The Bulgarian enterprises internationalization trends after the global financial crisis 1.
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Transcript of The Bulgarian enterprises internationalization trends after the global financial crisis 1.
1
The Bulgarian enterprises internationalization trends after the
global financial crisis
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TRENDS IN EXPORTS AND IMPORTS
2000-01 2000-12 2001-11 2002-10 2003-09 2004-08 2005-07 2006-06 2007-05 2008-04 2009-03 2010-02 2011-01 2011-12 2012-11
-1500
-1000
-500
0
500
1000
1500
2000
2500
3000
3500
Current Account, mln. Euro
Polynomial (Current Account, mln. Euro)
Exports, mln. Euro
Polynomial (Exports, mln. Euro)
Imports, mln. Euro
Polynomial (Imports, mln. Euro)
3
CONCLUSIONS ABOUT FOREIGN TRADE DYNAMICS
•Under the global financial bubble imports systematically outperformed exports due to so called savings glut•Current account was registering important deficits reaching up to 20% of GDP•After the crisis exports declined but quickly recovered overcoming pre-crisis level•Imports are lagging behind as a result of sluggish domestic demand•Current account is approximately balanced after the crisis
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The Role of the Real Effective Exchange Rate- REER
2002-Q3
2003-Q1
2003-Q3
2004-Q1
2004-Q3
2005-Q1
2005-Q3
2006-Q1
2006-Q3
2007-Q1
2007-Q3
2008-Q1
2008-Q3
2009-Q1
2009-Q3
2010-Q1
2010-Q3
2011-Q1
2011-Q3
2012-Q1
2012-Q3
2013-Q1
85
95
105
115
125
135
145
155
REER- Unit Labor Costs
REER- SPI
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Conclusions about the role of REER
•Before the crisis the REER on the basis of unit labor costs marked strong increase what reflects faster growth of domestic salaries vis-à-vis foreign competitors•After the crisis the process is reversed due mainly to cutting labor and productivity gains what can explain the stronger recovery of exports•REER on the basis of domestic prices- SPI, is stagnating after the crisis, a trend compatible with the relative slow down of imports•The improvement of the current account can be explained by enhanced cost competitiveness of exports and sluggish domestic demand
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Foreign Capital Flows
2000-01 2000-11 2001-09 2002-07 2003-05 2004-03 2005-01 2005-11 2006-09 2007-07 2008-05 2009-03 2010-01 2010-11 2011-09 2012-07 2013-05
-800
-600
-400
-200
0
200
400
600
800
1000
1200
FDI, mln. Euro
Polynomial (FDI, mln. Euro)
Portfolio Investments, mln. Euro
Polynomial (Portfolio Investments, mln. Euro)
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Capital Flows: Conclusions
•FDI increased before the crises and declined afterwards•Portfolio Investments are vulnerable during the whole period 2000-2013•The improvement of the current account is strongly correlated with the decline of FDI•The worsening of FDI and the improvement of current account coincide with the worsening of the fiscal deficit- twin deficit hypothesis not confirmed
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Structure of Exports
Jan/0
0Jul/0
0
Jan/0
1Jul/0
1
Jan/0
2Jul/0
2
Jan/0
3Jul/0
3
Jan/0
4Jul/0
4
Jan/0
5Jul/0
5
Jan/0
6Jul/0
6
Jan/0
7Jul/0
7
Jan/0
8Jul/0
8
Jan/0
9Jul/0
9
Jan/1
0Jul/1
0
Jan/1
1Jul/1
1
Jan/1
2Jul/1
2
Jan/1
30
10
20
30
40
50
60
Consumtion Goods, % of totalRow Materials, % of totalInvestment Goods, % of totalEnergy, % of total
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Conclusions about the structure of exports
•The structure lingers inefficient•The high share of row materials remains untouched•The share of energy products also does not change•We observe some trends towards the increase of share of investment goods and decrease of consumption goods•The 2008-2009 crisis does not affect the composition of exports in a particular manner, long terms trends are unaltered
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The Structure of Imports from European Countries 1995-2013
1995 г.
1996 г.
1997 г.
1998 г.
1999 г.
2000 г.
2001 г.
2002 г.
2003 г.
2004 г.
2005 г.
2006 г.
2007 г.
2008 г.
2009 г.
2010 г.
2011 г.
2012 г.
2013 г.0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
90.0
100.0
Consumtion Goods, % of imports from European countriesRow Materials, % of imports from Eu-ropean countriesInvestment Goods, % of imports from European countriesEnergy, % of imports from European countriesOther, % of imports from European coun-tries
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Conclusions about the Structure of Imports
•The structure of the European imports remains extremely negative with very high share of energy, what reflects strong dependence on Russian supplies•The share of investment goods remains low and declining•The structure of imports does not allow for post-crisis economy restructuring and improvement of competitiveness
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The Structure of FDI Flows
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
-20
-10
0
10
20
30
40
50
60Financial Intermediation, % of Total
Manufacturing Industry, % of To-tal
Electricity and Other Energy, % of Total
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Conclusions About the Structure of FDI
•The structural trends are unstable•We observe some increase of the share of energy Investments due to EU requirements about the Green energy and profitable price conditions•The share of manufacturing is unstable and declining•The FDI flows related to financial intermediation are also unstable
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Technology Transfer
2000-012000-102001-072002-042003-012003-102004-072005-042006-012006-102007-072008-042009-012009-102010-072011-042012-012012-102013-070
5
10
15
20
25
30
Licenses and Property Rights, Exports, mln. euro
Polynomial (Licenses and Property Rights, Exports, mln. euro)
Licenses and Property Rights, Imports, mln. euro
Polynomial (Licenses and Property Rights, Imports, mln. euro)
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Conclusions About Technology Transfer•The transfer is measured in terms of payments related to licenses and property rights•Both payments to and from Bulgaria increase•The crisis slightly accelerated the technology transfer to Bulgaria•The Bulgarian technology export also increased somewhat
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General Conclusions•The main question is: Do we observe Schumpeterian “Creative Destruction” after the crisis?•The answer in the case of Bulgaria is NO•We do not detect visible acceleration of some positive structural change•Only some long term trends, such as the increase of the share of investment goods in exports and intensification of technology transfer can be mentioned•The predominant form of external adjustment is via the comparative unit labor cost shrinkage
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Nevertheless: ClustersEU, Europe 2020 StrategyDanube StrategyThe Participation of GermanyGovernment-Business CooperationBulgarian Association of Business Clusters (ABC) was founded in 2009 with main aim to unite the efforts of clusters in Bulgaria for their dynamic development in line with European standards and to popularize clusters as opportunity for development of the Bulgarian economy in time of global crises. Full members of the organization are 11 clusters: Foundation Cluster Information and Communication Technologies (ICT Cluster) Bulgarian Furniture Cluster Cluster Mechatronics and Automation Maritime Cluster Bulgaria Cluster Information Resources Bulgarian cluster Telecommunications (BCT), ICT Cluster Plovdiv, Electric vehicle industrial cluster, Cluster for health tourism Bulgaria, Cluster Microelectronics and Embedded systems (CMES) Srednogorie Med Industrial cluster, 3 clusters became associated members of the organization: Bulgarian ecology cluster, Cluster Plovdiv – ancient and creative Bulgarian consortium of high-quality wine producers Trakia
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19
20
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MembersGEFCO Bulgaria EOOD www.gefco.bg Grammer AD www.grammer.com Haycad Infotech OOD www.haycad-infotech.bg IMACOS Truckenmüller & Company Bulgaria EOOD www.imacos.com Industrial Commerce Ltd. www.hyundaibg.bg ixetic Plovdiv EOOD www.ixetic.com Johnson Controls Electronics Bulgaria EOOD www.johnsoncontrols.com Leschke Design S-Media Team www.smediateam.com Technical University of Sofia www.tu-sofia.bg Würth Elektronik IBE BG EOOD www.we-online.de Festo EOOD www.festo.com
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Technical University of Gabrovo www.tugab.bg Balkan Star Automotive EOOD www.balkanstar.com Integrated Micro-Electronics Bulgaria EOODwww.global-imi.com
Litex Motors ADwww.greatwall.bg University of Rusewww.uni-ruse.bg Rödl & Partner EOODwww.roedl.com KEMMLER Electronic GmbHwww.kemmler-electronic.com Schenker EOODwww.schenker.bgTEM Bulgaria ADwww.etem.bgALC Bulgaria EOODwww.alc.co.zaSE Bordnetze – Bulgaria EOOD www.sebn.comSMC Industrial Automation Bulgaria EOOD www.smc.bgMelexis Bulgaria Ltd www.melexis.com
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Projects
1. First International Automotive Conference in Bulgaria
2. Auto Park Bulgaria
3. e-taxi-shuttle
4. Sofia Tech Park
5. Automotive Test Center
6. Concept and realization of education centers for middle managers
7. Best practice human resources
8. Best practice quality management
9. Best practice logistics
10. Evaluation of subsidy programs
11. Government and administration
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Results of the Automotive Cluster Activities
1. Some recent development of car assembly industry
2. 80% of cars produced in Europe have parts, manufactured in Bulgaria
3. Some progress in the field of electric cars promotion