DearLadies and Gentlemen,Let me firstthankMiroslavfrom Brainstorm and the organisers to give me the floorhere in Belgrade. I’m happy to seesuch a big interest fromSerbia in our country and region. My name is Thomas and today I have to honour to present youabout the assets of Flanders with a strong focus on IT and funding.
Who are we? Where are we? Belgium is a fairlyunknown country in the world and often has a greyburocratic image. Althoughthis is unfortunatelydefinitly the case to someextent – don’tforget we host the HQ of EU, NATO and somecouple of 100 other international organisations, think tanks and fundraisers – our country has quitesomeadvantages to offer. Today, I willspeakabout Flanders, which is the northern part of Belgium, whichyoucanseeon the leftside of the screen. The Flanders region is home to approx. 6 millioninhabitants and has BXL as itscapital. Flanders hostswith the port of Antwerp the secondbiggest Port in Europe and the secondbiggestpetrochemical cluster in the world (onlyafter Houston, USA). Notsurprisingly, ourlocation is our prime sales argument. We host over 800 European Distribution Centers, one of the most densiestconcentrations in the world. We findourselveson the crossroads of the German and Roman culture and love to speakforeignlanguages. Most Flemishpeoplespeak 3 languageseasily. Sowhy do I onlyspeakabout Flanders? Well…
As youmight have heard, Belgium is a complicated country. It is a federal state,with 3 communities and 3 official languages: DU, FR and GER. The result of one of the several state reforms was the creation of Flanders Investment and Trade, the one and only official economicrepresentation of Flanders to the world. So we are a governementalorganisation, althoughI’mnottooeager to usethat name . What do we do? What service do we provide? Basically, FIT holds a twofoldtask: we try to help Flemishcompanies to export, to go abroad and we are not bad in it. Currently, the Flemish export accounts for 83% of the totalBelgian export! Secondly, we assistcompanieswiththeir entry to the Western Europeanmarket. I’ll show youthat Flanders offers the ideal business climate to conquer Western Europe.
We canassistyouwithyourquestions, finding partners, setting up etc.. And more important, we do this free of charge (soit’snot all that bad being a governementalorganisation) .
To giveyouanexample of what we offer, please look at the followingslide: our services to foreigninvestorsinclude a wide range from site selection over incentives to legalaspects. Whatmightbe important forSerbia is that we alosgiveinformationregardingwork & residencepermits.
In order to give a good service, we have about 70 offices all over the world! Unfortunatelyno office in Serbia, as the Balkans are coveredfromour Ljubljana office. Dependingon the importanceorpotential of the market, we have installed more than 1 office in certaincountries.
Allow me now to jump to a next item of mypresentation, id est ourapproach and focus.
Flanders is a substantialplayer in the major industries and is a region of mostlySME’sjoinedby a largenumber of multinationals. We try to keep pace and achieve constant sustainablegrowth in the industries we’regood in, and those are the following:
Ourseven “principal industries” are mentionedon the slide, todayI’ll focus on IT.
Sowhy is IT a focus sector forus? And more important, whyam I here to talk about IT? We seeanenormous interest in the IT sector in Central and EasternEurope, we seerapidlygrowingcompanies (think of yourownSerbianNordeus opening an office in Ireland) in thisregion. We seeclever IT developers and techniciansreallywanting to move forward. Skype was invented in Estonia, now the most digitalized country in the world. Viber was inventedby a BelarussianIT-er, etc.. We see start ups everywhere in the regiongrowingfast and looking to expandinternationally. Thisgives me a firstreason to speak to thisaudience.
Secondly, the focus on IT is fosteredby the Flemishgovernment. It fits in a newstrategy and commitmentwhich is called the New Industrial Policyor NIP. Thisstrategyfocusesonmakingcompanies more innovative and aimsforsocalled smart specializations. Industrial jobs and industrialproduction is under more and more pressure, with jobs movingawayfrom Western Europe. We try to counter thisbyfocusingon top knodgespecializations in different sectors. We are fullyimplemented the idea of factory of the future, wherecompaniesdevelop (so R&D) theirproducts in Flanders butmassproduction is done in lowawagecountries, to cutlabourcosts. Of course we all knowthatthingscan move reallyfast in the IT sector: a smallcompanywith 5 employees caneasilyevolve to 50 or 100 in the course of severalmonthsor a year. Beforemoving to the knowledge clusters, let me giveyou a brief overview of the IT market in Flanders on the followingslide.
The ICT market in Flanders accounts for € 12 billion and employsabout 60 000 people. Most employmentyoucanfind in informationtechnology, 10 000 each in development and production and the telecom sector.
With respect toour expertise, specialistsmake a divisionbetween 6 domains in ICT: (1) Nano; (2) financialsecuritysolutions & smart card technology; (3) GPS and telematics; (4) Telecom; (5) Digital audio and video and printing; (6) software products.
Let me giveyousomeexamples. IMEC is a worldrenowned research instituteconnected to the University of Leuven and developping chips. It is a laboratorywherestudents, researchers and companiesfrom all over the worldjoinforces. Ithosts 350 guestresearchers and staffs 2000 people. The products of thisxenogamy are various: imagineyoucanjusttake a pill to kill a maliciouscancer. Vasco is big in e-bankingwhile the GPS system Tom Tom was developed in Belgium. Option is notonly shirt sponsor of the local premier league football team of Leuven, butalso provides worldleadingtechnology in cloudcomputing. Barcoproducesscreens and displays and also 3D visulation. LMS offers cuttingedgetesting software for the auto and aviationindustry. To giveyouanidea of the scope, LMS was recentlysold to Siemens for € 750 million.
Sowhatabout the clustering?How does ourgovernmenttries to fosterthis? We have 4 state of the art research institutesworking in close cooperation and/ordirectlylinked to the academic and business world…
IMEC in Leuven dealingwith NANO as I alreadypointed outiMinds in Ghentdealingwith ITVIB in GhentfocusingonbiotechnologyAnd VITO workingon recycling and clean energy / environement
The umbrellaorganisation is the FlemishAgencyforInnovationbyScience and Technology. Let me briefly zoom in on the work and service of IWT.
The agency was created in 1991 byourgovervnement to bring more innovation to and in Flanders. Itemploysabout 122 people and has in 2013 a budget of € 335 million. It pushes forinnovation and knowlegdedevelopmentthroughvariousfundingschemes. Bydoingso we aimfor 4 strategic goals:
Creative and innovativeentrepreneurshipInnovation as the solution to macro-economicchallengesInternational collaborationAnd aninternalreason…
Let ustake a look at the financial support IWTcan offer. The principle is quitestraightforward. Everycompanywanting to createaddedvalue in Flanders canapply. The aim is to developnewproducts/processesetc and to do this in a risk sharing environment. There’sno deadline forapplications and the amount of support can run up to 60% of the totalcosts. Butthere’s more: alsoindividualresearcherscanapply. To giveyouanidea, in 2012 320 enterprisesreceived support for a total of 129.5 eurmillion. Over 200 applicationswereacceptedon the R&D organisation level, goodfor € 79.4 million. About 800 individualapplicationswereacceotedfor the severaldoctoralgrants / studygrants: € 38.7 million.
Here we cansee a schematic presentation of the different levelswhichcanapply to IWT. We had the first 2 and the last one. Networks and intermediariescanbe eg CC etc..
Let’stake a look at the numbers. The measurefor support are feasibility studies, SME innovationprojects and R&D projects.
Touchingbrieflyupnon the knowlegde clusters – 2 have 2 IT clusters in Flanders. 1 findsitself in Leuven, a city 20 km at the east of BXL. The CatholicUniversity of Leuven is the oldest of the low countries and one of the oldest in the world. About 30 000 studentsstudy at thisuniversity and it has a long historicaltradition. IMEC aboutwhichI’vetoldyou a bit earlier is closelyconnectedwith the University. Several spin offsproducedby the KUL are financedby Leuven Research & Development, whichinvestsbothfunds and knowhow in the youngcompanywith in return a share in the company.
Ghent, the university city at about 60 km from the capital Brussels, is one of the major student cities in Belgium. The FlemishInstituteforBiotechnologyorshortly VIB guidesbiotechcompanies and offers severalfundingschemes. iMinds is an independent research institute founded by the Flemish government to stimulate ICT innovation. The iMinds team offers companies and organizations active support in research and development. It brings together companies, authorities, and non-profit organizations to join forces on research projects. Both technical and non-technical issues are addressed within each of these projects. Funding programs and an incubator are available.
To end – a brief overview of some of the incentives we offer in the field of R&D.
I willskip thecorporatefiscalmeasures and jumpdirectly to 2 interestingincentivesregarding R&D.
Lots of companies register their patents in Belgium, because the revenuesfrom patent income are very low taxed. There’s a standarddeduction of 80% whichmakesit the lowesteffectivetaxrateonrevenuesfrom patent income!
Secondly, we offer awidelyusedincentiveon the employment level, id est the 75% exemptionfrom the witholding taxonresearchers. This is a tex to bepaidby the employer to the taxadministration. For researchersthere’s a 75% exemption. This has a twofoldadvantage: itreducescostsfor the employerextensivly and createsanopportunity to offer better a betterwage to the researcher.
So I hope I gave yousomereasons to thinkabout the Flanders regionwhenyouexpand. And ifyou are stillnotconvinced, well….
Your fastest link to Western Europe
You will be surprised to see the wide range of advantages our region has to
offer you …
3. Flanders Investment and Trade
Flanders Investment & Trade provides expert
advice and guidance to foreign companies.
Whether your company is considering its first
steps into Western Europe, we can provide
Thanks to our experienced, multilingual staff we are
able to assist you with your integration into one of
Europe’s most prosperous economies, both
efficiently and effectively.
…free of charge
Flanders Investment & Trade provides
potential direct investors with information on:
• Site selection
• Overview of all benefits, grants and incentives
• Introduction to decision-makers
• Legal aspects of setting up locally
• Identify business opportunities
• Integration into local community life
We have more than 70 regional offices worldwide
to assist you, wherever you are.
9. Sectorial focus approach
10. Sectorial focus approach
• is a big player in a number of major industries
• houses numerous world-leading multinationals &
• has achieved a sustainable growth in these industries
• has acquired an excellent worldwide reputation
13. Why IT?
• Flanders’ New Industrial Policy
• Smart specializations across sectors
• Transformation through innovation
• Industrial jobs?
• Factory of the Future
• Multiplier-effect IT sector
• Knowledge clusters + R&D centers
14. IT in Flanders / Belgium
• ICT market: € 12 billion
•Employment: 60 000 people
– 2% of Flemish employment
• Information technology
– IT-hardware, services & software:
– 40 000
•Development & production of ICT:
– 10 000
– 10 000
15. 6 domains of expertise in ICT
1. Nano-electronics, nano technologies & micro-electronics
2. Financial security solutions & smart card technology
3. Telematics, GPS, cartography & Location Based Services, Geo-ICT
4. Telecommunication & Network equipment
5. Digital audio-video products & digital printing
6. Software products
16. 6 domains of expertise in ICT
2. Sec.Sol/Smart Card
5. Digital audio/video & printing
17. Knowledge clusters + R&D centers
• an impressive track record when it comes to
discovery research and innovation
• four Strategic Research Centers that collaborate with the
academic and business worlds
• frequently been the birthplace of cutting-edge
19. Knowledge clusters + R&D centers
…and one Flemish agency for Innovation by
Science and Technology
Fostering innovation in Flanders
20. IWT: mission
IWT , the innovation agency of the government of Flanders,
Stimulates by financial support, advice and coordination,
Knowledge development in companies, research centres and other
For more innovation, more new products, processes, services, ….
With economic and societal added value
21. IWT: goals
1. More creative and innovative entrepreneurship
2. Innovation as a solution for socio-economic challenges
3. International collaboration in innovation
4. An efficient, effective and high quality IWT
22. Financial support through IWT
• Direct support to R&D&I projects in industry
• Bottom up: no sectoral or thematic programmes: all companies which can create economic
added value in Flanders can apply
• New products/processes/services/concepts which potentially create sustainable added value
for Flanders (employment & investments)
• Risk sharing, economic return region when succesful: cost-benefit ratio (1/10)
• Support as direct state aid (European competitiveness rules do apply)
• Applications can be submitted continuously
• IPR: with industry, commercial rights: industry
• Amount of support is % of accepted costs (25% up to 60%)
• Simplified SME programme: low entry level
23. Financial support through IWT
R&D enterprise projects & SME-programme & SPRINT
Collective Innovation Tracks
24. IWT support to enterprises
Support % limits
50% max. 25.000 eur
25% max. 250.000 euro
sprint-project 25% max. 250.000 euro
R&D-project 25% - 50% max. 3 M euro
28. Other funding
•Business Angels Network
29. Diverse offering of
tax benefits & fiscal incentives
30. Tax benefits and fiscal incentives
• an ideal fiscal climate
• a wide range of tax benefits and financial grants
Just take a look at the following interesting measures…
31. Tax benefits and fiscal incentives
• The lowest effective European tax rate on revenues from
What is it ?
• Deduction of 80% of the income from patents from the
taxable basis, resulting in an effective tax rate of
maximum 6.8% on this income
32. Tax benefits and fiscal incentives
• 75% exemption from withholding tax
in favour of employers who employ researchers (PhD, engineers and
Principle : the salary withholding tax is normally retained on the
remunerations paid to the researcher, but the amount of tax so
retained must not be totally paid to the tax administration
The company benefits from a substantial reduction
of the cost of employment of researchers