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HEC January International Business Seminar : Key Factors and Business Location Case Study Monday 29th of January 2007. Jack Anderson CEO, Attorney at Law. Summary. Introduction Foreign Direct Investment Tax Misery & Reform Index Tax / Spending Burden € 200.000 Income, Married
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HEC January International Business Seminar :Key Factors and Business Location Case StudyMonday 29th of January 2007 Jack Anderson CEO, Attorney at Law
Summary • Introduction • Foreign Direct Investment • Tax Misery & Reform Index • Tax / Spending Burden • € 200.000 Income, Married • The local Employee Happiness Index • Misery Index for Expatriates • Analysis by region and function • Conclusion
I. Introduction • Review of key factors • Tax considerations only break ties for a final decision • Case study and your recommendation
II. Foreign Direct Investment (in-bound by country) 1997-2005 (US Dollar Millions 000,000) ** ** FDI France doubled in 2005 vs 2004 to be N°4 in the world and, in 2006 to remain N°4 increased 40% but represents only half of number 2, the UK
II. 1. FDI Out-bound from developing countries • One-half global GDP (in PPP) is from developing countries • Growing FDI:
FDI inflows, by host region and major host economy, 2004-2006 (billions of dollars) Source: Unctad - a) Preliminary estimates
II. 2. France : Outbound & Inbound Direct Investment by French and International Investment Notes : Data are converted to US dollars using average exchange rates; p: preliminary; e: estimate Source: OECD International direct investment database
V. €200,000 Income, Married (next) (New Orleans)
Comparative cost of US expatriates in 8 EU cities Expatriate Gross salary - $ 100 000
Comparative cost of US expatriates in 8 EU cities Expatriate Gross salary - $ 200 000
Comparative cost of US expatriates in 8 EU cities Expatriate Gross salary - $ 500 000
The top 10 most attractive countries in 2006(total superior to 100% - 3 possible choices) • Ranking 2005: • China (52%) • USA (39%) • India (18%) • Poland (17%)
The most attractive global areas 2006(total superior to 100% - 3 possible choices) Ranking 2005: 1) Western Europe (63 %) 2) Central & Eastern Europe (55 %) 3) China (52 %) 4) USA / Canada (45 %)
Investors’ preferred areas by functions(% of quotation for each region as first choice)
The Top 10 countries for production units 2006(% of citations for each country – one selection) Ranking 2005: China (23 %) Poland (11 %) Germany = USA (6%)
The Top 10 countries for call centres 2006(% of citations for each country – one selection) Ranking 2005: 1) India (23 %) 2) Poland (11 %) 3) Germany = USA (6%)
The Top 10 countries for headquarters 2006(% of citations for each country – one selection) Ranking 2005: 1) USA/ Canada (23 %) 2) UK (14 %) 3) Germany (11%)
The Top 10 countries for research & development centres 2006(% of citations for each country – one selection) Ranking 2005: 1) USA/ Canada (22 %) 2) Germany (18 %) 3) France = UK (7%)
Advantages and threats to Western Europe as a business location
Now: Where do you want to work in the world ? Where you have the highest « Real Pay » ?
IX. Conclusion Nothing is miserable but what is thought so, and contrariwise, every estate is happy if he that bears it be content. Boethius (A.D. C. 470-525)