Asia and Eastern Europe Quarterly Report

Transcription

1 Asia and Eastern Europe 2016 Quarterly Report

2 Combi Works The Company Combi Works is the first global Virtual factory. We have built the only factory without capacity or production method limitations. Without needing to invest in factory walls or machinery. Combi Works has production facilities in China, India, Russia, Belorussia, Estonia, Poland, Turkey and Lithuania. Each production country has its strengths and know-how areas which are used to our clients benefit. We are a factory with agile capacity as our client you can select the location and production method. The mindset Staying ahead in the world is a mindset the client must be put in the driver s seat. Our job is too free client resources and management to concentrate on the future. Physical infra and cost reduction are cornerstones, but they look into the past. We free your resources so you can stay ahead of your competition. Combi Works has built its system around free movement of production, tight control and documentation of production, an automated logistics chain and an engineering setup, which enables the Virtual Factory concept. The company s vision is to be the first global virtual factory combining component production and final assembly and be a world leader in IT-advanced industrial production. Combi Works already produces full-scale tractors, solar panels, LED streetlights, indoor gardens, windmill parts, production lines, boat mooring equipment to name but a few. We hope to be producing your machines, components or products very soon.

3 Global Raw Material and Labor costs Actual cost development in markets Combi Works is active in. Raw materials (USD/Ton) IN-India Iron Coke Steel / Q355 Plastics / ABS Raw materials (USD/Ton) CH-China Iron Coke Steel / S355 0

4 Labor cost masters (USD/Hour) 20,00 18,00 China 16,00 14,00 12,00 India 10,00 8,00 6,00 4,00 Lithua nia 2,00 0, Q3 Q Labor cost factory floor (USD/Hour) 10,00 9,00 8,00 China 7,00 6,00 5,00 India 4,00 3,00 2,00 1,00 Lithu ania 0, Q3 Q3 Q

5 Market development China Securities regulator cracks down on cross-industry investments in virtual industries The China Securities Regulatory Commission (CSRC) has banned listed companies from cross-investing in or acquiring companies in four industries: internet finance, gaming, movie and television, and virtual reality with money raised via additional stock issuing or other ways, the online financial magazine Caixin reported on Wednesday citing a source familiar with the matter. China criticizes EU anti-dumping move on steel bars The European Commission's latest decision to raise anti-dumping duties on Chinese steel bars"provided unjustifiable protection for the EU steel industry, "China's Ministry of Commerce(MOC)said Friday. China's securities watchdog, Russian central bank sign MOU China Securities Regulatory Commission(CSRC), the securities watchdog, signed a memorandum of understanding(mou)with the Russian central bank on Monday. Property tax requires cautious approach Media reports quote the government as saying that levying property tax is now part of its agenda, sparking public concern. The problem is, if property tax is levied without full preparation, it will not achieve the expected goal of increasing revenue. Instead, it could undermine the government's credibility and seriously impede the modernization process of national governance. Fujian achieves breakthrough in LED technology Fujian province has seen the technological breakthrough of LED technologies for transparent fluorescent ceramic material that allows dense LED lights to concentrate on a small surface. Shanghai pharma firm to buy 60% Vitaco stake Shanghai Pharmaceuticals Holding Co Ltd agreed to take a 60 percent stake in Australian vitamins maker Vitaco Holdings Ltd for around 938 million yuan ($141 million)

6 Shanghai company eyes $3b NYC condo project The US unit of Shanghai Municipal Investment, the largest State-owned enterprise in Shanghai, is reportedly taking part in a multi-billion-dollar condominium project in New York City. China becomes second-largest investor in foreign property Chinese investors pumped $17 billion into overseas property investment during the first five months, becoming the world's second-largest source of outbound property investment. Short Analysis of Chinese Economy 2016 China disclosed its mid-year economic health check, featuring indicators that the economy is generally in good shape and on track for stable economic growth and restructuring. China's GDP in the second quarter () was a stable 6.7 percent. Although this is the lowest quarterly rate since the global financial crisis, it is within the government's range for 2016 of between 6.5 and 7 percent. Infrastructure investment accelerated, lifting equipment manufacturing and boosting industrial production. Retail sales growth quickened on the back of a rebound in demand for consumer items. The economy is heading into the second half (H2) of this year with positive momentum. The stabilization in growth did not come at the cost of reviving industries bogged down by over capacity, which had been a concern. Despite a pickup in steel output in June, investment growth has continued to slow. Steel investment also fell 4.3 percent in June, down from an increase of 4.5 percent in May. Housing inventory adjustment is in progress, with floor space for sale in June down 21 million square meters from March. Meanwhile, the new economy is vibrant, new businesses are booming, and new growth momentum is accumulating. The service industry accounted for over 50 percent of GDP while high-tech production in the industrial sector grew 10.2 year on year. In addition, consumption contributed over 70 percent to overall GDP growth in the first six months.

7 7,6 % 7,4 % 7,2 % 7,0 % 6,8 % 6,6 % 6,4 % China - GDP change rate 6,2 % Q3 Q

8 Market development - India The overall growth of GDP The Indian economy expanded 7.3 percent year-on-year in the last three months of, slowing from an upwardly revised 7.7 percent growth in the previous quarter but in line with market expectations. The manufacturing sector surged 12.6 percent while farm output shrank 1 percent. GDP Annual Growth Rate in India averaged 6.04 percent from 1951 until, reaching an all time high of percent in the first quarter of 2010 and a record low of percent in the fourth quarter of Food Inflation Cost of food in India increased 6.85 percent in January of 2016 over the same month in the previous year. Food Inflation in India averaged 8.72 percent from 2012 until 2016, reaching an all time high of percent in November of 2013 and a record low of 2.15 percent in July of. Industrial Production Percentage(IIP) Industrial production in India declined 1.3 percent year-on-year in December of, following an upwardly revised 3.4 percent contraction in the previous month. Manufacturing went down 2.4 percent, offsetting a 3.2 percent rise in electricity and a 2.9 percent gain in mining. Considering the three months to December, industrial output went up 3.1 percent. Industrial Production in India averaged 6.43 percent from 1994 until, reaching an all time high of 20 percent in November of 2006 and a record low of percent in February of Government Spending Government Spending in India decreased to INR Billion in the fourth quarter of from INR Billion in the third quarter of. Government Spending in India averaged INR Billion from 2004 until, reaching an all time high of INR Billion in the third quarter of and a record low of INR Billion in the second quarter of 2004.

9 Balance of trade India recorded a USD 11,664 million trade deficit in December of, higher than a USD9,434 million gap a year earlier. It is the largest trade deficit since August, as exports fell 15 percent and imports declined only 3.9 percent as purchases of gold significantly rose. Balance of Trade in India averaged USD Million from 1957 until, reaching an all time high of USD Million in March of 1977 and a record low of USD Million in October of Exports from India Exports from India fell percent to USD 22,300 million in December of. It is the 13th straight month of decline, as non-petroleum exports declined by 7.86 percent to USD 19,93 million. Exports in India averaged USD Million from 1957 until, reaching an all time high of USD Million in March of 2013 and a record low of USD Million in June of Foreign Exchange Reserves Foreign Exchange Reserves in India increased to USD Million in February 5 from USD Million in the previous week. Foreign Exchange Reserves in India averaged USD Million from 1998 until 2016, reaching an all time high of USD Million in December of 2009 and a record low of USD Million in September of Consumer Price Index Consumer Price Index CPI in India increased to Index Points in January from Index Points in December of. Consumer Price Index CPI in India averaged Index Points from 2011 until 2016, reaching an all time high of Index Points in November of and a record low of Index Points in February of Business Confidence Business Confidence in India increased to in the fourth quarter of from in the third quarter of. Business Confidence in India averaged from 2005 until, reaching an all time high of in the first quarter of 2007 and a record low of in the third quarter of 2013.

10 India - GDP change rate 9,0 % 8,0 % 7,0 % 6,0 % 5,0 % 4,0 % 3,0 % 2,0 % 1,0 % 0,0 % Q3 Q

11 Market development Estonia Estonia Balance of trade Estonia trade deficit decreased by 19 percent to EUR million in December of, compared to EUR million gap a year before. Imports fell 3.5 percent, driven by intermediate goods purchases (-17.5 percent). Exports edged down 0.1 percent, as sales of intermediate goods (-0.5 percent); capital goods (-14 percent) declined while consumer goods (+10.5 percent) increased. Considering full, trade deficit shrank 14.7 percent to 1.4 EUR billion, as exports decreased by 4 percent to 11.6 EUR billion and imports fell by 5 percent to 13.1 EUR billion. The decline was influenced the most by trade in mineral products and electrical equipment. The biggest trade surplus was recorded in trade with Sweden, Norway and the USA and the biggest trade deficit occurred in trade with Germany, Poland and Lithuania. Estonia Business Confidence Business Confidence in Estonia increased to in January from 100 in December of. Business Confidence in Estonia averaged from 2001 until 2016, reaching an all time high of in September of 2006 and a record low of in March of Estonia Current Account Estonia recorded a Current Account surplus of EUR Million in the third quarter of. Current Account in Estonia averaged EUR Million from 1992 until, reaching an all time high of EUR Million in the second quarter of and a record low of EUR Million in the first quarter of Estonia Inflation Rate The inflation rate in Estonia was recorded at percent in January of Inflation Rate in Estonia averaged 3.55 percent from 1999 until 2016, reaching an all time high of percent in June of 2008 and a record low of percent in October of 2009.

12 Short Analysis of Estonian Economy The Gross Domestic Product (GDP) in Estonia expanded 0.70 percent in the fourth quarter of over the same quarter of the previous year, the same pace as in previous three months, preliminary data showed. Expansion was positively influenced by net taxes on products. The receipts of value added tax and payments of subsidies increased. In contrast, foreign demand decreased. the Estonian foreign trade was influenced the most by the decrease in the exports and imports of mineral products (incl. motor spirit, fuel oils, gas) and electrical equipment. On a quarter-on-quarter basis, the economy grew by 1.2 percent. GDP Annual Growth Rate in Estonia averaged 4.28 percent from 1996 until, reaching an all time high of percent in the fourth quarter of 1997 and a record low of percent in the third quarter of Consumer Spending in Estonia decreased to EUR Million in the third quarter of from EUR Million in the second quarter of. Consumer Spending in Estonia averaged EUR Million from 1995 until, reaching an all time high of EUR Million in the fourth quarter of 2007 and a record low of EUR Million in the third quarter of Foreign Direct Investment in Estonia increased by EUR Million in the third quarter of. Foreign Direct Investment in Estonia averaged EUR Million from 1994 until, reaching an all time high of EUR Million in the second quarter of 2005 and a record low of EUR Million in the second quarter of

13 4,0 % 3,5 % 3,0 % 2,5 % 2,0 % 1,5 % 1,0 % 0,5 % Estonia - GDP change rate 0,0 % 2013 Q3 Q

14 Market development Latvia Latvia's Current Account Latvia recorded a Current Account surplus of EUR Million in December of. Current Account in Latvia averaged EUR Million from 2000 until, reaching an all time high of EUR Million in June of 2009 and a record low of EUR Million in July of Industrial production output Industrial Production in Latvia increased 2.60 percent in December of over the same month in the previous year. Industrial Production in Latvia averaged 3.94 percent from 2001 until, reaching an all time high of percent in October of 2010 and a record low of percent in March of Latvia Balance of trade The trade gap in Latvia increased to EUR million in December of compared to a EUR million shortfall in the previous month as exports declined at a faster pace than imports. Exports fell 12.6 percent to EUR 817 million: Shipments of electrical machinery and equipment dropped the most (-35 percent) followed by articles of iron or steel (-22.1 percent), cereals (-20.4 percent) and mineral fuels, mineral oils and products of their distillation (-17 percent) and beverages, spirits and vinegar (-13.1 percent). Imports decreased by 8.3 percent to EUR million: purchases of electrical machinery and equipment reduced the most (-19.9 percent), followed by beverages, spirits and vinegar (-16.9 percent), plastics and articles thereof (-14.5 percent) and pharmaceutical products (-13.6 percent). Considering full, exports rose 1.2 percent while imports decreased 1.3 percent. Balance of Trade in Latvia averaged EUR Million from 1993 until, reaching an all time high of EUR Million in February of 1993 and a record low of EUR Million in July of Latvia Exports Exports in Latvia decreased to 817 EUR Million in December from EUR Million in November of. Shipments of electrical machinery and equipment dropped the most (-35 percent) followed by articles of iron or steel (-22.1 percent), cereals (-20.4 percent) and mineral fuels, mineral oils and products of their distillation (-17 percent) and beverages, spirits and vinegar (-13.1 percent). In

15 contrast, sales of optical instruments and apparatus (including medical) grew 46.3 percent. Exports in Latvia averaged EUR Million from 1993 until, reaching an all time high of EUR Million in October of and a record low of EUR Million in January of Industrial production Industrial Production in Latvia increased 2.60 percent in December of over the same month in the previous year. Industrial Production in Latvia averaged 3.94 percent from 2001 until, reaching an all time high of percent in October of 2010 and a record low of percent in March of Consumer Price Index CPI in Latvia decreased to Index Points in January from Index Points in December of. Consumer Price Index CPI in Latvia averaged Index Points from 1993 until 2016, reaching an all time high of 109 Index Points in May of and a record low of Index Points in January of 1993.

16 Short Analysis of Latvian Economy The Gross Domestic Product (GDP) in Latvia was worth billion US dollars in. The GDP value of Latvia represents 0.05 percent of the world economy. GDP in Latvia averaged USD Billion from 1987 until, reaching an all time high of USD Billion in 2008 and a record low of 4.50 USD Billion in The Gross Domestic Product (GDP) in Latvia expanded 3 percent in the fourth quarter of over the same quarter of the previous year, slowing from a 3.3 percent growth in the previous quarter, preliminary estimates showed. GDP Annual Growth Rate in Latvia averaged 4.38 percent from 1996 until, reaching an all time high of percent in the first quarter of 1996 and a record low of percent in the third quarter of Consumer Spending in Latvia increased to EUR THO in the third quarter of from EUR THO in the second quarter of. Consumer Spending in Latvia averaged EUR THO from 1995 until, reaching an all time high of EUR THO in the fourth quarter of 2006 and a record low of EUR THO in the first quarter of ,04 0,03 0,03 0,02 0,02 0,01 0,01 Latvia - GDP change rate - Q3 Q

17 Market development Lithuania Lithuania's Consumer Confidence Consumer Confidence in Lithuania increased to -6 in January from -7 in December of. Consumer Confidence in Lithuania averaged from 2001 until 2016, reaching an all time high of 9 in March of 2007 and a record low of -56 in January of Exports from Lithuania Exports in Lithuania decreased to EUR Million in December from 2055 EUR Million in November of. Exports in Lithuania averaged EUR Million from 1994 until, reaching an all time high of EUR Million in October of and a record low of EUR Million in October of Labour costs in Lithuania Labour Costs in Lithuania increased to 117 Index Points in the third quarter of from Index Points in the second quarter of. Labour Costs in Lithuania averaged Index Points from 2000 until, reaching an all time high of 117 Index Points in the third quarter of and a record low of 45 Index Points in the second quarter of Lithuania Completed Dwellings Housing Index in Lithuania increased to Index points in the third quarter of from Index points in the second quarter of. Housing Index in Lithuania averaged Index points from 2006 until, reaching an all time high of Index points in the second quarter of 2008 and a record low of Index points in the first quarter of Retails Sales in Lithuania Retail Sales in Lithuania increased percent in December of over the previous month. Retail Sales MoM in Lithuania averaged 0.48 percent from 1998 until, reaching an all time high of percent in December of and a record low of percent in January of..

18 Short Analysis of Lithuania Economy Industrial Production in Lithuania increased 4.80 percent in December of over the same month in the previous year. Industrial Production in Lithuania averaged 3.78 percent from 1999 until, reaching an all time high of percent in February of 2003 and a record low of percent in April of Manufacturing Production in Lithuania increased 4.80 percent in December of over the same month in the previous year. Manufacturing Production in Lithuania averaged 4.53 percent from 1999 until, reaching an all time high of 38 percent in February of 2003 and a record low of percent in November of Foreign Exchange Reserves in Lithuania decreased to USD Million in January from USD Million in December of. Foreign Exchange Reserves in Lithuania averaged USD Million from 1992 until 2016, reaching an all time high of USD Million in February of 2013 and a record low of USD Million in December of Lithuania - GDP change rate 4,0 % 3,5 % 3,0 % 2,5 % 2,0 % 1,5 % 1,0 % 0,5 % 0,0 % 2013 Q3 Q

19 Report Sources: China China Daily India Ministry of Finance, Govt. of India Estonia Statistics Estonia and Focus Economics Consensus Forecast. Latvia Central Statistics Bureau and FocusEconomics calculations. Lithuania Macro Research - Swedbank Economic Outlook. Reviewed 16 October Central Statistics Bureau and FocusEconomics calculations. Reviewed 16 October New Market Research Report: Lithuania Business Forecast Report Q Reviewed16 October 2013.