Competition for FDI in the Black Sea Region? What investors from Germany are looking for
Black Sea Economic Forum
4th October, 2012, Yalta
FDI (shared capital) in Ukraine
Country of origin accumulated FDI in % of total
Total 52,426.7
Cyprus 14,521.5 27,7 %
Germany 7,403.9 14,1 %
Netherlands 4,949.3 9,4 %
Russian Federation 3,652.5 7,0 %
Austria 3,249.6 6,2 %
France 2,505.2 4,8 %
United Kingdom 2,493.1 4,8 %
Virgin Islands (Brit.) 1,749.7 3,3 %
Sweden 1,566.1 3,0 %
Switzerland 1,071.5 2,0 %
USA 988.0 1,9 %
Italy 985.0 1,9 %
Poland 861.9 1,6 %
from other countries 6,429.4 12,3 %
Alexander Markus, Delegation der Deutschen Wirtschaft in der Ukraine, 24.09.2012 Slide 2
1st July, 2012 – source: State Service for Statistics of Ukraine, http://www.ukrstat.gov.ua/
FDI (shared capital) in Ukraine
Country of origin accumulated FDI in % of total
Total 52,426.7
Cyprus 14,521.5 27.7 %
Netherlands 4,949.3 9.4 %
India at least 4,800.0 9.2 %
Russian Federation 3,652.5 7 %
Austria 3,249.6 6.2 %
Germany 2,600.0 5.0 %
France 2,505.2 4.8 %
United Kingdom 2,493.1 4.8 %
Virgin Islands (Brit.) 1,749.7 3.3 %
Sweden 1,566.1 3.0 %
Switzerland 1,071.5 2.0 %
USA 988 1.9 %
Italy 985 1.9 %
Poland 861,9 1.6 %
Alexander Markus, Delegation der Deutschen Wirtschaft in der Ukraine, 24.09.2012 Slide 3
1st July, 2012 – source: State Service for Statistics of Ukraine, http://www.ukrstat.gov.ua/
stability
stability
…not changing the rules of the game in the very middle
of the gameAlexander Markus, Delegation der Deutschen Wirtschaft in der Ukraine, 24.09.2012 Slide 4
predictability
predictability
not changing official positions every now
and then
Alexander Markus, Delegation der Deutschen Wirtschaft in der Ukraine, 24.09.2012 Slide 5
long-term planning cycles
Alexander Markus, Delegation der Deutschen Wirtschaft in der Ukraine, 24.09.2012 Slide 6
long-term planning
…for investment into people,
equipment and sites
foundation stone ceremony of W.E.T. housing complex in Vinogradiv, 4th Sept. 2012
transparency
Transparency
…for example of
• investment procedures
• rules
• decision making
• payments
Alexander Markus, Delegation der Deutschen Wirtschaft in der Ukraine, 24.09.2012 Slide 7
Investing into their own business
German investors know their own business
very well, some for centuries and generations.
That is what they invest in!
Alexander Markus, Delegation der Deutschen Wirtschaft in der Ukraine, 24.09.2012 Slide 8
10 Years Leoni Wiring Systems in Striy, Lviv Oblast
criteria
Investment criteria• markets for both
– purchasing and
– sales
• supply framework
• land sites with infrastructure
• work force
• connection to major transport corridors
• investment climate
• political stability
Alexander Markus, Delegation der Deutschen Wirtschaft in der Ukraine, 24.09.2012 Slide 9
barriers to German investment
Alexander Markus, Delegation der Deutschen Wirtschaft in der Ukraine, 24.09.2012 Slide 10
lack of qualified work force
work and liviing permits for foreigners
import VAT on capital stock
costs and supply of energy
purchasing sites and real estate
product certification
currency risk
low purchasing power
licensing and permits
VAT reimbursement
taxes
expensive credits
customs
extensive bureaucracy
red tape
low level rule of law
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2.7
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3.6
3.9
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4.3
Many thanks!
Alexander MarkusDelegation of German Economy in UkraineUkraine, 01004 Kyiv, vul. Pushkinska 34,
phone +38 044 234 5995 [email protected],
www.ukraine.ahk.de Picture copyright: Images and/or photos in this presentation on slide 1, 2, 3, 5, 6, 7 are the copyrighted
property of 123RF Limited, their Contributors or Licensed Partners and are being used with permission under license. These images and/or photos may not be copied or downloaded without permission from 123RF
Limited. Picture on slide 4 is the property of Alexander Markus. The same as above applies.
Alexander Markus, Delegation der Deutschen Wirtschaft in der Ukraine, 24.09.2012 Slide 11