Business Friendly Slovakia. Slovak Ukrainian Forum, Košice April 20-23, 2015

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1 Business Friendly Slovakia Slovak Ukrainian Forum, Košice April 20-23, 2015

2 CONTENT OF THE PRESENTATION SARIO INTRODUCTION TO SLOVAKIA KEY SECTORS INVESTMENT AID SARIO BUSINESS EVENTS

3

4 SARIO INVESTMENT AND TRADE PROMOTION SERVICES Governmental Agency under the Ministry of Economy of the SR Services Free of Charge Source: SARIO

5 SARIO SERVICES I I I I I I I Trade Section Supports Slovak manufacturers in their export activities Assists foreign companies to identify potential new products for export from Slovakia Identifies potential suppliers and subcontractors Monitors free production capacities Manages online databases Trade Fairs Organizing B2B meetings Investment Section I I I I I I I FDI attraction Assistance, consultancy for investment project implementation Database of available real estate Consultancy on state aid Starting business related materials, analyses Promoting Slovakia abroad via seminars Manages M&A database, open projects fro investments

6 SARIO BUSINESS EVENTS I INTERNATIONAL ENGINEERING COOPERATION DAY International engineering fair May Nitra I EXPORT FORUM 2015 November Bratislava

7 INTRODUCTION TO SLOVAKIA

8 STRATEGIC POSITION WITH EXPORT POTENTIAL 300 million clients in radius of km 600 million clients in radius of km Source: World Resources Institute

9 ROAD & AEROSPACE NETWORK Krakow (PL) 180 km Brno (CZ) 120 km Prague Prague Vienna-AT London-UK Prague-CZ Bratislava-SK All major European cities airport WORLD Vienna-AT Source: National Motorway Company, Slovak Airports, 2015 WORLD Budapest-HU

10 EURO ZONE MEMBER - ONE OF A FEW IN CEE Euro since 1 January 2009 EURO IMPLEMENTATION IMPACT Limitation of Foreign Exchange Risk Lowering Transaction Costs Growth in Foreign Trade Increased Economic & Financial Stability Favorable conditions for long-term business decisions

11 FASTEST GROWTH IN EUROZONE, Average Annual Growth Rate Slovakia Latvia Estonia Lithuania Luxembourg* Malta Ireland Slovenia Austria Belgium Germany Netherlands France Finland Cyprus Spain EURO area (19) Portugal Italy Greece -1,24-0,28 0,02 1,72 1,57 1,45 1,35 1,29 1,12 1,05 1,02 0,99 0,9 0,87 2,67 2,51 2,3 3,05 3,33 3, *Data for 2014 missing Source: European Commission, Eurostat 2014

12 SLOVAKIA: MACROECONOMIC OVERVIEW Real GDP growth European Union (EU 28) Slovakia GDP Prediction by European Commission 2015 f 2016 f Germany 1.5% 2.0% Slovakia 2.5% 3.2% Poland 3.2% 3.4% f 2016f Czech Rep. 2.5% 2.6% Hungary 2.4% 1.9% Source: European Commission, Winter 2015 Forecast Romania 2.7% 2.9% Bulgaria 0.8% 1.0% Real GDP Growth 5.8% -4.9% 4.4% 3% 1.8% 0.9% 2.4% Source: European Commission, Winter 2015 Forecast Labor Productivity Growth 2.3% -2.3% 4.4% 2.0% 2.2% 2.8% - HICP Inflation 3.9% 0.9% 0.7% 4.1% 3.7% 1.5% -0.1% Unemployment 9.6% 12.1% 14.4% 13.2% 14% 14.2% 13.2% Average Gross Salary, Source: Eurostat, February 2015

13 Slovakia: 3 rd Most Promising Pre-Emerging Market Bloomberg - ranked pre-emerging markets based on their overall investment potential through awarded points based on the following indicators: Economic indicators Average projected GDP growth Projected inflation rate Government debt Total investments Financial indicators Price-to-book ratio of the primary equity Exchange rate volatility Liquidity of the primary equity Corruption Perceptions Index Political risk score Current labor participation Current account balance Foreign reserves Infrastructure Two-year sovereign debt Credit-default-swap spread Political and social measurements Ease-of-doing-business score Adult literacy rate Saudi Arabia Estonia Slovakia Lithuania Bahrain Slovenia Bulgaria Vietnam Kazachstan Romania 78,8 71,4 67,1 65,8 65, ,8 62,4 61,5 60,3 Source: Bloomberg, International Monetary Fund, World Bank, Economist Intellligence Unit, Transparency International, World Economic Forum, CIA, MSCI, FTSE, S&P, JP Morgan as of 2015

14 SLOVAKIA: HIGHEST LABOR PRODUCTIVITY IN CEE Gross monthly salary CZK Czech Republic 90,0 Slovakia reaches the highest labour productivity PLN Poland 858 Slovakia HUF Hungary RON Romania BGN Bulgaria 80,0 70,0 60,0 50,0 40,0 30,0 20,0 10,0 0, Slovakia Hungary Czech Republic Poland Romania Bulgaria GDP (in PPS) per hour worked as compared to EU 27 (100) Source: Eurostat 2014 Source: National Statistical Offices of Slovakia, Czech republic, Hungary, Poland and Bulgaria, National Bank of Slovakia, 2015

15 KEY SECTORS

16 INNOVATION & INFORMATION TECHNOLOGIES LEADING IN-LINE WITH SECTORS TRADITIONAL OF THE SLOVAK INDUSTRIES ECONOMY Automotive ICT/SSC Electronics R&D

17 KEY SECTOR N o 1: AUTOMOTIVE Car Production in Slovakia +4,8 % growth/annum forecast SLOVAKIA, 2014 Leader in World Car Production per 1000 inhabitants 183 vehicles /1000 inhabitants World Average 10 vehicles / 1000 inhabitants Source: Business Monitor International, Slovak Automotive Industry Association ZAP, VW, KIA, PSA-Peugeot, International Organization of Motor Vehicle Manufacturers 2015

18 MADE IN SLOVAKIA: AUTOMOTIVE PAST TAZ 1500 / Škoda 1203 Jawa Babetta Tatra T815

19 MADE IN SLOVAKIA: AUTOMOTIVE PAST VW Touareg Audi Q7 Peugeot 208 Kia Cee'd

20 Key Sector N o 2: ICT/SSC I 35 established SSCs I Personnel over

21 GREAT BRANDS GATHER IN SLOVAKIA, MEDIUM HIGH- TECH Medium-High Technology: Manufacturing Chemistry Defence industry Electrical equipment Machinery equipment Automotive industry, supplier sector Other transport equipment Medical and dental instruments

22 GREAT BRANDS GATHER IN SLOVAKIA, HIGH-TECH High-Tech Services: Knowledge Intensive High-Technology: Manufacturing Creative, movie, TV industry and ICT Scientific research and development (biotech, medical, engineering etc.) Pharmacy Computer, electronic and optical products Air and spacecraft industry

23 CORPORATE R&D CENTRES IN SLOVAKIA dernières

24 INVESTMENT INCENTIVES

25 ELIGIBLE PROJECTS Industry Shared Service Centers Technology Centers Tourism

26 BASIC FEATURES I Targeted at regions with high unemployment rate I Final decision: Slovak government I Administrative body: Ministry of Economy of SR I Investment intensity up to 35% from eligible costs I ELIGIBLE COSTS : LAND BUILDINGS NEW MACHINERY & TECHNOLOGY EQUIPMENT LICENSES & PATENT RIGHTS OR WAGE COSTS OF NEW EMPLOYEES DURING 2 YEARS I FORMS: INCOME TAX RELIEF up to 10 tax periods CASH GRANT (paid ex-post, based on annual costs report) CONTRIBUTIONS ON NEW JOBS (paid ex-post, based on annual costs report) PROPERTY TRANSFER Legal framework: Act no. 561/2007 Coll. on Investment Aid

27 MAX REGIONAL INTENSITIES OF INVESTMENT AID 25% 35% 35% for SMEs plus 10 to 20%

28 ELIGIBLE INVESTMENTS & REQIUREMENTS INDUSTRY TECHNOLOGY CENTER SHARED SERVICES CENTER TOURISM ELIGIBLE INVESTMENTS NEW FACILITY or EXPANSION MIN. AMOUNT 10/5/3 M 0.5 M 0.4 M 10/5/3 M MIN. NEW JOBS (70% university education) 40 (60% university education) 40

29 Slovak Success Stories Significant global leaders in IT, automotive and machinery sectors with unique innovation potential Source: SARIO, 2015

30 SLOVAKIA Country where history meets future 5th TOP best travel destination by Lonely Planet

31 Thank you for your attention SARIO Slovak Investment and Trade Development Agency Address Trnavska cesta Bratislava Slovakia Web

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