Future trends in the Baltic Sea Region         Elina Priedulena, Hanse Parlament           Part-financed by the European U...
Contents1. Economic development in Baltic Sea Region (BSR)   - general development trends   - SMEs2. Trading across border...
Is it worth to operate abroad?•   Large companies have been global for a    long time –    globalization/internationalizat...
Economic development      of BSR                       4
BSR      Source: HWWI                     5
States of BSR – a vast potential of EU•   147 million inhabitants = 29% of the population of the EU•   67 millionen employ...
Real GDP growth rate,percentage change on previous year                                     Source: Eurostat              ...
Real GDP development and forecast                        2009         2010         2011   2012f   2013fDenmark            ...
GDP per Capita in PPS (EU=100)                 250                                                                        ...
Small and medium-sized enterprises             (SMEs)                                     10
SMEs – backbone of the European economy• enterprises (EU, 2010)   – SME: 99.8% of all enterprises (20.8 Mio.)      • Typic...
Trading across borders                         12
Trading within BSR   The exchange of goods is essential for the cross-border    integration of EU states; Baltic Sea stat...
Major export and import countries of                    Lithuania 2011                       Imports             Exports  ...
Corner stones of export and import                                        mineral products                           25%  ...
Innovation             16
Indicators of Innovation                    Innovation        GDP share       Share of R&D      Patents per   Labour force...
Innovation and SMEs  • fundamental, especially in crisis times, for stimulating    the expansion of SMEs, either into exis...
Demographic changes                      19
Demography• employment resources is the key factor of economic  development in BSR• Demografic changes due to:    continu...
Effects: aging of society, lack of employment, growing average age ofpopulation, structural issues/changes regarding emplo...
Economic Outlook  for Lithuania                   22
Source: Lietuvos Bankas23
Economic outlook• The country’s economy is slowing amid the eurozone  debt crisis• Nevertheless,   → the global outlook br...
Yes, it is worth to operate abroad! • BSR builds a good action place:   “In spite of numerous economic, ecological and cul...
Thank you for your attention!                                26
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Future Trends in the Baltic Sea Region- Potential for SMEs

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Elina Priedulena, Hanse Parlament, “Future Trends in the Baltic Sea Region- Potential for SMEs“

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Future Trends in the Baltic Sea Region- Potential for SMEs

  1. 1. Future trends in the Baltic Sea Region Elina Priedulena, Hanse Parlament Part-financed by the European Union (European Regional Development Fund and European Neighbourhood and Partnership Instrument)
  2. 2. Contents1. Economic development in Baltic Sea Region (BSR) - general development trends - SMEs2. Trading across borders3. Innovation4. Demographic changes5. Economic Outlook for Lithuania 2
  3. 3. Is it worth to operate abroad?• Large companies have been global for a long time – globalization/internationalization• SMEs are usually acting on markets close to home → Next step: expand further to other markets, understanding the vast opportunities but also the risks, in large consumer markets like Poland, Russia and Ukraine, because: → more opportunities, even though more competitiveness; more profit for own enterprises 3
  4. 4. Economic development of BSR 4
  5. 5. BSR Source: HWWI 5
  6. 6. States of BSR – a vast potential of EU• 147 million inhabitants = 29% of the population of the EU• 67 millionen employees (2009) = 31 % of all employees in EU• 30 % of the GDP of the EU Member States• export 725 mrd./euro = 33% of exports within EU (2009)• import 993 mrd./euro = 30% of EU imports (2009)• more than 100 universities and research institutesFurthermore• favourable geographical location  regional cooperation in manifold manner• EU recognised the potential of BSR and developed the EU Strategy 2020 for the BSR – first specific regional strategy in EU to support and coordinate collaboration of diverse players on various levels. Source: HWWI 6
  7. 7. Real GDP growth rate,percentage change on previous year Source: Eurostat 7
  8. 8. Real GDP development and forecast 2009 2010 2011 2012f 2013fDenmark -5.8 1.3 1.2 1.4 1.7Germany -5.1 3.7 3.0 0.8 1.5Estonia -14.3 2.3 8.0 3.2 4.0Latvia -17.7 -0.3 4.5 2.5 4.0Lithuania -14.8 1.4 5.9 2.3 3.8Poland 1.6 3.9 4.0 2.5 2.8Finland -8.2 3.6 2.8 0.4 1.8Sweden -5.2 5.6 4.0 1.4 2.1Norway -1.7 0.7 2.4 2.7 2.9 • percentage change on previous year • f=forecast Source: Eurostat 8
  9. 9. GDP per Capita in PPS (EU=100) 250 EU 27 Denmark 200 Germany Estonia 150 Index value Latvia Lithuania 100 Poland Finland 50 Sweden Norway 0 2004 2005 2006 2007 2008 2009 2010 Source: Eurostat 9
  10. 10. Small and medium-sized enterprises (SMEs) 10
  11. 11. SMEs – backbone of the European economy• enterprises (EU, 2010) – SME: 99.8% of all enterprises (20.8 Mio.) • Typical SMEs (92% of all SMEs): micro enterprises < 10 headcount • Ø 4 employees/enterprise – large enterprises: 0.2% of all enterprises (43,000)• share of employment (EU, 2010)  SMEs EU 27: 66.9% of all employees  85% of net new jobs in the EU between 2002 and 2010 were created by SMEs 11
  12. 12. Trading across borders 12
  13. 13. Trading within BSR  The exchange of goods is essential for the cross-border integration of EU states; Baltic Sea states important trading partners  international trade through spatial proximity between regions more intense → neighbours within BSR have intense import and export trading relationships with each other  the traditional economic interconnections between former Hanseatic cities Source: HWWI 13
  14. 14. Major export and import countries of Lithuania 2011 Imports Exports 78159.9 LTL/milj. 69642.5 LTL/mlj.EU 55.9% 61.4%Russia 32.8% 16.6%Germany 9.7% 10.2%Poland 9.1% 9.3%Latvia 6.6% 6.9%Netherlands 4.9% 6.6%Sweden 3.3% 6.1%Italy 3.2% 5.2%Beldium 3.21% 4.1%Estonia 2.8% 4.1%Belarus 2.5% 3.6% Source: Statistics Lithuania 14
  15. 15. Corner stones of export and import mineral products 25% chemical industry products 48% machinery; mechanical appliances; electrical equipmentExport 9% vehicles; aircraft; vessels&associated transport equipment 10% other 8% mineral products 34% 35% chemical industry products machinery; mechanical appliances; electricalImport equipment vehicles; aircraft; vessels&associated transport equipment other 8% 11% 12% 15
  16. 16. Innovation 16
  17. 17. Indicators of Innovation Innovation GDP share Share of R&D Patents per Labour force European of R&D₂ employees at 100.000 share of Scoreboard₁ expenditures labour forces inhabitants HRST₃ 2009 2008 2007 2007 2009 Rating %EU 27 - 1.9 1.5 11.7 42.1Sweden 2 3.8 2.4 29.8 51.2Finland 3 3.7 3.0 25.1 52.5Germany 4 2.6 1.7 29.1 47.5Denmark 6 2.7 2.4 19.4 53.0Estonia 13 1.3 1.4 1.7 49.2Poland 26 0.6 0.7 0.4 36.4Lithuania 27 0.8 1.2 0.2 45.3Latvia 30 0.6 0.9 0.8 43.3Russia - 1.0 1.1 (2005) 0.2 -1) 33 countries by comparison2) R&D – Research and Development3) HRST – Human Resources in Science and TechnologySources: Eurostat (2010); HWWI 17
  18. 18. Innovation and SMEs • fundamental, especially in crisis times, for stimulating the expansion of SMEs, either into existing or new markets • compared with large enterprises rather difficult: finance, technology, shortage of qualified personnel, limited resources • Policy responses to those challenges:  Reaching equal big share of GDP into R&D is one of strategic goal of the EU Strategy 2020. 18
  19. 19. Demographic changes 19
  20. 20. Demography• employment resources is the key factor of economic development in BSR• Demografic changes due to:  continued increase of life expectancy  natural population development – averaged EU wide low rates of fertility  Migration – increased migration from low earn countries to EU 15 20
  21. 21. Effects: aging of society, lack of employment, growing average age ofpopulation, structural issues/changes regarding employment, problems insocial spheres – safeguarding of social pension system, etc. 21
  22. 22. Economic Outlook for Lithuania 22
  23. 23. Source: Lietuvos Bankas23
  24. 24. Economic outlook• The country’s economy is slowing amid the eurozone debt crisis• Nevertheless, → the global outlook brightens 2013 → the economy in Lithuania will recovery 24
  25. 25. Yes, it is worth to operate abroad! • BSR builds a good action place: “In spite of numerous economic, ecological and cultural differences, the Baltic Sea States form a cohesive, “domestic region”. This makes regional cooperation especially important here, acting as a role model for other regions of Europe. But there is still more potential to be exploited.” Günther Oettinger - Commissioner for Energy • and SMEs: “…form the backbone of the European economy. They are key to entrepreneurial spirit and innovation in the EU and thus crucial to ensure EU competitiveness. “ Erkki Liikanen - Enterprise Commissioner 25
  26. 26. Thank you for your attention! 26

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