KAUNAS REGION Source Statistics Lithuania VRM Invest in Lithuania 2014 Welcome to Kaunas Region Lithuania KAUNAS REGION stats Regional capital Kaunas City ID: 800061
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Slide1
Where
IT comes together
KAUNAS REGION
Slide2Source: Statistics Lithuania, VRM
, Invest in Lithuania, 2014 Welcome to Kaunas Region, Lithuania!
KAUNAS REGION statsRegional capitalKaunas
City
Population
593,000
Labour pool
289,000
Unemployment
31,300 (10.1%)
FDI growth11.4%
LITHUANIA stats
Size65,300 km2Population2.97 millionCapitalVilniusOfficial languageLithuanianCurrencyLithuanian Litas (LTL)Pegged to Euro since 20021 Euro = 3.45 LTLReal GDP growth2013: 3.2%2012: 3.7%2011: 6.0%FDI growth 8.1 %Annual inflation1.2%
Lithuania is at the center of three of large consumer markets: Western EuropeBaltic Sea RegionRussia and former Soviet States (CIS)
Kaunas
Region
KAUNAS REGION
Where
IT comes together
Slide3Source: * World Bank, Invest in Lithuania 2014Lithuania, a gateway to
the EU and CISLithuania allows access to main markets*:Member of the European UnionMember of the Schengen
Agreement (free trade and travel)Member of NATOMember of the Nordic Investment Bank, and part of Nordic-Baltic cooperation of Northern European countries Lithuania is ranked 17th of the world on the Ease of Doing Business Index (higher than e.g. Germany, Latvia or Poland) *Lithuania is a low risk country in the Central and Eastern Europe region, making it an excellent alternative for nearby high risk countries as Russia or Belarus
European Union
is the
largest
single market in the
world
(
almost
double the GDP of China) with over 500 million consumers (source: IMF)Risk rating of Lithuania compared to other countries (100= most risky)Source: Economist Intelligence Unit Q2 2014
KAUNAS REGION
Where IT comes together
Slide4Lithuania
ranked 1st globally on communications technology
Source: Invest Lithuania 20131st in the World Competitiveness Rankings for communication technology *1st for Internet upload and 3rd for download speed in the EU **Among Top 10 countries in the world for cloud readiness **Sources: * IMD, The Word competitiveness yearbook, 2011-2012 , Invest in Lithuania** Ookla Netindex, 2013 , Invest in Lithuania*** Cisco Global Cloud Index, 2013. The Index evaluates Consumer and Business Fixed Network performance and Consumer and Business Mobile Network performance, Invest in LithuaniaInternational rankings IT sector LithuaniaAnswer
to the question: Communications technology meets business requirements
Source: IMD WCY Executive Opinion Survey based on an index from 0 to 10, 2013 survey results, Invest in Lithuania
Lithuanians
are among the most
IT-proficient people of the
European Union
–
96.7% of individuals aged 16-24 obtain IT skills through formal educational institutesMore than 24,500 experienced IT professionals are currently employed in Lithuania in 2,185 companies. Over 8,000 employees are active in the area of computer programmingLithuania has 6,200 IT students at 7 universities and 14 colleges. A majority of ICT talent is located in Vilnius and Kaunas Lithuanian IT professionals feature strong competencies in: Java , Oracle, Microsoft (C#, C/C++, Visual Basic, ASP), Web Based (HTML, PHP, JavaScript, CSS, XML). Other well-spread competencies in the market are: Python, SAP, SharePoint
KAUNAS REGION
Where IT comes together
Slide5Source: Invest Lithuania 2013
Kaunas Region is next to
the capital Vilnius, Lithuania’s second city and an important hub for ITKAUNAS REGION
Where
IT
comes
together
Callcredit
Information groupDematicUnicallRunwayHPNielsen&NielsenIBM
SEBNielsenAteaBarclaysCOWIDanske BankMatrix SoftwareWestern unionStorebrand
CSCTranscom Paroc CITCOINWINDOCSC TelecomSwedbank Worldone Mirror Telia SoneraBDCOmegaGreencarrierLintelKaunas Region is proven to be an excellent alternative for the crowded and more costly Vilnius’ market
Slide6Highly educated IT talent
Cost attractiveness
ICT infrastructureInternational accessibilityReal Estate availabilityThe Kaunas Region provides an unmatched mix of cost-effective talent and high class infrastructure The right people
The right educationThe right languages
The right connectivityThe right speed
The right
location
The right direct
flights
The right offices
The right cost advantagesThe right labor cost savingsThe right tax schemeInKAUNAS REGIONit all comes together
KAUNAS REGION
Where IT comes together
Slide7In Kaunas Region over 5,000 people are employed in the information and communication sectorThe Kaunas region workforce is highly educated with 39% of workers having a third level diploma (Lithuania: 34%; EU: 24%). Virtually all highly educated graduates speak EnglishThe majority of IT talent is located in two largest clusters – Vilnius and Kaunas with more than 4,800 young people studying
IT curriculums in these citiesBecause of fast-growing IT centers like Barclays, Vilnius is experiencing a tight labour market for which Kaunas is an excellent alternativeBritish company Callcredit expanded its IT center in Kaunas from 120 to 200 employees in 2014 benefiting from the large graduate potential
Sources:
Lithuanian Statistical Department, VRM, Invest Lithuania 2014Barclays Technology Centre
has already reached more than 1000 FTE in less than four years since its establishment in 2009 in Lithuania
Source:
Invest Lithuania,
2014
IT students Lithuania by field of study 2012-2013
Source:
Invest Lithuania,
2014
Highly educated and multilingual talentKAUNAS REGIONWhere IT comes together
Slide81 Employer cost are based on the following expenses: gross salary, social security, medical and pension costs in addition to social security and performance bonuses
Source: National/Regional Statistical Offices, IMD, UBS, 2014Full employers cost per person per year (Euro)
Source: Invest in Lithuania, FEZ Kaunas,
FEZ
Kedainiai
2014
Tax
General
Free Economic Zone Income tax15 %0 % (first 6 years)
50% of the tax rate (subsequent 10 years) Property tax
1 %0 % Dividend tax15 %0 %Tax ratesIn general labour costs in Lithuania are less than half compared to Western European countries and the USAKaunas is a very cost attractive location for IT as employers’ cost levels are 10-15% lower compared to Vilnius and 20-40% lower than in Poland, Slovakia and HungaryStandard income tax rate is one of the lowest in Europe at 15%. If established in a Free Economic Zone (FEZ), property and dividend tax is at 0% and income tax is at 0% for the first 6 years and 7.5% for the following 10 years*Cost attractivenessKAUNAS REGIONWhere IT comes
together
*
Source: Invest in Lithuania, FEZ Kaunas,
Kedainiai
2014
Slide9The ICT infrastructure in Lithuania (and Kaunas Region) is the best in Europe with 33% of homes/buildings directly connected to fiberThe most up-to-date ICT technologies are implemented and functioning in the entire country (LTE technology, 3G mobile communications, infrastructure, mobile WiMAX 4G Internet etc.)*
Source: Speedtest.net, 2014
Source: FTTH Council Europe 2013
Also on the achieved internet speeds Lithuania scores very high at 7
th
globally
ICT infrastructure
KAUNAS REGION
Where
IT
comes
togetherLithuania ranked 7th globally on achieved internet speeds (Mbps)Countries with the highest penetration of fiber-to-the-home / building
*
Source: Invest in Lithuania
Slide10Kaunas Region is situated at the geographical centre of Lithuania and is further developing and strengthening its transport infrastructureKaunas Region is well connected by road to Vilnius, Klaipeda, Riga and Poland
Kaunas airport, which is the second largest airport in Lithuania, serves 8 international destinations (incl. London, Birmingham, Dublin, Oslo and Frankfurt) throughout the year on a weekly basisVilnius International Airport is located within a one hour drive providing 2-3 flights per hour and more daily direct flights to major European capitals and cities
International accessibility
KAUNAS REGION
Where
IT
comes
together
Slide11Kaunas Region provides affordable office space which is 25% cheaper compared to VilniusKaunas Free Economic Zone (FEZ) provides opportunities for setting up an office. The zone provides favourable and lower taxes for investors investing at least Euro 1 million Within the city of Kaunas, new high quality developments are underway to accommodate the business services industry
Note: Cost for a Grade A office space, excluding average local rates and service charges
Source: CBRE, Jones Lang LaSalle, UBS, Ober-Haus, Colliers International ,2014
Source: Invest Lithuania, FEZ Kaunas, 2014
Average
annual
occupancy
costs office (Euro/sqm)New office building Kaunas City
Availability of affordable real estate
KAUNAS REGIONWhere IT comes together
Slide12Source: Invest Lithuania, 2014
Financial
support available per FDI project in the field of services Construction, Infrastructure, Salary costs
Personnel training costs
Up to Euro 1.5 million
Up to Euro 2 million
Max. possible support
3.5 million Euro
Foreign investors interested in locating a business in Lithuania as well as foreign companies already operating in the Lithuanian market but eager to further expand may apply for Invest in Lithuania’s financial investment support of up to Euro 3.5 million per investment project
Invest in Lithuania provides financial support to cover personnel training costs (up to Euro 2 million) as well as eligible construction, infrastructure and salary costs (up to Euro 1.5 million), incurred by foreign investors establishing a services business unit in Lithuania
The financial support tool is designed to support foreign businesses investing into the production of export-oriented
high-quality services as well as establishment of qualified jobs on the market
National incentives support programKAUNAS REGION
Where IT comes together
Slide13InformationConsultancyAnalysisSearchGuidanceNetworkingAssistanceAftercare
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KAUNAS REGION
Where
IT
comes
together