1. Promoting Investment in the Western Balkans 0 I N S U R I N G I N V E S T M E N T S E N S U R I N G O P P O R T U N I T I E S Harald Jedlicka Marketing Executive Brussels, 27 th June 2007 Business climate and recent economic reforms in SEE & CIS The Western Balkans

2. Promoting Investment in the Western Balkans 1 The IIWB - Services to investors Information Quality advice and assistance Introduction to IFC finance & services and MIGA PRI Access to a wide network of contacts Brussels, 27 th June 2007Business climate in the Western Balkans countries IIWB value-add for companies

3. Promoting Investment in the Western Balkans 2 Doing Business in the Western Balkans Captures data in 10 areas defining the business climate Compares 175 countries worldwide Catch-up process has begun Some countries already exceeding NMS levels Ease of Doing Business ranking 2006 & 2007 Source: The World Bank Group, 2007 AL BiHHR MZ MT SE BG 2006 2007 RO PL PL 2007 Brussels, 27 th June 2007Business climate in the Western Balkans countries

4. Promoting Investment in the Western Balkans 3 Supportive environment for FDI New and improved FDI legislation Low corporate tax rates Attractive incentives for investors Investment Promotion Agencies in place to support investors Corporate tax rates Source: Investment Promotion Agencies, 2007 AL BiH (RS) HR MZ MT SE BG RO PLBiH (Fed) PL Brussels, 27 th June 2007Business climate in the Western Balkans countries

5. Promoting Investment in the Western Balkans 4 The IIWB benchmarking study Direct interviews with ~70 existing investors Captures more than 70 datapoints on -Costs -Business Conditions -Risks Focus on automotive and food & beverages sectors Available for free download at: www.iiwb.org Brussels, 27 th June 2007Business climate in the Western Balkans countries

6. Promoting Investment in the Western Balkans 5 Key indicators – employment cost Annual total employment cost for labor (in US$) Source: The World Bank Group / MIGA, 2006 AL BiHHR MZSE CZ Technical Skilled labor HU SK CZ Based on interviews with existing companies Figures include gross salaries and social security charges Overall labor costs vary between 30% and 70% of labor costs in the Czech Republic or Hungary Brussels, 27 th June 2007Business climate in the Western Balkans countries

7. Promoting Investment in the Western Balkans 6 Key indicators – labour availability Abundant avail- ability of labor Excellent skills base in certain sectors Strengths in technical sectors Multilingual proficiencies Unemployment rates 2006 Source: WIIW, 2007 AL HR MZ MT SE BiH Brussels, 27 th June 2007Business climate in the Western Balkans countries

8. Promoting Investment in the Western Balkans 7 A growing market of app. 30 million consumers at the doorstep of the EU Free trade agreements with the EU and Russia Market access Labor costs of 30%-70% of levels in Czech Republic and Hungary Reduce costs Access to skills Abundant availability of skilled labor in specific sectors Conclusion: a credible option to address your business issues Brussels, 27 th June 2007Business climate in the Western Balkans countries

9. Promoting Investment in the Western Balkans 8 Take the next step… Go visit the region and check it out! Help is here for you. Next steps Brussels, 27 th June 2007Business climate in the Western Balkans countries

10. Promoting Investment in the Western Balkans 9 Contact details Harald Jedlicka Marketing Executive t. + 43 (1) 535 53 82-2116 f. + 43 (1) 535 53 82-5115 harald.jedlicka@iiwb.org Invest In The Western Balkans World Bank Group Foreign Investment Advisory Service – FIAS Strauchgasse 3 A - 1014 Vienna, Austria www.iiwb.org Brussels, 27 th June 2007Business climate in the Western Balkans countries Maja Gedosev Marketing Executive t. + 43 (1) 535 53 82-2113 f. + 43 (1) 535 53 82-5115 maja.gedosev@iiwb.org