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Where Logistics comes together

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Presentation on theme: "Where Logistics comes together"— Presentation transcript:

1 Where Logistics comes together
KAUNAS REGION Where Logistics comes together

2 Welcome to Kaunas Region, Lithuania!
Where Logistics comes together Lithuania is at the center of three of large consumer markets: Western Europe Baltic Sea Region Russia and former Soviet States (CIS) LITHUANIA stats Size 65,300 km2 Population 2.97 million Capital Vilnius Official language Lithuanian Currency Lithuanian Litas (LTL) Pegged to Euro since 2002 1 Euro = 3.45 LTL Real GDP growth 2013: 3.2% 2012: 3.7% 2011: 6.0% FDI growth 8.1 % Annual inflation 1.2% KAUNAS REGION stats Regional capital Kaunas City Population 593,000 Labour pool 289,000 Unemployment 31,300 (10.1%) FDI growth 11.4% Kaunas Region Source: Statistics Lithuania, VRM , Invest Lithuania 2014 Buck Consultants International

3 Lithuania, a gateway to the EU and CIS
KAUNAS REGION Lithuania, a gateway to the EU and CIS Where Logistics comes together Lithuania allows access to main markets*: Member of the European Union Member of the Schengen Agreement (free trade and travel) Member of NATO Member 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: * World Bank, Invest Lithuania 2014 Buck Consultants International Source: Economist Intelligence Unit Q2 2014

4 Logistics sector Lithuania
KAUNAS REGION Logistics sector Lithuania Where Logistics comes together With approximately 80% of freight which is transported through international transport corridors passing through Lithuania, the country has become one of the most important transport centres in the European Union, linking the EU with the East (Source: Datamonitor) The North-South highway, the railway route connecting Scandinavia with Central Europe, and the East-West route that connects vast Eastern markets with the rest of Europe, all figure among the 10 principal freight routes in Europe. The expansive network of central motorways and European railroads, along with the ice-free port of Klaipėda and 4 international airports comprise the key infrastructure of the Lithuanian transport network The largest warehouse in Lithuania is situated in Kaunas. “Senukai Logistics Park” and measures 70,000 m2 The greatest supply of modern warehousing facilities in 2010 remained in Vilnius ( m2), with Kaunas following in the 2nd place ( m2). Kaunas is a dynamic, upcoming location Two of Lithuania’s five largest logistics centers are in Kaunas Major logistics FDI in Lithuania Largest Logistics Centres Area, m2 City Senukai Logistics Park 70,000 Kaunas Laistai International Trade Center 32,000 Klaipėda Tromina 30,000 Vilnius Kaunas Terminal Business Park E67 28,000 Panevėžys AutoLogic Group Rhenus Logistics Schenker Maersk Line Msc DHL DPD Gefco UPS DSV TNT Source: Invest Lithuania 2014 Source: Invest Lithuania 2013, Colliers 2013 Buck Consultants International

5 Real Estate availability International accessibility
The Kaunas Region provides an unmatched mix of cost-effective talent and high class infrastructure KAUNAS REGION Where Logistics come together Location Cost attractiveness The right connection to: EU CIS Baltics Russia In KAUNAS REGION it all comes together The right labor cost savings The right tax scheme Real Estate availability International accessibility The right industrial parks The right cost advantages The right location The right logistics

6 Location KAUNAS REGION Where Logistics comes together The international competitiveness of Lithuania in the transport and logistics sector is to a large extent determined by its geographical position Many companies see Lithuania as a springboard from which to penetrate the vast markets of the EU and the Russia-Kazakhstan-Belarus Customs Union and other CIS countries. The latter is increasingly important now that Russia has joined the World Trade Organization* Kaunas is connected to Poland (and rest of Europe), Belarus and Russia by rail and road Kaunas connected to Poland (and rest of Europe), Belarus and Russia by rail and road* Baltics, Russia, CIS, CEE and Germany are reached within two truck days* Buck Consultants International * Source: Invest in Lithuania,, 2013

7 Location KAUNAS REGION Where Logistics comes together Some of the major logistics centres in Lithuania are in Kaunas Region The Kaunas region has a highly developed railway infrastructure. Three railway lines cross the region: Moscow-Minsk-Kaliningrad, Vilnius-Kaunas-Klaipeda and Kaunas- Siauliai-Riga. The “Rail Baltica” or “Baltic” rail (standard European gauge) section between the Lithuanian-Polish border and the Marijampole-Kaunas line is under development. It will connect Kaunas Region to Warsaw and the Western EU markets. Kaunas Region is conveniently located on crossroads of modalities The Kaunas Region interconnects the Nordics and Western Europe with Russia and CIS Buck Consultants International Source: BCI,, 2014 Source: Invest in Lithuania, 2013

8 50% of the tax rate (subsequent 10 years)
Cost attractiveness KAUNAS REGION Where Logistics comes together In general labour costs in Lithuania are less than half compared to Western European countries and the USA Truck operating costs in Lithuania are among the lowest in Europe and % lower than Western Europe Labour costs in Kaunas Region are approximately 10% lower than in Vilnius and 25-40% lower than in Poland and Slovakia Standard 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 Source: Invest Lithuania 2013, PwC 2013 Annual full employers cost warehouse employee Tax rates Tax General Free Economic Zone Income tax 15 % 0 % (first 6 years) 50% of the tax rate (subsequent 10 years) Property tax 1 % 0 % Dividend tax Source: Invest Lithuania, FEZ Kaunas, FEZ Kėdainiai 2014 1 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, 2014 Buck Consultants International

9 International accessibility
KAUNAS REGION Where Logistics comes together Kaunas Region is situated at the geographical centre of Lithuania and is further developing and strengthening its transport infrastructure Kaunas 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 basis Vilnius 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 Buck Consultants International

10 Real Estate Availability
KAUNAS REGION Where Logistics comes together The two Free Economic Zones of Kaunas Region are good locations for the setting up of logistics facilities. The zones provide favourable and lower taxes for investors investing at least Euro 1 million Kaunas Free Economic Zone (FEZ) offers a total of 294 hectares for logistics and manufacturing. Logistics companies are already present. Direct foreign investments in Kaunas FEZ account for 76% of all investments The Kėdainiai FEZ offers 9 plots for investors, with already installed water supply, sewage, surface waste water, pipeline and road infrastructure. The size of the proposed plots varies from 6,26 to 20,86 ha. Targeted activities are industrial and logistics/warehouwing The Kaunas FEZ provides 294 hectares of logistics and production area The Kėdainiai FEZ provides 9 ‘ plug-and-play’ plots Buck Consultants International Source: Kėdainiai FEZ, FEZ Kaunas, 2014

11 National incentives support program
KAUNAS REGION National incentives support program Where Logistics comes together 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 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 Source: Invest Lithuania, 2014 Buck Consultants International

12 Contact us TBD One stop shop
KAUNAS REGION Contact us Where Logistics comes together TBD One stop shop Contact Information: +370 …. @ www Information Consultancy Analysis Search Guidance Networking Assistance Aftercare Buck Consultants International

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