Transcript Dia 1 - Vlaanderen

March 2009
Flanders
Economy and Public Finances
Agenda
I.
Economy
II.
Public Finances
III. Financing
2
Economy
Main Facts & Figures
3
Capital
Brussels
Language
Dutch
Surface
13 684 km²
Population
6 117 440 (2007)
Density
447 hab./km² (2007)
Currency
Euro
N° of Companies
509 300
Nominal GDP
EUR 200 bn (2008)
GDP/Capita
EUR 30 500 (2008)
Income/Capita
EUR 33 300 (2008)
Economy
Strong Economic Fundamentals
Flanders benefits from very strong economic fundamentals. Despite the current virulent economic crisis,
most economic indicators should remain sound and encouraging in the coming years.
Flanders
France
Germany
Netherlands
EU - 27
Unemployment Rate*
4,0%
7,3%
7,9%
2,8%
7,0%
Real GDP Growth Rate
1,3%
0,7%
1,0%
2,1%
1,1%
(*) Q3 2008 figures
Source: Eurostat
4
Economy
Stands Out from its Peers
(2007 figures)
Flanders
BadenWuerttemberg
Bavaria
Catalonia
(region of)
Madrid
(region of)
North
RhineWestphalia
AA+
AA+/Aaa/AAA
AAA/Aaa/
AAA
AA/Aa2/A+
AA/-/AAA
AA+/Aa1/AA
AA-/Aa1/AAA
Belgium
Germany
Germany
Spain
Germany
Spain
Germany
Population
6,0 m
10,7 m
12,5 m
7,2 m
6,0 m
6,0 m
18,0 m
Unemployment
rate
4,4%
4,9%
6,2%
6,6%
7,7%
6,3%
9,4%
Operating balance
(% of operating
revenues)
7,8%
3,5%
9,0%
7,8%
-1,0%
14,4%
-1,0%
Balance after
capital exp.
2,7%
-1,4%
1,4%
-6,5%
-2,3%
3,1%
-8,4%
Total Revenues
(EUR billion)
22,875
34,267
38,253
22,109
20,386
17,583
47,514
Direct debt (% of
operating rev.)
1,2%
129,1%
65,9%
59,1%
160,1%
31,1%
254,9%
Credit rating
(S&P/M/F)
Government
Country
Source: S&P, Moody’s, Dexia Capital Markets Research
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Hesse
Economy
An Economy based on Trade and Services
Primary
Sector
1%
Secondary
Sector
28%
• Construction: 6%
• Chemicals: 4%
• Iron, Metal & Steel: 3%
• Food & Tabacco: 3%
Tertiary Sector
71%
• Real Estate and Business
Services: 24%
• Wholesale and Retail: 14%
• Transport: 8%
• Health Services: 7%
Source: Institute of National Accounts (2006)
6
Economy
Strong GDP Evolution
EUR (billion)
250
200
150
100
50
Source: Eurostat, Study Office of the Flemish Government, nominal figures
7
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
0
Economy
High GDP per Capita (2008)
EUR (thousands)
34
32
30
28
26
24
22
20
Flanders
Belgium
France Netherlands Germany
Source: Eurostat, Study Office of the Flemish Government
8
United
Kingdom
EU-15
EU-27
Economy
Low Unemployment Rate
%
12
10
8
6
2003
4
2004
2005
2
2006
2007
0
Flanders
Belgium
France
Netherlands
Source: Eurostat, Study Office of the Flemish Government
9
Germany
EU-15
EU-27
Economy
Flanders’ Employment: Resilient in Periods of Crisis
Economic Growth and Employment in Flanders, 1981 - 2008
%
7
2 600 000
Reorganisations after investment
hausse and dot.com hype
6
5
Years of Economic Restructuring
Germ an unification and preparing for the
Maastricht criteria
2 500 000
2 400 000
4
3
2 300 000
2
2 200 000
1
2 100 000
0
-1
1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2 000 000
-2
Real % GDP growth (left scale)
Source: Eurostat, Study Office of the Flemish Government
10
Total employment (right scale)
1 900 000
Economy
Flanders’ Key Strengths
• Located in the heart of Europe
• Unique European hub
• Strong export-driven economy
• Diversified base of trading partners
• Foreign direct investment figures & trading partners
• Diversified economy
• Highly qualified workforce
• R&D competence center
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Economy
Located in the Heart of Europe
Flanders lies at the center of the EU’s
wealthiest and most populated area –
and Flanders has the highly developed
transport and communications
systems required for companies to
take full advantage of this fact.
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Economy
A Unique European Hub
Flanders offers companies rapid and efficient
supply and distribution links with other major
European centers and beyond.
13
Leading ports
Antwerp, Ghent,
Ostend, Zeebrugge
Airport freight &
logistic hubs
Brussels, Ostend
Extensive inland
waterway system
Linking into the
European system
High density of
freeways
Connecting directly
to other European
countries
High density rail
network
Dedicated freight
lines to other parts of
Europe
Economy
Strong Export-Driven Economy
Regional Distribution of Belgian
of Belgian Exports (%)
Brussels
2%
Increase in Flemish Exports
(EUR billion / Nominal Figures)
191
200
Wallonia
17%
169
178
158
150
146
100
50
Flanders
81%
0
2003
2004
2005
2006
2007
The Flemish economy is strongly export-oriented, in particular in the areas of food, beverage,
automobiles, iron and steel. Flanders’ exports represent over 80% of Belgium’s total export in
volume.
Source: Institute for the National Accounts (National Bank of Belgium)
14
Economy
Diversified Base of Trading Partners
TOP 10 Flemish Export Markets in 2007
(in EUR billion and as % of total)
35
16.8%
30
13.9%
13.6%
25
20
7.9%
4.0%
2.7%
1.8%
1.8%
Poland
4.4%
Sweden
4.9%
10
India
15
5
Spain
United States
Italy
United Kingdom
France
Netherlands
Germany
0
The Flemish export markets have traditionally been focused on Western Europe and more
particularly on Germany.
Source: Eurostat, Study Office of the Flemish Government
15
Economy
Foreign Direct Investment Figures & Trade Partnerships
Flanders has a proven track record of welcoming
Top 10 biggest investors (in 2007, total =100)
foreign businesses to its region.
1
USA
22,8%
2
Netherlands
16,9%
3
UK
9,1%
4
Germany
5,8%
5
France
5,2%
6
Sweden
5,2%
7
Japan
4,6%
8
India
3,9%
9
China
3,9%
10
Denmark
3,2%
Source: Eurostat, Study Office of the Flemish Government
16
Life Sciences
Johnson & Johnson, Pfizer,
Schering-Plough, AstraZeneca, ...
Automotive
Ford, General Motors, Volvo, …
ICT
Alcatel Lucent, British Telecom,
Philips, ST Microelectronics, ...
Chemicals
BASF, Total, Suez-GDF, Bayer,
Kaneka, Nippon Shokubai, ...
Food Products
Heinz, Procter & Gamble,
Tropicana, ...
Logistics
Caterpillar Logistics, Deutsche
Post, NYK, ...
Economy
R&D Competence Center
Share (%) of GDP invested in Research & Development
3
2
1
Source: Eurostat, Study Office of the Flemish Government (2006)
17
EU-27
Germany
The
Netherlands
France
Flanders
EU-27
Germany
The
Netherlands
France
0
Flanders
16
14
12
10
8
6
4
2
0
Share (%) of workers in knowledge intensive
sectors
Economy
Education: Flanders on Track for the Future
Mathematical literacy
Scientific literacy
Reading literacy
Top countries
Finland
563
Korea
556
Hong Kong China
542
Finland
Hong Kong - China
547
536
Excellent countries
Canada
Chinese Taipei
534
532
Chinese Taipei
Finland
549
548
Canada
527
Flanders
522
Estonia
Japan
New Zealand
531
531
530
Hong Kong China
Korea
547
547
New Zealand
Ireland
521
517
Flanders
543
Flanders
529
Australia
Netherlands
Korea
Liechtenstein
Average
46 countries!
527
525
522
522
Germany
United Kingdom
France
516
515
495
Source: PISA 2006, Average country scores
18
50 countries!
53 countries!
Netherlands
Germany
France
United Kingdom
531
504
496
495
Netherlands
United Kingdom
Germany
France
507
495
495
488
Economy
Flanders in Action
Goal
A well-defined plan to make sure that Flanders will be in the
top five of the European regions by the year 2020 carried by
all social groups in Flanders
Vision & Ambition
To ensure and assure the region’s future by developing it into
an innovation-driven, ecologically sustainable and socially
welcoming society
20 Concrete Objectives
Examples:
• Increase of R&D from 2,1% to 3,0% of GDP
• Double number of participants in lifelong learning
programs
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Economy
Countering the Economic Crisis in the Nearby Future
Measures already taken
• Capital injection in financial sector (KBC, Dexia, Ethias)
 total investment of EUR 3 000 million
“Restore Confidence” plan
• Strengthen the granting of credit and capital to companies
- new SPV set up which provides company guarantees (EUR 300 million)
- launch of XL-fund to provide growth capital for companies
• Enhancement of the activation policy on the labour market
• Speed up investments
- accelerated release for investments in infrastructure (EUR 180 million)
- strengthening of the public-private investments (e.g. school buildings)
 total indicative budget of EUR 842 million
Special measure to increase purchasing power (in February 2009)
 total budget of EUR 710 million
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Agenda
I.
Economy
II.
Public Finances
III. Financing
21
Public Finances
Belgium Federal Structure
Federal State
The Flemish Community and the
Flemish Region decided to merge their
3 Regions:
Flanders
Wallonia
Brussels
3 Communities:
Flemish
French
German
competences.
As a result, Flanders has one Flemish
Parliament, one Flemish Government
and one public administration,
10 Provinces
responsible for community and
regional matters.
589 Towns and Cities
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Public Finances
Competence Distribution
Flanders
Federal State
Flemish Community
•
•
•
•
•
•
•
Public Finances
Defense
Security
Justice
Social Security
Public Health
Domestic & International
politics
• Transport &
Communication
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• Education
• Culture
• Public health
(prevention)
• Welfare
• Language issues
• Child protection
Flemish Region
• Economic development
& co-operation
• Public infrastructure
• Town & country
planning
• Environment
• Energy
• Employment
• Agriculture
• Foreign Trade
• Regional transport
• Control & organization
of local governments
Public Finances
Revenues by Segment
EUR (million)
30 000
Regional taxes
20%
Others
1%
25 000
20 000
Specific
allocations
4%
15 000
10 000
Combined and
shared taxes 5 000
75%
0
2009
2010
Combined and shared taxes
Allocated income
2011
Specific allocations
Other funds
Combined taxes are part of Belgium’s personal income tax levied in Flanders.
Shared taxes are part of Belgium VAT and transferred at endowment to Flanders.
Source: Flemish Community, Department of Finance and Budget (2008)
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2012
2013
2014
Regional taxes
Credit grants and participations
Public Finances
Breakdown of Public Spending
EUR (million)
Economy,
Science and
Culture,Youth , Innovation
4%
Sports and
Media
5%
Finance and
Budget
5%
Work and Social
Economy
6%
Administrative
Mobility and
affairs
Public Works
10%
12%
Rest
9%
30 000
Education and 25 000
Training
37%
20 000
15 000
10 000
5 000
0
Public Health
and Family
Welfare
12%
2009
2010
2012
2013
2014
Education and Training
Public Health and Family Welfare
Mobility and Public Works
Administrative affairs
Rest
Work and Social Economy
Finance and Budget
Culture,Youth , Sports and Media
Economy,Science and Innovation
Source: Flemish Community, Department of Finance and Budget (2008)
25
2011
Public Finances
Flanders Sustaining Belgian Financial Stability
EUR (million)
EUR (million)
1 000
400
800
200
600
0
400
-200
200
-400
0
-600
Balance to be achieved (left scale)
Realizations (left scale)
Difference between balance and realizations (right scale)
Source: Institute of National Accounts (National Bank of Belgium)
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2008
600
2007
1 200
2006
800
2005
1 400
2004
1 000
2003
1 600
2002
1 200
2001
1 800
2000
1 400
1999
2 000
Public Finances
History of a Healthy Budget…
EUR (billion)
EUR (million)
30
1 500
25
1 000
20
500
15
0
10
Revenue (Left Scale)
Expenditure (Left Scale)
2008*
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
-1 000
1994
0
1993
-500
1992
5
Balance (Surplus/deficit) (Right Scale)
(*) Without redemption of local debt (EUR 650 million) and capital injection in Dexia & Ethias (EUR 1 000
million) in 2008
Source: Flemish Community, Department of Finance and Budget
27
Public Finances
…has led to zero-debt in 2008
EUR (billion)
9
Flanders’ debt management policy has
achieved remarkable debt reduction in the
past two decades to virtually no debt at
regional level at the end of 2008.
In addition: extra redemption of local debt
(EUR 650 million).
8
7
6
5
4
3
2
1
Source: Flemish Community, Department of Finance and Budget
28
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
0
Agenda
I.
Economy
II.
Public Finances
III. Financing
29
Financing
Credit Profile: Key Points and Major Strengths
Flanders benefits from:
•
Solid financial position on a consolidated level
•
Prudent and sophisticated management
•
Low regional debt. The total debt/total revenue ratio has constantly decreased from
44% of the revenues in January 1999 to nearly 0% in December 2008.
•
A strong taxable basis with a GDP around EUR 200 bn.
•
A wealthy and diversified economy
•
Sound budgets despite cyclical economy
•
A strong educational system
•
Strong financial ratings
30
Financing
Main Terms & Conditions
31
Issuer
Flemish Community (and Region)
Rating
AA+ (S&P)
Rating Outlook
Stable (S&P)
Currency
EUR
Amount
Up to EUR 2 bn
Coupon Format
Fixed Rate
Issuance Format
EMTN Programme
EMTN Programme Size
EUR 10 bn
Issue date
March 2009
Maturity
[3-5-8] yr
Listing
Euronext Brussels
Documentation
ICMA Standard
Governing Law
Belgian
Joint-Bookrunners
DEXIA, HSBC, ING, KBC, SG
Contacts
Hedwig Van der Borght
Secretary – general
Flemish Community, Department of Finance and Budget
+32 2 553 54 09
[email protected]
Luc Keereman
Head of financial management division
Flemish Community, Department of Finance and Budget
+32 2 553 54 34
mailto:[email protected]
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Disclaimer
This presentation has been prepared by Flanders for informational purposes only. Although the information in
this presentation has been obtained from sources which Flanders believes to be reliable, we do not represent or
warrant its accuracy, and such information may be incomplete or condensed. This presentation report is not
intended to provide the sole basis for any evaluation of the transactions discussed herein. All estimates and
opinions included in this presentation constitute our judgment as of the date of the presentation and may be
subject to change without notice. Changes to assumptions may have a material impact on any
recommendations made herein. Flanders will not accept any liability whatsoever for any loss howsoever arising,
directly or indirectly, from the use of this presentation or the information provided for in this presentation or
otherwise arising in connection with this presentation.
This presentation is confidential and is provided to you for information purposes only and does not constitute a
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the trading on a regulated market.
© March 2009 Flanders. All rights reserved.
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