EMERGING EUROPE – “OPPORTUNITIES CLOSE TO HOME”

2. EMERGING EUROPE – “OPPORTUNITIES CLOSE TO HOME” A Strategic Opportunity for Black Country Business Jonathan Allen HM Ambassador to Bulgaria 22nd November 2013

3. 1. What is Emerging Europe? • A region stretching from Austria to Romania, from Poland to Croatia • 110 million consumers • A combined GDP of over £ 1 trillion • Easy and inexpensive access – located just 2-3 hours from the UK • Potential to double exports by 2020 • All EU regulated, part of the EU’s Single Market • Lower overall risk profile than emerging markets further from the UK • Proven market for UK businesses

4. 2. Sustainable Medium-term Growth... ...on a par with other emerging economies • Source: HSBC The World in 2050

5. 3. Main Challenges • Outdated perceptions of the region among business in the UK • Bureaucracy • Transparency • Strong and increasing competition

6. 4. Doing Business in Emerging Europe Ease of Doing Business Corruption Perceptions World Bank Ease of Doing Business Survey 2013, rankings 1-185 Transparency International Corruption Perceptions Index 2012 – rankings from 1-174

7. 5. A Competitive Marketplace • The UK barely manages 3% of Emerging Europe’s total imports • We are lagging behind Germany, Italy and France Source of Imports - 2011 Source: CIA Fact book Disappointing…but a real opportunity! .

8. 6. Emerging Europe Energy • Energy sector less affected by downturn • Seven out of the top ten companies are energy and resource companies with revenue growth figures from 5% to 45% higher* • In ten years energy consumption grew by 10% in the region, and is expected to increase even further – 30% growth in demand by 2030 compared to the OECD average of 4%** • Countries are upgrading existing facilities, diversifying their overall energy mix and modernising grids • The region is a significant recipient of EU funding The modernisation of the energy sector in the nine markets of Emerging Europe is the single largest opportunity in the region for UK business. *Deloitte Central Europe Top 500 report, ** BP Energy Outlook

9. 7. British Success Stories • Extracting natural gas in the Black Sea • EUR 140 million invested since 1998 • 15% of Bulgaria’s natural gas consumption • 60% of $189 million gas production revenues in 2011 • High level and sustained support from FCO/UKTI/Embassy (Kavarna East production concession August 2012) *Deloitte Central Europe Top 500 report, ** BP Energy Outlook

10. 8. British Success Stories William Hughes Ltd • Wire form and spring making for aerospace and automotive • Factory near Plovdiv since 2003 • Complementary UK & Bulgarian production facilities (more strings to the bow/better chance of winning contracts) *Deloitte Central Europe Top 500 report, ** BP Energy Outlook

11. 9. Driving Growth in Emerging Europe • The region is underexploited by UK firms. If we matched the trading performance of our main European competitors, an additional £30 billion could be added to the UK’s GDP • Our regional sector specialists mean one point of entry for the nine countries • Write to us at emergingeurope@fco.gov.uk • Or visit the Emerging Europe landing page on UKTI’s website

12. 10. Emerging Europe Mega-Mission • Save the Date: 3rd to 7th of March 2014 • Be a part of the GREAT Emerging Europe Trade Show • 5 Cities in 5 Days • For more information email: emergingeurope@fco.gov.uk Thankyou for listening.