PPT
Joint industriAll European Trade Union EFFAT project:
Strengthening the industrial trade unions role in South East Europe
in shaping the industrial policy agenda in the light of the
objectives of Europe 2020 (VS/2015/0238)
SWOT
Analysis and first draft
Recommendations
of Croatian, Macedonian, Montenegrin and Serbian Industrial
Sectors
Mid-term Conference: IP SEE Project, Zagreb, 24-25 April
2017
Radmila Grozdanic
Contents
Bacground of SWOT Analyisis
Macroeconomic framework of 4 countries, Industry analysis,
Industry sectors analysis
First draft Recommendations
Recommentations
1. Horizontal industrial policies
creation of economic, legal, human resource and business
conditions for a balanced industrial development
the growth of the private sector and adjustment of the existing
SMEs to internal and external technological and market
influences
structural adjustment of the industry
solving of social problems caused by industry restructuring
environment protection
promotion of the education system and curriculum for modern
knowledge and skills, high-quality labour force
establishing trust at the regional level
protection and sustainable use of natural resources
development of industrial relations, participation of trade
unions and social dialogue in making decisions on the
development
2. Vertical industrial policies
industry efficiency at sectoral level
rationalisation of the overall activity
harmonisation of industrys organisational structure
better use of industrial capacities
faster adaptation of industry to constantly changing social,
environmental and technological aims
realisation of reforms started in most parts of industrial
sectors
Innovations, new materials, skills, knowlwdge based on ICT and
industry 4.0 concepts
SWOT Metal
WEAKNESES CroatiaIntensive flexible working patterns entering
the labor market, short term working contracts increase,
non-dignity work conditionsHigh energy prices obstacle for
competitive prices of metal sector (electricity), high input costs
of raw material for the production, Long production cycle,
Dependence on suppliers and imports (e.g. the old iron ore, and
other products imported)Access to credit lines for SMEs, financial
market that is no longer willing to follow the needs of shipyards
and extremely low levels of prices that are close to historical
minimum, All levels mismatching of skills and competences, The
growing shortage of skilled workers , migrations to EU
countriesbrain-drain problem, the most skilled shipyard workers
migrate to Italy Boatbuilding companies often lack resources for
large research and development operations making them more
dependent on institutions for collaboration compared to the large
shipbuilders.Shipbuilding - lack of components from domestic
production.Technological level in the industry varies from poor to
very good, depending on the activity of enterprisesLack of respect
for the provisions of the Law on the Preservation and Protection of
the Environment, environ mental standards implementation, customs
regulationsthere had been a strong influence of monetary and
non-monetary government intervention in the business
accomplishments of individual enterprises, which significantly
altered the profitability of all the work due to the high share of
these enterprises in total assets, revenue and overall volume of
productionThe biggest loss realized by sub industry: manufacture of
railway locomotives and railroad carsElectronics and Engineering ,
ICT Industry (Manufacturing and services, Telecommunications ,
Increasing competitiveness.Allowed import of inferior products, the
practice of state-owned firmsAlmost no specific firms other than
those depending on production schedule within the MNCSlow
acceptance of ICT by businesses because of the constrains of
traditional management methods and or- ganization of
processesCompanies not focused enough on technological
innovation
SWOT Metal
WEAKNESES MacedoniaStrong competition in neighboring and
European countries, as well as global manufacturers for the main
manufacturer of car parts with several new investments in this
sector, Obsolete technologyLack of funds, insufficient investment
in new production, diversification, research, and
developmentInsufficient cooperation with the scientific and
educational sector, lack of skills, especially digital and
mechatronicInfrastructural deficiencies: the unfinished corridors 8
and 10, railway not modernized, energy dependence, and exclusive
reliance on the Thessaloniki harborWorld trends in determining
prices, increases in energy pricesGreater and stricter ecological
demandsDdecreased commissioning and demand
SWOT Metal
WEAKNESES MontenegroIntense global competition, Increased costs
due to the harmonization with EU standards, obligations in terms of
environment protectionOutdate technologyCosts (which is a threat to
profitability), in low solvency due to the non-compliance with
payment deadlines and reduced support of the banking sector and in
the limitation or cessation of investment activities. Low and
irregular wagesLow productivityDependence on the import of
expensive energy products, Expensive electric energy and the lack
of other, more cost-effective energy sourcesLack (limitation) of
domestic and foreign capital for investment High
indebtednessPredominance of products with a low processing level
which has a negative effect on the overall finances. Import of
aluminum and steel products highNo adeqate education curricuklum
for metal workers, lack of experts in the sector, ppersonnel cannot
be quickly trained or retrained due to narrow specialization, lack
of advanced managerial skillsLabour relations and social dialogue:
frequent violation of CA, of workers right to severance pay and
other material entitlements, labour relation status, accelerated
retirement, difficult working conditions
SWOT Metal
WEAKNESES SERBIA-1Lack of market research, promotion. Poor
marketing in target markets. Lack of linkages with marketing
functions, Relationship with clients low and with
suppliersProcurement prices and terms of factors of production,
prices of domestic raw materials and components / monopoly
/Underdeveloped sector of business services for metal, undeveloped
network of suppliers Inadequate credit policy, level of investment,
low interest of domestic and foreign capital for Greenfield
investments in export industries with higher technological level,
increased illiquidityPrivatization terminated , 463 of 622
contracts. Unsatisfying restructuring process of 49 metal companies
with more than 26,000 workershuge fiscal and number of Para fiscal
paymentsNon-existent infrastructure for electric vehicles, charging
stations, installations and integration with the target consumers
(public utility companies, parking service, public garages, hotels,
tourist and industrial parks)Discontinuous horizontal and vertical
linkages with partners in the chain of productionBioelectronics
(wearable electronics) and bioinformatics field is puzzling. low
technological development and introduction of ICT, new materials,
new industries, and the production based on knowledge and
innovation .
SWOT Metal
WEAKNESES SERBIA-2The emergence of new players in the BRIC
countries in steel production Incomplete decomposition of large
companies, subsidies for steel in countries outside the EUNot
specialized production and companies, lack of cooperation with
companies from developed countries for the new products
developmentLack of finance for the productionEcology: land
degradation, lower quality of water, air pollution, gases, dust,
irresponsible consumption of process waterPoor relationship with
the R&D institutions , adverse environment, underdevelopment of
the infrastructure, inadequate incentives, Extremely sensitive to
fluctuations in raw material prices and transportation and the
safeguards established by the country the third row of
vendorsDependence on imported iron ore and coalPermanent control of
EU production of steel in new privatized Zelezara Smederevo on
Chinese inputsIncomplete liberalization of the energy sector
resulting in high electricity prices - input expenses. Increasingly
stringent regulations relating to energy use, CO2 emissions,
pollution prevention and control and wasteExtremely sensitive to
economic cyclesLow labor costs, unfavorable for employment of those
with the greatest knowledge and skills, young people, lack of
qualified staff (and aging workforce), Weaknesses of education for
industry 4.0
RECOMMENDATIONS-metal
HORIZONTAL IPIn the favor of the modernization, technological
innovation, and industrial sustainability of the sector is
necessary to create more: Favorable economic, labor, fiscal,
research, innovations, and educational conditions for the metal
sector creation , business ambient and tripartite social dialog and
collective bargaing with TUs involvment in all designing
development support, decrease all fiscal and parafical payments,
flexible patterns of work and workers protecion measures. improve
the capacity of young workers to the metal industry sector.VERTICAL
IPIncrease salaries and attracting skilled metal, electric and
shipbuilding workers, especially young would have to sustain the
growth of the sector. The future success of the metal cluster an
chains depends on reaching new export markets and expanding sales
beyond the domestic market, achieving economies of scale and scope
enhancing international competitiveness. The challenge implies that
companies will have to grow, either organically involving new
materials, technologies, organization and innovations, or through
mergers and acquisitions, until they have attained a critical mass
enabling them to successfully compete in the larger European and
global markets, increasing the effective ness of cooperation
between the smaller and medium sized companies in the cluster,
especially in areas of research and development and cluster-wide
improvements in the business environment, further-more, FDI
accompanied by management and marketing know-how as well as
distribution networks could. Organize trade unions to handle a more
diversified private sector, privatised companies, and mixed
companies. Develop new methods in social dialogue and implement
worker councils and tripartite and bipartite strategic groups to
influence industrial policies for the sectors vertical development
as well as for general horizontal macroeconomic and legislative
changes
SWOT Non- metal
WEAKNESESRising the competition of producers form developed
markets, stronger competitive pressures from emerging markets
Chemical industry and rubber and plastic are dependent on imported
raw materials , (recorded foreign trade deficit.)pharmaceutical
industry is oriented mainly to the production of generic drugs that
are losing their market position, hindered by the high accumulated
costs of health care, long deadlines to pay the expenses of
medicals, unclear policy medications and cutting price.
Wood Production , Paper, Cellulose: lack of availability of raw
materials (primarily paper), Capital less accessible, Low
expenditures on research and development, Greatest losses realized
in manufacture of pulp.
The speed of technological development and introduction of New
tecnologies, new materials, and the production based on knowledge
and innovation not quick enoughinvestments into modern production
of this sector and in digitalization of value chains low,
Development of small and medium enterprises not supported enough
financialy, R&D, entrepreneurial education and skils Nano
technologies usage low, support not tailored to the sector needs
and prospective attractiveness for new ventures, young workers
engneering qualificationssLack of qualifications.
RECOMMENDATIONS-Non-metal
HORIZONTAL IPIn the favor of the modernization, technological
innovation, and industrial sustainability of the sector is
necessary to create more: Favorable economic, labor, fiscal,
research, innovations, techology scientific parka, centers of
excellence, and educational conditions for the non metal sector
creation , business ambient and tripartite social dialog and
collective bargaing with TUs involvment in all designing
development support, decrease all fiscal and parafical payments,
flexible patterns of work and workers protecion measures. improve
the capacity of young workers to the non-metal industry
sectorVERTICAL IPPharmaceutical, cosmetic, biotechnological and
chemical industry place very specific challenges before producers
in analyzed countries regarding cleaning and sanitizing, which
require equally specific competence. The challenges of structural
change in the wood products production, paper and cellulose
industry, would move towards production without carbon dioxide in
accordance with the efficient use of resources. Until 2020 regional
industrial companies will have to invest into modern production of
this sector, and have their digitalized value chains, which is also
the main challenge for producers from pod sectors. It would be
welcomed to create a platform for development of small and medium
enterprises, increase employment, integrate consumers and buyers
and develop new products on Nano technologies as the most important
ones for future growth, employment and improvement of quality of
consumer goods in the IPs strategies until 2020. Third Industrial
Revolution as the driving force for building a green economy will
in future be a long-term challenge for industrial policy of in
terms of how to transform environmental challenges into economic
opportunities and to create synergies between economic growth and
environmental protection. The demographic challenges of our aging
population encourage the emergence of specific challenges in
pharmaceutics: new products and services to help older people, the
challenge of an active and healthy aging, and the growth of average
age required for retirement, employment opportunities for older
workers, lack of qualifications
SWOT Textile
WEAKNESESHigh competition from Asian countriesComparative
advantages diminish Lack of availability of domestic raw materials
for production.Labor intensive activity and poor technological
equipment (obsolete equipment).Insufficient expenditure on research
and development, and marketing activities, Insufficient development
of the sales network..Lower educational qualifications.Export is
very concentrated, despite increase in the share of exports in
total revenues.LON operations, Insufficient development of domestic
brands.The potential for growth and employment is low, except in
manufacture of knitted and crocheted apparel that has growth
potential.Limited access to capital.Labor intensive activity, sub
industry manufacture of other textiles recorded the biggest losses,
earnings smallThe activity had 700% growth in 2012.Insecure market
end products, subject to the constant influence of fashion and
short lifecycle products.High environmental standards of
production.High concentration of activity.Not attractive industry
for young workers
RECOMMENDATIONS- Textile
HORIZONTAL IPAccording to perspective studies, garments and
textile will continue to offer interesting opportunities for
industrial investment and cooperation, so the sector has to be
considered as important in the framework of investment policies
aiming to regain traditional competitiveness of the local
companies, by creating the conditions for the sale of services of
the industry (to improve infrastructure equipment, computerization
of public enterprises, and introduction of e-services in public
companies). Also the states would support constructive social
dialogue and Tus activities on wages increase, educational
opportunities, and innovative policy meassures concerning favorable
business conditions
VERTICAL IP Developing of domestic brands and fashion clothing
industry and realize the export potential within the framework of
activities such as sub industry manufactures in favor of growth and
employment, can improve the attractiveness of the industry, wages,
young people interests , investments in new technologies
implementation, and overall competitiveness.
RECOMMENDATIONS- Energy
HORIZONTAL IPTo make policy framework in the highly regulated
energy sector not hamper competition and market-driven investment,
undermining integration in the internal marketIncrease the
investments in the energy sector historically driven by state-owned
enterprises , even though new private entrants are playing an
increasingly important role
VERTICAL IPTo increase the Energy efficiency , rentable energy
and decrees high-carbon-intensity of the economies.To improve the
electricity market, Stock Exchange for electricity , implement the
Paris Convention on Climate change, Cross-border investment in
energy sector, to join and create the frameworks for projects that
are not commercially viable, but are necessary for its external
effects: security of supply, solidarity or technological
innovation, and to create the opportunities for green growth and
jobs in the energy sector.
Weakneses
Tourism Product
Lack of attraction development
Highly concentrated accommodation supply
Few professional operators
Lack of general as well as of special tourism infrastructure,
especially in the underdeveloped areas
the quality of services ranks poorly vis--vis its competitors,
outdated products and tourist infrastructure, leading to high
seasonality and limited value added of tourism services, import
dependence of the economy is explained by the strong link between
imports of goods and tourism, Apartmanization of hospitality
industry, Seasonal character of tourism. The competence in the
tourism sector is still not the one to support and coordination the
actions growing demand for customized experiences, new products,
growing competition from other EU destinations, Lack of refinancing
of entrepreneurs in tourism
Insufficient investments in chain of provision of services and
the safety of visitors, in investments in new technologies and
research and innovation, Low level of digitization of services
Lack of connection with agricultural production, as well as with
other industries of transport, insurance, entertainment, banks
Marketing and Promotion
Negative image due to recent past (political turmoil)
Under-funded marketing efforts, of trends, market competitors
and prices
Lack of an integrated national marketing and promotion plan of
national Tourism Product
Lack of the appropriate national, regional and local structures
dealing with development, management and promotion in the field of
tourism
Uncontrolled tourism facility development
Lack of adequate infrastructure development to match tourism
projections Marketing and Promotion
Political positioning overshadowing tourism development
Lack of adequate tourism product and infrastructure development
before product is ready Increased threat of terrorism, migration
and political instabilities in the country and region
Human Resources in Tourism
Discouraging image of tourism sector in the country
Insufficient educational basis for the advancement of
services
Brain drain of skilled employees abroad ( in Croatia luck of
around 40.000 workers for the touristic season 2017 who (with
problems of working permits, temporal working contracts and labor
legislation for the whole year are permanent challenges
RECOMMENDATIONS-Tourism
HORIZONTAL IPSupport financial policy for the business in the
sector, start ups, family and FDI investments , the market
capitalization of the sector , EU Funds joint project proposals
founding, Joint planed destinations with neighboring countries and
regions, Cluster development and interconnections with other
industries, harmonizing Lbor low and flexible paterns of work with
EU.
VERTICAL IPProduct-group developmentSerbia as non-traditional
tourist destination to develop Special interests in tourism :
ecotourism, rural, tourism, natural and cultural heritage
tourism-monasteries, adventurous tourism - mountain biking,
recreational Tourism (lakes, mountains, spas)diving,-City tours
development connections with other sectors: airline and charter
flights, joint tours, special entertainment, sport, activities and
attractionsSupply chains development with agribusiness, ecology,
food and beverage sector, security, insurance, Banks. Projects to
develop supply, accommodation, attractions and activities,
especially in rural tourism and EcotourismTourism
educationEducation about tradition in country Education of
stakeholders in rural and ecotourismNetwork of secondary schools,
colleges and faculties or departments, appropriate professional
work during education (colleges and faculties)Training and
education - crucial to achieve desirable service quality and to
improve knowledge and skills of the employed in the tourism
industry in accordance with the expected trends in tourismSpecial
target groups: employees laid off during the process of
privatization, current employees in traditional tourism, employees
in the areas which can expect a rapid growth, entrepreneurs,
newcomers and first-time job seekers
RECOMMENDATIONS-Tourism
HORIZONTAL IPTUs to be involved in working groups, tripartite
and bipartite forms on issues concerning the realization of the
development Strategy of the sector, activities in all supply with
employers, especially with micro and small enterprises, SD and
distant work for employees. To be involved in all patterns of work
implemented in the employment of the sector and TUs impact into the
workers rights and protection. To attract more members and young g
people for TUs activities.
VERTICAL IP
SWOT-Food & beverages
WeaknesesLimited access to capital.Dependence on imports of raw
materials for production. The financial crisis and fluctuations in
the price of raw materials led to creation of uncertainty in the
market of food products.Lack of national brands.Relatively weak
technical equipment and obsolete.Lack of investments in
development.Reduced energy, changes in consumer habits and
generally reduce in sales.Expenditure on research small.Strict
regulations and international standards of production (food
products, food, beverages, etc.).Indicator of the relative
comparative advantage is very low. Great competition on open
market.Lower prices and higher quality of products.Lack of
packaging, branding and marketing.various trade barriersIn todays
environment beverage manufacturers are concerned about the rising
costs of raw materials and large amounts of energy consumption in
the production process. It is necessary to reduce costs and
maximize productivity and business efficiency.Luck of working
force. Permanent migration of farmers, young people from
agriculture to EULack of investment in R&D development
RECOMMENDATIONS-Food & beverages
HORIZONTAL IPSupport establishing of the centers for excellence
in agricultural business, food industry and management, Education
skills and knowledge more flexible to the labour market for the
sectorSupport the positioning the food industry sector as a
strategic sector in the countrys industrial policy and sustainable
development strategyconnecting industries for the purpose of
improving and planning tourismHelp education advancing human
resources for a modern and sustainable productionVERTICAL IPThe
introduction of technological change and automation of production
(networking, integration of control systems and automation of
measurement of pressure and flow of production); flexibility in
marketing (labeling, packaging); diversity, especially in the
production of beer (the volatility of raw materials, smaller
production units) is needed. Food and beverage products to develop
in accordance with ecologically healthy, green, controlled
geographical origin, and be the focused on creating own brand
products. Joint ventures or takeovers use also as a strategies that
allow companies to conquer new markets or strengthen their own
position in the market.TUs involvement in the realization of the
Strategy for agriculture and agribusiness sector, in tripartite and
bipartite social dialogue forms and agreements. Attraction of young
people to membership, households from rural regions, and producers.
Involvement in working groups for EU Chapters concerning
entrepreneurship and industrial policies in the sector, family
businesses, cooperatives, micro and small producers, private
sector, supply chains in the sector as well as in clusters with
tourism, pharmaceutics, chemical industry and health and sport
sectors .
Thank you for the attention
