Fdi Effects In Bulgaria, Croatia, Egypt, Morocco
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Fdi Effects In Bulgaria, Croatia, Egypt, Morocco

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Fdi Effects In Bulgaria, Croatia, Egypt, Morocco Fdi Effects In Bulgaria, Croatia, Egypt, Morocco Presentation Transcript

  • FDI Effects in Bulgaria
  • Macroeconomic indicators show consistent growth in the years leading up to the global financial crisis
    Real GDP Growth
    Inflation
    2011
    2004
    2003
    2004
    2005
    2006
    2007
    2008
    2009
    2005
    2010
    2006
    2007
    2008
    2009
    2010
    * February 2011
    FDI Inflow
    Unemployment
    € mln.
    2004
    2005
    2006
    2007
    2008
    2004
    2005
    2006
    2007
    2008
    2009
    2010
    2010
    2011
    2009
    * February 2011
    Source: Bulgarian National Bank
  • 6
    FDI in Bulgaria comes mostly from EU countries and is concentrated in sectors
    FDI flows by industry, 1996-2010 (€ mln.)
    FDI by host country, 1996-2010 (€ mln.)
    Netherlands
    5,740
    Real Estate
    8,419
    Austria
    5,183
    Finance
    7,422
    Greece
    3,763
    Manufacturing
    6,552
    UK
    2,948
    Trade
    6,425
    Germany
    2,646
    Cyprus
    2,229
    Construction
    2,608
    Hungary
    1,362
    Energy
    2,492
    USA
    1,337
    Telecom
    1,955
    Russia
    1,229
    Other
    2,376
    Italy
    1,221
    Source: Bulgarian National Bank
  • Educated and skilled workforce is among the main advantages of Bulgaria
    0
    Almost 60,000 students graduate every year from over 50 universities
    Bulgaria has one of the highest proportions of students abroad from all European countries
    Iceland
    17.8%
    19,480
    Business
    Ireland
    14.2%
    Social sciences
    8,372
    Slovakia
    10.2%
    Engineering
    7,178
    Bulgaria
    Education
    3,677
    Greece
    Health
    3,166
    Austria
    Law
    1,553
    Germany
    Architecture
    EU-27 average
    Agriculture
    Students in another EU / EEA country, % of all
    Other
    Czech Republic
    12,684
    Source: National Institute of Statistics, Bulgaria
  • Why invest in Bulgaria?
    Political and business stability
    EU and NATO member
    Currency board
    Low budget deficit and government debt
    Low cost of doing business
    10% corporate tax rate
    Lowest cost of labor within EU
    Access to markets
    European Union / EFTA
    Russia
    Turkey / Middle East
    Educated and skilled workforce
    Government incentives
  • Nestle Hewlett-Packard
    • 1000 existing jobs, adding at least 1000 more
    • Bulgaria wins over 30 countries
    • Higher standard of living, greater skills, education put to use
    Diversification of the sweets market
    Over 1000 jobs within the factory
    Loyal brand
    No threat of competing with the local market
  • FDI Effects in Croatia
  • Macroeconomic Indicators
  • Who is investing in Croatia?FDI Stock by country through 2005
  • Equity inflows and earnings reinvested into newly established FIEs1993-2005
  • Croatians are highly educated!
  • Accession to the EU
    Applied for membership in 2003
    Completed 29 out of 33 “chapters”
    Public support is low due to EU financial situation and harsh sentencing of Croat generals in the Hague
    Possible accession by 2013
  • Bulgaria/Croatia Comparison
    • Former Soviet history
    • Delay in Reforms
    • Expansion of the service sector
    • Should expand manufacturing
    • Greenfield investments predominant
    • Does the service sector lead to economicgrowth?
    • Trading between the EU member states
    • Economic recession in 2008
  • Global Competitiveness Index - Ranking SEE and CEE countries according to performance in education and innovation
    Source: The Global Competitiveness Report 2009-2010, and 2007-2008, World Economic Forum
    Note: Global Competitiveness Report 2007-2008 is based on survey and data of 131countries, while for 2009-2010, N=133.
  • FDI Inflow in $
  • How FDI Impacts Development in Egypt
  • Education
    Currently combating low levels of education and illiteracy.
    Business firms are required to combat illiteracy among their employees.
    As of 1999, public expenditure on education was estimated at 4.7% of GDP.
  • Education and Coca-Cola
    Has been investing in the region for 50 years.
    Partnered with UNICEF to help get rid of terminal diseases such as Polio, HIV, and Hepatitis C.
    The goal of this partnership was to shed light on the issue of AIDS by providing adequate education and prevention.
    Coke is promoting education, the development of information, and communication materials all in an effort to help promote AIDS awareness.
  • Technology
    Egypt mostly specializes in information technology, tourism and travel, consumer goods and Telecom companies.
    Bringing development through the Information Technology Industry Development Agency (ITIDA).
    Develops infrastructure and helps existing companies.
    Creation of more jobs and encourages international business.
    Up to 50,000 new job opportunities.
  • Technology and IBM
    IBM developed The Service Delivery Center, which promised it would employ up to 100 people in the beginning and then increase up to 1,000 being employed within the company.
    Assumed to bring about more growth in Egypt as well as develop technology, education, and industry.
    IBM is just one of many companies that has invested in Egypt. Other examples would be: Intel, Coca-Cola, and Microsoft.
  • Egypt’s Future
    Because of the demonstrations that took place earlier this year, Egypt’s GDP is estimated to take a 2 to 3 percent nosedive.
    The reasoning behind this assumption is due to the fact that tourism drastically came to a stand still and many businesses closed down.
    This could cause potentially significant damage to Egypt’s future development in many sectors.
    Currently the government to already devising strategies for Egypt to withstand the latest economic blow.
  • Impact on FDI
    Egypt went from a closed market economy to more liberalized and open.
    Technology has further helped develop initiative in Egypt by creating education opportunities.
  • How FDI Helps Develop Morocco
  • Impact of Education on FDI
    Chemonics educated the ministry of tourism and development and they were better able to tap into the rural tourism market and bring in more inflow of FDI from a more diversified international clientele.
    The Moroccan government has also funded training for the staff that would be needed for the Plan Azur, which has enhanced human capital.
  • Impact of Capital on FDI
    Capital has had a positive impact on the attraction of FDI, especially when it came to building infrastructure in Morocco.
    Ex. Plan Azur
  • Plan Azur-Impact on Morocco’s FDI
  • Impact of Technology on FDI
    All sectors in the economy are turning to the new technologies which will lead to increased potential for development in the telecom sector, of which Morocco is a regional leader.
    This technology has allowed the largest Multinational Telecommunication operator, Maroc Telecom to operated in various other North West African countries.
  • MarocTelecom and Vivendi Agreement -- Impact on FDI
    Table 4.3: Africa’s share of FDI inflows (millions of US dollars)
    Year Africa World Percentage
    91–96 4,606 254,326 1.8
    1997 10,667 481,911 2.2
    1998 8,928 686,028 1.3
    1999 12,231 1,079,083 1.1
    2000 8,489 1,392,957 0.6
    2001 18,769 823,825 2.2
    2002 10,998 651,188 1.6
    Source: United Nations, World Investment Report 2003.
  • MarocTelecom and Vivendi Agreement -- Impact on FDI
    Africa’s share of FDI inflows (millions of US dollars)
    Source: United Nations, World Investment Report 2003.
  • The similarities found between Morocco and Egypt is the countries’ openness to MNC investments because the policymakers see a direct correlation between the increase in skilled human capital and the creation of jobs that leads to an amplification of FDI amounts and more pervasive country developments. Egypt and Morocco are the most integral North African countries because of their prime geographical location, openness to FDI and trade relations with the United States and other advanced economies such as France from the EU.