Transcript The Bulgarian enterprises internationalization trends

The Bulgarian enterprises
internationalization trends after the
global financial crisis
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3000
2000
1500
-500
-1500
2000-01
2000-05
2000-09
2001-01
2001-05
2001-09
2002-01
2002-05
2002-09
2003-01
2003-05
2003-09
2004-01
2004-05
2004-09
2005-01
2005-05
2005-09
2006-01
2006-05
2006-09
2007-01
2007-05
2007-09
2008-01
2008-05
2008-09
2009-01
2009-05
2009-09
2010-01
2010-05
2010-09
2011-01
2011-05
2011-09
2012-01
2012-05
2012-09
2013-01
2013-05
TRENDS IN EXPORTS AND IMPORTS
3500
Current Account, mln. Euro
Exports, mln. Euro
2500
Imports, mln. Euro
Poly. (Current Account, mln. Euro)
Poly. (Exports, mln. Euro)
1000
Poly. (Imports, mln. Euro)
500
0
-1000
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CONCLUSIONS ABOUT FOREIGN TRADE DYNAMICS
•Under the global financial bubble imports
systematically outperformed exports due to so
called savings glut
•Current account was registering important deficits
reaching up to 20% of GDP
•After the crisis exports declined but quickly
recovered overcoming pre-crisis level
•Imports are lagging behind as a result of sluggish
domestic demand
•Current account is approximately balanced after the
crisis
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145
125
2002-Q3
2002-Q4
2003-Q1
2003-Q2
2003-Q3
2003-Q4
2004-Q1
2004-Q2
2004-Q3
2004-Q4
2005-Q1
2005-Q2
2005-Q3
2005-Q4
2006-Q1
2006-Q2
2006-Q3
2006-Q4
2007-Q1
2007-Q2
2007-Q3
2007-Q4
2008-Q1
2008-Q2
2008-Q3
2008-Q4
2009-Q1
2009-Q2
2009-Q3
2009-Q4
2010-Q1
2010-Q2
2010-Q3
2010-Q4
2011-Q1
2011-Q2
2011-Q3
2011-Q4
2012-Q1
2012-Q2
2012-Q3
2012-Q4
2013-Q1
2013-Q2
The Role of the Real Effective
Exchange Rate- REER
155
REER- Unit Labor Costs
135
REER- SPI
115
105
95
85
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Conclusions about the role of
REER
•Before the crisis the REER on the basis of unit labor costs
marked strong increase what reflects faster growth of
domestic salaries vis-à-vis foreign competitors
•After the crisis the process is reversed due mainly to
cutting labor and productivity gains what can explain the
stronger recovery of exports
•REER on the basis of domestic prices- SPI, is stagnating
after the crisis, a trend compatible with the relative slow
down of imports
•The improvement of the current account can be explained
by enhanced cost competitiveness of exports and sluggish
domestic demand
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400
-200
2000-01
2000-05
2000-09
2001-01
2001-05
2001-09
2002-01
2002-05
2002-09
2003-01
2003-05
2003-09
2004-01
2004-05
2004-09
2005-01
2005-05
2005-09
2006-01
2006-05
2006-09
2007-01
2007-05
2007-09
2008-01
2008-05
2008-09
2009-01
2009-05
2009-09
2010-01
2010-05
2010-09
2011-01
2011-05
2011-09
2012-01
2012-05
2012-09
2013-01
2013-05
Foreign Capital Flows
1200
1000
FDI, mln. Euro
800
Portfolio Investments, mln. Euro
600
Poly. (FDI, mln. Euro)
Poly. (Portfolio Investments, mln. Euro)
200
0
-400
-600
-800
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Capital Flows: Conclusions
•FDI increased before the crises and declined
afterwards
•Portfolio Investments are vulnerable during the
whole period 2000-2013
•The improvement of the current account is
strongly correlated with the decline of FDI
•The worsening of FDI and the improvement of
current account coincide with the worsening of
the fiscal deficit- twin deficit hypothesis not
confirmed
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Jan/13
Jul/12
Jan/12
Jul/11
Jan/11
Jul/10
Jan/10
Jul/09
Jan/09
Jul/08
Jan/08
Jul/07
Jan/07
Jul/06
Jan/06
Jul/05
Jan/05
Jul/04
Jan/04
Jul/03
Jan/03
Jul/02
Jan/02
Jul/01
Jan/01
Jul/00
Jan/00
Structure of Exports
60
50
40
Consumtion Goods, % of
total
Row Materials, % of total
30
20
Investment Goods, % of
total
Energy, % of total
10
0
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Conclusions about the structure
of exports
•The structure lingers inefficient
•The high share of row materials remains untouched
•The share of energy products also does not change
•We observe some trends towards the increase of
share of investment goods and decrease of
consumption goods
•The 2008-2009 crisis does not affect the composition
of exports in a particular manner, long terms trends
are unaltered
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The Structure of Imports from
European Countries 1995-2013
100.0
90.0
80.0
70.0
Consumtion Goods, % of imports from
European countries
60.0
Row Materials, % of imports from
European countries
50.0
Investment Goods, % of imports from
European countries
40.0
Energy, % of imports from European
countries
30.0
Other, % of imports from European
countries
20.0
10.0
0.0
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
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Conclusions about the Structure
of Imports
•The structure of the European imports remains
extremely negative with very high share of
energy, what reflects strong dependence on
Russian supplies
•The share of investment goods remains low and
declining
•The structure of imports does not allow for postcrisis economy restructuring and improvement of
competitiveness
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The Structure of FDI Flows
60
Financial Intermediation, % of
Total
50
Manufacturing Industry, % of
Total
40
Electricity and Other Energy, % of
Total
30
20
10
0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
-10
-20
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Conclusions About the Structure of
FDI
•The structural trends are unstable
•We observe some increase of the share of
energy Investments due to EU requirements
about the Green energy and profitable price
conditions
•The share of manufacturing is unstable and
declining
•The FDI
flows
related to
financial
intermediation are also unstable
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2013-05
2013-01
2012-09
2012-05
2012-01
2011-09
2011-05
2011-01
2010-09
2010-05
2010-01
2009-09
2009-05
2009-01
2008-09
2008-05
2008-01
2007-09
2007-05
2007-01
2006-09
2006-05
2006-01
2005-09
2005-05
2005-01
2004-09
2004-05
2004-01
2003-09
2003-05
2003-01
2002-09
2002-05
2002-01
2001-09
2001-05
15
2001-01
20
2000-09
2000-05
2000-01
Technology Transfer
30
Licenses and Property Rights,
Exports, mln. euro
25
Licenses and Property Rights,
Imports, mln. euro
Poly. (Licenses and Property Rights,
Exports, mln. euro)
Poly. (Licenses and Property Rights,
Imports, mln. euro)
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5
0
Conclusions About Technology Transfer
•The transfer is measured in terms of
payments related to licenses and property
rights
•Both payments to and from Bulgaria
increase
•The crisis slightly accelerated the
technology transfer to Bulgaria
•The Bulgarian technology export also
increased somewhat
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General Conclusions
•The main question is: Do we observe
Schumpeterian “Creative Destruction” after the
crisis?
•The answer in the case of Bulgaria is NO
•We do not detect visible acceleration of some
positive structural change
•Only some long term trends, such as the increase
of the share of investment goods in exports and
intensification of technology transfer can be
mentioned
•The predominant form of external adjustment is
via the comparative unit labor cost shrinkage
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Nevertheless: Clusters
EU, Europe 2020 Strategy
Danube Strategy
The Participation of Germany
Government-Business Cooperation
Bulgarian Association of Business Clusters (ABC) was founded in 2009 with main aim to unite
the efforts of clusters in Bulgaria for their dynamic development in line with European
standards and to popularize clusters as opportunity for development of the Bulgarian economy
in time of global crises.
Full members of the organization are 11 clusters:
Foundation Cluster Information and Communication Technologies (ICT Cluster)
Bulgarian Furniture Cluster
Cluster Mechatronics and Automation
Maritime Cluster Bulgaria
Cluster Information Resources
Bulgarian cluster Telecommunications (BCT),
ICT Cluster Plovdiv,
Electric vehicle industrial cluster,
Cluster for health tourism Bulgaria,
Cluster Microelectronics and Embedded systems (CMES)
Srednogorie Med Industrial cluster,
3 clusters became associated members of the organization:
Bulgarian ecology cluster,
Cluster Plovdiv – ancient and creative
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Bulgarian consortium of high-quality wine producers Trakia
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Members
GEFCO Bulgaria EOOD www.gefco.bg
Grammer AD www.grammer.com
Haycad Infotech OOD www.haycad-infotech.bg
IMACOS Truckenmüller & Company Bulgaria EOOD www.imacos.com
Industrial Commerce Ltd. www.hyundaibg.bg
ixetic Plovdiv EOOD www.ixetic.com
Johnson Controls Electronics Bulgaria EOOD www.johnsoncontrols.com
Leschke Design
S-Media Team www.smediateam.com
Technical University of Sofia www.tu-sofia.bg
Würth Elektronik IBE BG EOOD www.we-online.de
Festo EOOD www.festo.com
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Technical University of Gabrovo www.tugab.bg
Balkan Star Automotive EOOD www.balkanstar.com
Integrated Micro-Electronics Bulgaria EOODwww.global-imi.com
Litex Motors ADwww.greatwall.bg
University of Rusewww.uni-ruse.bg
Rödl & Partner EOODwww.roedl.com
KEMMLER Electronic GmbHwww.kemmler-electronic.com
Schenker EOODwww.schenker.bg
TEM Bulgaria ADwww.etem.bg
ALC Bulgaria EOODwww.alc.co.za
SE Bordnetze – Bulgaria EOOD www.sebn.com
SMC Industrial Automation Bulgaria EOOD www.smc.bg
Melexis Bulgaria Ltd www.melexis.com
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Projects
1. First International Automotive Conference in Bulgaria
2. Auto Park Bulgaria
3. e-taxi-shuttle
4. Sofia Tech Park
5. Automotive Test Center
6. Concept and realization of education centers for middle managers
7. Best practice human resources
8. Best practice quality management
9. Best practice logistics
10. Evaluation of subsidy programs
11. Government and administration
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Results of the Automotive Cluster
Activities
1. Some recent development of car assembly
industry
2. 80% of cars produced in Europe have parts,
manufactured in Bulgaria
3. Some progress in the field of electric cars
promotion
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