Industrial Competitiveness: Changing hierarchies in a pan-European perspective

Jan Krzysztof Bielecki, CEO, S.A., , UniCredit Group Brussels, Tuesday, 17 March 2009 Increasing relevance in EU trade (exports of country to EU-15 imports, normalized 1995=100) Source: IMF-DOTS, current prices

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5 6 7 8 9 0 1 2 3 4 5 6 9 9 9 9 0 0 0 0 0 0 9 9 9 9 0 0 0 0 0 0 1 199 1 1 1 2 2 200 2 2 2 2 US CEE Emerging Asia China EU15

2 Evolution of trade shares of NMS countries in EU-15 markets Source: UniCredit Research Network on Global Insight Data

Paper Chemicals

-0.5%0.0% 2.0% 4.0% 6.0% 8.0% Wood

-2.5%

Non Metallic mineral products -4.5% Leather Intra-EU trade Machinery Food

(change of EU-15intra-trade market share, 2000-2007) -6.5% Electrical Eq. Rubber and Basic metals Plastic Automotive Textile and apparel -8.5% Increasing role of CEE as supplier of EU-15 (change of CEE market share in EU-15 imports, 2000-2007)

3 Percentage of exports to CEE countries Source: UBS

4 % Sales generated in Eastern (incl. )

% Sales generated in Eastern Europe (inlc. Russia)

Sectors Companies - some examples Food & beverages 12% Vienna Insurance Insurance 46% Auto and parts 10% Erste banks 35% Telecom 9% Telekom Austria telecom 34% Personal & Household goods 8% Suedzucker Food & beverages 33% Banks 8% Wienerberger Constraction & materials 30% Basic Resources 8% Strabag Constraction & materials 28% Constraction & materials 7% Austrian Airlines Travel 24% Chemicals 6% Fomento De Constr. Constraction & materials 20% Retail 5% Italcementi Constraction & materials 20% Technology 5% Metro Retail 19% avg Stoxx 600 5% Henkel Personal & Household goods 19% Health care 4% Arcelor Mittal Basic resources 18% Industrial Goods and Services 4% Renault Automotive 14% Insurance 3% Scania Automotive 14% Media 1% Imperial Tobacco Personal & Household goods 13% Travel and Leisure 1% Swedbank banks 13% Utilities 1% Ericsson Technology 13%

Source: Goldman Sachs

5 Hotel arrivals of non-residents, 2005 Source: Eurostat

6 Gross monthly average wages and „competitiveness”: NMS and China Source: , UniCredit Research Network

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8 Bosnia-H.

7 Moldova Ukraine Serbia

6 Bulgaria Romania

5 Russia Turkey Croatia China 4 Lithuania Poland 3 Latvia Czech R. Slovenia 2 Estonia 1 WEF Competitiveness index (Deciles) index Competitiveness WEF

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7 A level playing field Attractiveness by region (2006-2008)

8 Gross average monthly wages (2008 estimates, Euro)

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ry a y a i e ia ia tv s nia rb oatia a a ia-H. r oland L m hstan e lovenia lovakiaC P Turk Rus o k S S EstoniaHung S Bulgaria Lithuania R Bosn Czech Rep. Kaza

9 Growth in credit from abroad and competitiveness (2000-2008) Source: BIS, World Economic Forum

80

LV 70

UA 60

RO EE BH BG 50 LT

40 HR SL

HU 30 PL

Growth in cross-border credit cross-border in Growth IE ES CZ NL FI GR 20 FR DK TK GB PT BE IT AT SE 10 DE CH

0 3.5 4.0 4.5 5.0 5.5 6.0 Competitiveness index (World Economic Forum)

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