Klaipeda FEZ - new member of the Finnish-Lithuanian Trade Association
Investment Advisor Ugne Urnieziute from The Management Company of Klaipeda FEZ tells about markets of Lithuania and gives advices for a Finnish company planning to enter the Baltic markets of Lithuania.
Which kind of commercial activity the company you represent has in the Baltic markets – in which country/countries?
Klaipeda FEZ is the first and the largest free zone in Lithuania offering its customers services and assets for industrial, manufacturing and R&D projects. Currently, more than 35 investors from 17 countries operate in the zone with their total revenue exceeding 1,2 billion EUR in 2018. The total investment into the zone currently accounts to 634 million EUR.
Klaipeda FEZ caters to companies operating in the plastics, metalworking, food processing, electric component manufacturing, logistics and other industries. 7 of Klaipeda FEZ companies are among the top 500 largest in Lithuania, including one company in the top 10. At the same time, Klaipeda FEZ is increasing its footprint in R&D and innovation, both in terms of laboratories and excellence centers at the companies and as new, inno- vation-driven companies setting up at the zone. A prime example of the latter is Dancer, the fully-electric bus, designed and manufactured in Klaipeda.
On top of opportunities for greenfield investment, Klaipeda FEZ has assets for quick launch, including its FlexStart advance buildings for manufacturing that were awarded by FT's FDI Intelligence magazine in 2017. Our customers quote our state-of-the-art infrastruc- ture, location, access to transport and access to talent among the main reasons for investment into our zone. They also benefit from tax incentives such as 0% real estate and corporate tax rates.
Which kind of advice would you like to give for a Finnish company planning to enter the Baltic markets or Lithuania?
Despite the growth of FDI in the Country in comparison to traditional manufacturing markets, Lithuania remains an unsaturated location. This means that there is still much potential that remains untapped.
In the past, the FEZ was sold to investors as a convenient infrastructure package and a way to pay less for labour. Today, investors are much more interested in the community and talent, which can not only manufacture but develop products as well. New investors entering the FEZ are researchers and developers who employ the greatest minds in Klaipeda first and manufacturers second.
Companies value employees for a number of reasons. In particular,they drew attention to their aptitude for learning quickly, their cultural compatibility, and eagerness to outperform and stand out. As the whole world fights for talent, Lithuania has raised a generation that is able to work in a number of foreign languages professionally, with English almost as prominent as Lithuanian within the companies surveyed. English is spoken in 98% of the companies surveyed.
Companies have close cooperation with universities, we can see that partnerships between education and industry are being leveraged to create top talent. This collaboration also fosters innovation and technological advancement in the manufacturing sector.
Please, tell us your success story in one of the Baltic countries or in Lithuania?
We started as a purely manufacturing destination capitalizing on our location, infrastructure and access to talent. While we still are a major Baltic industrial hub, and most of our investors have been exceeding their initial investment plans, these companies have also discovered the opportunities to create and to design new products, processes and technologies here.
We have also been transforming our offering to fit global trends better. While massive greenfield investments have always been welcome, we have identified an emerging need of fast launch services in the current dynamic global business environment - this strategy and consequent products was saluted by our customers and even awarded by the fDi Intelligence magazine.
Lithuania and Klaipeda has a major and ever-increasing advantage of being a small, yet close-knit community. Our investors implement many mutual projects: from joint procurements to knowledge-sharing events. At the same time, both local and national organizations and institutions - ministries, municipalities, various agencies and academia - are extremely cooperative and collaborative when it comes to creating solutions that help our business environment.
How do you see the position of the Baltic countries or in Lithuania in your activities during the 5 coming years?
It is becoming increasingly obvious that the community Klaipeda FEZ is not a pure manufacturing territory: indeed, while many of the companies started as manufacturers, they now host R&D, excellence and design centers, as well as laboratories, which employ local talent to build new, global and competitive products and services here in Klaipeda. This transformation makes us certain that the future is very bright for our community as we can pivot, innovate, and grow here, while our talent pool caters to the complex needs of today’s business.
Klaipeda Sea Port plans to invest 600 million EUR into deepening the port, improving navigation and expanding the territory (excluding the outer port). These expansion projects would allow the port to service the biggest of ships, stay current to the present trends in the industry and help to increase the market competitiveness of exporters from Klaipeda and Lithuania overall.
Your moto to do business in the Baltic countries or in Lithuania?
Innovating for customer success.
Company in a nutshell
Name The Management Company of Klaipeda FEZ
Products Services and assets (land plots and buildings) for industrial, manufacturing and R&D projects
Home place Klaipeda, Lithuania
Turnover EUR 2,5 million
Name Ugne Urnieziute
Title Investment Advisor
Something you would like to tell about yourself
More than 15 years of experience in business development and marketing in the investment acquisition field.
Writer: Anne Hatanpää, Finland Chamber of Commerce