Doing Business in Spain

1. Doing Business in Spain Montreal, 22nd May 2008

2. Invest in Spain: Economy, Business and Advantages for Canadian companies May, 2008 Marian Scheifler Phd. Chief Operations Manager

3. Political Structure. • Spain in Figures (I-II). • Canada-Spain: Some things we share. • Main Agreements Spain-Canada. • Main Reasons to Invest in Spain (I-III). • About INTERES.

4. 1. POLITICAL STRUCTURE

5. 2. SPAIN IN FIGURES (I)

6. 2. SPAIN IN FIGURES (II) • The world’s 8th largest economy (market exchange rate); 11th (purchasing power parity). • (IMF-2008) • The 3rd largest investor in the world and the 2nd largest in Latin America. • (World Investment Report 2007 (UNCTAD) • 3. The 8th largest FDI stock worldwide (6th in the EU). • (World Investment Report 2007 (UNCTAD) • 4. The 10th best place to live and the preferred work destination for Europeans. • Worldwide Quality-of-life Index, Economist Intelligence Unit • 5. The world’s 2nd tourist destination. • (Tourism Organization (WTO))

7. 3. CANADA – SPAIN: SOME THINGS WE SHARE • Multilingual and multicultural societies. • Highly decentralized administrations: important role played by Provinces and Autonomous Communities. • Economic performance. • Great potential to strengthen trade and investment ties: current trade and investment flows belie the similarities in economic performance and complementarities in our economies.

8. CANADIAN COMPANIES IN SPAIN

9. 4. MAIN AGREEMENTS SPAIN - CANADA • S&T: (Science and Technology) • Spain’s R&D Plan for 2008-2011 identifies Canada as one of the three non-EU strategic countries for cooperation. • Canadeka: Bilateral program for technological cooperaton, CDTI –NRC. Support to joint projects of Spanish-Canadian companies. • CSIC-NRC: Development of research and innovation projects. • Genoma España – Genome Canada: Joint research projects. • CESCE-EDC: Reinsurance agreement for joint operations of Canadian and Spanish companies. • Double taxation: Agreement to avoid double taxation on income and capital.

10. 5. MAIN REASONS TO INVEST IN SPAIN (I) • Geostrategic location: • Privileged position for southern Europe's key markets, Latin America and North Africa. • Potential access to over 1.2 billion consumers: • 45 million consumers in Spain. • 443 million consumers in Europe. • Entry point for non-EU Mediterranean countries with 264 million consumers. (privileged relations with Morocco and Algeria). • Hub for South and Central America, with 560 million consumers. • Financial protocols with North Africa and Latin America.

11. 5. MAIN REASONS TO INVEST IN SPAIN (I) • Ultra Modern Transport Infrastructure • 47 airports. • 53 ports on both the Atlantic and the Mediterranean coasts. • 3rd largest EU highway network. • Ambitious plans for high speed trains (Spain will be the world leader with 2,230 km in 2010). • State-of-the-Art metro system in major cities.

12. 5. MAIN REASONS TO INVEST IN SPAIN (II) Economic criteria: Competitive operating costs Source: Eurostat 2007 Source: Eurostat 2008 Source: Cost of Living Survey 2007, Mercer Human Research Consulting Source: Eurostat 2008

13. 5. MAIN REASONS TO INVEST IN SPAIN (III) Fiscal incentives framework map

14. 6. About INTERES • INTERES Invest in Spain is the leading government organization that supports foreign companies seeking toset up or expandtheir business in Spain. • We provide comprehensive, efficient and confidential consultation at no cost during all stages of the investment process. • THE ONE-STOP SHOP FOR INVESTORS IN SPAIN.

15. Investor Services Pre-Installation Installation Operation Expansion Relocation Benchmarking & Attraction Support to new invertors strengthening of loyalty Growth Retention

17. Thank you very much!

18. Doing Business in Spain Montreal, 22nd May 2008

19. What makesSpain a winning location for the Life Sciences & Biotech industry? Ana Arias Biotech & Life Sciences Investor Services Manager

20. INDEX • Why Spain? • Why biotechnology? • Why you can bet on Spanish biotech • A piece of history • Business opportunities

21. Why Spain? • Highly qualified and competitive human resources • Quality and standard of living • Geo-strategic location • Cultural and educational levels • Weather • Natural resources • Logistics... Spain has solid scientific and technological capabilities that have enabled a competitive bio industry to emerge

22. Why Biotechnology? • Employment: around 80,000 people • Over 500 enterprises involved in biotech activities • Turnover: over €19,000 million and investment of over €200 million in research and development (R&D). • Annual growth of around 30% in total revenue. ………making Spain the most dynamic European country in this area after Ireland. Source: ASEBIO – Spanish Association of Bioenterprises (2004)

23. Why Biotechnology? (cont.) • Bio-economy heads Spain’s strategic agenda. • The Spanish pharmaceutical market is the fifth largest in the EU-15 and the seventh in the world. • Favourable financial environment: increase in the volume of venture capital operations in biotechnology. • New venture capital funds specialized in biotechnology and national networks of business angels are being created

24. Why you can bet on Spanish biotech • Solid Science • -Good scientific output • Groups and Centers of Excellence • -R&D Integrated System • Efficient WorkFlow • Excellent conditions for Translational Research • Modern Science Parks and state of the art facilities • Good partnership opportunities • -“Value for Science” • Every euro in the lab is put to good use • Great potential -Huge body of knowledge yet to be exploited • -Human Capital, very well trained

25. Why you can bet on Spanishbiotech(cont.) • Emerging bio-economy • -Increasing support from Governments for R&D and • bio-enterprise creation • -Competition among local Governments for talent and capital • -Good balance between being competitive on cost and competitive • in differentiation • Good personal attitudes • -Creativity • -Sense of community and focus on colective objectives and challenges • -Positive spirit and commitment

26. Why you can bet on Spanish biotech(cont.) • Solid Science: Scientific and Technological Facilities and • Capabilities • The Genomics, Proteomics and Bioinformatics platformsboost the • national participation in biotechnological advances: • -National DNA Bank • -Spanish National Genotyping Centre • -National Proteomics Institute ProteoRed • -National Bioinformatics Institute INB • A new framework for co-operative biomedical research is being created: • -The Biomedical Research Thematic Networks (RETICs) • -The Biomedical Research Centers Network (CIBER)

27. 6% 5% 18% 26% 7% 18% <5% 5-15% 15-25% >25% Why you can bet on Spanish biotech (cont.) • Solid Science:Principal Bio-clusters Geographic distribution of Spanish biotech companies • Catalonia and Madrid, followed by the Valencia Region, Andalusia, Basque Country and Galicia have the highest concentration of biotech companies. • The rest of the Spanish regions are also designing and implementing strategies. Source: ASEBIO Report – Spanish Association of Bioenterprises (2006)

28. Why you can bet on Spanish biotech(cont.) • Great potential to unlock: Workforce • 7,000 researchers in biotechnology and biomedicine: 11th position in the world. • 4th position in Europe in scientific output in biotechnology. • 1995-2003: number of scientific research papers published in Spain grew by over 12%. • 66% of biotechnology researchers working within the public Spanish R&D System were cited by U.S. patents.

29. Why you can bet on Spanish biotech (cont.) • Emerging bio-economy: Legal framework • The new Spanish Law on Biomedical Research: creation of a National Biobank Register • Favourable legal framework: Cultivation of Genetically Modified Organisms (GMO) and a unique Traceability and Labelling Law • Full Tax exemption on biofuels until Dec 2012. • Other Spanish instruments and laws.

30. Why you can bet on Spanish biotech (cont.) • Emerging bio-economy:Government support • The Ingenio 2010 Programme: to meet the Research, Development and Innovation convergence objectives of the Lisbon Strategy. • Sustained annual growth rates of the government’s budgets in recent years. • The Spanish Tax System is one of the most advanced in the world, especially in the Research, Development and Innovation field. • The adoption of the Young Innovative Company Status will no doubt help biotechnology firms.

31. A piece of history • 2001:The Spanish National Cancer Centre (CNIO) launches its first Oncochip. • 2002:Abengoa signs a $35.5 M R&D project with the U.S Department of Energy (DOE). • 2003:Serono concentrates global production of its growth hormone in Spain. • 2005:Genetrix receives the first Orphan Status designation by the EMEA in Europe for a medicinal product based on the use of stem cells of adult origin. • 2005:GSK opens its Molecular Screening and Tropical diseases research facilities in Spain. • 2005:Natraceutical buys Braes Group (€80 M). In 2006 it acquires Forté Pharma (€82M). • 2006:Spain continues to be the European leader in the cultivation of genetically modified crop varieties with a total of 53,667 hectares under cultivation. • 2007:The EMEA approves Zeltia's drug Yondelis for the treatment of soft tissue sarcomas. • 2008:The OMS designated the ONT (Organización Nacional de Transplantes) as a WHO Collaborating Center on Donation and Transplants

32. Business Opportunities

33. BIO Business Opportunities Spain offers specific opportunities in……………………. • Biochips: towards a personalized medicine • Food quality and security • Private Equity • Functional foods • Organic farming

34. BIO Business Opportunities (cont) Spain offers specific opportunities in……………………. • Nanobiotechnology • Generic drugs • Gene silencing • Production of therapeutic proteins using non-genetically modified plants • Algae active ingredients

35. BIO Business Opportunities (cont.) Spain offers specific opportunities in……………………. • Production of enzymes with industrial applications in transgenic plants. • Drug development from target’s structural determination. • Pharmacogenetics: Genetic biomarkers. • Molecular diagnosis. DNA and protein arrays. • Bioinformatics.

36. Leading pharmaceutical & biotech multinationals are already successfully located in Spain

37. BIOSPAIN 2008 • BIOSPAIN 2008 is the International Meeting on Biotechnology to be held in Granada from the 17th to the 19th of September 2008. • Five events in one: • BIOTEC 2008 " - Scientific Congress • Plenary Sessions: "Towards a Sustainable Bioeconomy“ • Investment Forum • Partnering • Trade Fair and Bio-Regions Hall

38. Thank you very much See you at BIOSPAIN’08! www.biospain2008.org For further information please contact: Ana Arias Life Sciences & Biotech Life Sciences & Biotech Investor Services Manager Email: aarias@interes.org

39. Doing Business in Spain Montreal, 22nd May 2008

40. SPAIN: Business opportunities in Aeronautics Vanessa Guerrero, Investor Services Manager INTERES Invest in Spain May, 22th 2008 MONTREAL

41. Why Spain

42. Why Spain • Because the Spanish Aeroespace Industry is the fifth in Europe in terms of turnover (4,203 million euros)* and employment (29,521 employees)* • Because of its high growth – the industry has grown an average 13% in the last decade: 4,203 3,767 1,421 * 2006 Data

43. Why Spain Because Spain is highly developed in aeronautical production: 420 M € 420 M € 2,816 M € 546 M € Total: 4,203 M €

44. Why Spain • Because Aeronautics companies based in Spain are leaders in: • Composite Aerostructures (especially, carbon fiber reinforced plastics) • Low pressure turbine engines • Air Traffic Management systems - 3 out of 5 flights in the world use Spanish software for landing

45. Why Spain - Clusters • Spain has significant Aeronautics clusters: • MADRID 63.6% of turnover 58.4% of employees 130 companies • ANDALUSIA 16.8% of turnover 21.0% of employees 75 companies • BASQUE COUNTRY 11.3% of turnover 11.1% of employees 54 companies • CASTILLA-LA MANCHA 4.2% of turnover 3.5% of employees 12 companies • CATALONIA 2.1% of turnover 2.7% of employees 53 companies

46. Why Spain – R&D • Because Aeronautics in Spain is a very innovative industry: • Investment: 575 M. € in 2006 (+26% from 2005) • 48% by companies • 13.7% of turnover • 15% of turnover in the case of systems and frames • High quality public R&D Centers: FIDAMC : Research, Development and Applications of Composites Other important centers: Public Research Organization specialized in aerospace research and technology development

47. Why Spain – R&D • Both AIRBUS and BOEING have developed important R&D Centers in Spain: • Boeing Research and Technology Europe (Madrid) • First Boeing R&D center outside the USA • Main areas: safety, ATM and environmental technologies • April ’08: first flight of an airplane powered by hydrogen fuel cells According to Boeing: “The reason for choosing Spain was the outstanding role of the country in the EU and as a reference point with the Latin American countries. It also shows the relevant position that the Spanish Aerospace industry has acquired in the last few years and the capabilities of the country in environmental and ATM technologies” Source:www.boeing.es

48. Why Spain – R&D • Both AIRBUS and BOEING have developed important R&D Centers in Spain: • Airbus Advanced Composites Center • Center of excellence for horizontal tail planes for all Airbus Aircraft worldwide • Airbus Spain: leader worldwide in composite materialstructures: first company in using carbon fiber for fuselage sections in commercial aircrafts over 100 seats • Specialised in large curvature panels from carbon fiber reinforced plastic

49. Why Spain – Industry PRIME CONTRACTORS ) Complete integration capability OEMs – Original Equipment Manufacturers Taking part in FAL. Intermediate added value products SUBCONTRACTORS Systems or sub-systems manufacturers AUXILIARY INDUSTRY Product manufacturers Ca. 170 companies

50. Why Spain – Industry • Growing importance of Spain in international programs: AIRBUS • Spanish participation share: - Civil programs: • 4.2% in the first programs (manufacture) • 10.8% in A380 (also design, development and certification); mostly in Madrid - Military programs:15% in A400M (including the Final Assembly Line, and simulation and training center, in Seville, Andalusia) EADS • Eurofighter Typhoon: 14% (in Madrid, major components: right wing and leading edge slats) • Eurocopter: Brand-new plant in Albacete (Castilla-La Mancha), FAL and delivery center for NH-90, Tiger and EC-35