Big-hitters from some of the world’s most influential companies and consultancies were in Vilnius this week for an international conference on capital markets. Lithuanian media agency DELFI spoke to a number of participants at the ‘Building a Capital Markets Union: Challenges and Opportunities for Business’ conference to get their perspective on Lithuania’s current economic position. Of the many values the Lithuanian economy has to offer, it was the Baltic country’s deep pool of young, skilled specialists that most impressed the conference delegates.
A growing reputation
Nick Collier, a member of the City of London delegation and manager of Thomson Reuters, a world leader for providing intelligent information for companies and professionals, was making his first ever visit to the Baltic States when attending the conference. And Lithuania’s economic conditions made a good impression on the expert in international business conditions, who believes Lithuania’s global reputation is improving all the time.
“Lithuania’s economy, like Ireland, has recovered fairly well after the economic downturn,” he said. “However, Lithuania has faced some difficulties due to the Russian sanctions, which I think we all expected. Nevertheless, the economic history of the country still remains positive and, in my opinion, many would agree that Lithuania has developed a good economic image in the United Kingdom.”
Mr Collier also believes further connectivity would facilitate Lithuania’s continued growth and development. “More direct flights to the big London airports would certainly bring more benefit,” he explained.[quote text=”I think that there are many things in Lithuania which are attractive for investors. The one that stands out most is the country’s wealth of young educated people who have lived abroad and can speak several languages” name_surname=”Silvi Wompa Sinclair” description=”An international risk advisor and insurance broker at Willis Group” left=””]
As a company that analyses investor conditions, Thomson Reuters know that an educated labour force and a stable economic and political environment are key factors for international investors. According to Mr Collier, Lithuania scores well in these categories. “In my view, Lithuania meets these criteria, which is why global investors like Barclays have already set up units here. Our company has a similar unit in Gdynia, Poland, and I think that in principle it could have been established in Lithuania as well.”
Whilst Mr Collier explained that Thomson Reuters have no current plans to set up operations in Lithuania, he added that it could still do so in the future. “I see no reason why we could not work in Lithuania. We have many Lithuanians working in our office in London. Sometimes the perception is that investors don’t establish service centres requiring highly skilled staff, but for us that is not the case. Our company needs very highly educated people. For example, our employees in our unit in Poland collect and present financial markets information, work which requires highly qualified staff,’ Mr Collier said.
He believes that other investors have spotted Lithuania’s potential as well, which has led them to set up and then expand their service centres in the Baltic state. At the same time, Mr Collier stressed that present-day Europe as a whole is not a particularly attractive region for international investors. “The companies I represent see Asia and South America as fast growing markets, whereas Europe is perceived as a region of slow growth. This is why we are having negotiations with the heads of the European Union over the growth strategy of the region and the union of capital markets,” Mr Collier said.
Top jobs for scientists and lawyers
For Thomson Reuters, the profile of employees they recruit changes in different parts of the world and for different functions. For instance, in India they employ scientists who can prepare high-quality descriptions for scientific publications used in the company’s database of research projects and patents. In English-speaking countries, they employ law specialists who help develop databases in English to be used in the US, Australian, and UK markets. In South America and Spain they employ lawyers who can work with databases in Spanish.
Mr Collier believes that potential functions that would suit Lithuania could include IT and financial services. “We have a big financial services and smart technologies centre in China. I think IT services could also be provided from a country like Lithuania. Here they could have back offices,” he explained.
He also feels that more active involvement in developing the economy from local and foreign investors, rather than by banks, would further boost Lithuania’s attractiveness as an investment location. Whilst he acknowledged that Lithuania is receiving increasingly more attention thanks to the innovative ideas of some of its young businesspeople, he also feels that to implement these ideas successfully, you need investors that are prepared to take risks. “If we compare Europe and the USA, we can say that Europe is in principle funded by banks, while in the USA it is completely the opposite. Most of the financing comes from the market, in the form of bonds for example, or from equity capital attracted from the markets. In my opinion, Europe’s slow growth as a region is down to the cautious attitude of banks after the financial crisis. For this reason, it is worth developing financing alternatives to complement banks in this field of activity,” he suggested.
A Nordic view on Lithuania’s progress
Also present at the conference was Silvi Wompa Sinclair of Willis group, an international risk advisor and insurance broker. Ms Sinclair, who heads Willis’ Financial Industry Group for Western Europe, already has experience working with Lithuanian businesses and has been impressed by the countries work ethic and culture. “I have worked with enterprises, banks and legal service companies which carried out acquisitions in Lithuania. From my own experience, I have noticed the professionalism and organisational skills of the people who live here. They take their work seriously and tend to deliver on time, which is often not the case in other parts of Europe,” she told DELFI media agency.
Although Willis currently carries out its activities in the Baltic states through its partners, according to Ms Sinclair company representatives from Sweden are interested in the services Lithuania provides and are looking into opportunities in the country. “For a long time the ancillary services of Willis Group were provided from India, which was quite natural when such decisions were taken in the UK. Looking at the region I am responsible for, namely Europe, I don’t find it natural to look for additional services in India, as within Europe we have a general understanding of how to work better, which really eases business processes.”
According to Ms Sinclair, the company is considering Lithuania as a location for IT and process management services, as well as other services such as analysis and financial accounting. Lithuania is in the frame alongside a number of other European locations. As Ms Sinclair explained, “in our company we are also considering some other potential countries which could provide the services we need, for example, Bulgaria, the Czech Republic and Slovakia. Whilst these countries are being considered alongside Lithuania, you distinguish yourselves from the others thanks to your responsible staff and strong ability to cope with the economic crisis.”
In general, Ms Sinclair feels that working in the Baltic States is hassle-free and productive for Western European businesses. Key factors in Lithuania’s favour include good connectivity and geographical position, a similar business environment and competitive costs that are at least a half or even a third of those in the UK or Sweden. “Thus we can get more value for money compared to other companies,” she explained. “I think that there are many things in Lithuania which are attractive for investors. The one that stands out most is the country’s wealth of young educated people who have lived abroad and can speak several languages.”
A good first impression
DELFI also spoke to Marcus Schüler, Managing Director of Sales and Marketing at Markit Group, a leading provider of financial information services. Lithuania’s business climate left a good first impression on Mr Schüler, especially its ability to develop highly-skilled talent. “This is my first time in Lithuania” he said, “and I have to admit that I was very impressed by Lithuania’s capabilities to attract innovative foreign companies. I think one of the major advantages Lithuania has is its state-of-the-art universities, and also the good level of foreign language competence here.”
For Mr Schüler, the key to Lithuania attracting more investments is to guarantee that they will be used in a transparent manner. In other words, investors have to see what return their money brings, and if required, there should be mechanisms for returning investments, for instance by selling them to other interested purchasers. “Of course, it takes time to develop such tools but they are very important,” concluded Mr Schüler.
Read full article in Lithuanian at Delfi.lt
