Presentation is loading. Please wait.

Presentation is loading. Please wait.

Restructuring of the Bulgarian sector of electrical engineering Dr. Rumen Atanasov Bulgarian Association of Electrical Engineering and Electronics Bulgaria,

Similar presentations


Presentation on theme: "Restructuring of the Bulgarian sector of electrical engineering Dr. Rumen Atanasov Bulgarian Association of Electrical Engineering and Electronics Bulgaria,"— Presentation transcript:

1 Restructuring of the Bulgarian sector of electrical engineering Dr. Rumen Atanasov Bulgarian Association of Electrical Engineering and Electronics Bulgaria, Latvia, Lithuania and Slovakia – Comparison of industrial transition models CCMI Conference, Sofia, 6-7 October 2008

2 07/10/08 bassel 2 share in WGDP and EE sector Employed in the ELECTRA sector as % of the employed in industry The leading sector after WW2 The leading sector after WW2 The basis of the technology development in the last 60 years The basis of the technology development in the last 60 years It is the leading European industry It is the leading European industry The most important for the Bulgarian industry, defines the technological level of the whole machining industry. The most important for the Bulgarian industry, defines the technological level of the whole machining industry. The Sector of the El. Eng. and Electronics

3 07/10/08 bassel 3 The Electrical Engineering in Bulgaria has a long history The roots 1878/79 – first electrical lighting system; facilities for telegraph network delivered by SIEMENS 1878/79 – first electrical lighting system; facilities for telegraph network delivered by SIEMENS 1888/99 – first electrified factories, collieries 1888/99 – first electrified factories, collieries 1900/02 – first hydroelectric PS with 7 kV transmission line; first thermal PS; tramway in Sofia starts to roll 1900/02 – first hydroelectric PS with 7 kV transmission line; first thermal PS; tramway in Sofia starts to roll 1909/19 – regular import of bulbs & utility material from Austria. SIEMENS wins tender for first 3000 posts distribution telephone exchange; permanent representation agencies of SIEMENS-SCHUCKERT for HV technique and SIEMENS-RHEINIGER for medical equipment 1909/19 – regular import of bulbs & utility material from Austria. SIEMENS wins tender for first 3000 posts distribution telephone exchange; permanent representation agencies of SIEMENS-SCHUCKERT for HV technique and SIEMENS-RHEINIGER for medical equipment 1920/35 – Bulgarian Ltd Company for electricity-SIEMENS inaugurated; regular import of radio receivers; first X-ray device imported; production start of small electric motors, dynamos, transformers, lighting fixtures, cables, bulbs, switchgear; first 320 kVA transformer 1920/35 – Bulgarian Ltd Company for electricity-SIEMENS inaugurated; regular import of radio receivers; first X-ray device imported; production start of small electric motors, dynamos, transformers, lighting fixtures, cables, bulbs, switchgear; first 320 kVA transformer 1934/45 – construction of automatic telephone exchanges; high-frequency installations; repair workshops for radio sets, telephone and telegraph appliances, el. motors, transformers, heating devices 1934/45 – construction of automatic telephone exchanges; high-frequency installations; repair workshops for radio sets, telephone and telegraph appliances, el. motors, transformers, heating devices

4 07/10/08 bassel 4 Subsectors included (acc. NACE codes) Manufacture of portable hand held power tools Manufacture of portable hand held power tools Manufacture of electric domestic appliances Manufacture of electric domestic appliances 31.1 Manufacture of electric motors, generators and transformers 31.1 Manufacture of electric motors, generators and transformers 31.2 Manufacture of electricity distribution and control apparatus 31.2 Manufacture of electricity distribution and control apparatus 31.3 Manufacture of insulated wire and cable 31.3 Manufacture of insulated wire and cable 31.4 Manufacture of accumulators, primary cells and primary batteries 31.4 Manufacture of accumulators, primary cells and primary batteries 31.5 Manufacture of lighting equipment and electric lamps 31.5 Manufacture of lighting equipment and electric lamps Manufacture of electrical equipment for engines and vehicles Manufacture of electrical equipment for engines and vehicles 33.3 Manufacture of industrial process control equipment 33.3 Manufacture of industrial process control equipment Subsectors not included Office technique, computers and other electronic facilities Office technique, computers and other electronic facilities Communication technique Communication technique

5 07/10/08 bassel 5 Development in Bulgaria after WW2 Specialists obtaining higher education in Germany, Italy, France, Czechoslovakia available Specialists obtaining higher education in Germany, Italy, France, Czechoslovakia available Administrated market of the former Soviet Union orientated development Administrated market of the former Soviet Union orientated development Natural way of development without ill-founded political solutions Natural way of development without ill-founded political solutions Presence of some subsectors (electric motors, transformers, cables, batteries) on the free markets Presence of some subsectors (electric motors, transformers, cables, batteries) on the free markets Intensive development of specific subsectors in the eighties, licenses from leading companies Intensive development of specific subsectors in the eighties, licenses from leading companies State monopoly on export and import; sales of manufacturers used to be prerogative of the state State monopoly on export and import; sales of manufacturers used to be prerogative of the state Exorbitant industrial development Exorbitant industrial development

6 07/10/08 bassel 6 The period after 1990 Disappearance of administrated markets: internal and COMECON Disappearance of administrated markets: internal and COMECON Suspension of supply sources of raw materials, components and elements Suspension of supply sources of raw materials, components and elements Drastic decrease in production, closure of enterprises Drastic decrease in production, closure of enterprises Former state-owned factories performed social functions maintaining redundant personnel Former state-owned factories performed social functions maintaining redundant personnel Difficult access to capital – as a result loss also of free markets Difficult access to capital – as a result loss also of free markets Liberalization of the trade Liberalization of the trade Establishment of many small and micro enterprises, initially in the field of services Establishment of many small and micro enterprises, initially in the field of services Start of privatization of the big state-owned factories Start of privatization of the big state-owned factories Different forms of privatization, in many cases owners without ideas about development of the factory – profiting from assets only Different forms of privatization, in many cases owners without ideas about development of the factory – profiting from assets only Restructuring – ownership, markets, products, management Restructuring – ownership, markets, products, management

7 07/10/08 bassel 7 The former state-owned enterprises of the electrical engineering industry are utilizing only 30-35% of their previous capacity. Some of them are not-existing anymore. In the last years – new technologies, new equipment (usually second hand). Personnel is optimized. During the last 3-4 years, a process to discover real owners of the factories is running The former state-owned enterprises of the electrical engineering industry are utilizing only 30-35% of their previous capacity. Some of them are not-existing anymore. In the last years – new technologies, new equipment (usually second hand). Personnel is optimized. During the last 3-4 years, a process to discover real owners of the factories is running A great number of newly established (after 1990) SMEs; new technology, new facilities A great number of newly established (after 1990) SMEs; new technology, new facilities In the last 5-6 years – investment into new production sites & buildings, new equipment even into some of the former state-owned factories In the last 5-6 years – investment into new production sites & buildings, new equipment even into some of the former state-owned factories The sector comprises about 590 enterprises, 350 of them – actively operating; 20 are large (more than 300 wplcs), the rest – small and medium The sector comprises about 590 enterprises, 350 of them – actively operating; 20 are large (more than 300 wplcs), the rest – small and medium Labor force in the sector – about employees Labor force in the sector – about employees Restructuring still not completed, clusters – in highly introductory phase Restructuring still not completed, clusters – in highly introductory phase Now 100% private industry

8 07/10/08 bassel 8 The most important for the sector - FDIs USD m Companies 85; Private persons 124

9 07/10/08 bassel 9 Factories of important foreign investors (former state-owned factories) ABB: MV&LV switchgear; 250 wplcs ABB: MV&LV switchgear; 250 wplcs HYUNDAI HEAVY IND.: power trafos, tap-changers; 600 wplcs HYUNDAI HEAVY IND.: power trafos, tap-changers; 600 wplcs SCHNEIDER: LV breakers (the old one) SCHNEIDER: LV breakers (the old one) SPARKY: el. hand tools; 1300 wplcs SPARKY: el. hand tools; 1300 wplcs SET: PCBs; 280 wplcs SET: PCBs; 280 wplcs MHT: magnetic heads; 200 wplcs MHT: magnetic heads; 200 wplcs DZU-VIDEOTON: small household appls, el.mech. devices; 650 wplcs DZU-VIDEOTON: small household appls, el.mech. devices; 650 wplcs NAYDEN KIROV: LV installation products; 300 wplcs NAYDEN KIROV: LV installation products; 300 wplcs AROS QUALITY: small trafos; 290 wplcs AROS QUALITY: small trafos; 290 wplcs

10 07/10/08 bassel 10 Factories of important foreign investors (green field projects) ABB: 2 factories; LV, 150 workers.; now 3 th LV/MV, 600 wplcs, start May 2009; 4 th planned ABB: 2 factories; LV, 150 workers.; now 3 th LV/MV, 600 wplcs, start May 2009; 4 th planned LIEBHERR: fridges, 1500 wplcs; R&D center, 30 eng. LIEBHERR: fridges, 1500 wplcs; R&D center, 30 eng. SCHNEIDER: new (2 nd ) factory, LV breakers, 800 wplcs SCHNEIDER: new (2 nd ) factory, LV breakers, 800 wplcs EPIQ: PCB assembling; 2000 wplcs EPIQ: PCB assembling; 2000 wplcs MELEXIS: PCB assembling; 200 wplcs MELEXIS: PCB assembling; 200 wplcs FESTO: sensors for automation; 200 wplcs FESTO: sensors for automation; 200 wplcs SIEMENS: HV measurement transformers SIEMENS: HV measurement transformers ARKOMAT: automotive wire harnesses, 600 wplcs ARKOMAT: automotive wire harnesses, 600 wplcs NURSAN: automotive wire harnesses NURSAN: automotive wire harnesses CURTIS: el. motor-control for forklifts; 140 wplcs CURTIS: el. motor-control for forklifts; 140 wplcs

11 07/10/08 bassel 11 The success stories of FDI The sector had a good reputation amongst global leaders: with the start of privatization SIEMENS, ABB, SCHNEIDER, EPIQ, SPARKY, HYUNDAI (well knowing the sector) came to Bulgaria and bought up the state-owned factories The sector had a good reputation amongst global leaders: with the start of privatization SIEMENS, ABB, SCHNEIDER, EPIQ, SPARKY, HYUNDAI (well knowing the sector) came to Bulgaria and bought up the state-owned factories Subsequently, a series of green field projects were realized and were successfully developed Subsequently, a series of green field projects were realized and were successfully developed For the last years - $137 million FDI. This is a very small amount against the background of the total FDI in this country. However, production FDI drive into the country new products and respective markets, new technologies, new management, new industrial mentality For the last years - $137 million FDI. This is a very small amount against the background of the total FDI in this country. However, production FDI drive into the country new products and respective markets, new technologies, new management, new industrial mentality Production FDIs are generating a new industry of sub-suppliers in the region, natural clusters Production FDIs are generating a new industry of sub-suppliers in the region, natural clusters Some new, very large and important industrial areas have been stimulated and established in our country Some new, very large and important industrial areas have been stimulated and established in our country In general – all FDIs in new production enterprises are success stories. In general – all FDIs in new production enterprises are success stories. And yet why? And yet why?

12 07/10/08 bassel 12 FINANCIAL STABILITY Currency board since 1997 FINANCIAL STABILITY Currency board since 1997 The Central Bank does not act as a lender to government and commercial banks The Central Bank does not act as a lender to government and commercial banks The exchange rate to foreign reserve currency (EURO) is strictly fixed, 1 = 1,95583 BGN The exchange rate to foreign reserve currency (EURO) is strictly fixed, 1 = 1,95583 BGN The Central Bank will issue only one unit of local currency for each unit of foreign reserve currency it has in its vaults The Central Bank will issue only one unit of local currency for each unit of foreign reserve currency it has in its vaults The country has not the ability to set monetary policy according to domestic considerations The country has not the ability to set monetary policy according to domestic considerations 4 POLITICAL STABILITY NATO member country since April 2004 NATO member country since April 2004 EU member country since January 2007 EU member country since January 2007 All political parties support NATO and EU membership All political parties support NATO and EU membership No ethnical problems No ethnical problems

13 07/10/08 bassel 13 FAVORABLE INVESTMENT CLIMATE Corporate Tax: 10% Manufacturing companies in high-unemployment municipalities: 0% 17 EU TECHNICAL LEGISLATION IN FORCE Transposed directives: LVD, EMC, R&TTE, ATEX, Machinery, lifts, gas appliances, simple pressure vessels, pressure equipment, toys, NAWI, refrigeration appliances, hot water boilers, noise emission, etc. Transposed directives: LVD, EMC, R&TTE, ATEX, Machinery, lifts, gas appliances, simple pressure vessels, pressure equipment, toys, NAWI, refrigeration appliances, hot water boilers, noise emission, etc. WEEE (effective from ); WEEE (effective from ); RoHS (effective from ); RoHS (effective from ); Batteries (since 2005) Batteries (since 2005) Transitional period - Directives on medical devices Transitional period - Directives on medical devices Most enterprises ISO9000 certified by TUV, SGS, LR, BVQi Most enterprises ISO9000 certified by TUV, SGS, LR, BVQi

14 07/10/08 bassel 14 WELL EDUCATED AND HIGHLY SKILLED LABOR FORCE 43 Universities; graduates (BA or MA) annually 350 vocational technical colleges, graduates annually Bulgarian students in foreign countries 13 THE LOWEST PRICE LEVEL IN EU !!!

15 07/10/08 bassel 15 Price Level Indices 2005 (%) 15 Annual average gross wages, EE sector BG, EUR

16 07/10/08 bassel 16 Monthly emoluments in electrical engineering sector, large cities, EUR, 2006 Position Gross salary Total cost Low-skilled worker Skilled worker 190 to to 372 Engineer (MSc) 330 to to 558 Manager 400 to to 620

17 07/10/08 bassel 17 Productivity rises, but still too unsatisfactory

18 07/10/08 bassel 18 Labor productivity in 2006 – GDP per employee on PPP basis as a percentage of the EU–27 average Top 5 states Bottom 5 states Country % of the EU-27 average Country Luxembourg183.3Poland61.5 Belgium134.9Lithuania58.5 Ireland132.1Latvia52.8 France125.2Romania38.3 Austria121.1Bulgaria35.3

19 07/10/08 bassel 19 Important el. eng. sub-sectors Power equipment (transformers, switchgear) Power equipment (transformers, switchgear) Motors, generators, alternators Motors, generators, alternators Cables and wires Cables and wires Batteries, start and traction Batteries, start and traction LV apparatus, building installation products LV apparatus, building installation products Control, measurement and automation devices and systems Control, measurement and automation devices and systems Industrial electronics, PCBs, electronic modules and systems Industrial electronics, PCBs, electronic modules and systems Automotive parts Automotive parts Lighting fixtures Lighting fixtures Optical devices Optical devices Household appliances Household appliances Sub suppliers (plastics, metal parts, ceramics etc.) Sub suppliers (plastics, metal parts, ceramics etc.)

20 07/10/08 bassel 20 Production and export, EUR m

21 07/10/08 bassel 21 Production of electric motors, batteries, switchgear

22 07/10/08 bassel 22 Export of assembled PCBs, m

23 07/10/08 bassel 23 Production of electrical household appliances, pcs

24 07/10/08 bassel 24 Import of electrical household appliances, pcs

25 07/10/08 bassel 25 Proportion of the population aged 25–64 with completed secondary education Human resources

26 07/10/08 bassel 26 Proportion of the population aged 25–64 with higher education

27 07/10/08 bassel 27 University graduates in science and technology per 1,000 population in the age group 20–29

28 07/10/08 bassel 28 Lifelong learning – proportion of the population aged 25–64 involved in training and education

29 07/10/08 bassel 29 Number of graduates in electrical engineering subjects, 2005 There are 5 technical universities and 65 vocational schools with el. eng. & electronic disciplines SubjectBachelorMasterTotal Mech. engineering El. engineering El. devices El. installation

30 07/10/08 bassel 30 State economic strategy According to STRATEGIC TRENDS OF BULGARIAN ECONOMY, published July 2007 by the Ministry of Economy and Energy: According to STRATEGIC TRENDS OF BULGARIAN ECONOMY, published July 2007 by the Ministry of Economy and Energy: DELOITTES SURVEY - most perspective sectors and competitive advantages in Bulgaria are: IT, outsourcing, electrical engineering and electronics; DELOITTES SURVEY - most perspective sectors and competitive advantages in Bulgaria are: IT, outsourcing, electrical engineering and electronics; UNCTADS SURVEY 2007/ electrical engineering and electronics is most perspective industrial sector for investments in Bulgaria UNCTADS SURVEY 2007/ electrical engineering and electronics is most perspective industrial sector for investments in Bulgaria Sector strategy A National Strategy for the Development of the Electrical Engineering Industry in Bulgaria up to 2013 was jointly elaborated with the Ministry of Economy and Energy. Yearly Action plans.

31 07/10/08 bassel 31 R&D expenditures in ELECTRA (% of the GVA) n.a. ? R&D expenditures, % of GDP

32 07/10/08 bassel 32 NIF - Projects financed by NIF Session Projects Submitted Projects Selected Success Rate % Agreed Subsidy ( BGN m) Average Value of the Financed Project ( BGN) 1st session , nd session , rd session , th session , Projects leading sectors ICT % ICT % electronics and electrical eng % electronics and electrical eng % biotechnologies & food industry % biotechnologies & food industry % mechanical eng. & metal processing % mechanical eng. & metal processing % Bulgarian National Innovation Policy

33 07/10/08 bassel 33 Other instruments to promote innovations Voucher scheme; Techno-starter scheme; Techno-starter scheme; Tax incentive scheme; Loan guarantee scheme; Loan guarantee scheme; Venture capital scheme Venture capital scheme

34 07/10/08 bassel 34 But !? Lisbon 2010 BG 2003 Natl Str Natl Str R&D % GDP 30,430,450,51 Share of business for R&D ,823

35 07/10/08 bassel 3529/02/08 nceeb 35 Social Dialogue Sector councils for social collaboration with the Ministry of Economy and Energy Sector councils for social collaboration with the Ministry of Economy and Energy Law on health preserving and safe conditions of work, including a separate system for social dialogue at national, sector, regional, company level Law on health preserving and safe conditions of work, including a separate system for social dialogue at national, sector, regional, company level Two trade-union partners of the Association. Two trade-union partners of the Association. A collective labor agreement is signed for the EE-industry between the sector organizations of employers (NCEEB) and the trade unions A collective labor agreement is signed for the EE-industry between the sector organizations of employers (NCEEB) and the trade unions Very strange!. The dialogue between employers and trade unions is far more spontaneous and constructive than between business and the state administration. Very strange!. The dialogue between employers and trade unions is far more spontaneous and constructive than between business and the state administration.

36 07/10/08 bassel 3622/04/08 nceeb 36 Thank you for your kind attention


Download ppt "Restructuring of the Bulgarian sector of electrical engineering Dr. Rumen Atanasov Bulgarian Association of Electrical Engineering and Electronics Bulgaria,"

Similar presentations


Ads by Google