Volume 1, 2008
Convention Centre Malaysia
Interim Management Thailand
Upgrading Wamena Airport

Why China?                                                                                              developing countri...
and business and work culture.                                      management organisation structure. Moreover, the manu-...
A Gemstone Exhibition and Convention Centre in Malaysia
Partner in Poland: ASM
The fibres in the mortar do their work in particular during the
concrete’s hardening process: due t...
Three Awards for Driessen Thailand                                                                                        ...
Newsletter DeRuiter Consultancy
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Newsletter DeRuiter Consultancy

  1. 1. Volume 1, 2008 Projects Convention Centre Malaysia Interim Management Thailand Fibricon Upgrading Wamena Airport Benchmarking Why China? Background MIGA direct investment support Knowledge Network Our experts in Poland: ASM INTERNATIONAL MARKET & INVESTMENT SURVEYORS
  2. 2. Why China? developing countries too, in particular the newly industrialis- solid industrial background, although due to last century’s areas into today’s relatively expensive areas, more suited to ing ones, are competing strenuously to be the destination of political developments, in many sectors outdated. However, the manufacture of complex, higher-valued goods. However, choice for western enterprises relocating their operations. this important skill base together with the vast and “eager a skilled labour force and management capabilities are to prosper” population makes a perfect combination for a becoming scarce in these regions and subsequently costly. Many believe China is the place to be to outsource India has developed a strong focus on the service sector strong economic development. Textile, garment, shoe and other low-tech industries for manufacturing, but other countries could fulfil that job (accounting, insurance, ICT), in addition to its traditionally example have already moved to inner areas of the country much better. Why and when to go to China and if not, vast textile, garment and jewellery export sectors to recall a Low wages in China in relation to the workmanship offered to meet the low-cost conditions required for making these where should you go to instead? few. Pakistan wants to become a major shipbuilding nation have attracted an enormous amount of foreign investment, goods. Our clients are often large and small enterprises globalising leading, together with the fast expanding local industry, to their operations to benefit from the positive effects of a the country’s long period of sustained economic growth of China is still an extremely good place to invest in manu- larger business scale. In the decades since our establish- over 10% annually . facturing, if the aim is on selling products to the huge local ment we have developed many market entry strategies market. If the products are for export, then there are better and prepared local establishments and direct investments But with economic growth and extreme pressure on the locations to invest in today; Thailand, India and Malaysia for that purpose. Ever since China opened up in the early labour market for skilled workers, the coastal regions offer a more suitable infrastructure; less government red 1980s, foreign companies have been flocking there either remarkably quickly changed from low-cost manufacturing tape and substantially lower manufacturing costs. for the great potential of its huge market or to have their manufacturing outsourced, to benefit from the low-cost Government Contribution to an environment supporting international business activity Skill base Availability of skilled manpower in the labour force conditions. 0.000 0.200 0.400 0.600 0.800 1.000 0.000 0.250 0.500 0.750 1.000 1.000 South Korea 1.000 Singapore However, we were and still are not always that satisfied with 0.867 Slovenia Hong Kong 0.909 the results our clients achieved. With its population of 1.3 0.797 Russia 0.521 Taiwan 0.783 Taiwan billion, China is certainly an enormous market, but it only 0.500 Slovenia 0.740 Argentina 0.436 South Korea gradually reached the stage where an emerging middle 0.731 Poland 0.420 Czech Rep class with purchasing power could justify a distribution Singapore 0.725 0.370 Slovakia Hungary 0.717 0.358 Hungary Czech Rep 0.548 Malaysia 0.351 Labour cost Wage cost of industrial workers (USD per hour) Infrastructure Availability of 'basic' and 'modern' infrastructure Thailand 0.498 0.306 Argentina 0.496 Romania 0.000 0.200 0.400 0.600 0.800 1.000 1.200 1.37 Philippines 0.262 China 0.472 Slovakia Based on indices of (a) macroeconomic Wage cost refers to the compensation of skilled 1.89 Indonesia 0.248 Poland 1.000 Singapore stability (weight = 0.40), (b) market openness 0.412 Hong Kong industrial workers (with vocational training and Mexico 2.07 0.241 Thailand South Korea 0.875 (unimpeded cross-border flows of goods and 0.397 about 10 years’ experience) in major agglom- Malaysia Thailand 2.32 capital; property rights protection; weight 0.230 Mexico 0.885 Hong Kong erations. Wage cost includes (a) holiday and 0.382 Turkey 2.90 India = 0.30), and (c) ‘rule of law’ (absence of Based on Harbinson-Myers Index 0.178 India vacation pay and (b) taxes and social security 0.865 Taiwan Philippines 0.381 corruption; weight = 0.30). Values of indi- values for enrolment in secondary Romania 3.16 contributions by the employer. 0.733 Turkey 0.167 Czech Rep vidual indices are first normalised and then and tertiary education. Index values Brazil 0.347 China 3.40 0.733 Slovenia 0.153 Russia converted to composite score values (from are converted to score values (from Mexico 0.313 Russia 3.53 0.000 to 1.000). 0.000 to 1.000). 0.586 Slovakia 0.112 Romania China 0.255 4.63 Hungary 0.499 Malaysia 0.104 Brazil Indonesia 0.213 4.85 Poland Russia 0.432 0.085 Philippines India 0.141 Argentina 5.21 0.416 Hungary 0.076 Indonesia Hong Kong 5.38 0.386 Thailand Malaysia 5.39 0.381 Poland 5.74 Slovakia *The benchmarks indicate the results of a number of parameters from UNESCO, World Bank, UNDP, ILO and others, complied into the graphs. 0.248 China 6.62 Turkey 0.244 Romania Interim Management 7.17 Czech Rep Based on indices of (a) paved roads as a share 0.189 Turkey Singapore 7.59 of total roads (weight = 0.25), (b) energy use per Mexico 0.182 Brazil 8.41 capita (weight = 0.25), and (c) the availability of 0.155 India 8.94 Slovenia a telecom infrastructure (weight = 0.50). Values 0.151 Argentina of individual indices are first normalised and then Taiwan 9.29 for DriessenThailand converted to composite score values (from 0.000 0.091 Brazil South Korea 16.88 to 1.000). 0.090 Indonesia 0.00 5.00 10.00 15.00 20.00 0.000 Philippines channel to sell imported or even locally made (western) and already has a large share of the world’s manufactur- In October 2004 DeRuiter Consultancy was asked to fill products. The relatively few very rich consumers nowadays ing of crop processing installations, like sugar mills, and an urgent management position for the duration of 3 are gaining strongly in numbers on their equivalent class in oil-processing plants. But global business is changing fast, months in the manufacturing and regional sales opera- Europe and the USA, but the focus here is only on high-cost and the perception of a decade ago might no longer be the tions of Driessen Aircraft Interior Systems in Thailand. luxury goods. Some 97% of China’s vast population is still truth of today. However, at the end of that period Driessen, still without a Thus began an interesting period for Kees de Ruiter, unable to pay for any imported western articles. permanent Managing Director, requested Kees de Ruiter to since taking up the management of existing companies When China opened its doors to the world in the early stay on a bit longer in the position to prepare and implement was additional to our usual international operations, In recent decades, China has become the manufacturing 1980s, many believed its huge number of people would a plan for the complete turnaround of the company, by namely the preparation and development of business workshop for many global industrial enterprises. But other make it the most sought-after market of the future. It had a improving efficiency and effectiveness, planning and control operations in overseas countries. A S P E C I A L I S T C O M PA N Y F O R T H E P R E PA R AT I O N A N D D E V E L O P M E N T O F D I R E C T I N V E S T M E N T S
  3. 3. and business and work culture. management organisation structure. Moreover, the manu- facturing processes were limited to some extent by the local A renovation plan focusing on the company’s galley equip- environment. Production interruptions due to breakdowns ment manufacturing operations and later also its cargo could only be countered by large over-capacity, not by business in Thailand was agreed upon. Because Kees was redundancy or a keen maintenance philosophy. also managing the daily operations of the company, a time The Company Culture span of two years was considered necessary to implement all aspects of the programme. The first part of the assignment was to establish a commit- Driessen in Thailand had experienced years of fast growth, ted local management team, enhance team skills and create partly due to overall growth of the business, but mainly an open management culture throughout the organisation, The Thai Culture because many of the company’s activities were being promote a mutual vision of future operations and build trust the problems were never just the concern of the individual transferred there from The Netherlands, its home base. This in the process of change. ultimately causing them, but also of the group or even the transfer of the business to Thailand had taken place in a whole organisation effected by them. Problems are now The Thai culture in large organisations as Driessen Thailand somewhat haphazard manner, leading to quite sub-optimal Ample time was also given to changing the ineffective way solved by committees of people that in one way or another is, necessitates a form of leadership that is clear and operations with a more or less provisory manufacturing and problems were dealt with by incorporating awareness that are related to the problem. decisive, nowadays in developed industrial countries char- acterised as somewhat patronising, while relations between management, staff and workers, and amongst each other, are founded in the country’s strongly embedded Buddhist A testimonial by Driessen CEO Paul Verheul philosophy: attitudes of respect and service towards each other. This philosophy can be very well utilised to the good Driessen’s 2006 revenue split Driessen employs over 1,750 professionals, of which to enhance teamwork and cooperation and as a reference in Driessen engaged Kees de Ruiter of DeRuiter Consultancy approximately 1,000 are located in Thailand. In 2006, 39% matters of collective responsibility. in 2004 as Managing Director ad interim of its operations in 15% 6% of Driessen’s revenue was generated by products manufac- Thailand. The original three-month term was soon extended tured in Thailand. A great number of structural and operational improve- to a three-year ‘interim’ position to give Mr. De Ruiter ments were able to be incorporated in the manufacturing sufficient time to direct the facilities, professionalise the 33% Under the management of Kees de Ruiter many improve- organisation within the interim management period (see operations and improve profitability in the longer run. 46% ments took place, including: the contribution from Paul Verheul, CEO of Driessen in this Thailand is the location issue) and although fine-tuning requires more time, the Thai of Driessen’s largest • The culture, job motivation and work ethics at the facili- manufacturing organisation is now fully capable of dealing Gallery Equipment Services Cargo Galleys manufacturing facilities. ties in Thailand were changed and elevated, resulting with the requirements of its clients: on-time delivery, and At the company’s factories in a management team that is now more open and high and flexible productivity and output - all supporting low in Lamphun and Bangkok enthusiastic to continuous improvement of the opera- manufacturing costs and a responsive organisation. respectively galley equip- tions. This is crucial for Driessen’s successful continuity. • The facilities in Thailand won numerous awards from Thailand for Group’s parts making ment (trolleys, drawers and • A centre was opened for training new employees and for several Thai ministries, which, thanks also to Kees food containers) and cargo regular updating of the skills and knowledge of our Thai de Ruiter’s excellent public relations skills, greatly equipment (containers and professionals. enhanced Driessen’s image. One notable aspect of Driessen’s “view of the future” was pallets) are manufactured. • Galley equipment and cargo equipment production was the prominent position entrusted to the parts-making depart- Galley (aircraft kitchen) parts separated and dedicated facilities introduced, resulting in On behalf of the Driessen Aerospace Group, I would like ment. The growth and profitability of the facility in Lamphun are also produced there. greater focus and substantially improved efficiency. to express my gratitude for the professional support we was targeted for parts-making predominantly and large Paul Verheul • The facilities in Thailand were upgraded in order to received during Mr. De Ruiter’s 3-year term in Thailand. volumes of orders are now received from the company’s Driessen Aerospace Group is a leading supplier of gal- facilitate further growth in capacity. And more generally, we will certainly miss hearing the many aircraft galley manufacturing organisations in the US and leys, galley equipment, cargo equipment and services. Its • Profitability was improved by separating the CNC colourful expressions he picked up in the cavalry during his the EU. With large investments in CNC milling, the facility customer base includes virtually all the world’s airlines and machines from the line production in a departmental time of military service. Hopefully, his successor will never is now ready to supply the majority of parts for Driessen’s airframe manufacturers. configuration. have any reason to use one of his most memorable expres- galleys. The assignment was finally completed at the end Driessen is headquartered in The Netherlands and has • Mr. De Ruiter initiated the production of galley parts in sions, “When I first arrived here, it was like having to ride a of 2007 and we consider it one of the finest we have ever manufacturing facilities in Thailand, USA, the Czech Thailand, resulting in considerable savings in the overall horse without any reins”. received been commissioned to perform byform our clients Republic and the UK. Its seven sales offices and 29 service production of galleys. The Thai Board of Investment to perform. stations are strategically located in Europe, Asia Pacific and subsequently awarded tax holiday and other privileges Paul Verheul the Americas. for these activities. CEO Driessen Aerospace Group A S P E C I A L I S T C O M PA N Y F O R T H E P R E PA R AT I O N A N D D E V E L O P M E N T O F D I R E C T I N V E S T M E N T S
  4. 4. A Gemstone Exhibition and Convention Centre in Malaysia However, in 1998, after completion of the preparation cultural aspects. Paying to park a car, for example, is not The official opening of the Kuala Lumpur Convention phase, Amsterdam RAI withdrew from the investment widely accepted yet, so the revenue from this fell far below Centre - “the Centre” as it is nowadays called - took and the venue’s management contract, to give priority to the estimates. place in June 2005. Years earlier, in 1997, our company opportunities elsewhere. Convex Malaysia Sdn Bhd, a joint was awarded the contract to prepare an extensive venture company between KLCCH and Ogden International Typical mass consumer shows do not allow substantial feasibility study and subsequent business and invest- Facilities Corporation Pty Ltd from Australia, now operates revenues to be earned from visitors’ entry fees. Large Chi- ment plan for this remarkable real estate project in the Centre. nese wedding parties appeared to be very sensitive to Feng Malaysia. Recently we had the opportunity to compare Shui building layout and location rules (for some Malaysian our original plan with the reality of today. The execution of the assignment was a typical example of Chinese, the architectural layout was not considered ideal The project to build a high-quality convention and exhibition the cooperation our company strives for, with civil engineer- for happy weddings!). In addition, more and smaller trade centre was part of an immense real estate and land devel- ing and marketing expertise from RAI, marketing and legal shows and a larger number of conventions than anticipated opment plan initiated by Kuala Lumpur City Centre (KLCC) experts from KLCCH, structural engineers from DSBV, resulted in substantial variations from the revenue projec- to create a landmark on the 40 hectares (100 acres) of the architecture and engineering consultants of Rotterdam, and tions made earlier. former Selangor Turf Club and Race Course. Davis Langdon & Seah, quantity surveyors and construction cost consultants from Kuala Lumpur. The temporary coop- The location of the Centre is extremely well positioned in Eventually the overall development plan provides for an eration of the survey team covered a period of 6 months. the heart of Kuala Lumpur, while the anticipated high traffic area of more than 1.6 million m2 (18.3 million sq ft) of circulation through the area (a well-surveyed aspect of the commercial, retail, office, hotel, residential, entertainment, Besides determining the various functions, number of study) has been thoroughly and effectively taken care of by investment, gave us some very valuable feedback. It was convention and exhibition facilities, as well as a mosque attending people and defining the related size of direct and the municipality and KLCC. These factors, together with the exciting to see how the Centre, now in its mature state of within a park setting.The KLCC site is strategically well service areas to be configured and built, a model to calcu- almost boundless hotel capacity nearby, makes the Centre a operations, is in fact functioning beyond the expectations located, within the Golden Triangle of Kuala Lumpur, the late detailed multi-year revenues needed to be developed real gem in comparison to rival centres in South East Asia. then formulated. Both the inventive and imaginative architect very heart of the city. to facilitate evaluation of the many alternatives at hand. The and the qualified and resourceful management of Ogden Evaluation model therefore was purpose-built and successfully inte- International have succeeded remarkably well in diverting to KLCC (Holdings) Sdn Bhd (KLCCH), the initiating company grated into our standard model for 10-year financial feasibil- alternatives where determinative factors changed, or where together with major KLCC shareholder, MAI Holdings ity projections. Later, in 2001, the same model for revenue This unique opportunity to re-evaluate the original assump- assumptions made have proved to be no longer valid. Sdn Bhd, took up the redevelopment of the whole site in calculations was used for a similar project, the Cape Town tions made in the early conception phase of this major 1993. The most notable development on this famous site Convention Centre in South Africa. is certainly the 88-storey, 452-metre-high Petronas Twin Towers, for a few years the world’s tallest building until the Because our company was not involved in implementing From bright idea to marketplace “Taipei 101” building took over in 2004. the investment, it was a great pleasure for us to recently be invited by the present management to visit the Centre and to see and experience the building. Fibricon Winconcrete But more importantly it was also an opportunity to compare today’s reality with the assumptions our survey team had once made about the different functions and revenue earn- The basis of a successful idea is simplicity. Concrete ers the Centre should have in order to make it a financially mixed with fibres under the trade name FIBRICON Win- feasible and attractive investment. concrete is such an idea. Even though the concept of fibrous concrete is known to have been applied by the It turned out that our estimations about the total investment ancient Egyptians, FIBRICON multi-fibrous concrete still had been quite correct, although a number of deviations represents a real innovation in the world of concrete from the initial plan had been made (smaller exhibition areas today. The FIBRICON concept has now been patented and larger convention spaces, predominantly a larger, very worldwide as a multi-fibrous ready-to-use concrete well-equipped auditorium next to a smaller one). mortar with predefined strength specifications. At the The assignment to draft the investment and business plan moment it is only supplied by licensed concrete-mixing for the Centre was granted to us in 1977 by Amsterdam- Although well within the overall estimations made in 1997, plants in The Netherlands, but will soon be provided by based RAI Exhibition and Convention Centre in cooperation the revenue projections that were made differed widely in suppliers worldwide. with KLCCH. Amsterdam RAI and KLCCH aimed for coop- the various categories from the actual revenue composition. applied to replace traditional wire mesh or being additional eration to invest, develop and manage the new exhibition This was partly due to the different purposes and configura- Because FIBRICON multi-fibre concrete benefits from to it, depending on the application. Constructions can be and convention centre on the basis of the plans to be made. tion of the space, and partly due to various Malaysian significantly improved specific tensile strength, it can be thinner, slimmer, or proportionately more robust. A S P E C I A L I S T C O M PA N Y F O R T H E P R E PA R AT I O N A N D D E V E L O P M E N T O F D I R E C T I N V E S T M E N T S
  5. 5. Partner in Poland: ASM The fibres in the mortar do their work in particular during the concrete’s hardening process: due to a balanced hardening of the inner and outer sides of the concrete, cracks from hardening can be completely avoided while at the same time Since early 2000, DeRuiter Con- Before establishing your the forming of internal stresses is suppressed. Moreover, sultancy and ASM have worked market entry strategy, take into due to the three carefully selected fibres, shrinkage from together successfully on a number consideration analysis of the hardening is almost non-existent. This is why the boundaries of projects focusing on executing market, the competition, pric- of the size of a concrete application can be firmly extended. market surveys, developing market ing systems and distribution It is now possible for roads to construct concrete slab entry strategies and preparing for channels, as well as seriously lengths of over 100 metres without any seam to be made in foreign direct investment in Poland. evaluating business practices one pouring. designated market segments. The application for road con- and consumer behaviour.” struction in The Netherlands has picked-up the fastest. The Based in the centrally located Polish city of Kutno, ASM Verwaard Handelsonderneming BV, being partly owned by market segment for industrial flooring will most likely be the Market Research and Analyses Centre Ltd. performs Poland is the largest country in the large Netherlands-based Dyckerhoff Basal Betonmortel hardest to conquer, since long-established practices in the specialist services in the field of market determination and East-Central Europe and one Mrs. Maria Góreczna BV, initially and for many years already traded several steel use of low-grade fibres may well prevent the acceptance of valuation. The company has great knowledge and experi- of the most attractive markets Manager, International fibres used in concrete, before its main shareholder Johan a high-grade and more costly ready-mix FIBRICON product. ence of business data and opinion gathering by professional for investors either relocating Department, ASM Verwaard started to seriously investigate the effects and interviewing techniques. Foreign companies consider this their business for exports into specific contribution of the various fibres in use at that time An average of 50% of mortar produced in the industrial well-developed service very convenient for their assessment the EU or setting up a in the mortar industry. world is used in concrete prefab products like sewerage of the Polish market. ASM’s operations include appraising business for the fast-growing local market. In recent years, tubes, concrete building components, piles and many and comparing prices, the appreciation of products and Poland has been realising relatively high economic growth. more. These products often need complicated wire mesh services offered, the rating of competition and assessment In 2006, GDP growth stood at 3.4% and, according to constructions that in many cases can be avoided by the of overall market potential. All these services contribute to forecasts, is set to reach at least 4% by the end of 2007. A use of FIBRICON’s 565-37 purposely composed multi-fibre a more successful approach to capturing Poland’s increas- remarkable success of reform was the reduction of hyperin- concrete. ingly attractive consumers and B2B market. flation from 600% in 1990 to a level of just 2% today. This product is expected to become another cornerstone in Significant assignments have been carried out for our clients Given Poland’s geographic location, an investment in the product range. Because Verwaard is a long-time supplier who are active in the development of Polish infrastructure Poland also provides easy access to neighbouring markets of fibres to the Indonesian company PT Karunia Power (traffic information systems and control equipment, road in Russia and the Ukraine. Since the early 1990s, the inflow Abadi, a FIBRICON test of ready-made concrete was also construction), food processing, assessment of outsourcing of foreign capital into Poland has exceeded USD 80 billion conducted in that country. The assignment concerned the the manufacture of industrial parts and components to local and is expected to grow on average to more than USD 8.5 supply of high-strength concrete for a bomb-resistant wall industry, and many more. billion annually by 2010. in one of the embassies in Jakarta. A testing procedure by Commercial services have grown rapidly in the past decade the principal concluded that FIBRICON 565-37 (for prefab and are now one of the main drivers of the economy. The products) would serve their requirements best. ability to hire highly educated and trained local personnel, After his own basic research, Verwaard decided to embark coupled with the relatively low cost of employment, have on a more detailed and comprehensive innovation process We consider the work we performed for FIBRICON to be also precipitated a flood of investors looking to relocate their in order to relate market requirements for concrete ap- a good example of an all-encompassing product develop- global operational support facilities to Poland. The country plications more firmly to specific types of fibre concrete, ment assignment, because we were engaged in managing has seen a growth in technical research, IT, call centres and ultimately to result in a unique fibre concrete product line. both the development process and its content. Managing a accounting services. In addition, numerous initiatives exist research team of high-calibre experts is a challenging task for new investments, including 14 Special Economic Zones Such development process should be backed up by exten- especially in the cautious world of concrete. It was also a and a large number of technology parks. sive research for the exact justification of the characteristics project with a significant component of strategic marketing. of the products offered as well as its patenting. A consistent FIBRICON is assured of a successful future because it The cooperation between ASM and DeRuiter Consultancy marketing and promotion plan should support penetration represents a remarkable technology upgrade of one of the has proved to be very successful during the past seven of the respective market segments and, by a step-by-step oldest materials in the world. years. It has proved competent and effective in assisting approach, capture the world market in the long run. companies to measure the scope of the business in Poland, Mrs. Maria Góreczna, Manager of ASM’s International and especially to define the market in terms of those Calculation value Application FIBRICON® The results, however, confirm the initial idea of Johan Department: “It is important that foreign companies prepare companies’ parameters and characterisation, such as sales Types tensile strength Industrial floors FIBRICON® 225-55 Verwaard: to obtain the best results from fibre concrete, all volumes, price structures and nature of the competition. In 2.5 N/mm2 themselves well before starting a business in Poland. To Industrial floors (high load) ® elements should be in balance with each other; it’s wasting addition, several existing clients are increasingly making benefit most from the opportunities offered, the typical 2 FIBRICON 335-55 2.8 N/mm Fluid tight floors potential to just mix fibres with any kind of mortar. it good practice to perform annual updates on customer Polish business culture should be well understood, while ® 2 FIBRICON 535-37 3.0 N/mm satisfaction and market position. We are very happy with Roads and highways detailed knowledge of the local situation of a certain busi- ® 2 FIBRICON 445-55W 3.2 N/mm By this stage, all the products have been launched in their this very prospering venture with ASM. ness provides unmistakably for a better negotiating position. Prefab concrete products ® 2 FIBRICON 565-37 4.1 N/mm A S P E C I A L I S T C O M PA N Y F O R T H E P R E PA R AT I O N A N D D E V E L O P M E N T O F D I R E C T I N V E S T M E N T S
  6. 6. Three Awards for Driessen Thailand training, basic and advanced manufacturing skills, team lessons in teaching. The school has small and large class building, work process and environmental safety. Besides rooms and a practical training area on the premises. two professional teachers, most of the training is provided Users. The other award was for having an effective learning by the company´s own professional staff that received Over 2006 and 2007, Driessen in Thailand received as centre that incorporates instruction for employees on how to much as three prestigious awards! It is a clear recogni- prevent using drugs. tion of the success of Driessen Thailand over the years MIGA Investment Insurance in which period it became one of the largest Dutch Khun Pagorn, Production Manager of the Sheet Metal multinational companies in the country. factory has been instructing new employees how to prevent NTCC Business Excellence Award on using drugs, for over four years. He does this in close MIGA insures new foreign (cross-border) investments cooperation with the Labour Welfare Office of Lamphun. originating in any MIGA member country, destined for any The first award was received for Business Excellence. This organisation coordinates in the Lamphun region the developing member country. New investment contributions The joint foreign chambers of commerce of the Benelux special programme called “White Factory”. associated with the expansion, modernisation, or financial countries in Thailand established this award in 1998 to restructuring of existing projects are also eligible, as are honour Benelux companies in Thailand for the way in which Last year Driessen started a policy to dismiss dealers of acquisitions that involve the privatisation of state-owned Despite its huge insurance portfolio of guaranteed proj- they excel in business and for their contribution to the Thai drugs immediately when caught. Users of drugs will have enterprises ects, totalling US$ 17.4 billion in coverage, the Multilat- society. a second change. They have to follow again the newcomer eral Investment Guarantee Agency (MIGA), a member of introduction instructions and to undergo numerous tests at Types of foreign investments that can be covered include the World Bank Group, is relatively little known among the hospital during a period of time. If they pass the test they equity, shareholder loans, and shareholder loan guarantees the increasing number of companies taking up global can stay with Driessen. The whole workforce, moreover, is provided the loans have a minimum maturity of three years. activities, particularly in developing nations. tested on unexpected moments throughout the year. This Loans to unrelated borrowers can be insured, provided a new policy has been very benificial for both the workers and In countries where political turmoil is escalating (Thailand, shareholder investment in the project is insured concurrently the company. Pakistan, Venezuela) the risk of expropriation, sudden or has already been insured. Other forms of investment, change of law at the expense of the investor, breach of such as technical assistance and management contracts, Driessen (Thailand) honoured by the Prime (Government) contracts is a real possibility. For such and franchising and licensing agreements, may also be Minister Surayud Chulanont of Thailand circumstances, MIGA has great tools in place that no other eligible for coverage. insurer can match. MIGA, established in 1988, already The Training Center of Driessen in its largest establishment offers political risk insurance for projects in a broad range In keeping with MIGA’s objective of promoting economic Lamphun has received the official recognition from the of sectors in 147 developing member countries, covering all growth and development, investment projects must be Ministry of Labour in 2007 to provide professional training regions of the world. financially and economically viable, environmentally sound, and the license to issue certificates and diplomas. His Excel- and consistent with the labour standards and other develop- lency Surayud Chulanont, the Prime Minister of Thailand, ment objectives of the country hosting the investment. The Ambassador of The Netherlands, HE Pieter Marres presented an award to Driessen. presented the prestigious award to Kees de Ruiter MD of MIGA prices its guarantee premiums based on a calculation Driessen in Thailand, in a gala dinner event in Bangkok. of both country and project risk. Rates for the SIP guarantee Driessen received the award for its achievements in 2005. (three coverages) range between (0.45%) and (1.75%) During this year the facilities in Thailand were restructured, basis points per year. production processes were adjusted, and decision making responsibilities were brought to lower levels in the organisa- Coverage is for up to 15 years (possibly 20 if justified by the tion. This resulted in greater commitments on performance. nature of the project). MIGA cannot terminate the contract To reach these goals, an in-company Education and unless the guarantee holder defaults on its contractual Training Centre was established. The continuous training obligations to MIGA, but the guarantee holder may reduce of staff and workers is made a key element for success in or cancel coverage on any contract anniversary date starting Driessen’s manufacturing facilities. The measures taken with the third. have lead to an improved cost effectiveness in the opera- tions. Investors may choose any combination of the four types Investors in today’s dynamic investment climate understand of coverage offered by MIGA. Equity investments can be Employer of the Year 2006 the potential benefits of investing in emerging markets. The covered up to 90 percent, and debt up to 95 percent. MIGA even smarter ones also understand the critical importance may insure up to $200 million, and if necessary more can be In September, Driessen was invited by the Ministry of Driessen substantially enlarged its Training Centre in 2005 of addressing the political risks that may accompany an arranged through syndication of insurance (see also Justice to come to a ceremony in Bangkok to receive two to further enhance the practical and theoretical skills of its investment in an untested environment. MIGA guarantees http://www.miga.org/). awards. The awards were for being Employer of the Year managers, staff and workers. A broad training curriculum is offer much more than just the assurance that losses will be 2006 with a positive Attitude towards Rehabilitating Drug now exercised on a full time daily basis. It includes language recovered. A S P E C I A L I S T C O M PA N Y F O R T H E P R E PA R AT I O N A N D D E V E L O P M E N T O F D I R E C T I N V E S T M E N T S