Successfully reported this slideshow.

Mega trends in russia 2012 2020



Loading in …3
1 of 43
1 of 43

More Related Content

Related Audiobooks

Free with a 14 day trial from Scribd

See all

Mega trends in russia 2012 2020

  1. 1. Russia Mega Trends: Macro to Micro Implications for 2020 May 2012 1
  2. 2. Introduction to Mega Trends 2
  3. 3. Definition of a Mega Trend What is a Mega Trend? Impact of Mega Trends on Key Organizational Functions Mega Trends are global, sustained and macro economic forces of development that impact business, economy, society, cultures and personal lives thereby defining our future world and its increasing pace of change 3
  4. 4. Mega Trends in Russia 4
  5. 5. Economy: Russia Beyond Moscow – The Next Game Changers 5
  6. 6. Moscow – Emerging Mega City Fast Forward Moscow City Facts: Did You Know?.. 25-30% of Russia’s GDP will be produced in Moscow (2025) 20% of Russian population will live in Moscow agglomeration The city will grow 2.5 times (Big Moscow) 150km of new tracks and 70 stations will be opened in Moscow Metro What Are The Implications? Global economic force on its own Hub and spoke business model Diverse and dynamic socio-economic mix Tech-savvy citizens connected 24/7 Mega-corridors: Moscow – St. Petersburg, Moscow – Nizhniy Novgorod 6
  7. 7. Russia Beyond Moscow – The Next Game Changers 5 to 7 cities will emerge as alternative growth centres by 2020, bridging the welfare gap between Moscow and the regions Saint Petersburg Moscow 1/3 of the population will live in the Eastern part of Russia in 2025 Krasnodar Yekaterinburg Novosibirsk Krasnoyarsk Khabarovsk South: Sochi, Krasnodar, Rostov Development of tourism and agricultural business Vladivostok Ural: Yekaterinburg, Siberia: Krasnoyarsk, Far East: Vladivostok, Perm Novosibirsk, Tomsk Nakhodka, Khabarovsk Logistics, finance, machine Oil and gas, healthcare, Modern infrastructure and building energy, innovation logistics facilities 7
  8. 8. The New Locomotives of Growth Vladivostok – “San-Francisco” in the Far East “Open sky” status – transit between China and US Modernization of Vladivostok Marine Trade Port Educational, scientific, travel and business centre linking Europe, Asia and America “Tomsk 3.0 – Cognitive City of the Future Post-industrial, innovative economic development Strong scientific and educational complex Comfortable living environment and social infrastructure Yekaterinburg – “The City” of Ural Economic and financial centre Important transportation hub – multi-modal logistics, the fastest growing airport Solid industrial base attracting investments 8
  9. 9. Social Trends: Prosperity, Education and Social Mobility 9
  10. 10. The Middle Bulge Middle Class •Boom in consumer expenditure, stimulating the overall economy growth Annual Disposable Income* (Russia), USD per capita •The largest consumer markets in Europe •Higher demand for intangible products – services, leisure and entertainment, etc. Wellness and wellbeing •Healthy nutrition •Healthier lifestyle – sport and fitness Social mobility •She-economy •Small and medium businesses •Reverse brain-drain 2005 2010 2015 2020 Education •RUB 140.5 billion investment * Current prices, year-on-year exchange rates •From quantity to quality •Corporate and federal universities, national Source: Frost and Sullivan, Euromonitor International, Rosstat research centres 10
  11. 11. Small and Medium Business – Engine for Innovative Growth Positive trends Restraints 1.7 m SMEs, 4 m individual entrepreneurs Only 5% have international contacts 17 m employed, 22% of working-age Only 2% - innovative SME population US – 40% of GDP, Europe – 60% of GDP 21% of GDP Barriers – tax system, lack of available 2000-2005 growth – 7%, 2005-2009 – 40% financing, corruption, red tape What kind of support measures for SMES would be most effective? % of responses Source: Chamber of Commerce of Russia and the Ministry of Economy – “Monitoring of SME sector”(June 2011), Opora. 11
  12. 12. Healthcare as a National Security Doctrine 12
  13. 13. Facing Demographic Crisis Life expectancy among the lowest in the developed world Fast Forward Facts: Unhealthy lifestyle and inefficient healthcare system Demographics Number of population decreased by 7 million in 1991-2009. 2025 forecast: optimistic/pessimistic scenarios ~139/131 million Source: WHO, UN, Rosstat, Frost and Sullivan Nation’s healthcare becomes THE most urgent problem in Russia 13
  14. 14. Pharmerging Economy Today Low per capita consumption of drugs High dependency on imports Pharma Tomorrow One of the fastest and most attractive pharmaceutical markets Locally-produced drugs, including innovative and biopharmaceuticals Manufacturing of pharmaceuticals in Russia 2010 2020 Source: IMS Health, Frost and Sullivan Pharma 2020 CAGR 2011- 2016: 11-14% Foreign Russian 14
  15. 15. Equipping the Healthcare System Today Installed base – 4 MRI and 9 CT scanners per 1 million population Estimate in order to meet the diagnostic needs – 14 and 25 Medical Lack of qualified personnel (e.g. radiologists) Equipment Dependency on imports Tomorrow Steady market growth Localization of production and technology transfer CAGR: 7-8% MRI – magnetic resonance imaging CT – computer tomography Source: Frost and Sullivan 15
  16. 16. Infrastructure Development 16
  17. 17. The most ambitious infrastructure development programme in the world New and improved business opportunities Population mobility Economic development of the Eastern part of Russia 17
  18. 18. Up in the Air Today: 63% of the Russia’s territory has no alternative to air transport. 80% of airport infrastructure is outdated and requires modernization Investment 2012-2019: RUB 107 ($ 3.55) 70% of runways were built over 20 years ago. billion Tomorrow: Tourism in the North Caucasus– 4 new and modernization of 6 existing airports Vladivostok – air hub in the Far East Source: Rosstat, IATA, Frost and Sullivan 18
  19. 19. Fools and Roads Today: 29% of federal roads are overloaded, in Moscow – 60% 46,000 settlements (2.7 m citizens) do not have access to hard-surfaced Investment 2012-2019 roads RUB 1.71 trillion 23.5 deaths per 100,000 people caused by road accidents (Europe – 9.5) ($ 57 billion) Tomorrow: Construction/modernization of ~20,000 km of roads, including toll highways Trans-Siberian route development and emergence of multi-modal hubs The Silk Road of Modern Age: Europe to China highway via Kazakhstan Automotive Industry Over 4 mln new car sales in Russia by 2020 Logistics Industry To reach over $100 bn by 2020 Source: Ministry of Transportation, Frost and Sullivan 19
  20. 20. Back on Track Today: Low railway network density Low cargo delivery reliability – 88-90% Investment 2012-2019 Tomorrow: RUB 407 ($ 13.5) 20,000 km of new railway links by 2030, +24% in railway network density billion The dawn of high-speed railway era – 1,500 km with speeds up to 350 km/h (St-Petersburg – Moscow – Yekaterinburg) Modernization of rolling-stock (passenger and cargo) Siemens Desiro trains to be manufactured in Russia Talgo Railway modernization Spanish manufacturer to supply in Russia attracts variable gauge trains for Moscow- foreign players Berlin and Moscow-Kiev routes Alstom Supplier of Allegro train on St.Petersburg-Helsinki direction, is eyeing further expansion in Russia Source: Ministry of Transportation, Frost and Sullivan 20
  21. 21. e-Russia 21
  22. 22. Modern Russia Implications for Government, Business and Society: Accountable and transparent government Transparency for stakeholders in G2G and G2B transactions, bidding process Improved city planning process Cut red tape and save time: on-line G2C services (taxes, utility bills) Reduce operational costs for businesses Efficient delivery of a long range of public services 24/7 – education and healthcare New business models 22
  23. 23. E-Government UN e-Government index 2012 – solid and representative, rich technical features portal – One Stop Shop for e-services, ~500,000 monthly visitors 27th spot in the world +32 positions in global ranking in The leader in Eastern Europe, only 2 years (!) behind Japan and US among the largest populated countries RUR 80 ($2.7) billion investment for government informatization 60% of the population to use e- government services in 2020, up from ~11% presently Note: * - with a population over 100 million people Source: United Nations 23
  24. 24. e-Society Legal status of e-learning approved by the new Law on Education (2012) e-Learning 20-25% growth of e-learning services in the coming years RUR 24 ($ 0.8) billion investment Electronic health records system roll-out in pilot e-Healthcare regions Telemedicine and m-healthcare – remote patient diagnosis, monitoring and treatment ~ 40% annual growth Overcoming general distrust, expansion in the regions and all age-groups e-Commerce Solving logistics and payment issues New business models (private shopping clubs, group purchasing, penny auctions) 24
  25. 25. Made in Russia 25
  26. 26. Made in Russia 2.0 Innovative production in Russia, % of GDP Before After “REBRANDING” Innovative products in Russian exports, % 26
  27. 27. From Raw Materials Supplier to Innovative Exporter Strong Before After Export of dependence innovative on goods and hydrocarbon services exports Localization of R&D funding foreign manufacturers Technology transfer Localization of manufacturing in Russia will trigger its innovative growth 27
  28. 28. Back to Russia Energy Healthcare ICT Automotive Energy efficient power CT scanners – Philips Mobile base stations for Localization of generation turbines – Healthcare and Elektron, LTE networks – NSN, automotive plants General Electric and GE Healthcare and Rosnano and Mikran Railway cars – Alstom Rostekhnologii Rostekhnologii IPTV set-top boxes – and Siemens AG High performance gas Big Pharma Cisco Systems (manufactured by Jabil) Automotive components turbines – Siemens AG – Valeo, Robert Bosch and Silovye Mashiny 28
  29. 29. Technology Leapfrogging 29
  30. 30. Space Jam Automotive & Other: Logistics: •Tracking (personnel, •Navigation assistance children, criminals) •Traffic management •Remote patient monitoring •Usage-based insurance •Improvement in weather prediction •In-vehicle infotainment •Mobile satellite services •Asset tracking •Increase in broadband •Real-time stock speed management •Air-traffic control •Automated guidance of machines ERA GLONASS is to become fully operational by 2014-2016 and create multiple innovative applications 30
  31. 31. Wireless World 4G Mobile Technology •High rates of data transmission •Enabling integration into any wireless Broadband Internet Access, % of Households platform •Russia at the forefront of LTE deployments globally RFID / NFC •Potential economic benefits to outweigh implementation costs •Multiple applications – retail, logistics, toll collection, fare payment Security •Transportation and critical infrastructure protection 2010 2015 2020 •CCTV surveillance integrated into the wireless platform •Market growth of IP-based solutions Wireless intelligence – IT infrastructure to be around 80% wireless 31
  32. 32. Biopharmaceuticals and Beyond Today 0.1% of the global biotechnology market 80% import dependence Biotechnology-2020 Focus on pharmaceutical biotechnology RUB 1,163 ($38.6) Tomorrow billion 5% market share in the global biotech market Two-fold reduction of imports Red, White and Green biotech Red Biotech - Pharma White Biotech – Industry Green Biotech - Agriculture Fast-growing, attractive for Virtually non-existent Legal uncertainty – barrier investment for growth Large-scale projects – “Third wave of biotech” Opportunities – increase Generium, Bioprocess, Chemrar, Opportunities – biofuels yields of agricultural crops, Biocad (agricultural and forestry reduce their vulnerability Opportunities – import waste), chemical industry to diseases, improve substitution of generics, (biopolymers), food and feed nutritional quality of food innovative drugs (ingredients, supplements) (amino acids) 32
  33. 33. Nano-Russia NANOMATERIALS Global Scanning Probe Microscopes Market, $ million Large scale production of silicate nanocomposites (Bryansk, February 2012) – Rosnano Large number of innovative SMEs, e.g. Novosibirsk Nanomaterials – metal R 15 % nanopowders. G CA NANOINSTRUMENTATION Worldwide spending on nanotechnology will lead to sustained growth in demand NT-MDT (Zelenograd) – manufacturer of world-class scanning 2009 2012 2015 2018 probe microscopes (SPM) since 1989 Advanced Technologies Centre – manufacturing of SPMs (Moscow, December 2011) – Rosnano. Source: Frost and Sullivan, NT-MDT, Rosnano 33
  34. 34. Smart is the New Green 34
  35. 35. “Smart” is the New Green Smart Cities Smart Smart Smart Energy Technology Infrastructure Smart Smart Smart Grids Smart Clouds Mobility Buildings Smart Smart Smart Phones Smart Meters Materials Bandages 35
  36. 36. The Lighting Revolution Today LED – 3-5% of the market due to high cost Tomorrow LED prices are to decrease 30% by 2015 Smart Lighting Russia is to phase-out inefficient light bulbs: 2011 – 100W, 2013 – 75W LED vs. Incandescent bulbs – potential energy saving of 80% Intelligent lighting systems – wireless networks to remotely monitor and control street lighting, motion controls, dimming sensors, on/off scheduling. LED Lighting – Market Revenue, World % 20 R C AG LED-pioneers in Russia Source: Frost & Sullivan Russia is to leapfrog from incandescent light bulbs to intelligent LED lighting systems 36
  37. 37. Saving the Energy Today 13-15%energy loss during electricity transmission 70% of installed equipment – import Smart Meters Tomorrow and Grids 40% energy efficiency increase by 2020 (Federal Law #261) Incentives for localization of production – to reduce share of imports to 40% Beyond electricity – pilot installations of water smart meters (Mosvodokanal) Source: Federal Grid Company, Frost & Sullivan European Smart Meters Market Smart Grid projects in Tomsk, Sochi, Perm, Belgorod Installed Base, million units Price Projection, $ Intelligent grid implementation could result in RUB 50 million annual savings 37
  38. 38. From Concept to Reality Today Citizens demanding a modern living environment Energy efficiency and environmental concerns SMART CITY Rapid growth and penetration of ICT Tomorrow Smart city projects in Belgorod and Skolkovo – a model for modernisation of smaller Russian cities • E-government • Traffic management Belgorod • E-healthcare • Public transport Maiden smart city project in Russia Smart Smart Smart lighting system governance mobility 59,000 smart meters Smart grid. Smart Smart living environment • Entertainment • Smart buildings • Culture and sport • Smart grid Smart City – interconnected urban environment where citizens lead a fully digitalized lifestyles 38
  39. 39. Mega Events 39
  40. 40. Mega Events Sochi 2014 Winter APEC Summit 2012 F1 Grand Prix FIFA World Cup 2018 Olympics $ 9 billion $ 10 billion ~ $ 22 billion investment $ 200 million investment investment Development of investment Modernization of Infrastructure, tourism in the Recurring annual Vladivostok – hub tourism, global Caucasus revenue in the Far East marketing campaign A string of large-scale events that will open up Russia to the world 40
  41. 41. Macro to Micro Analysis 41
  42. 42. Key Strategic Conclusions 1. Mega Trends are connected and intertwined which suggests “synergetic” opportunities between them 2. It is important to understand the eco-system of the Mega Trend and the elements of the value chain which have most profitability 3. All these trends have global ramifications thereby offering scalable opportunities 4. These forces are changing rapidly and bringing new competencies into play at half the life-cycle speed of the past decade 5. Organisations’ need “Mega Trend” champions and teams within their organisation structure to best exploit the opportunities 6. It is important to build a healthy eco-system around your opportunity related to a mega trend as it can be a source of competitive advantage and raise barriers to entry 42
  43. 43. From Macro to Micro: Taking Mega Trends from Information to Strategy Implementation Macro Micro Analysis of Mega Trend Selected trends that Opportunities impact your business and Unmet and markets Needs Impact on Sub Trend Future Product/ A sub-layer of trends that has a wide ranging impact Technology Impact to Your Industry Visualising the roadmap of these critical forces through scenario-building and macro economic forecasts 43