invest in lviv · europe & central asia 5.0 327.5 41.7 17.6 238.0 33.8 10.6 175.0 43.8 9.0...
TRANSCRIPT
INVESTin LvivThe t ime i s r ight !
We invite partners to join us in the transformation of Lviv to even more successful and prosperous place. And I assure you that your business will develop together with Lviv.
Lviv is open to the world. Lviv is open to you. Invest in Lviv. The time is now.
Andriy Sadovyy Lviv City Mayor
“
LVIV IS AN EXCELLENT, SMARTLY-LOCATED, AWARD-WINNING CITY WITH A PROMISING BUSINESS CLIMATE.
The local community and business ecosystem are very advanced and dynamic, where development is backed by a pro-active local government.
WESTERN UKRAINE'S LARGEST CITY WAS NAMED:
12020 Emerging City at the Global Business Services Awards in Central and Eastern Europe (CEE) Warsaw
10Ranked in the Financial Times fDi Intelligence Global Top 10 "Smart Locations of the Future" for cost-effectiveness
12019 Most Transparent City in Ukraine for investment
EBRD Sustainability Awards 2020
RANKINGS
POPULATION
42 million (70% urban-based)
20 million diaspora worldwide
LANGUAGEUkrainian
TIME ZONEGMT +2 in winterGMT +3 in summer
BIG MAC INDEX
$ 2,38
CLIMATEAverage temperature
in July +24C | in February -3C
#43 FINTECH COUNTRY
RANKINGS INDEX 2020
CURRENCYUkrainian hryvnia/ 1€ = UAH 30 /
#64EASE OF DOING BUSINESS 2020
#20 DEALING WITH
CONSTRUCTION PERMITS
#47GLOBAL INNOVATION
INDEX 2019 (BOIB)
#5
INNOVATION EFFICIENCY
#3 LOWER-MIDDLE
INCOME
UKRAINELviv
2
UKRAINE: KEY FACTS
INFORMATION TECHNOLOGY
• #1 IT engineering force in Central and Eastern Europe (CEE)• IT services are 40% of all exports to US - #1 trade category• 100+ global companies operate software R&D labs in Ukraine• 130,000 engineering graduate annually
AGRIBUSINESS
• 33% of world’s black-soil (“chornozem”) is in Ukraine, considered the most fertile and productive agricultural land• Over 70% of Ukraine is agricultural land estimated at > $100 billion• #1 in sunflower oil exports globally• #5 world’s grain exporter• #4 in corn exports globally
INFRASTRUCTURE
• Railways – 23,000 km (#14 globally)• #7 world’s largest freight transporter• Roadways – 170,000 km (#29 globally)• Airports – 17 international airports• Sea ports – 13 along main coastline of Ukraine • 4 out of 10 principal transport corridors run through Ukraine • Pipelines: Gas 37,000 km, Oil 4,800 km, Refined product 4,400 km
NATURAL RESOURCES
• #1 black soil concentration globally• #2 manganese ores and graphite deposits globally• Top-3 iron ore deposits globally• Local gas production covers 50%+ of domestic needs
3
UKRAINE: KEY FACTS
Chengdu, China 2017
Vilnius, Lithuania 2014
Przemysl, Poland / 2005 Novi Sad, Serbia
Lodz, Poland 2003
Krakow, Poland 1995
Rzeszow, Poland 1993
Freiburg im Breisburg, 1989 Germany
4
UKRAINE: KEY FACTS
With its independent coffee houses and traditional chocolatiers, Lviv looks, smells and tastes like the best of Europe.
CNN
“
Chengdu, China
Vilnius, Lithuania
Przemysl, Poland / Novi Sad, Serbia
Lodz, Poland
Krakow, Poland
Rzeszow, Poland
Freiburg im Breisgau, Germany
Plovdiv, Bulgaria
Tbilisi, Georgia
Banja Luka, Bosnia and Herzogovina / Lublin, Poland
Wroclaw, Poland / Kutaisi, Georgia
Budapest, Hungary
Rochdale, UK
Winnipeg, Canada
20172016
20142013
2005
2004
20032002
19951993
19931992
1989 1973
FOUNDED
1256
POPULATION
758K Lviv city
1M Lviv (agglom.)
2.5M Lviv Region
AREA
182 km2
MEMBERSHIP IN INTERNATIONAL ORGANIZATIONS
SISTER CITIES
5
LVIV: KEY FACTS
COUNTRY COMPARISON FOR CORPORATE TAXATION
Paying Taxes in Ukraine and comparator economies
Source: Doing Business, 2020
Number of Payments of Taxes per Year
Time Taken For Administrative Formalities (Hours)
Total Share of Taxes (% of Profit)
Ukraine GermanyUnited States
Eastern Europe &
Central Asia
5.0
327.5
41.7
17.6
238.0
33.8
10.6
175.0
43.8
9.0
218.0
49.0
EFFECTIVE TAX RATES, %
€ 400gross average salary
VAT 20%Corporate income tax 18%Corporate tax on salary 22%Individual income tax (temporary military tax) 18% + 1.5% Industrial property tax (for large companies) 0%Land tax 1%
6
THE PAYING TAXES
#65 UKRAINE 2020 PAYING TAXES SCORE OF DOING BUSINESS
5% work tax for private entrepreneurs in Ukraine
Details – Paying Taxes in Ukraine | Source: Doing Business, 2020
Payments (number)
Notes on Payments
Time (hours)
Statutory tax rate
Tax base Total tax and con-tribution
rate (% of profit)
1.0
1.0
1.0
1.0
0.0
1.0
online
online
online
online
online and
jointly
online
92.0
36.5
199.0
22%
18%
various rates
various rates
1.5%
20%
gross salaries
taxable profit
land area and
value
ton of
waste
personal income
value added
33.85
10.23
1.10
0.01
0.00
0.00
Tax or mandatory contribution
UNIFIED SOCIAL CONTRIBUTION
CORPORATE INCOME TAX
LAND TAX
ENVIRONMENTAL TAXES
MILITARY CONTRIBUTION
VALUE ADDED TAX (VAT)
7
THE PAYING TAXES
60 KM TO EU
A4 / E40 main road
9 customs border checkpoints
INTERNATIONAL AIRPORT
51 destination
21 airlines
9 departure gates
3000 pax / hour
7 km / 15 min to city center
Source: Danylo Halytskyi International Airport “Lviv”, 2020
Copenhagen
Riga
VilniusMinsk
Kyiv
Gdansk
Olsztyn-MazuryBydgoszcz
PoznanBerlin
Dortmund
Dusseldorf
London STN
London LT
Paris Frankfurt-Hahn
MunichMemmingen
ViennaBudapest
Burgas
Belgrade
Bratislava
Wroclaw
Prague Katowice
Krakow
Warsaw WMI
Warsaw WAW
Milan MXP
Milan BGYBolonga
RomaBarcelona
MadridNaples
Monastir
Tiva
Thessaloniki Istanbul
Dalaman
Heraklion Rhodes
Hurgada
Tel Aviv
Sharm El Shekh
Antalia
Batumi
Venice
LVIV
Baku
8
A GATEWAY TO EU
PASSENGER TRAFFIC, ‘000 pax
AIRLINES OPERATING IN LVIV INTERNATIONAL AIRPORT:
2014
585
2015
571
2016
738
2017 2018 2019
1 107
1 598
2 200
Source: Danylo Halytskyi International Airport “Lviv”, 2019
9
DANYLO HALYTSKYI INTERNATIONAL AIRPORT • LVIV •
10
UKRAINE: KEY FACTSDANYLO HALYTSKYI INTERNATIONAL AIRPORT • LVIV •
11
UKRAINE: KEY FACTS
Back in 2011 Nestle decided another important investment in Lviv - opening the NESTLE Business Service Center. This BSC grow over the years. Now we employ around 1200 people. It is very important to know that our first production site was established in Lviv. Here we have our Svitoch factory which produce chocolate. Another important asset we have in Lviv is our distribution center. This is the state-of-the-art distribution center which is servicing international and local purposes. I believe that we will continue invest in Lviv.
Alessandro Zanelli, CEO Nestle Ukraine and Moldova
“
Total
Economically active
Unemployed
In active job search
Have higher education
POPULATION, ‘000 people
EMPLOYMENTSTRUCTURE
0 100 200 300 400 500
Industry 26%
Unemployed 7%
BPO, Shared services 3%
Construction 8%
IT 8%
Banks, Finance, Legal services 4%
Education 4%
Medicine, Social services 4%
Municipal services 4%
City and state administration 3%
Retail 13%
Commercial services 16%
600 700 800
758
564
41
17
402
Source City Institute, 2019
12
PEOPLE
Source: City Institute, 2019
I – II level of accreditation 21%
Economics 20%
Medical science 7%
Engineering 15%
Law 10%
III – IV level of accreditation 79%
Social science 14%
Natural sciences 11%
IT 7%
Humanities 8%
Architecture, construction and design 6%
114,000 STUDENTS
STUDENTSBY SCIENCE
Other 3%
UNIVERSITIES (III-IV LEVEL OF ACCREDITATION), students
Lviv Polytechnic National University 26,0
Ivan Franko National University of Lviv 20,0
Danylo Halytskyy Lviv National Medical University 6,14
Lviv National Agrarian University 4,20
Lviv State University of Internal Affairs 4,70
Lviv National University of Veterinary Medicine and Biotechnologies 3,40
Ukrainian National Forestry University 3,10
Hetman Petro Sahaidachnyy National Army Academy 2,10
Lviv University of Trade and Economics 2,78
Lviv State University of Physical Culture 2,90
Ukrainian Academy of Printing 2,33
Lviv State Financial Academy 2,50
Lviv State University of Life Safety 2,21
Ukrainian Catholic University 1,73
Lviv National Academy of Arts 1,10
10 other small universities 63,0
Total 114,0
13
EDUCATION
14
UKRAINE: KEY FACTS
Lviv and Lviv region by itself with qualified human capital, favourable location and well developed infrastructure have a big potential to grow. This is the place where foreign investors will get full support of the authorities to establish and built new companies.
Jorge Garcia, Corporate Vice President, Fujikura Automotive Europe
“ STRUCTURE OF FOREIGN DIRECT INVESTMENTS BY COUNTRIES (equity capital) IN THE ECONOMY OF LVIV ON 31.12.2018, %
PERCENTAGE OF FOREIGN DIRECT INVESTMENT BY COUNTRY (equity) INTO THE ECONOMY OF LVIV AS AT 31.12.2019, %
Po
lan
d
Net
her
lan
ds
Cyp
rus
Swit
zerl
and
Hu
ng
ary
Vir
gin
isla
nd
s
Au
stri
a
Oth
ers
LVIV
Virgin islands
Netherlands
Switzerland
Cyprus
Austria Hungary
Poland
Industry
Real estate operations
Finance and insurance activities
Administrative and support service activities
Wholesale and retail trade
Professional, scientific and technical activities
Agriculture, forestry and fish industry
Other services
56%
10%
8%
8%
4%
4%
3%
6%
23% 21% 19%
7%4%
3%
3%
20%
15
BUSINESS
20
0
40
60
80
100
120
INVESTMENTS IN LVIV
$ 250+ Mforeign direct investmentsin the economy of the city
9%+Average yearly growthof capital investments
in the economy of the city
671 %
Source: Main Department of Statistics of Lviv region, 2019
2018
2018
108
2015
14
2016
32
12
2017
2017
84
13.1
Foreign direct investment, M $
Capital Investments amount, Bln UAH
16
BUSINESS
INTERNATIONAL PRESENCE (industrial production & manufacturing)
FINANCIAL INSTITUTIONS INTERNATIONAL PRESENCE:
UTILITIES, (on April 2020) Electricity € 83.95/MW-hNatural gas € 0.19/m3
Water & sewerage € 0.35/m3 / € 0.19/m3
Food processing 39%
Metal & chemical products 4%
Mechanical engineering 14%Plastics 13%
Pharmacy 12%
Clothing & footwear 10%
Wood & paper 8%
INDUSTRIALPRODUCTION
Source: Lviv Investment Office, 2019
17
COST-EFFECTIVE LOCATION
18
UKRAINE: KEY FACTSRING UKRAINE POWERED BY AMAZON
350+ IT companies in Lviv
$ 919M economy effect of tech industry in Lviv
25 000+ IT specialists
56% software engineers
99.6% speak English
5000 IT specialists graduate annually
20% predicted annual growth of IT industry
4000+ participants in IT Arena annual event
Source: Lviv IT Cluster, 2019
COMPANIES FROM THE GLOBAL OUTSOURCING 100 PRESENT IN LVIV:
[email protected] 0 800 300 331 www.itcluster.lviv.ua
*HQ in Lviv
* *
19
IT INDUSTRY
20
UKRAINE: KEY FACTS
≈2500 EMPLOYEES
INTERNATIONAL PRESENCE:
• legal services
• accounting sales
• finance
• HR
• procurement
• consulting
• audit
• advisory
• call centers
• data analysis
• technical support
• project management
VACANCY AVG. NET SALARIES
Call center employee $ 588
Customer relations specialist $ 490
Accountant $ 385
Financial analyst $ 470
IT Administrator $ 1000
QA $ 1350
IT Developer $ 2000
Source: Deloitte, 2019
21
BPO & SS POTENTIAL
IT CLUSTER
50+ companies 6 Universities
PUBLISHING AND PRINTING CLUSTER
13 publishing enterprises 1 University
LVIV CLUSTER OF EDUCATION DEVELOPMENT AND CREATIVITY
10 founders 10 members of Advisory Board11 cluster members
LVIV MEDICAL TOURISM CLUSTER 10 private clinics
BIOTECH&PHARMA CLUSTER 18 cluster members
WEST UKRAINIAN FASHION INDUSTRY CLUSTER 32 light industry enterprises 2 educational institutions1 school of innovative tailoring skills “List”
22
DISCOVER. ACT. CONNECT.
NUMBER OF TOURISTS, million people
2013
1.3
2014
1.7
2015
1.7
2018
2.2
2017
2.6
2019
2.5
2016
2.6
Ukrainians 36%
Visiting relatives 11%
Business 11%Other 5%
Overseas Visitors 64%
Leisure, vacations 73%
PURPOSEOF
VISIT
ORIGIN
Source: Lviv Tourism Office, 2019
3.8 days average length of stay
€ 94 1 tourist spends per day
23
TOURISM
LVIV CONFERENCE FACILITIES
TOTAL DELEGATES IN 2019
291, 144
HOTELS
hotels with conference facilities Sonata Hotel 450 *
academic venuesLviv Polytechnic National University – 800*
unique venuesLviv Opera and Ballet Theatre – 1, 000*
conference hallsArena Lviv Stadium – 1, 200*
*Biggest capacity, theatre seating
41
9
10
12
Hotels with Conference Facilities 41Other hotels 81Total no. of rooms 3, 866No. of beds 7, 824
812CONFERENCES
IN LVIV 2019
236 National
423 Local
153 International
24
CONFERENCING
TOP 10 CONFERENCES IN LVIV IN 2020
28-30 May Lviv media Forum 20201-4 June OMEE International Conference on Oxide Materials for Electronic Engineering 20203-5 June International Blackcurrant Conference 202026 June Lviv IT Jazz Conference 202010-15 July 28th International Congress of Individual Psychology 2020 July 35th Annual Meeting of the European Forum of Medical Associations (EFMA) 13 September Lviv EcoForum «Water and Energy» 2020 16-20 September Book Forum 202017-20 September 11th Conference on Medical Chemistry 20202-4 October IT Arena 202010-11 October E-governance Forum 451E28-30 October 17th International Dental Forum and Exhibition 2020
SPHERE 147 medicine144 service136 economy and business84 science
76 IT54 education20 culture151 other
Source: Lviv Convention Bureau, 2019
Science 18%
Other 15%
IT 14%
Economy & Business 13%
Education 7%
Culture & Art 4%
Safety 4%
Services 4%
Law 3%
Industry 3%
Environment 3%
Medicine 12%
CONFERENCE SUBJECT
lvivconvention.com.ua
25
CONFERENCING
26
UKRAINE: KEY FACTS
We can recommend Lviv as a solid base to start when aiming to invest in Ukraine. A long breathe, patience, relationships, accessibility to (debt) financing as well as the capacity to amend plans are though key ingredients for anyone aiming to operate in Ukraine.
Gawein Minks, Director, Multi Ukraine
“METROPOLITAN ANDREY SHEPTYTSKY CENTER
27
UKRAINE: KEY FACTS
CONGRESS CENTER
3+ PROJECTS IN REAL ESTATE
• 8 ha land plot• 27, 000 m2 planned area• 3, 500 attendees capacity• Located near Arena Lviv stadium
28
WHERE TO INVEST?
UNDERGROUND PARKING PROJECTS
Underground parking on DVIRTSEVA SQ.
• 1.036 ha land plot• 12 000 m2 parking area• 2 floors• 400 parking spaces • total cost ≈ 12,9M USD• parking fee ≈ 1.6 USD hour (1 USD)• March 1, 2019 – started Dvirtseva sq. rehabilitation
Underground parking on PETRUSHEVYCHA SQ.
• 0.8 ha land plot• 8 332 m2 building area• 2 500 m2 area of landscaping• 12 000 m2 parking area• 2 floors• 350 parking spaces• total cost - 10,5M USD• parking fee – 1 USD per hour (1 USD)• City Council will close nearby streets for car parking• Includes Petrushevycha Sq. rehabilitation
Dvirtseva Sq.
Petrushevycha Sq.
29
WHERE TO INVEST?
CTP INDUSTRIAL PARK LVIV
• A-Class manufacturing and logistics facilities • 24 ha land plot • 100,000+ m2 Gross Leasable Area • Located on the A4 Highway on the outskirts of Lviv
• www.ctp.eu
30
INDUSTRIAL PARK ZONES
ANY CHOSEN PIECE OF LAND FROM INDUSTRIAL ZONE CAN BE SEPARATED. Acquisition:• Purchase via auction• Long-term lease / 30 years lease as industrial park
92 HA – SYHNIVKA INDUSTRIAL ZONE• 5 km / 12 min to ring road / A4 / E40 main road• 8 km / 20 min to airport• 8 km / 22 min to main train station / 20 - 500 m to railway
37 HA – RYASNE-2 INDUSTRIAL ZONE• 2.5 km / 5 min to ring road / A4 / E40 main road• 15 km / 27 min to airport• 10 km / 36 min to main train station / 200 - 1000 m to railway
M10
M11 E40 < Ring road | City center >
Pivnichna St.
Koniushynna St.
Danyly Apostola St.
SYHNIVKA
M10
M10
RYASNE-2
Shevchenka St.
Avtobudivel'nykiv Passage
Tsentral'nyj Passage
31
INDUSTRIAL ZONES
TAXES AND FEES
Property tax for industrial buildings
Investment contribution for infrastructure development
Land lease fee
STANDARD TAXATION
€ 0.89 – € 1.46 / m2
Up to 10% of estimated cost of construction
3% of normative monetary valuation
AFTER INDUSTRIAL ZONE TAX RELIEF
ZERO
ZERO
60% reduction
INCENTIVES
Main railway station
City center
Airport
Bus stationRing road / A4 / E40 main road
SYHNIVKAINDUSTRIAL ZONE
RYASNE-2INDUSTRIAL ZONE
32
INDUSTRIAL ZONES
AFTER INDUSTRIAL ZONE TAX RELIEF
ZERO
ZERO
60% reduction
SOLID WASTE MANAGEMENT PROJECT
URBAN PUBLIC TRANSPORT PROJECTS
• Construction of MBT Plant • € 100M+ investment from EBRD, EIB and Lviv Municipality
Project Manager:Lviv Municipal Company •GREEN CITY• +380 322 97 55 [email protected]
Implemented:• 7 new and 35 used trams (EBRD funding)• Construction of new tramline (EBRD funding)• 150 new buses in 2018 (leasing financing)
In progress:• Automatic fare collection system (EBRD funding)• 50 new trolleybuses (EBRD funding)• 10 new trams (EIB funding)• 100 new buses (EIB funding)• 100 trolley buses with autonomous motion (IFC funding)
33
MAJOR INFRASTRUCTURE PROJECTS
IMPLEMENTED
Project
Tram rolling stock Modernization
Street reconstruction with tram lines (trams 2 and 6)
Tramline to Sykhiv district
IFO
EBRD
Lviv City Council
EBRD
Lviv City Council
EBRD
BMU
Lviv City Council
Amount Financed, € M
13,9
2,5
27,1
5,9
12
6,2
7,7
Total, € M
16.4
33
25.9
TOTAL FUNDS 75.3
34
PARTNERSHIP WITH IFOs
Project
Wastewater treatment & biogas production
Heating modernization
E-ticket
Waste management
Trolleybuses and infrastructure
Urban Public Transport
Road Safety
Trolleybuses with autonomous motion
PROJECTS IN PROGRESS
Total, € M
31.5
33
11.2
41.75
22
40
IFO
EBRDE5PNEFCOLviv City Council
EBRDE5P Lviv City Council
EBRDLviv City Council
EBRDE5PLviv City Council
EBRDLviv City Council
EIB
EIB
IFC
37,8
32
Credit rating B/Positive
Amount Financed, € M
157,554
20103
101,2
25106.75
254,5
40
37,8
32
TOTAL FUNDS 249,25
35
PARTNERSHIP WITH IFOs
INNOVATION DISTRICT IT PARK
The project occupies the land plot of nearly 10 ha, and represents one of the largest and most important urban developments in the city in the next 5 to 10 years.
DEVELOPER - GALEREJA CENTRE LTD.www.galereja.com.ua
Stage 1
Six blocks of 8-storey office buildings 72 000 sq m GLA space A, B, C
office tower D 28 000 sq m GLA space
Technological laboratories F 2 000 sq m
Mall with supermarket, 10 000 sq m GBAfood court, fitness area, entertainment zone, supporting services FConference facilities
Internal and external parking 2000 + parking lots
Open green areas for sports and leisure 20 000 sq m
58 000 sq m office premises signed!
Construction period for Stage 1: 24 months
Stage 2 and Stage 3
Set of office buildings different high Up to 150000 sq mwith retail on the ground floors GLA space
36
OFFICE PROPERTY MARKET
37
OFFICE PROPERTY MARKET
LVIV.TECH.CITY
• Three class-A office buildings and a multi-family residential complex positioned in a business class with diversified amenity facilities.
• The Project’s site – 4.7 ha• Total area (GBA) 55 000 sq. m
235,000 m² total stock
(GLA)
1,8 % vacancy rate
$ 12 - 19 rent (excluding
VAT and utilities)Source: Deloitte, 2019
320 000 m2 OF A-CLASS OFFICES TO BE COMMISSIONED BEFORE 2022
• Lease area (GLA) 27 000 sq. m• Number of working stations – 3500• Underground parking. For 350 cars• Fitness centre,• Modern Café with a catering function
Developer – UDP www.udp.ua
38
OFFICE PROPERTY MARKET
CONTACT US:
SUPPORTS
• investment activities locally and clears any investment process bottlenecks
SEARCHES
• investment targets
PROVIDES
• information on business climate, investment opportunities, human capital availability, local costs and taxes structure
IDENTIFIES
• potential investment projects and investment opportunities on demand
ARRANGES
• bilateral business meetings and study visits
1 Rynok Square, office 31779008 Lviv, Ukraine+380 322 54 60 06
European Business Association
3 Myhaila Verbytskoho, office 2Lviv 79013, Ukraine+380 322 61 40 67
39
LVIV INVESTMENT OFFICE
NOTES
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