the Candidate Countries to the required EU standards: transitional periodshave been allowed in this matter, although only regarding specified structural deficiencies, but not regarding matters ofhygiene and control.

Antony Burgmans believed that in order to avoid the occurrence of any future food scares, there was a need to distinguishbetween scares which are due to criminal acts (such as tampering with animal feed), and scares which occur from a lack ofknowledge or understanding (for example, failure of hygiene), as well as those which are due to “unforeseen”developments - such as emerging animal diseases - and for which there are no immediate or simple solutions. For the first type of scares, effective inspectorates and enforcement authorities at Member State level are of paramountimportance. In addition, Governments must take strong and swift action to prosecute criminal acts to ensure that publicconfidence in the system is not undermined, Burgmans said. In situations where a lack of knowledge could result in a scare,access to sound independent scientific advice as well as adequate training for those working in agriculture or the foodsupply chain needed to be made available. Finally, it is essential to have good veterinary and public health monitoringprogrammes as well as an approach which stimulates drawing conclusions and turning that into action, Burgmans said. He also underlined that modern food chains are increasingly complex and it is impossible to hold one player responsible forthe entirety of it. He called for a strong and effective European Food Safety Authority (EFSA). He distinguished between thesafety of a food, and the quality aspects which have more to do with its flavour, colour and texture. He stressed that itshould be left to the market which spectra of these qualities are wanted by informed consumers. He also called for clearlegislation on claims that can be allowed to promote food products. He therefore welcomed the Commission’s futureinitiative to regulate nutritional, functional and also health claims.

Dimitris Daskalopoulous returned to the definition of food safety. He mentioned that we had now achieved very highstandards of food safety, while at the same time consumers were very defensive about their food. In his view, consumersmust participate in the debate on food safety and must be aware that even higher standards will mean increased costs.

Interactive Panel Sessions - 2Social Performance


CONGRESS PROGRAMMEDaskalopoulos also made a few proposals for restructuring the debate on food safety: the evaluation of costs and effectsshould be open to public debate; all players in the food chain should be involved; there should be an education andcommunication strategy tailored to the consumers, the media, politicians and scientists and finally, the new EuropeanFood Safety Authority should implement this strategy.

Roland Vaxelaire described the achievements of Carrefour in the area of food safety. He mentioned the “Filières QualitéCarrefour”, the good practice guides and the policy not to sell any GMO products. In his view, the means to achievethese goals were a proper audit and the implementation of HACCP and ISO standards, the training of staff, and finallyappropriate information to consumers and communication to the media. Vaxelaire also mentioned that Carrefour, the 1st retailer in Europe, is part of the Global Food Safety Initiative.

Finally Jim Murray explained that because of globalisation, food is now coming from a greater variety of countries and isprocessed in increasing complex ways. The distribution is also global, with very small enterprises producing productsdistributed globally. This has a price, and the result is greater complexity in the way the food is processed and increaseddifficulty in tracing the countries of origin, Murray said. Labelling has become increasingly important in this respect.Claims should be closely controlled and other sources of information such as the Internet should be monitored, headded. As regards the EFSA, he agreed that risk assessment of these new methods should be undertaken at theEuropean level. Consumers should be involved in this process and participate in the achievement of food safety. The EFSAshould not be responsible for risk management, Murray said.

� Meeting the skills gap across Europe

Speakers Antonio Borges, Managing Director and Vice-Chairman of Goldman Sachs (Moderator)Viviane Reding, European Commissioner for Education and CultureUmberto Paolucci, Vice-President for Corporate and Government Strategy, Microsoft EMEATjark de Lange, President of YES for EuropeLajos Nyiri, Chief Executive Officer of the Zinnia Group

Summary of the discussionModerator Antonio Borges opened the discussion by pointing out that productivity growth in the EU is lagging behindthat of the US. The main reasons behind this difference were the power of the American university system, whichmanaged to attract researchers and students from all over the world; a strong R&D effort, driven by the private sector;and a risk-taking attitude towards innovation. In the EU, there is more human capital available than most people think,but there is a lack of mobility which prevents people from taking a more productive job. On average people were alsoless entrepreneurial, Borges said. He noted that the main question thus is what the EU could learn from the US.

European Commissioner Viviane Reding recalled that the Lisbon Summit, by putting forward the idea of the EU as aknowledge-based economy, had for the first time launched education as one the main European topics. The task ahead issignificant, since the EU currently lacks 2 million skilled employees in the ICT sector alone. This skills gap is not distributeduniformly across the EU: whereas the Benelux, the UK, Ireland and Germany are doing relatively well, the ICT shortage isgrowing in countries such as Spain and Italy, Reding said. European action is therefore needed to close the gap. This actionshould both address primary and secondary schools, to ensure that pupils leave school with good reading knowledge, with adiploma and with the ability to learn more; and universities to create cross-national centers of excellence, Reding said. Shealso pointed out that, regarding education, the candidate countries were already fully participating in the EU programmes.

Dimitris Daskalopoulous, Roland Vaxelaire, Antony Burgmans, Jim Murray,David Byrne.


CONGRESS PROGRAMME

Umberto Paolucci recalled that the Lisbon strategy on ICT was to give people the skills to exploit information andcommunication technologies and to ensure that no one is excluded from the benefits of the information society. In orderto achieve this goal, public and private partnerships were encouraged. In this context, Microsoft is also working onbridging the ICT gap in the EU through university programmes, as an authorized academic training provider, and inretraining unemployed through the European Scholar Programme. The skills gap remained an important issue becausethe IT curriculum was not adapted fast enough to ongoing technology developments. Also, the industry needed to workmore directly with educational authorities and academia and to share technology as it developed. Whereas the industrycould act as a “middle man” in closing the skills gap, governments should incorporate the certifications designed by theindustry to meet corporations’ needs into their qualification programs.

Tjark de Lange stated that the challenge is to change the mind-set of people from a national focus to a more Europeanfocus. In doing so, it is probably more important to point out the things Europeans have in common rather than stressingtheir differences. Initiatives for European programmes in education are very important, but in the end the individualcountries would have to execute them. These programmes could and should, address the issue of the skills gap. However,the mentality gap would be more difficult to change, de Lange said. Finally, one should also learn to be patient: Europeshould not be changed completely within one generation. People needed time to start thinking European, he said.

Lajos Nyiri noted that the labour market had undergone various changes, including a closer inter-relationship betweenthe level of education and employment security and a growing gap between the demand for low- and high-skilledworkers. This meant that the skill and knowledge requirements of potential employees were changing quickly. Skillsnowadays needed to succeed in the labour market included not only technical capabilities, but also communication skills,learning skills and a multidisciplinary approach. In order to address the skills mismatch, both the rigidity of the labourmarkets and the conservatism of the traditional educational system had to be addressed. This was notably the case forcandidate countries, who have seen an FDI increase especially for the manufacturing industries and thus face difficultiesto match the future skill demands with the competences of the current labour force. Two of the measures to be takenwere the adjustment of the educational system to the global labour market requirements and the creation of a locallabour market demand for highly qualified ICT professionals, Nyiri said.

� Migration of workers in a wider Europe

Speakers Odile Quintin, Director-General, DG Employment and Social Affairs (Moderator)Peter Mitterbauer, President of VOI and Chief Executive Officer of MIBAJan Nijssen, Chairman Central Europe at the ING GroupÇelik Kurdoglu, Chairman of Kurdoglu Consulting Inc.Giampiero Alhadeff, President of the Social Platform

Summary of the discussionOpening the discussion, moderator Odile Quintin pointed out that there were two dimensions to migration in Europe:the internal and the external dimension. Within Europe, only 0.5% of Europeans migrated to another European countryin 2001. However, it was the external dimension which produced a variety of reactions among European citizens. On occasion, these reactions have been extreme and have not reflected projections of immigration. According to theCommission’s Strategy for 2001, immigration from the Central and Eastern European countries would be 1.4 million in2010. Quintin concluded that Europe needed an effective policy against illegal immigration and coordinated policies toencourage the promotion of opportunities for the migrants.

Peter Mitterbauer argued that due to demographic changes, Europe will be compelled to open its borders. However,common European instruments to organise immigration and an immigration policy based on an analysis of the skills

Antonio Borges, Viviane Reding, Umberto Paolucci, Tjark de Lange, Lajos Nyiri.


CONGRESS PROGRAMME

shortages and of labour requirements would ensure that Europe remains economically competitive and culturally rich.According to Mitterbauer, even in border countries such as Austria and Germany, the necessity for skilled workersshould encourage national authorities to decide against introducing transition periods for the migration of workersfrom the Central and Eastern European countries.

The opinion that an influx of migrants from the CEECs was unlikely and that migration will enhance Europe as aneconomic force, was also shared by Jan Nijssen. Nijssen pointed out that structural economic growth is the key toencourage workers from the CEECs to remain in their own countries, and that in turn, pension reform is the key tostimulate structural economic growth in the CEECs. According to Nijssen, accession to the EU would create new jobopportunities in these countries by stimulating GDP growth, foreign investment and demand for local employees. Pension reforms could contribute towards this economic growth by reducing the yield on government debt andencouraging stability through contractual savings, thus making the CEECs more attractive to investors and contributing to regional stability. Consequently, there is a need for political agreement to enable European pension funds to operateEU-wide, Nijssen said.

Çelik Kurdoglu commented that the economic contribution of migrants to their host country is often neglected bycommentators. He gave the example of Turks living in Germany, where the majority are below the age of 50, with 24%between the ages of 18-30 and 42% aged 31-40. Moreover, Turkish immigrants have invested 13.6 billion DeutchseMark since the year 2000 and created numerous SMEs (46% employing up to 3 people; 44% employing 4-9 people),Kurdoglu said.

The human dimension of the illegal immigration which is currently taking place in the CEECs was discussed byGiampiero Alhadeff. Alhadeff argued that the impact of this illegal immigration on local communities in the CEECs hasbeen considerable, and the possibility existed that a skills gap in these countries may emerge in the near future.Consequently, there is a need for more investment in these countries, he said. Alhadeff also made the point that moreefforts were needed to integrate immigrants into the local communities of their host countries, and to educate individualsagainst racist discrimination.

� One European social model for 28 countries?

Speakers Anna Diamantopoulou, European Commissioner for Employment and Social AffairsEtienne Davignon, President of the CSR Europe Advisory BoardErnest Antoine Seillière, President of MEDEF and Vice-President of UNICE (Moderator)Emilio Gabaglio, Secretary General of the European Trade Union Confederation ETUCJanusz Galeziak, former Secretary of State at the Polish Ministry of Social Affairs

Summary of the discussionIt was generally accepted by the panel that there is not one genuine social model for Europe although the social modelsin Europe share common features and traits. All the panellists spoke of the importance of the evolution of the Europeansocial model, as well as the adaptability employed by Central and Eastern European countries.

An OECD and Commission study highlighted that all advanced countries spend +/- 30% of their Gross Domestic Producton social issues. European Commissioner Anna Diamantopoulou pointed out that the issue is therefore not how muchgovernments spend but how those funds are used. She also viewed Europe’s pension problems as not about finances butas about reaching political agreement on how pension systems should be reformed. Diamantopoulou also stressed therole of the social partners to work together to adjust the present European social model and to address the currentpressures upon it.

Giampiero Alhadeff,Peter Mitterbauer,

Jan Nijssen, Odile Quintin,

Çelik Kurdoglu.


CONGRESS PROGRAMMEEmilio Gabaglio perceived one social model in Europe, although with diversity in its implementation at the nationallevel. Throughout Europe there were shared features in the social models: high social protection, public services and therole of the social partners. Together these produce a system of shared values, he said. Unsurprisingly from the ETUChead, he also stressed that workers’ rights in Central and Eastern Europe should not be secondary to economic growth asthey face difficult economic challenges. ETUC is playing its part there, helping trade unions democratise and bringingthem into ETUC. Gabaglio argued that managing social change with the proper institutions is critical to the success of theEuropean social model.

Janusz Galeziak spoke not only about Poland’s situation, but also about the broader agenda established at Lisbon in2000 and the challenges facing it. Galeziak noted that critics of the European social model point to economic indicatorsunfavourably comparing them to USA and Japan; whereas its supporters highlight the values within it. He also recognisedthe need for immigration and migration. However, any such strategy should include ways of fighting and preventingracism and xenophobia. Galeziak noted that Central and Eastern European countries were mostly excluded from thediscussions around the Lisbon Process despite the strategy applying to them for six out of the ten years of its lifespan.

Etienne Davignon commented that the current social model in Europe is distinctly a European one, with Europeantraditions in it. The current environment has created new challenges for business, in particular increased calls forcompanies to act in a socially responsible manner.

Moderator of the panel, Ernest Seillière also expressed his opinion on the European social model. In agreement withGabaglio he noted the benefit of the institutions, with the advantage of Europe over USA being the inclusion of thesocial partners.

Ernest Antoine Seillière, Anna Diamantopoulou,Etienne Davignon, Emilio Gabaglio, Janusz Galeziak.


CONGRESS PROGRAMME

� Global climate change obligations in a wider Europe

Speakers Jacqueline Aloisi de Larderel, Assistant Executive Director at the United Nations Environmental Programme Paul Skinner, Group Managing Director of Royal Dutch / Shell Fabrizio d’Adda, Chairman and Chief Executive Officer of Polimeri Europa and Chairman of the UNICE Working Committee on Environment (Moderator)Tony Long, Director of the WWF European Policy Office Perry Fredriksson, President and Chief Executive Officer of Global Responsibility International AB

Summary of the discussionThe panel explored how Europe can best meet its obligations under the Kyoto Protocol. Participants also had a discussionon the best way forward towards sustainable development.

The sustainable development goals can be reached by using a mix of policy instruments, according to Fabrizio d’Adda.These should be characterized by clear and sound objectives, a mix of environmental effectiveness and economicefficiency, policy coherence and practicality in terms of monitoring and adjustment. d’Adda also emphasized the need forimplementing the objectives by using voluntary approaches, market instruments and regulatory simplification with impactassessment.

Jacqueline Aloisi de Larderel pointed out that climate change has an impact on a wide range of sectors such asinsurance companies, tourist companies and the agricultural sector. There is today a need to change the energy andconsumption patterns of both industry and consumers. In order to do so a mix of policy instruments is needed: costinventorisation, institutional measures and raising awareness. Greater emphasis should also be put on research andinnovation, while voluntary initiatives by business should be encouraged, Aloisi de Larderel said. She also pointed out tothe need for a worldwide network of energy centers of excellence.

Paul Skinner emphasized the role of natural gas in combating climate change. Expanding the use of gas for electricity,heating and transport could help in meeting this challenge. Shell sees an important role for the Kyoto flexible marketmechanisms, he said. In 2000, Shell set up an internal emissions trading scheme and in October 2001 the schemeincluded external emissions trading. The next challenge is the EU-wide emissions trading scheme, where mandatoryparticipation with absolute caps is the way forward, according to Skinner. He also gave a couple of examples of howShell applied its sustainable development criteria in practice. The Athabsca oil sands project is a concrete example ofmeeting North America’s demand for low-sulfur transport fuel, Skinner said.

Interactive Panel Sessions - 3Environmental Performance

Tony Long, Fabrizio d’Adda, Perry Fredriksson,Jacqueline Aloisi de Larderel, Paul Skinner.


CONGRESS PROGRAMMEAccording to Tony Long, there are four steps towards sustainable development. These are maintaining natural capital,wise management of resources, the eco-efficiently use of these resources and the reduction of per capita consumption.Business should aim for the “smart zone”, which is equal to a public acceptance curve and not to keep the lowestcompliance curve, Long said. He noted that WWF has initiated a climate change campaign, which includes a campaign togreen the power sector, strong policies to support renewable and energy efficiency and the climate savers’ initiative.Under the climate savers’ initiative, companies can enter into agreement with WWF to set short-term and ambitioustargets on CO2 emission reduction.

Perry Fredriksson argued that stakeholders want to be able to measure a company in order to evaluate its performanceon health and environmental grounds. Therefore, the most important actors are the companies and its business leaders,according to Fredriksson. Public procurement rules, where taking into account of environment aspects are a requirement,is one way of moving forward but this is difficult to achieve. Measuring companies, evaluating quality, environmental,health and security will soon have the same future and weight as credit financial ratings have today, Fredrikssonconcluded.

� Sustainable energy supply in a liberalised and enlarged market

Speakers Jean-Pierre Hansen, Chief Executive Officer of Tractebel Angelo Airaghi, Chairman of Ansaldo Energia Michel-Marc Delcommune, Chief Financial Officer of MOL Hungarian Oil and Gas PlcGuy de Selliers, former President of EBRD and expert in EU-Russia relations

Summary of the discussionIn November 2000, the Commission adopted its Green Paper “Towards a European Strategy for the security of energysupply”. The aim was to open a broad debate for a long-term strategy that ensures uninterrupted physical availability ofenergy products on the market. In this panel discussion, speakers focused on questions regarding sustainable energysupply in an enlarged Europe.

According to Jean-Pierre Hansen fossil fuels are pushed back due to their environmental damage and we are movingtowards a carbon constraint economy. There is no single solution and there is a need for a technological research mix ofrenewable energy, nuclear energy, demand-side management and efficient use of fossil fuels, Hansen said. He arguedthat the market economy, coupled with constraining mechanisms, is the best way for channeling benefits towards thecustomers.

Michel-Marc Delcommune pointed out that there is a strong growth in motor fuel consumption in the Centraland Eastern European countries. The economic growth feeds the purchasing power, but there is a lack ofdiversification of energy sources. Gas prices in Hungary are subsidized and as a result of the cheap prices, there isno incentive to save energy or for monitoring purposes. The consequences are a severe peak demand for industry.In terms of the gas assets, there is a need to control transit facilities better and investment is necessary. Hungarycould become an excellent hub in storing gas for providing access to northern Italy, Spain and France. In terms ofthe quality of oil products, Hungary has the three best refiners in Europe with a strong commitment to the qualityof the products and processes. There is however a need to a better implementation of the regulations and tofinancing the exploration.

Michel-Marc Delcommune, Jean-Pierre Hansen,

Guy de Selliers,Angelo Airaghi.


CONGRESS PROGRAMMEGuy de Selliers pointed out that Europe currently imports 50% of its gas, of which 40% comes from Russia. In itsGreen paper on security of supply, the European Commission forecast that in 2020 the import dependency of gas wouldincrease from 50% to 75%. de Selliers argued that European industry has to be more optimistic towards Russia, wheresocietal changes have taken place. An energy strategy for Russia would require an annual investment of 5-10 billion USdollars per year for projects such as the Barents Sea. de Selliers also stressed the importance of the energy dialogueinitiated by the Commission between Russia and the EU. The challenge is to find a way to finance all the energy projectspossible in Russia, he said.

A possible way to moderate the impact of the energy and transport sectors on the environment is the increase ofefficiency in energy production, distribution and utilisation, the support of renewable energy and an increased focus ontraffic management, according to Angelo Airaghi. He emphasized that more and important public investments aretherefore needed in sectors such as new nuclear fission, hydrogen as a fuel and new renewable energy. There is anurgent need for policy makers to give high priority to research and development in the energy sector, as this has not beendone so far, Airaghi concluded.

� Mobility and the development of new transport modes

Speakers Isabelle Durant, Belgian Deputy Prime Minister and Minister for Transport and MobilityUwe Doerken, Chief Executive Officer of DHL Worldwide Heather Allen, Corporate Affairs Director ar the International Association of Public TransportJosé Ignacio Gafo Fernández, President of the Transport and Energy Sectionat the European Economic and Social CommitteeBeatrice Schell, Director of the European Federation Transport & Environment (Moderator)

Summary of the discussionIn its second White Paper (WP) on the Common Transport Policy the European Commission proposes an actionprogramme that should lead to more sustainable transport. To this end, the Commission suggests new principles forinfrastructure with a view to internalise external costs, improving quality of the road sector and revitalising the railways,encouraging research and technological development in areas of intermodality and clean and safe transport. Since itsadoption, the WP has triggered many reactions from supportive to strong opposition. As the document contains a seriesof key questions, which are wide in scope and cover many issues, each speaker in this discussion focused only on a fewkey questions.

Isabelle Durant stated that technological achievements in the transport sector have brought considerable benefits tosociety. However, transport became a victim of its own success: congestions, 44,000 fatalities a year in road accidents,high emission levels of CO2. She pointed out that mobility is in itself sustainable: it promotes growth, maximises benefitsto the society and minimises negative impacts on the environment. However, the benefits of mobility may be limited byan unnecessary growth of transport. This is particularly important in the context of enlargement. She argued thattechnological solutions, such the super Airbus, the new intercontinental Boeing and Segway could alleviate but not solvethe negative effects of the increased volume of traffic. She therefore called for an integrated policy. Also, a moresustainable mobility in an enlarged EU should result in applying fairer pricing to transport and internalising external costsand by making better use of existing infrastructures and improving the management of transport demand. She concludedthat individual behaviour and choices are as important, if not more so than the political decisions that surround them.

Uwe Doerken stated that mobility is a human need and should therefore be helped and not curtailed by politicians.Transport is sustainable in itself as it promotes economic growth and development. Statistics on the impact of transporton the environment during past decades showed that economic and technological progress could assist the returning topre-industrialisation pollution levels. Looking at air pollution, technological improvements over the past years have led toa significant decline in dangerous commodities, in particular lead and sulphur dioxide. Technological progress has led toreduction in noise pollution. Accident records show that all transport modes have become significantly safer. However, 11 September has brought an additional dimension and complexity to safety related aspects, which need to be furtherreinforced, he said. Doerken called for a level playing field between countries, regions and transport modes. In his view,air transport needed global regulation regarding the issues of landing rights and the environmental impact of aircraft.Finally, he called for promoting transport within the framework of strict environmental and safety standards and “wise”equitable taxation.


CONGRESS PROGRAMME

Heather Allen argued that by 2020 almost 70% of the world population would live in urban areas, which means 50%extra mobility requirements. If nothing is done to reverse this growth, this would lead to an increase in the automobilesector. On competition policy in public transport, she stated that there is no clear model pointing to a successfulintroduction of a completely deregulated market. Concerning rail, she believed it must be revitalised. The past 50 yearshave showed an explosive growth in population and car use in urban areas. This is of great concern, especially in theview of future enlargement. She thus called for a change in users’ habits by stressing the need to educate young peopleand the important role that employers play in developing these habits. Finally, she underlined that a successful mobilityand public transport system of the future relied on everybody co-operating, in order to achieve both economic viabilityand sustainable transport networks for the future.

José Gafo Fernández pointed out that there is a serious debate on the cost of mobility (congestion, environmentalimpact, social disruption) and less on fiscal revenues that mobility produces (taxes and levies). On the White Paper, hecommented that it has progressed too fast from liberalisation to intervention without giving enough importance to thesocial dimension in transport. He argued that the WP establishes too much competition in some sectors and distorts it inothers. In his view, there is a need to take a realistic approach to rail and air potential. Fostering multimodality, inland andmaritime motorways are important, along with a more rational approach to critical bottlenecks (Alps and Pyrenees) and abetter use of Community funds. He also called for the creation of a real mobility to all citizens including remote regionsand handicapped people.

Beatrice Schell, the panel’s moderator, emphasised that transport has to play a more serious role in sustainabledevelopment. In her view, achieving sustainable development in transport means simultaneously promoting economic,social and environmental pillars. She believed that obstacles to creating sustainable mobility lie with the external costs oftransport and that inclusion of these costs into prices would lead to a fairer and more efficient distribution of wealthamong economic actors. As for the Trans-European Transport Networks, she called for better decision-making, increasedpublic participation, strategic environmental assessments, as well as improved cost benefit analyses across the EU.

Heather Allen, Beatrice Schell, José Ignacio Gafo Fernández, Isabelle Durant, Uwe Doerken.

H.R.H. Prince Philippe of Belgium attendedthe interactive panel session on mobility.Georges Jacobs, Luc Vansteenkiste and Tony Vandeputte accompanied the Prince.


CONGRESS PROGRAMME

� From Lisbon to Barcelona and beyond: what next toconsolidate a competitive and innovative europe?

Speakers Myles Staunton, Irish Representative at the Trilateral Executive Committee and former Member of the Irish ParliamentJacques H. Schraven, President of the Dutch employers’ federation VNO-NCW and Vice-President of UNICE Philippe Busquin, European Commissioner for ResearchScott Beardsley, Director at McKinsey & Company (Moderator)Valdis Lokenbahs, President and Chairman of the Board of DATI

Summary of the discussionIn its 2000 Lisbon meeting, the EU set the ambitious target of becoming the most competitive and dynamic knowledge-based economy in the world by 2010. At the Barcelona Summit in early 2002, progress was judged to be too slow. In this panel discussion, speakers focused on questions regarding overall competitiveness and two particular factors tofoster it: R&D and innovation, and ICT and telecommunication.

Giving an example of a European best practice, Myles Staunton presented the Irish case of how a radical tax reformhad helped to boost economic growth and increase government revenues at the same time. Corporation tax, capitalgains tax and income tax had all been drastically lowered over the last decade in Ireland, resulting in a Gross DomesticProduct growth of more than three times the EU average. At the same time, net tax receipts increased almost by a factorthree. The English language abilities of the population and the good relationships with the US also supported thiseconomic growth, Staunton said.

Jacques H. Schraven pointed out that there were three main obstacles for EU businesses to increase their participation in R&D.First, the output markets for innovative products and services are not sufficiently developed and suffer from fragmentation and ahigh number of regulations. Secondly, the availability of people with excellent education and skills is insufficient. And finally,there is a lack of good R&D input factors, notably insufficient government schemes to help fund companies’ R&D. The European Commission’s plan for a European Research Area seems to provide a good way to tackle these problems.

Putting the EU’s competitiveness in a wider perspective, European Commissioner Philippe Busquin pointed to the rapidlyrising research investment gap compared to the US, 90% of which is caused by a lack of business R&D spending in the EU.By 2010, the objective for the EU is to spend 3% of its GDP on R&D, with two-thirds of it coming from the private sector.In order to achieve this, specific measures are needed at both the European and national level, including benchmarking ofinnovation and research performance and improving the mobility of human resources.

Interactive Panel Sessions - 4R & D Session

Philippe Busquin, Jacques H. Schraven,

Scott Beardsley, Myles Staunton,

Valdis Lokenbahs.


CONGRESS PROGRAMMEThe panel’s moderator, Scott Beardsley, argued that telecom sector reform and funding would play a key role inachieving Europe’s knowledge economy aspirations. The EU and the candidate countries would need to meet thechallenges of broadband and Third Generation Mobile Phones (3G). Europe is currently lagging behind: at the start of2002, South Korea alone had more broadband connections than all of Western Europe, Beardsley said. In 3G, theinvestments needed are huge. The total cost of setting up 3G in Europe, including the UMTS license fees and the cost tobuild the infrastructure, is estimated at 350 billion Euro, not including 100 billion US dollars in new handsets. This compares to a relatively modest 21 billion Euro of EBITDA (Earnings before interest, taxes, depreciation andamortisation) that the current mobile operators are earning. The challenge to fund this with money from the industry, theconsumers and/or public sources is huge.

Valdis Lokenbahs presented Latvia as a case example of a country that can profit from its specialisation in IT. Latvia is anobvious choice for IT outsourcing, since it has a historical specialisation in IT. The last years, the Latvian IT market hasgrown by 40%, more than three times the EU average. Boosting education in the technical universities had been a keysuccess factor in supporting this growth, as well as the development of clusters of IT companies. The fact that Latvianemployees can work, next to Latvian, in Russian, German and English also presents an added advantage, Lokenbahs said.


CONGRESS PROGRAMME

� Business opportunities in Bulgaria

Speakers Nikolay Vassilev, Deputy Prime Minister and Minister of Economy Bojidar Danev, President of the Bulgarian Industrial AssociationIvan Badinski, Deputy Manager of SopharmaMorten Jung-Olsen, Head of Bulgaria Team, DG Enlargement (Moderator)

Summary of the presentationModerator Morten Jung-Olsen opened the session by saying that Bulgaria’s preparations for EU membership wereirreversible. “It is no longer a question if Bulgaria will join the EU, the question is when it will join,” he said. He addedthat the accession negotiations were well on track and the prospective for progress over the next 1,5 years werelooking very good. He also welcomed the government’s programme for joining the EU and said there was no reason itshould not be met.

Deputy Prime Minister Nikolay Vassilev explained why Bulgaria was a good place for doing business. He stressed thevery good macro-economic outlook of the country, noting that Bulgaria had the highest growth rate, one of the lowestinflation rates and the lowest interest rates of the region. On top of this, the country has a very stable currency board,which will not be abandoned until Bulgaria joins the European Economic and Monetary Union. The only minus points arethe high unemployment rate, the large trade deficit and the current account deficit, Vassilev said. He also said that theFDI record in the country could be better, but that he was quite confident it would grow strongly in the coming years.Bulgaria is attractive for investors because of its consistent political and macro-economic stability, the very low directtaxes, its stable and predictable business environment, the sharply decreasing corruption and the transparent privatisationprocess, its strategic geographic location, its excellent educational system, its excellent labour quality/labour cost ratio andthe existence of many free trade agreements, Vassilev said. He said he was quite hopeful the European Commission in itsnext progress report on Bulgaria would classify the country as a fully functioning market economy.

Bojidar Danev gave some further details on Bulgaria’s recent developments. He mentioned the drastic reduction incorporate tax rates and the very healthy banking and financial system. Bulgaria has 34 operating banks of which 17 aremajority foreign-owned. Free trade agreements with several countries are allowing a free access of Bulgarian exports to amarket of 500 million consumers, he said. Danev also noted the growing share of investments in Bulgaria’s GDP.Germany, Greece, Italy and Belgium are the biggest investors, with industry, finances, trade and tourism being the mostimportant sectors. Danev said that it was very important for investors to seek local partners, not only in the businessworld, but also among NGO’s.

A case of a successful Bulgarian company was presented by Ivan Badinski, who is Deputy Manager of Sopharma, thelargest Bulgarian pharmaceutical company. The company was founded in 1933 and has been a private company since 2000.

Candidate Country Presentations

Nikolay Vassilev, Bojidar Danev, Morten Jung-Olsen.


CONGRESS PROGRAMMEIt is specialised in medical substances (tablets, syrups, ampoules and lyophilic phials), finished medicinal products and gammasterilisation. Sopharma has recently engaged in a 15-million-USD-investment programme and aims at full compliance withthe World Good Manufacturing Standards for pharmaceutical products. About 71% of Sopharma’s tablets production arebeing exported, with the most popular markets being Russia, Poland, Ukraine and the US, Badinski said.

� Business opportunities in the Czech Republic

Speakers Jiri Skalicky, Senator and Chairman of the Committee for EU integration of the Czech RepublicMiroslav Somol, Deputy Minister at the Ministry of Industry and TradeStanislav Kazecky, President of the Confederation of Industry of the Czech RepublicMartin Jahn, General Director of CzechInvestPetr Leidl, Principal at McKinsey & Company in Prague (Moderator)

Summary of the presentationSenator Jiri Skalicky highlighted the current economic situation in the Czech Republic after 12 years of transformation.He noted that today 80% of Czech GDP is produced by the private sector and that prices and foreign trade have beenfully liberalised. He also stressed the pro-European attitude of all political parties in the Czech Republic. “Application ofEU law is a key priority of all parties,” Skalicky said. He said there “was no doubt that the Czech Republic would bepresent in the next round of EU enlargement”, despite the remaining obstacles in the enlargement negotiations. Skalickymentioned competition rules - especially in the steel industry -, transport, financial services and agriculture as theremaining obstacles in the accession negotiations. He concluded that he could not imagine a better investment incentivefor the Czech Republic than becoming a member of the EU.

Miroslav Somol gave more information on Czech foreign trade. He noted that the EU states were taking the biggestshare of the turnover in foreign trade with 65.2%. Germany is the biggest EU trade partner with a share of 35.4%,followed by Austria, France, Italy and the United Kingdom. The main part of Czech exports is still taken up by traditionalexports, although the share of high-value-added goods is growing, Somol said. He also elaborated on the difficultsituation in steel trade. He said the Czech Republic had introduced its own specific legislation with regard to anti-dumping and safeguard measures, but that this legislation was not often applied. On the other hand, the CzechRepublic was seeking preferential treatment and the establishment of national quotas from the EU.

Stanislav Kazecky presented the advantages and threats of EU enlargement for the Czech industry. Kazecky said thatalthough the general performance of the Czech industry was positive, there was still a threat of substantial price increasesfollowing EU enlargement, especially in the food sector. He also noted the need to divert investment to new technologiesand highlighted the substantial costs linked to the necessary adaptation to EU environmental rules. Kazecky also said hedid not share the view that EU enlargement would lead to a mass exodus of cheap labour force from Central and EasternEurope to the EU. EU enlargement will also bring a lot of opportunities, such as the removal of the remaining tradebarriers, the establishment of a better law enforcement and improved financial services, he said.

The fact that the Czech Republic is still dominating the region in attracting FDI is a clear statement that there is a goodclimate for foreign investment in the country, Martin Jahn said. He noted that over 80% of all FDI inflow in the CzechRepublic was coming from EU states. He was pleased that a recent PriceWaterhouseCoopers survey showed that theskilled labour force was quoted as the main reason for investment in his country. Jahn also noted that the Czech Republic

Jiri Skalicky, Rutger Wissels,

Miroslav Somol, Stanislav Kazecky,

Petr Leidl.


CONGRESS PROGRAMMEwas one of the last countries in the region to have introduced government incentives for foreign investment, such ascompany income tax relieves, job creation and training grants and the easy transfer of land. He stressed that all incentiveshad been introduced following consultation with the European Commission. Most investors see the Czech Republic as anexport market. “All investors and businesses take the country’s accession to the EU for granted and theirs expectationsand plans are based on it,” Jahn said.

At the end of the session, moderator Petr Leidl gave the floor to Rutger Wissels, Head of Unit for the Czech Republicat the European Commission. “I am confident that the negotiations will be completed in the next 6 months or so,”Wissels said, adding that the remaining issues should pose no major problems for the Czech Republic. He noted thatfurther efforts were however needed to remedy the poor functioning of the judicial system and to improve the quality ofpublic administration.

� Business opportunities in Estonia

Speakers Kristiina Ojuland, Minister of Foreign AffairsIndrek Neivelt, Chairman of the Board of HansabankTeet Jagomagi, Chairman of Regio ASErkki Auvinen, Vice-President of PARTEK CorporationDirk Lange, Head Estonia Team, DG Enlargement (Moderator)

Summary of the presentationOpening the session, Dirk Lange said Estonia had already made great progress towards becoming a fully integratedmember of the European Union. He mentioned the stable democracy, the reliable economic environment, the relativelylow level of corruption and the good progress in EU enlargement negotiations as key elements for investors in thecountry. “I am quite optimistic that Estonia is prepared to finish the negotiations by the end of 2002 in order to allowEstonia to participate in the EU elections of 2004,” he said.

Kristiina Ojuland outlined the positive transformation of Estonia into a successful economy. She said that since theindependence of the country 10 years ago, a lot of important and successful changes had been introduced, such as theintroduction of an own currency, the liberalisation of trade and the reform of the tax system. Ojuland also mentioned thestrong foreign trade structure of Estonia and the conclusion of a major privatisation process. The Estonian privatisationoffice was closed down in 2001. But the Minister stressed that although the end of transitional period might be in sight,there still remained many challenges. Being a small country with limited human and natural resources, Estonia needs aclear vision and is therefore focusing on the innovative sector and on SME’s, she said. We are paying particular attentionto education, the improvement of infrastructure, the development of new technologies and in particular genetechnology, strict environmental rules and regional co-operation, especially in the Baltic Sea region, Ojuland said.

Indrek Neivelt summed up the reasons why –following the completion of the privatisation process- foreign companiesshould be interested in Greenfield projects in Estonia. He mentioned the highly motivated and educated people, theadvantageous corporate tax regime and the stable monetary and banking system. Another very important reason is thegrowing trade with Russia, Neivelt said. He said that Estonia’s geographical location turned it into the crossroads of anincreased East-West trade relationship. The strong economic relationship with Finland and the prospects of EUmembership also made Estonia to a country with lots of investment opportunities, Neivelt said.

Representing Estonia’s information technology, Teet Jagomagi explained that a small country can be big in ICT if it isbacked by the whole population. “Information technology has entered our society and the success of the story is allabout people,” he said. He said that the Estonian leaders had come up with some great ideas that had further beendeveloped into real and useful policies by the new generation that had come into power after the independence of thecountry. Jagomagi mentioned a couple of successful IT projects, such as the IT education plan, under which all schoolshad to have computers and be connected to the Internet, the digital ID-card and the private initiative to educate peoplethat have never been in touch with the Internet. As a result of these projects, Estonian people are much more skilled in ITand this has led to further initiatives, such as the strong development of e-banking (94% of monetary transactions arealready done by e-banking) and the mobile parking project. “If you want to see how the mobile sector can serve you,you have to come to Estonia,” Jagomagi concluded.


Speaking as rapporteur for Estonia in the Unice enlargement task force, Erkki Auvinen said that from a business pointof view, Estonia was ready to join the EU in 2004. He said that the success of the Estonian transformation was largelydue to the “new generation” that took over in the business and public administration in the early nineties. “There is adrive and you feel it,” he said. He noted that the only problem left was the large black market, which was discriminatingagainst those businesses –especially foreign companies- that were following the rules. He also said that he saw greatinvestment opportunities in the tourism sector, where a trilateral co-operation between Estonia, Finland and Russia in theGulf of Finland could lead to a boost in investments for shipbuilders, the hotel business and port infrastructure.

� Business opportunities in Hungary

Speakers Peter Gottfried, Head of the State Secretariat for Integration at the Ministry of Foreign AffairsAntal Csuport, Secretary General of the Confederation the Hungarian Employers’ Organisation for International CooperationEndre Lukacs, Managing Director of 77 ElektronikaWillem-Jan Laan, Agricultural Economic Adviser at UnileverPierre Mirel, Head Hungary Team, DG Enlargement (Moderator)

Summary of the presentationModerator Pierre Mirel opened the session by summing up the key features for investors in Hungary: political stability, avery successful economic reform, a very high level of economic integration between Hungary and the EU and the existenceof free trade in manufactured goods. He also mentioned the very good preparations towards EU membership and said hewas hopeful Hungary would be able to conclude the negotiations by the end of 2002.

Peter Gottfried was proud that Hungary was among the frontrunners in the EU enlargement negotiations. He noted thatby the end of 2002, Hungary would have completed all preparatory work to install an efficient legislative and administrativeframework. Conscious of the fact that the final part of the discussions on EU budget matters might be rather tough, hewarned that a failure would be “dramatic”. He said the advantages of a successful conclusion of the negotiations weremore important than the risks, even though the costs were currently more visible than the advantages. Gottfried stressedthat enlargement would contribute to the European Union’s goal to become stronger and more competitive. “Hungary willbe a reliable and committed EU member,” he stressed. He also said that once an EU member, Hungary would like to adoptthe Euro as its currency “as soon as technically possible.”

Antal Csuport shed more light on the social dialogue in Hungary. He said the social dialogue was already working quitewell in certain aspects, such as the reconciliation procedures, but in other matters, such as the sectorial negotiations, therewas still room for improvement. He welcomed the Minister of Employment’s commitment to increase the social dialogue andto broaden the number of companies and organisations invited. Csuport regretted that the Hungarian employers were stillnot organised in one big federation. It is “ridiculous” that we have 9 employer federations at the national level, he said. Themain challenge for Hungarian companies at the moment was to enable sustainable economic growth in order to be able tocompete with EU firms. To that end, more efforts on capitalised operations, technology investments and human capital wereneeded, he said. He also mentioned the need to be better informed about existing EU funds and support measures. “A good interaction and membership of EU organisation can contribute to this,” he said.

Proof that small and medium-sized, private Hungarian companies can withstand competitive pressure, was delivered byEndre Lukacs, Managing Director of 77Elektronika. Founded in 1986, 77Elektronika soon became one of the mostprosperous privately owned Hungarian companies. Originally only designing electronical products, the company todaydevelops and manufactures medical electronics and telecommunications equipment. About half of its production is exported,of which the bulk goes to Europe, Lukacs said. He said EU membership will bring further benefits to the company, such assimplified logistics, commercial agreements with third countries and improved labour regulations.

Erkki Auvinen, Indrek Neivelt, Kristiina Ojuland, Teet Jagomagi, Dirk Lange.

CONGRESS PROGRAMME


CONGRESS PROGRAMME

Willem-Jan Laan presented the views of a large, foreign investor in Hungary. He noted that Unilever had a long-standingtradition in the region, and that as soon as 1992, Unilever had started a series of acquisitions in Hungary. Unilever now has 5 modern production sites in Hungary and can count on a satellite suppliers’ system of 270 SME’s. It has 1,600 employeesand 20% of the Hungarian production is being exported, Laan said. He mentioned the competitive free market economycombined with a stable political situation, the high level of education, the well-developed infrastructure, the geographicallocation and the good competitive environment as positive elements for investors in Hungary. Speaking in his capacity asrapporteur for Hungary in the UNICE enlargement task force, he also made a couple of recommendations, such as thefurther improvement of the administrative capacity on government institutions and the judicial system, the non-discrimination in the employment of minorities, cutting down inflation and the implementation of EU-compatible health,safety and environment standards. Laan agreed with Gottfried that Hungary would be ready with the EU accessionnegotiations by the end of 2002.

� Business opportunities in Latvia

Speakers Aigars Kalvitis, Minister of EconomicsValdis Lokenbahs, President of DATIVitalijs Gavrilovs, President of the Latvian Employers’ ConfederationJoris Declerck, Deputy Head Latvia Team, DG Enlargement (Moderator)

Summary of the presentationLatvia wants to become a reputed knowledge-intensive economy. The government therefore supports the renovatingof traditional sectors of economy with modern technologies and the development of new post-industrial knowledge-intensive sectors, Economics Minister Aigars Kalvitis said. To this end, the government introduced an Action Plan toImprove the Business Environment in Latvia, the Minister said. This plan includes the improvement of corporatelegislation, the strengthening of the capacity of the judicial system and the state and municipal procurement issuesand the introduction of measures conducive to the investment climate. Being a small country, 99% of Latvia’senterprise population are small and medium-sized companies, Kalvitis said. The government therefore also hasintroduced a National Programme for SME Development, including support for growth generating activities and a pro-active innovation policy.

Valdis Lokenbahs illustrated how Latvia’s goal to be a specialist in Information & Communication Technologies hasindeed contributed to the development of a successful IT sector. Latvia currently has 100 software developmentcompanies and more than 3,000 highly qualified specialists. Lokenbahs noted that Latvia had become a “realinformation society” with the rapid development of e-government, a high computer literacy rate and a good co-operation between government, private businesses and society. Thanks to the presence of experienced companies,

Janis Grins, President of Freja, Vitalijs Gavrilovs, Joris Declerck, Valdis Lokenbahs, Aigars Kalvitis.

Peter Gottfried, Antal Csuport, Endre Lukacs,

Willem-Jan Laan, Pierre Mirel.


CONGRESS PROGRAMMEthe strong government support, the large number of IT students, its specialisation in outsourced project managementand the upcoming EU membership, Latvian IT companies will become and remain competitive players in the Westernmarket, Lokenbahs said.

Latvia’s economic success is also the result of the development of social dialogue in the country, Vitalijs Gavrilovs stressed.He said that employers had understood the importance of being more open and better organised. The Latvian Employers’Confederation currently unites 56 enterprises and 18 associations and is a member of the International Organisation ofEmployers and UNICE. The Free Trade Unions’ Confederation of Latvia unites 26 organisations, but its membership isconcentrated on state-owned enterprises, former big state enterprises and civil service. The social dialogue in Latvia is beingheld in the National Tripartite Co-operation Council, Gavrilovs explained. He said its main achievements so far are the Law onstrikes, the Labour Code, the Law on Labour Protection and the agreement on a scenario for macro-economic development.He noted, however, that the social dialogue in Latvia was still in a developing stage and that Latvian EU membership in 2004would further contribute to improving the social partners’ capabilities to develop an autonomous social dialogue at national,branch and company level.

� Business opportunities in Lithuania

Speakers Petras Austrevicus, Chief Negotiator with the European UnionNerijus Eidukevicius, Vice Minister at the Ministry of EconomyGintaras Morkis, Director of the International Affairs Department, Confederation of Lithuanian IndustrialistsAlvydas Zabolis, Investment Banker at Vilniaus Bank SEBMichael Persson, Director General of DaniscoTomas Milaknis, Managing Director of Alna ABAnders Henriksson, Head Lithuania Team, DG Enlargement (Moderator)

Summary of the presentationChief negotiator Petras Austrevicius confirmed Lithuania’s ambition to finish EU accession negotiations in 2002 and toassume all obligations of EU membership by 2004. He noted that the country had already undergone fundamental changesand now had become a functioning market economy and an open and liberal market. Foreign investment has played animportant role in the modernisation of the economy, while international trade is also a major source of economic growth.Re-pegging the Lithuanian Litas to the Euro also was a logical step in the context of the political and economic integrationprocess and the long-term Lithuanian strategy towards the Euro, Austrevicius said. He said that pre-accession economicprogrammes were a critical tool to assure the necessary degree of co-ordination of economic policies between EU andcandidate countries. The principal objectives of the Lithuanian economic policy in the medium term were the maintenance ofstable monetary policy, sustainable fiscal policy, the promotion of investments and business developments and an activelabour market policy, he said.

Nerijus Eidukevicius described Lithuania as the best kept investment secret of Europe. Located at the crossroads of theEuropean and Russian markets, Lithuania offered a stable economy, in which the private sector dominated, he said. The EUintegration process had prompted the adoption of a legal structure and the necessary technology to promote and attractinvestment and to promote economic growth. Eidukevicius noted that FDI had been growing significantly in the last coupleof years, with the main investors being Denmark, Sweden, Estonia and Germany. The equal regime for foreign and domesticinvestors, the right for a foreign investor to be the sole founder of a company, the right to free repatriation of profits andinvestment, an active dialogue between foreign investors and of course the existence of free economic zones were the mainattractions for foreign investment in Lithuania, he said. The most attractive sectors were electronic component assembly, ITand software development, biotechnology, textiles and food, he added.

The strengthening of Lithuania’s economy is also the main priority for the Confederation of Lithuanian industrialists (LPK),Gintaras Morkis said. This non-governmental, non-political organisation has a membership of 2,804 companies, of which28% are large, 62% are medium and 10% are small companies. LPK has regular talks with government, solves legal affairsof employers in social and labour questions, offers training services and organises trade missions to foreign countries. It alsofocuses on the stimulation of innovation in its member companies and is a keen supporter of Lithuania’s integration to theEU, Morkis said. “LPK is convinced about EU membership advantages and opportunities for the economy and people ofLithuania,” he said.


CONGRESS PROGRAMME

Alvydas Zabolis presented the success and expectations of the private businesses in Lithuania, such as Senukai, Rokiskio Surisand Vilniaus Prekyba. According to Zabolis, the success of these companies was the result of the fact that they started fromscratch, were born out of real spirit of entrepreneurship and on the dividing line of the old and new times. These companiesall achieved maturity in the home market and successfully started expansion. “You can talk of a mature business if you exportand implement your visions outside your country,” Zabolis said. He confirmed that Lithuanian businesses were supportive toEU membership. EU membership will provide a shield against bureaucracy, support for private business, fair competition for allparticipants, a flexible labour regulation and a sound social security and pension system, he said.

As member of the Foreign Investors’ Forum, Michael Persson presented the views of foreign investors in Lithuania. TheInvestors’ Forum has 39 company members and aims at improving the Lithuanian business climate through a positive dialoguewith government. The Forum has regular consultations with the Lithuanian authorities, during which it formulates priorityproblems and proposes solutions, Persson said. Speaking from his experience as agricultural investor, Persson said theauthorities had understood the need for restructuring and modernising the Lithuanian agricultural sector, but that they hadunfortunately supported the forces working against it. He stressed that this was the only real disappointment of investing inLithuania, and summed up a number of positive experiences, such as good contacts with the authorities, an active press,competent and existing management and good relations with the unions, beet farmers and customers. “Despite the delay inrestructuring, we are confident that we shall achieve our goals in Lithuania,” he concluded.

Tomas Milaknis gave more details on the development of modern technologies and a knowledge economy in Lithuania. He said that Lithuania was a technology-keen country with a rapidly growing IT market. Government spending for IT hadbeen doubled, while e-banking and internet penetration had been rapidly increasing. Milaknis also mentioned the initiative todevelop knowledge economy clusters, which should help to increase the development of innovations and new technologybusinesses. “Prospects of the Lithuanian IT enterprises are to develop and grow, and to create technologically innovativedecisions that would facilitate their penetration into the global market,” he said.

� Business opportunities in Malta

Speakers Josef Bonnici, Minister for Economic AffairsLawrence Zammit, Chairman of the Malta Development CorporationJoe Zammit Tabona, President of the Malta Federation of IndustryHelga Ellul, Managing Director of Playmobil Malta Ltd.Vincent O’Doherty, Director of SuperquinnArhi Palosuo, Head Malta Team, DG Enlargement (Moderator)

Summary of the presentationOpening the session, moderator Arhi Palosuo said that Malta was advancing well towards its goal of closing the enlargementnegotiations by the end of 2002. He noted that many relevant chapters for the business world had already been provisionallyclosed, but that a number of important issues, such as taxation, competition policy and customs union were still under discussion.

Minister Josef Bonnici gave more information on Malta’s economic outlook. He said that at the time of its independence in1964, Malta was dominated by the services sector. Following a very extensive transformation, the manufacturing industry nowcounted for 23% of the industrial output, while the services sector was more diversified. Having no natural resources, Malta islargely dependent on international trade. Malta’s main trading partner is the EU, but the US and Japan are also importanttrade partners, the minister said. EU membership will allow Malta to intensify international trade even further, the Ministersaid. “It is Malta’s aim to strengthen its flows of goods and services with the EU even further, while at the same time establishbetter trade links with its North-African neighbours,” he said. “We want to develop Malta as the international trading centrefor the region,” Bonnici concluded.

Petras Austrevicius, Nerijus Eidukevicius, Gintaras Morkis, Michael Persson, Alvydas Zabolis, Tomas Milaknis


CONGRESS PROGRAMMELawrence Zammit explained why the Maltese manufacturing sector was playing an increasingly important role. He notedthat over 200 foreign-owned manufacturing operations representing 21% of workforce were currently present in Malta. Thepredominant sectors were electronic components, parts and instrumentation, automotive components and parts, precisionengineering, medical and pharmaceutical products and information technology. He said that given the limited size of theisland, the manufacturing industry was gathered in a number of industrial zonings. Zammit also summed up the manyadvantages of the Maltese business environment: equal treatment of all investors, good financial services, moderncommunication network and efficient transport links and a flexible and multi-lingual work force. On top of this, Malta wasoffering flexible incentive schemes offering benefits customised to the client’s requirements, he said.

The challenges of EU membership for the Maltese industry were highlighted by Joe Zammit Tabona. He noted that givenMalta’s open economy, Maltese entrepreneurs could not afford to look at the local market alone. Malta can already look at anumber of important achievements, such as the setting up of a trade investment agency, the liberalisation of financialservices, the liberalisation of the telecommunications sector and the development of incentives for local SME’s, he said. EU membership will bring further positive effects, such as the stimulation of new investments and economic growth. Zammit Tabona stressed that the Maltese Federation of Industry was in favour of EU membership at the right conditions. “EU membership for Malta is a good proposition. The compliance costs will be diluted and a more predictable legalenvironment will be in place,” he said.

Representing a company with 30 years of presence in Malta, Helga Ellul was the right person to explain why Malta was, isand will remain an attractive location for investment. Playmobil Malta started in 1971 with 50 employees, but today itemploys about 800 people and works with about 10 subcontracting companies, Ellul said. Playmobil chose Malta asinvestment location in 1971 because of the attractive FDI policy, the good factory conditions, the skilled and well-disciplinedwork force, the European culture and the vicinity of the headquarters. Playmobil is still investing in Malta because of theexcellent return to shareholders, the continued government efforts to sustain FDI, the existing highly trained work force, thehigh quality standards, the investments in state-of-the-art technology and the excellent responsiveness to consumerdemands, Ellul said. She said that in the future, Playmobil saw Malta as a market where international standards were thenorm and as a hub for Mediterranean trade.

Vincent O’Doherty briefly touched upon the UNICE report he had prepared on Maltese readiness for EU membership. Hesaid that Malta was a suitable base for business and that the island was able to compete in the European market. Therewere however some points for improvement, such as the port monopoly and the further development of the tourism sector.

� Business opportunities in Poland

Speakers Marek Wejtko, Deputy Minister of EconomyTeresa Malecka, Vice-President of the Polish Agency for Foreign Investment PAIZHenryka Bochniarz, President of the Polish Confederation of Private EmployersAndrzej Malinowski, President of the Confederation of Polish EmployersUwe Krüger, Chief Executive Officer of Hochtief Polska (Moderator)

Summary of the presentationFollowing the successful change to a market economy and a far-reaching fiscal plan, Poland was faced with a GrossDomestic Product growth rate of only 1% of GDP in 2001, Marek Wejtko said. In order to increase the Polish growthrate to its minimum level of 5.3% of GDP and to combat the very high level of unemployment, the government

Lawrence Zammit, Helga Ellul,

Vincent O’Doherty, Arhi Palosuo,

Joe Zammit Tabona, Josef Bonnici.


CONGRESS PROGRAMMEintroduced a “Programme towards entrepreneurship and development”. This programme introduced simpler rules forrunning a business by both foreign and Polish investors and the further improvement of the legal system, Wejtko said. “I believe that no special incentives for foreign investors are needed. They want the same level playing field as nationalinvestors”. He also warned that both the EU and the Polish government should stick to the deadline set for EUmembership. “It is an extremely difficult process, but if we prolong it, we will observe a fatigue on the side ofgovernments, private companies and the general public,” he said.

Henryka Bochniarz said the fall in the GDP growth rate and the high rate of unemployment was the price Poland hadto pay “to become more competitive.” She noted that Poland also had booked some positive results, especially in cuttinginflation. Bochniarz said she was “quite optimistic” that growth would pick up again in the near future. She noted thehuge potential of the Polish work force, with 900,000 youngsters entering the employment market every year, and theentrepreneurial capacity of the Poles. Further incentives for the private sector, such as more capitalisation and moreflexible rules, will further help the development of the Polish economy. She noted that 70% of the Polish GDP is alreadyproduced by the private sector and that this figure would further increase. Bochniarz also welcomed the government’sprogramme for entrepreneurship and development. “I am convinced we are on the verge of the next stage of a dynamicdevelopment of the Polish economy,” she concluded.

Proof that Poland was and is a popular destination for foreign investment was given by Teresa Malecka. She noted thatthe FDI inflow in Poland had been increasing steadily in the last couple of years. Most popular sectors for investment areautomobile, telecommunication, food processing and financial services. The US and France are the biggest investors inPoland, followed by Germany, the UK, Spain, Italy and Belgium. Malecka said that the main motives for investments inPoland were: market size, human capital, the central location, perspectives for dynamic economic development, EUintegration, the legal environment and the investment-friendly climate. She said the legal conditions for investment werecompatible with EU regulations and guaranteed equal treatment between local and foreign investors. She said the privatesector was already playing an important role, but that privatisation should be continued.

Andrzej Malinowski said Polish employers were looking forward to co-operate with foreign businesses and investors.He noted that job creation in an investment-friendly climate was a main priority for Polish employers as well. “We areprepared to offer our assistance and experience to foreign companies,” he said. He added that both Polish and EUcompanies should not only look at the costs of an integrated EU, but also at the profits and advantages. “Let’s dobusiness together, we should have a common vision of a united Europe,” he said.

� Business opportunities in Romania

Speakers Radu Serban, Minister Counsellor at the Mission of Romania to the EUMarius Sorin Bota, Secretary of State at the Ministry of Public WorksMariana Diaconescu, President of EximbankSilviu Hotaran, Director General of Microsoft RomaniaBernard Savage, Task Manager Romania Team, DG Enlargement (Moderator)

Summary of the presentationRadu Serban opened the presentation by summing up the reasons why Romania is an ideal location for investment. Hementioned the good economic and human resources, a good telecommunications and transport network and its ideallocation at the crossroads of traditional and new markets. Serban also confirmed that Romania wants to close its

Marek Wejtko, Henryka Bochniarz,

Andrzej Malinowski, Teresa Malecka,

Uwe Krüger.


accession negotiations with the EU by the beginning of 2004 at the latest. In order to meet this goal, the governmenthad adopted a series of programmes aimed at maintaining macro-economic growth and a high level of GDP growth. Theprogrammes also aimed at creating 750,000 new jobs and bringing down the inflation rate to a one-digit number in2004, an acceleration of privatisation and a support programme for SME’s. Serban said that Romania’s economic growthshould also be based on an increased foreign investment rate. The government has therefore introduced the equaltreatment between foreign and domestic investors and set up a Romanian agency for foreign investment, which mainpolicy in the first couple of years will be the fight against corruption, Serban said.

In the enlargement negotiations with the EU, transport policy is a very important matter for Romania, Marius SorinBota said. He noted that Romania had already made a lot of efforts in this field, but more needed to be done todevelop a very efficient transport infrastructure. Following the adoption of a law allowing Romanian and third countrypartnerships for major infrastructure works, there were good investment opportunities in transport networks, Botasaid. He mentioned Romania’s ambition for the development of a network of motorways, the rehabilitation of nationalroads, the modernisation and rehabilitation of the railway infrastructure and the development of a maritime corridorand network.

Mariana Diaconescu touched briefly on Romania’s GDP growth and inflation rates. She noted that the GDP growth was5.3% in 2001 and was expected to be around 4.4% in 2002. Following a peak in 1997, inflation was gradually fallingand expected to be below 22% at the end of 2002, she said. As President of Eximbank, Diaconescu also gave moreinformation about this institution, which was set up in 1992 with as main goal supporting Romanian trade. Eximbankacts on its own account as well as agent of the government. The main activities of Eximbank include the modernisationof production capacities for export goods through investment financing programmes, guaranteeing of equalopportunities for foreign and Romanian investors, drafting of credit reports and issuing guarantees and export creditinsurance. On behalf of the state, Eximbank also issues interest rate subsidies, bonds and export credit insurance,Diaconescu said.

The development and strong potential of Romanian software and IT development was presented by Silviu Hotaran. He said that “software development was the secret weapon of Romania to overcome its problems”. He noted the strongeducational system, the strong and large diversified community and the growing number of software companies. He welcomed the lead taken by the Romanian government to promote IT development and summed up a number ofimportant decisions. He mentioned the e-government programme, the fiscal incentives for software companies, thesevere laws on cyber crime and the e-tax plan. The combination of transparency, citizen satisfaction, reduction of costsand the fight against bureaucracy will contribute to the success of the IT sector in Romania, Hotaran said.

� Business opportunities in the Slovak Republic

Speakers Jaroslav Chlebo, State Secretary at the Ministry of Foreign AffairsMichal L’ach, President of the Federation of Employers’ Associations of the Slovak RepublicArtur Bobovnicky, General Director of the Slovak Investment and Trade Development AgencyDirk Meganck, Head Slovak Team, DG Enlargement (Moderator)

Summary of the presentationThe Slovak republic has already booked many successes in improving its macro-economic situation and has carried out aseries of structural reforms, Dirk Meganck said. He mentioned the fully completed privatisation in the banking,insurance and telecommunications sector, the restructurised and privatised steel sector and the recently startedprivatisation of the energy sector. These measures have improved the business environment in the country, but moreefforts –especially to attract Greenfield investments- are needed, he said.

Marius Sorin Bota, Bernard Savage, Mariana Diaconescu, Radu Serban.

CONGRESS PROGRAMME


CONGRESS PROGRAMMEThe Slovak general elections of September 2002 are a crucial and stimulating factor for the current government tocomplete its political goals, Jaroslav Chlebo said. He said stable and democratic functioning institutions, rule of law,NATO membership and the completion of the EU accession negotiations were key political goals for the government.Economically, Slovakia was still experiencing the consequences of the process of transformation and a series of fiscalmeasures. However, this transformation also had positive results, such as the stabilisation of interest rates following therestructuring of the financial sector and the change of company ownership to the private sector, Chlebo said. He alsomentioned the very good preparations for EU membership and confirmed Slovakia’s intention to complete thenegotiations by the end of 2002. “EU membership will be the completion of our political goal to be part of a unifiedEurope,” he said.

Artur Bobovnicky gave more information on the Slovak business climate and summed up the favourable conditionsfor investing in the country. He mentioned among others the favourable geographical location, a stable local currency,political stability, a good transport and telecommunications infrastructure, a well-educated, skilled and availableworkforce and a good cost structure. On top of this, Slovakia was well known for the friendliness and hospitality of itspeople and for its world-class beer, Bobovnicky said. He said that the investors that came to Slovakia had been stayingand expanding and had also brought a lot of sub-suppliers to the country. Bobovnicky also mentioned the investmentsupport measures in the country, such as tax credits, grants for training and education and support from localauthorities.

Michal L’ach presented the social climate in the Slovak Republic and the important role played herein by the businessworld. L’ach noted that Slovakia had not known any strikes for the last 10 years. According to him, this was the result ofthe good, tripartite social dialogue in the country. “All important legal discussions are being discussed with the socialpartners. It is a guarantee that the decisions taken will be beneficial for the three players in the social field: government,employers and unions,” he said. L’ach also highlighted the role of the Slovak employers’ federation as a bridge betweenEastern and Western Europe. Western investors can use our experience to find out more about investing in Russia andUkraine, L’ach said.

� Business opportunities in Slovenia

Speakers Renata Vitez, State Secretary at the Ministry of EconomyMatej Kovac, Director of the Slovenian Trade and Investment Promotion Agency TIPOPeter Kraljic, Senior Director at McKinsey & Company in DüsseldorfEdi Kraus, Managing Director of JulonJaime Garcia Lombardero, Head Slovenia Team, DG Enlargement (Moderator)

Summary of the presentationIn his introductory remarks, Jaime Garcia Lombardero said the European Commission viewed the Slovenian macro-economic situation as favourable, although there were concerns about the high inflation rate and the increase of thebudget deficit.

State Secretary Renata Vitez said that Slovenia successfully managed to turn into a market-oriented economy.Slovenia had been experiencing a steady growth of 4-5% of GDP in the last couple of years, with a minorslowdown in 2001 and an estimated GDP growth rate of about 3% in 2002. As a result, Slovenia had now reacheda GDP level of 70% of the average EU level. Inflation remained high at 8%, but was expected to fall to 7% in

Michal L’ach, Jaroslav Chlebo,

Artur Bobovnicky, Dirk Meganck.


CONGRESS PROGRAMME2002 and below 5% at the time of Slovenia’s accession to the EU in 2004, Vitez said. While both inward andoutward FDI was growing, Vitez hoped for a better diversification of investments as about 50% of inward FDI areof Austrian origin and about 50% of outward investments go to ex-Yugoslavian countries. She said that EUmembership was a logical step in the further economic development of Slovenia and would allow economicgrowth, a better life and social welfare.

Matej Kovac confirmed that following a slow start in the early nineties, Slovenia was becoming more and moresuccessful in attracting FDI. A series of government programmes, such as the abolishment of remaining administrativebarriers, the increased availability of land and the formation of a skilled labour force, should further contribute to anincreased inflow of FDI, Kovac said. He also noted that Slovenia had introduced a simple and understandable corporatetax code and a series of grant schemes that were in line with EU state aid rules. Thanks to a decentralised privatisation,Slovenia could be seen as a gateway to future and present EU markets, he concluded.

Peter Kraljic summed up the many advantages for investors in Slovenia. He noted the stable political and economicenvironment with low corporate taxes and a low level of red tape, the skilled and homogeneous work force and thelanguage skills, the favourable geographic position and a tradition of economic and financial solidity. He also mentioned acouple of weak point such as the slow pace of privatisation, a difficult market penetration and the high level of inflation.But he noted that every country has its weak points and that the weak points were more than overturned by the manyadvantages of investing in Slovenia.

An example of a successful investment was presented by Edi Kraus, Managing Director of Julon. Julon belongs to theItalian Bonazzi Group, which is present in 20 production sites in Europe in the field of cotton mills and the fabrics ofcotton and the chemical textiles business. The Bonazzi Group started to look for investment projects in Slovenia as earlyas 1989. In 1993, the Group acquired the bankrupt Julon textile mill and started its privatisation and recapitalisation. The Bonazzi Group currently has 4 production sites in Slovenia and 1,500 employees. Kraus said that the investment inSlovenia also encouraged the Group to further in investments in the region.

� Business opportunities in Turkey

Speakers Melek Us, General Director of Foreign Investments at the Turkish TreasuryBahadir Kaleagasi, Tüsiad Representative to the EU and UNICEÇelik Kurdoglu, Chairman of Kurdoglu Consulting IncAli Tekin, Member of the Turkish Parliament and Delegate at the European ConventionYusuf Sukal, Principal McKinsey & Company, Istanbul (Moderator)

Summary of the presentationThe recent financial crises had prompted the Turkish government to carry out intensive structural reforms aimed atincreasing the competitiveness and effectiveness of the Turkish ecomomy, Melek Us said. She noted that Turkey did nothave a good record in attracting Foreign Direct Investment, but she was confident that a new reform programme wouldreverse this trend. The reform programme included a reduction of administrative barriers, tax incentives, equal treatmentfor foreign and domestic investors and improved land access for foreign investors. Us said the government would alsocreate a Promotion Agency in order to better promote Turkey’s business incentives to potential investors. Through regularcontacts with foreign business people, Turkey should be able to promote itself better, but also to learn from others’experiences and advice. “Turkey has to get rid of its traditional image,” she said.

Edi Kraus, Matej Kovac, Peter Kraljic, Jaime Garcia Lombardero,Renata Vitez.


CONGRESS PROGRAMME

Bahadir Kaleagasi agreed that the recently introduced structural reform programmes had a positive impact and helpedto reconsolidate the Turkish economy. The customs union between Turkey and the EU also helped as it opened Turkishindustry to European competition. Kaleagasi noted that an economic relationship was not sufficient and that politicalreforms were also necessary for Turkey to become an EU member. He said the strong public support for EU membershiphad incited the political establishment to adopt the necessary reforms. “Some steps have already been taken. But there isstill much to do, both by Turkey and the EU,” he said. He added that Turkey’s young population, high entrepreneurshipand multicultural structure would be a valuable asset to the EU, while EU membership would also enhance the country’secomomic presence and democratic stance at the international level. However, there was also a responsibility to be takenby the EU, especially in bringing a constructive message about Turkey and by having an open mind to set a date for thestart of the accession negotiations, he said.

Çelik Kurdoglu sketched the evolution in the Turkish enterprise culture from family holdings to corporations and thegrowing investments of Turkish businessmen in the Balkan countries and the New Independent Republics of Central Asia.As a result, Turkish membership of the EU will have a positive impact for both Turkish and EU firms. Turkey also hasgrowing trade relations with the EU, in particular in electronic equipments and household appliances. “The emergingTurkish market is of growing significance for the European Union’s global competitiveness,” Kurdoglu said.

Speaking in his capacity as Turkish representative in the European Convention, Ali Tekin explained why the future ofTurkey was linked to the future of the EU as a global player in a globalised world. He noted that the EU was facing threemajor reforms: an increase in size as a result of the upcoming enlargement, a further deepening of its structures and amore flexible and efficient decision-making process. Turkey with its large and young and computer-literate population andits high level of entrepreneurship could help the EU to reach these goals, Tekin said. On the other hand, Turkey also had alot to gain from EU membership, especially in the field of a stable market economy, the respect of human rights andplural democracy, he said.

Melek Us, Bahadir Kaleagasi,

Çelik Kurdoglu, Ali Tekin,

Yusuf Sukal.


CONGRESS PROGRAMME

Plenary Sessions

PLENARY OPENING SESSION

� Lessons from previous enlargements and the challenge of future enlargement

Speakers Luc Vansteenkiste, President of the Federation of Enterprises in BelgiumAnnemie Neyts, Minister at the Belgian Foreign OfficeAdrian Nastase, Prime Minister of RomaniaGünter Verheugen, European Commissioner for Enlargement

Summary of the discussionVBO-FEB’s Luc Vansteenkiste opened the session by pointing out the benefits of enlargement for the EU as a whole andfor businesses in particular: extending the area of peace and stability, stimulating economic growth, and boosting theinternational standing and influence of the EU. Regarding sustainable development, the other part of this year’s topic ofthe European Business Summit, the goal should be to maintain the balance between economic development, socialdevelopment and environmental protection, Vansteenkiste said. He also pointed out that the dialogue at the EuropeanBusiness Summit was not limited to economic and political players, since it also gave representatives of civil society,NGO’s, social partners and academics the opportunity to participate.

Annemie Neyts noted that the method of setting target dates, as is being done now with enlargement, is a provenmethod in the history of European integration. Politically spoken, the enlargement process is irreversible. The goal of thisambitious undertaking is to extend stability and prosperity across the continent. As a result, the EU will once more increaseits economic power, which should also be used to reduce the gap between the rich and poor nations and populations inthe world, Neyts said. On top of free trade, financial support, political co-operation and a solidarity mechanism are neededto achieve this, she said. Neyts noted that agriculture was a good example of the challenges in integrating new memberstates and in finding the right balance between self-interest and global solidarity on the world stage.

Romanian Prime Minister Adrian Nastase focused on the economic and business aspects of future EU enlargements.Regarding the four freedoms, the EU has at the moment a favorable trade balance with Romania on the free movementof goods, while Romania is very competitive when it comes to free movement of labour. Free movement of servicesshould offer opportunities for both, whereas the Romanian government continues to push forward policy measures toenhance investor confidence and thus facilitate free movement of capital, Nastase said. He also added a fifth freedom:the free movement of good ideas and best practices. In the accession negotiations, Romania is focusing on social aspects,in order to offer a minimum standard of living to less-favoured categories of people. Finally, Romania is working hard onlowering inflation, continuing to boost economic growth of around 5%, and improving the business climate, includingmodern VAT and tax profit regulations, the Prime Minister said.

Günter Verheugen,Annemie Neyts, Luc Vansteenkiste, Adrian Nastase.

European Commissioner Günter Verheugen acknowledged the fact that challenges such as immigration, cross-bordercrime and competition from low-cost labour existed. But he stressed that EU enlargement was not causing these issues,but rather formed the best possible answer to them. Limiting wealth increase to the current EU would only increasepressure on the poorer parts of the continent. Enlarging the EU, on the other hand, would give people in Central andEastern Europe hope of a better future in their own countries. In order to do so, it is crucial to get public support forenlargement, Verheugen said. The main actors here are the national governments. Given the fact that public knowledgeabout enlargement is still very low, there is a lot of work ahead. “For the one risk we cannot take, is to forego thecurrent chance to enlarge the EU,” Verheugen said.

PLENARY CLOSING SESSION

� Entrepreneurship and sustainable development in an enlarged Europe: future challenges for the business world

Speakers Georges Jacobs, President of UNICEJean-Philippe Courtois, President of Microsoft EMEAGerhard Cromme, ERT Chairman and Chief Executive Officer of ThyssenKruppJean-Luc Dehaene, Vice-President of the European Convention

Summary of the discussionThe closing session of the European Business Summit focused on the key challenges and opportunities facing business inEurope as the EU strives to reform itself institutionally as well as economically in preparation for enlargement.

Opening the session, Baron Jacobs said that enlargement presented huge challenges as well as opportunities. Businesshas always been strongly in favour of enlargement. Yet while there should be no delay for the front-runners, equallythere should be no precipitating of the accession for those candidates that were not sufficiently prepared, Jacobs said.The key question facing business, he said, was how to find a balance between sustainability and economic development.Sustainable development should be promoted by the EU, but on the basis of dialogue and self-regulation rather thanlegislation.


CONGRESS PROGRAMME

Georges Jacobs, Gerhard Cromme,

Jean-Philippe Courtois, Jean-Luc Dehaene.

At the plenary openingsession: The Choir ofthe European Schooland the audience.


CONGRESS PROGRAMMEJean Philippe Courtois called for efforts to be made to unleash the full potential of resources in an enlarged Europe. All Europeans needed to have the freedom to learn and work, he said, with the key to achieving this being co-operationbetween all stakeholders. The top three actions that needed to be taken to achieve this goal were: boosting innovationto stimulate the growth of a knowledge-based economy; investing in IT training to bridge the current skills gap; andfinally, encouraging entrepreneurship to ensure that Eastern Europe could rely on indigenous growth as well as FDI tostimulate its economic development.

According to Gerhard Cromme, both the single market and sustainable development provided business with a set ofobligations as well as opportunities. He warned that urgent action needed to be taken by the EU to halt the relativedecline of its economic competitiveness vis-à-vis the US. Economic liberalisation in the framework of the Lisbon processwas all the more vital and urgent in view of enlargement, yet progress was being delayed by the cumbersome nature ofthe EU decision-making process, which was almost approaching paralysis, he said.

Vice-President of the European Convention and former Belgian Prime Minister, Jean-Luc Dehaene closed the secondEuropean Business Summit. He emphasised the need to distinguish between the grinding technical process of theenlargement negotiations and the historic significance of the reunification of Europe. The Nice Treaty, he said, hadproduced a minimalist agreement that would allow enlargement to proceed but it left some key questions unanswered.In this light, the Convention would only be considered a full success if it produced a large consensus on the text of a newConstitutional Treaty for the EU. If, on the other hand, it merely produced a report summarising the future options opento the EU, it would not be able to significantly influence the work of the forthcoming Intergovernmental Conference,Dehaene said.

At the plenary closing session:Adrian Knott and European School.


NETWORKING VILLAGE

Dialogue and networking are the main values of the European Business Summit.The EBS is not only a congress; it is also a place to meet, discuss, negotiate andgather information. In the Networking Village, several European institutions,candidate countries, companies, organisations and NGO’s were brought together inan atmosphere of conviviality and openness.

Candidate countries used the opportunities to present their national productsand/or companies. High-level government or business representatives were presentto give more information on the business climate or economic situation of thecountry. But the presence of so many candidate countries showed first andforemost what an enlarged European Union will look like. EBS delegates withquestions on the European Union, the many European Commission programmesand initiatives for companies could pay a visit to the large European Union block.DG Education & Culture, Enlargement, Enterprise, Environment and Research wereall present, but also several European agencies, such as the European Agency forSafety and Health at Work, the European Foundation for the Improvement of Livingand Working Conditions and the Office of Harmonisation in the Internal Market.Being not a fair in the traditional sense of the word, the companies present in theNetworking Village took the opportunity to present their actions and views on“sustainable development”. Civil society was represented amongst others by theEuropean Trade Union Confederation (ETUC) and the Social Platform. The SocialPlatform regroups 38 European NGO’s, federations and networks working to buildan inclusive society and promote the social dimension of the EU.

The Networking Village was the “very heart” of the European Business Summit.Apart from visiting the stands, delegates could also take a rest in the Piazze orcontinue their discussions in a calmer corner over a little drink. The Gala Evening onThursday evening, lunch and the Farewell Cocktail on Friday took also place in theNetworking Village.

FEB CEO Tony Vandeputte, BrusselsMayor Freddy Thielemans and UNICESecretary-General Philippe de Buckvan Overstraeten at the officialopening of the Networking Village.

H.R.H. Prince Philippe of Belgiumtalking to Interbrew’s Pierre JeanEveraert and Alain de Waele, and EBSManaging Director Didier Malherbe.


NETWORKING VILLAGE

• Abelag Aviation• ACE – The Alliance for Beverage

Cartons and the Environment• Ackroyd Publications• Banksys• Barco• Brussels-Capital Region• Business & Society Belgium• Canada• Carrefour• CEN – The European Committee for

Standardization• CSR Europe• De Financieel-Economische Tijd• Decitime• DHL Worldwide Express• EastWest Institute• EFES – The European Federation of

Employee Share Ownership• Emakina• Eurokids’ Team• Euronext• Europe Information Service• European Business Forum• European Voice• Eurowards• FEB – Federation of Enterprises in

Belgium

• Generation Europe• ING Group• Interbrew• Kompass Belgium• La Quinzaine Européenne• L’Echo• Malawi• Medeatrade• Microsoft• Mouvement Européen• Nespresso• OCE Belgium• Renault• Siemens• Social Platform• Solvay• The Work Foundation• Tractebel• UNICE• Unilever• United Nations Environment

Programme – UNEP• Vienna Business Agency• WeberShandwick• Yes for Europe

Thanks to all those present in the Networking Village

Were they preparing the Plenary Closing Session?Gerhard Cromme of ThyssenKrup, Jean-LucDehaene of the European Convention and H.R.H. Prince Philippe of Belgium.

Networking in a relaxed atmosphere: Georges Jacobs of UNICE, Daniel Janssen ofSolvay and French Ambassador to BelgiumJacques Rummelhardt.

Candidate Countries• Czech Republic• Enterprise Estonia• Hungary with ITDH, the Ministry of

Foreign Affairs, 77 Elektronika Ltd,Ganz Steel Structure Co. Ltd, TescoConsulting Co Ltd, The TreasuryProperty Directorate and ZwackUnicum Co Ltd

• Lithuania• Malta• Poland• Romania• Slovakia• Slovenia


NETWORKING VILLAGE

European Union• European Commission DG Education

& Culture• European Commission DG

Enlargement• European Commission DG Enterprise• European Commission DG

Environment• European Commission DG Research• European Economic and Social

Committee

• European Investment Bank• Cordis• European Agency for Safety and

Health at Work• European Foundation for the

Improvement of Living and WorkingConditions

• Office of Harmonisation in theInternational Market

European Commissioner Erkki Liikanen visiting theCordis stand.


SATELLITE ACTIVITIES

Several activities were organised alongside the core programme. These includedseminars, lunches, general assemblies and a training session for journalists.

The Brussels Regional Development Agency, in collaboration with BrusselsTechnopol organised a seminar on “Invest in Brussels, an opportunity for Europeancompanies”. In an interactive panel session, five business leaders discussed thebusiness opportunities for European companies in the Brussels-Capital Region. Inthe next sessions, academic representatives discussed how the business andacademic world could work together. Eric Tomas, Minister of Economic Affairs ofthe Brussels-Capital Region concluded the seminar by highlighting the economicadvantages of the Brussels-Capital Region. About 120 persons attended theseminar.

The European Services Forum and the European Services Leaders Group heldtheir General Assembly during the Summit. Sixty-five ESF members attended theassembly, in which European Trade Commissioner Pascal Lamy also participated.

CSR Europe organised a training session for journalists and leading communicatorson “The stories behind corporate social responsibility”. Together with a panel ofexperts, journalists discussed how to find a right balance between the views of thebusiness world and civil society in corporate social responsibility reporting. They alsodiscussed the difference in perception of corporate social responsibility betweenregions and countries.

In the general philosophy of the European Business Summit to stimulate a dialoguebetween the business world and civil society, WeberShandwick in co-operationwith the Social Platform (formerly known as the European Platform of SocialNGO’s), organised a round table on Corporate Social Responsibility. The round tablebrought together twenty NGO leaders and top-level business executives for a frankand open debate on the most topical Corporate Social Responsibility issues.Theround table was chaired by the chief executive of the Work Foundation, Will Hutton,and was attended, amongst others, by Umberto Paolucci of Microsoft Italy, RolandVaxelaire of Carrefour, Baudoin Kelecom of ExxonMobil, Giampiero Alhadeff of the

European Services Forum GeneralAssembly with European

Commissioner Pascal Lamy asspecial guest.


SATELLITE ACTIVITIES

Social Platform, Marie-Francoise Wilkinson of the European Anti-Poverty Networkand Dick Oosting of Amnesty International. Discussions focused on the role oflegislation in Corporate Social Responsibility and whether mandatory environmentaland social reporting should be required of companies. Both NGO and businessrepresentatives found the discussion useful and looked forward to a follow up eventin the future.

Several organisations also organised a lunch for their members or for invited guests.Belgian Business for Europe and the Vlerick Leuven Gent Management Schoolorganised a members lunch around the theme of EU enlargement with BelgianMinister of State Mark Eyskens as keynote speaker. The Canadian Embassy inBelgium had invited a number of CEO’s to hear more about investmentopportunities in Canada and the EastWest Institute organised a lunch duringwhich the EU-Russian relationship was discussed.

Belgian Business for Europe and theVlerick Leuven Gent ManagementSchool discussing EU enlargement withBelgian Minister of State Mark Eyskens.

Networking lunch on EU-Russianrelations organised by theEastWest Institute.


PRESS CLIPPINGS

“Ce n’est pas un hasard si le sommet EBS, qui s’affirme désormais comme undes rendez-vous majeurs pour Bruxelles en tant que capitale de l’Europe,avait choisi de se focaliser sur l’élargissement de l’Union. Le échéances seprécisent en effet et la perspective d’une Europe à vingt-cinq est désormaistoute proche. Or, si les réunions techniques et politiques entre les Quinze etles pays candidats sont devenues quasiment routinières, les opportunités decontacts économiques et de rencontres moins officielles sont restées plusrares. Pourtant, il est préférable pour les deux parties de se connaître avantde se marier.”L’Echo, 7 June 2002

“A remarkable development was the participation of European NGOs andtrade unions. Whereas during the first edition, representatives of civilsociety stayed outside of the venue and protested against globalisation, thissecond edition took the initiative to invite major NGOs for a seriousdialogue.”Euractiv.com, 10 June 2002

“Le but des organisateurs et des deux mille participants consistaitégalement à construire des ponts entre les Etats membres de l’Union et lespays candidats, d’une part, entre le monde des affaires et de la sociétécivile, d’autre part. En dehors des conférences, le “networking village” -oùles organisations européennes, les pays candidats, les entreprises et les ONGtenaient des stands- a favorisé le dialogue et les rencontres informelles.”La Quinzaine Européenne, 17-30 June 2002

“The first day of the two-day European Business Summit ended with aplenary session in which Enlargement Commissioner Günter Verheugen madeit crystal clear enlargement would come about. “Enlargement will come. It isa must. It can be done. It must be done. It will be done,” he insisted.”The Times of Malta, 7 June 2002

“The summit’s goal is to evaluate prospects of sustainable development andmatters linked with EU enlargement. Since special attention will be paid tothe EU enlargement issues, representatives of the EU candidate countrieswill be able to organize presentations to report on the economic situationand business opportunities in their countries. Taking into account theimportance of the event, Latvia will stage a presentation on businessopportunities in Latvia on June 6.”Latvian News Agency LETA, 5 June 2002


PRESS CLIPPINGS

“Representatives of foreign companies and investors showed surprisinglygreat interest in operation in the Czech Republic at the European BusinessSummit, which started in Brussels today, CTK was told by Jiri Eicher of theIndustry and Trade Ministry. Eicher is responsible for the Czech informationstand at the EBS. Soon after the official opening of the two-day summit, theCzech stand was visited by representatives of the Italian Chamber ofCommerce, Microsoft and representatives of Spanish and Belgian firms.”CTK (Ceska Tiskova Kancelar) Business News, 6 June 2002

“The challenges for business in the EU enlargement process were at theheart of the European Business Summit in Brussels on 6-7 June. Fifteenhundred policy makers and business executives were discussingentrepreneurship and sustainable development in an enlarged Europe – and found plenty of difficulties as well as plenty of opportunities.”European Report, 12 June 2002

“The Brussels exhibition centre, known as Heysel, was the centre ofattraction and attention for both the political and the business world inEurope from 6 to 8 June, when the Heysel opened its doors to welcomeover 1500 participants to the European Business Summit. This second editionof the European Business Summit was even more successful than the first,with more participants, more discussion panels and - above all - a largenumber of companies, such as Solvay and Microsoft which presentedthemselves and their EU interests in the "Networking Village". “Unice@news, July 2002

Tony Vandeputte,Philippe Busquin,Pascal Lamy,Isabelle Durant,H.R.H. Prince Philippe of Belgium,Luc Vansteenkiste,Georges Jacobs.


FACTS & FIGURES

PARTICIPANTS: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,612

SPEAKERS: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122OF WHICH 8 EUROPEAN COMMISSIONERS AND 10 MINISTERS AND VICE-MINISTERS

JOURNALISTS: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150

TOTAL: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,884

NATIONALITIES REPRESENTED: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

Some reactions“It was really a pleasure to have had the chance to take part in the event.”CEBRE – Czech Business Representation in Brussels

“Congratulations on the very professional and well-organised event”Mexican Embassy in Brussels

“Another scheduling of the event might have been better: one day businessopportunities and one day discussions and plenary sessions.”Philip Luyten – Atofina

“The concept of the Networking Village was very good! Keep it for the nextedition. Maybe you could find a way to increase interactivity in theNetworking Village?”Pascale Zoetaert – Ackroyd Publications

“I believe that the Networking Village concept was good but that thelocation at Heysel may have discouraged people from visiting the EBS. Thequality of the service you provided and the organisation of the meetingitself was of a very high standard.”Miguel Veiga-Pestana – Unilever

We hope to see you at the next European

Business Summit

BRUSSELS, 20-21 MARCH 2004

Contact us for more information

Tel: +32 2 515 08 11 Fax: +32 2 515 09 15Email: [email protected]

www.ebsummit.org

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European Business SummitRue des Sols 8 - B-1000 Brussels Tel: +32 2 515 08 11 Fax: +32 2 515 09 15Email: [email protected]

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