COMPETITIVE POSITION OF THE
BALTIC SEA REGION
THE ROLE OF REGIONAL CLUSTERS
POTENTIAL FOR REGIONAL COOPERATION AND COMPETITIVENESSSTIMULATING INTRAREGIONAL RELOCATION
Tomasz Brodzicki*
with cooperation from
Anders Elmgren
Tomasz Grubiszewski
Magdalena Romanowska
Report financed within the framework of Polish Lisbon Strategy Forum
Gdansk, November 2005
*GIME and University of Gdansk, Department of European Integration Economics; holder of a scholarship of
the Polish Science Fund(FNP)
COMPETITIVE POSITION OF THE BALTIC SEA REGION
INTRODUCTION
Located in peripheries of the European Union the Baltic Sea Region (BSR) has a tremendous
endogenous potential to become one of the key regions of the enlarged European Union
capable of facing up to challenges of the globalizing economy. Furthermore, the BSR could
be considered as a leader with reaching the goals of the modified Lisbon Strategy. This great
endogenous potential characterized by high degree of internal heterogeneity is however not
utilized to acceptable extent. The degree of internal heterogeneity is in fact a major
impediment to establishment of cooperative linkages. A common Baltic identity is actually
missing despite frequent statements of national and regional leaders and a lot of time will pass
till it actually develops. It will develop through actions and not blunt words however.
The diversity of the BSR is beneficial despite significant difficulties in cooperation. It is
beneficial because it creates significant opportunities for reaping actual benefits related to
higher degree of specialization, better allocation of resources (improved division of labor),
higher productivity and knowledge generation. Regional cooperation could be beneficial from
the perspective of both national and regional authorities as well as of particular sectors or
even individual profit-seeking entrepreneurs if it can enhance the competitive position of the
region on a global arena. In order to do so national and regional authorities should facilitate
establishment of cooperative linkages among business communities or even within the triple
helix setting. This should apply in particular to sectors of strategic importance to regional
economy. It is worth to note that the Baltic Sea Region taken as a whole could be said to have
relevant competencies to successfully compete with other European as well as global regions
in a number of industrial and services sectors. Due to their strategic importance to the overall
prosperity of the region the economic performance of the sectors should be constantly
monitored and appropriate steps but only if economically viable should be made. However,
these key prosperity drivers should be identified.
The aim of the present repot is to give objective opinion on the key drivers of competitive
position of the BSR. In order to so we will analyze the regional economy (regional
manufacturing industry) from both a traditional sectoral perspective as well as the relatively
novel cluster-perspective. It is worth to note that the recent report by Ketels and Solvell (2005
- State of the Region Report) adopted cluster-approach to analysis of the regional economy as
2
COMPETITIVE POSITION OF THE BALTIC SEA REGION
well. It is to us the step in the right direction1. The main conclusion of the Report is that the
Region has a strong cluster base with a rich portfolio of regional clusters and overlaps in
cluster-export specialization. As to policy recommendations the authors suggested: more
cooperation between related clusters, benchmarking of cluster policies as well as creation of
consistent data on clusters and clusters across the region.
Despite its obvious merits, the analysis by Ketels and Solvell (2005) in the area of clusters is
unsatisfactory was unsatisfactory. A lot more could and should be done in order to better
inform the policy-making process. Our report despite its obvious drawbacks goes one step
further. From this perspective the present study is both complimentary and supplementary to
the analysis by Ketels and Solvell (2005).
We would like to note, furthermore, that several reports have recently identified major shifts
in location of manufacturing industries as well as services within the European Union. These
trends seem to extend to or encompass the Baltic Sea Region. Moreover, accession of the
Baltic States and Poland to the European Union has created a unique opportunity for
reallocation of manufacturing industry as well as services sectors to occur within the region
itself. All the economies of the BSR with an exception of two Russian oblasts constitute a part
of the internal market were the freedom of movement of goods, services, labor and capital are
guaranteed (with an exception of temporary transition periods provided by accession treaties).
This could bring important benefits to the region taken as a whole allowing for more efficient
and productive specialization to occur thus strengthening or allowing to retain competitive
advantage over other European or even global subregions (a policy target stressed in the
recent State of the Region Report). Furthermore, apart from reallocation this constitutes an
opportunity for establishing globally competitive value added chains within the Baltic Sea
Region. The secondary objective of the present study is to investigate the potential for
reallocation of industry and services within the Baltic Sea Region. The cluster-perspective
seems to be beneficial as well.
1
It is worth to note that to our knowledge apart form the State of the Region Report (2005) there were no cluster
studies performed at the BSR level. Finland and Denmark performed a meta-cluster study. Sweden had a
national cluster-mapping project. The study in Poland was carried out by GIME applying a modified DTI
methodology (TBR).
3
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Setting the other stage – our definition of the Baltic Sea Region
It seems that the definition of the BSR in many policy documents relating to the BSR
including the recent State of the Region Reports is not well funded 2. If Norway or even Island
are taken to Baltic economies than the definition for Poland should not be limited only to
three northern NUTS-2 regions (zachodniopomorskie, pomorskie, warmińsko-mazurskie)
situated directly on its shores3. We could argue that at least 3 more regions that is lubuskie,
wielkopolskie, kujawsko-pomorskie should be taken into account as they are situated no more
than 200 kilometers from the sea shore itself.
Data availability is a major bottleneck in particular if the scope of research adopts subnational
regions and goes deep into analyzing individual 3-digit sectors. This is the problem that we
had to deal with. In this report we adopted the following approach: we adopt 3 digit NACE as
the level of analysis but we compromise on the regional dataset. Future extensions (editions)
of the present report, in particular if the national governments implement policy
recommendations presented in the final part of report, will be more precise in this element.
The BSR in the report is comprised of three Nordic states that is Denmark, Finland and
Sweden as well as Poland (all 16 NUTS2 regions). There were no data available for 3 Baltic
States (that is Estonia, Latvia and Lithuania) as well as Norway (an EEA economy) and two
Russian oblasts. Furthermore, as we were unable to disentangle information on the northeastern regions of Germany we decided to eliminate the country from the study. Inclusion of
whole Germany would cause more bias then exclusion of it. We have to acknowledge that this
approach biases our results to a certain extent.
Data sources and methodological issues
We utilize two data sources: EUROSTAT and GUS and three different data bases: COMEXT
– database on internal and external trade of the European Union, NEW CRONOS – database
2
This biases the results significantly and could even impact policy recommendations.
There is a curious situation created in the report – 3 northern regions are said to be part of the BSR while 5
southern regions to be part of the Central Europe peer region. The authors seem to forget that there are another 8
regions in-between which are for some reason left out from their analysis? Are they Baltic or Central European?
It seems that more rational definition of the region should be prepared and adopted in order to create a sound
platform for future benchmarking exercises of the BSR to competing regions.
3
4
COMPETITIVE POSITION OF THE BALTIC SEA REGION
on industrial activities within the EU and database on Polish industry provided by GUS on
enterprises with employment of 10 and above based. The period under analysis is 1995 to
2000 for employment and turnover and 1995 to 2001 for trade flows. The level of analysis is
set to 3-digit NACE rev 1. Data on trade flows have been adjusted from 8-digit combined
nomenclature to 4-digit CPA and than to 3-digit NACE in order to allow for direct
comparability. Several secondary data sources are utilized in the second part of the report.
All the analysis is carried out on a two levels: on the level of individual 3-digit NACE sectors
as mentioned above and on the level of clusters understood as multisectoral groups of 3-digit
NACE groups. Particular clusters – groups of sectors are taken from a study carried out by
GIME within the cluster mapping exercise in Poland. This approach creates a possibility to
compare the results of the proposed study with earlier detailed studies on Poland (thus make it
possible to pin point particular locations within northern NUTS-2 regions of Poland which
could become or have already become places of potential reallocation of production from the
Nordic States as well as northern Germany4).
Structure of the report
The report is divided into two distinct sections. In the first one we will try to identify sectors
with strategic importance to the economy of the Baltic Sea Region in both absolute as well as
relative terms. We will also focus on analyzing potential evidence of reallocation of
manufacturing industry on intra-regional and inter-regional level.
In the second part we will adopt a cluster-approach to analysis of the economy of the region.
We will present information on major Baltic (meta-) clusters. In particular we will try to find
out whether clusters in the northern Polish regions could or do constitute an interesting target
for intra-regional reallocation of manufacturing industry.
The final section concludes and provides general policy recommendations based on the
research results of the previous sections.
4
A good example is the case of IKEA which established its furniture production plants within a north-western
region of Poland which in the GIME study has been identified as one showing features of a potential cluster in
furniture manufacturing.
5
COMPETITIVE POSITION OF THE BALTIC SEA REGION
PART I
SECTORS OF STRATEGIC SIGNIFICANCE TO
THE BALTIC SEA REGION
6
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Introduction
In this part of the report we will try to identify sectors with strategic importance to the
economy and competitive position of the Baltic Sea Region. This could seem at first to be a
relatively easy task. We have to note, however, that a wide range of competing indicators
could be applied thus generating different results probably conflicting. Majority of economists
would probably agree that the most important indicators should be related to production
taking place (value added, total turnover) as well as employment both in absolute levels as
well as their growth ratios. Off course more elaborated measures could be employed, for
instance different measures of total factor productivity (TFP). Trade-rated indicators are
interesting as their analysis could lead to identification of sectors with particularly evident
revealed comparative advantage. Moreover, the identification could be based on more
elaborate methodology combing several different indictors at the same time. Furthermore, the
analysis should compare the results against a reference or a benchmark group in order to
depict particular specialization of the region under analysis. In the present study, mainly due
to data limitations, we have decided to adopt EU15 and Poland (EU16 henceforth) as a
benchmark for the region. The subsequent sections will follow the philosophy of analysis as
has been outlined above.
Top branches in terms of employment levels
If we stick to the definition of the Baltic Sea Region presented above the BSR had in 2000 an
approx. 11.5 per cent in total manufacturing employment of the EU16 (EU15 and Poland). As
could be expected majority of the regional manufacturing employment was generated in
Poland (52 per cent), 22 per cent in Sweden, 13 per cent in Finland and 12 per cent in
Denmark. The population of Poland in absolute and relative terms has a heavy impact on the
regional economy.
In 2000 only eight 3-digit NACE manufacturing sectors had employment levels within the
BSR exceeding a 100.000 threshold. The first three were: manufacture of furniture (161.000),
manufacture of other food products (156.000) and production, processing, preserving of meat,
meat products (131.000). These are traditional labor-intensive industries.
7
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Table 1 Top 8 employers within the BSR in 2000 – sectors with employment exceeding 100.000 employees
NACE
Name
DNK
FIN
SWE
POL
361
158
Manufacture of furniture
25 898
12 476
27 635
94 674 160 683
31 937
15 418
24 567
83 923 155 845
23 341
11 066
14 880
81 519 130 806
295
Manufacture of other food products
Production, processing, preserving of meat, meat
products
Manufacture of other special purpose machinery
16 306
23 381
27 666
62 097 129 450
182
Manufacture of other wearing apparel and accessories
4 822
6 236
252
Manufacture of plastic products
20 965
15 148
18 481
59 127 113 721
221
Publishing
34 560
17 722
30 315
20 112 102 709
21 852
16 248
32 014
30 178 100 292
151
292
Manufacture of other general purpose machinery
Source: Own calculations.
BSR
3 469 112 364 126 891
Top branches in the BSR – relative share in the employment of the benchmark group
The following table presents ten BSR sectors with highest shares in the total employment of
the benchmark group (they are presented in declining order). Traditional industries dominate
once again. The only real exception being the manufacture of television and radio transmitters
– a high-technology ICT sector with particular significance to the development of the region.
Table 2 Top 10 BCR groups in terms of their share in total employment of EU16 (in 2000)
NACE
Name
211
Manufacture of pulp, paper and paperboard
Total share of
the BSR
34.2
201
Saw milling and planing of wood, impregnation of wood
28.3
314
Manufacture of accumulators, primary cells and primary batteries
28.2
351
Building and repairing of ships and boats
26.7
352
23.2
155
Manufacture of railway, tramway locomotives, rolling stock
Manufacture of veneer sheets; manufacture of plywood, laminboard, particle
board, fiber board and other panels and boards
Manufacture of television and radio transmitters and apparatus for line telephony
and line telegraphy
Manufacture of dairy products
265
Manufacture of cement, lime and plaster
19.3
202
322
153
Processing and preserving of fruit and vegetables
Source: Own calculations.
22.1
21.0
19.7
19.1
Top branches in terms of turnover levels
As could be expected data on turnover bring a rather different picture as the data on
employment where the impact of Poland is truly significant. In terms of absolute turnover
levels manufacture of television and radio transmitters is a regional leader (43 billion euro).
8
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Followed by traditional resourced-based manufacture of pulp, paper and paperboard (28.5
billion euro) and automotive industry – manufacture of motor vehicles (25 billion euro). In
contrast to previous tables the present one is dominated by medium-high and high-technology
sectors though the traditional sectors are present as well.
Table 3 Top 10 groups in terms of turnover within the BSR in 2000 (exceeding 10 billion EURO)
NACE
211
Name
Manufacture of television and radio transmitters and
apparatus for line telephony and line telegraphy
Manufacture of pulp, paper and paperboard
341
Manufacture of motor vehicles
151
Production, processing, preserving of meat, meat products
5 123
2 156
3 151
4 173 14 603
158
Manufacture of other food products
3 562
1 896
3 455
4 234 13 146
241
Manufacture of basic chemicals
1 097
3 504
5 184
2 886 12 672
295
Manufacture of other special purpose machinery
2 030
3 863
5 170
1 437 12 500
292
Manufacture of other general purpose machinery
2 859
2 649
5 769
785 12 062
2 724
2 370
4 595
1 158 10 846
3 642
851
5 078
1 226 10 796
322
221
Publishing
Manufacture of pharmaceuticals, medicinal chemicals and
244
botanical products
Source: Own calculations.
DNK
FIN
SWE
POL
BSR
879 22 369 19 047
818 43 113
284 15 702 11 203
1 365 28 554
0
352 18 074
6 491 24 918
Top branches in the BSR – relative share in the turnover of the benchmark group
The list of top branches as measured by falling shares in total turnover of the benchmark
group brings a rather unexpected result as to the overall leader. The BSR generates 95 per
cent of total turnover of the EU16 group in manufacture of coke oven products. In fact this is
due to a particularly strong position of Poland in this declining sector with no importance at
all to the Polish not mentioning the BSR economy. The true regional leader is manufacture of
pulp and paper.
Table 4 Top 10 groups in terms of their share in total turnover of EU16
NACE
231
211
201
314
351
352
Name
Manufacture of coke oven products
Manufacture of pulp, paper and paperboard
Saw milling and planing of wood, impregnation of wood
Manufacture of accumulators, primary cells and primary batteries
Building and repairing of ships and boats
Manufacture of railway, tramway locomotives, rolling stock
Manufacture of veneer sheets; manufacture of plywood, laminboard, particle
202
board, fiber board and other panels and boards
Manufacture of television and radio transmitters and apparatus for line telephony
322
and line telegraphy
155
Manufacture of dairy products
265
Manufacture of cement, lime and plaster
Source: Own calculations.
Total share of
BSR
95.0
34.2
28.3
28.2
26.7
23.2
22.1
21.0
19.7
19.3
9
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Regional specialization (concentration) patterns vis a vis the benchmark group
The shares of the region in total employment and turnover of the benchmark group point to
certain areas of particular relevance. It is worth, however, to go even further and to calculate
the so called location quotients (LQs). These are calculated as ratios of shares of given sectors
in a given region to shares of the same sectors in the benchmark group. LQs can be thus
considered as measures of relative concentration within a region or as indicators of relative
specialization of a given region. For obvious reasons they are particularly appealing to us as
well. It is worthwhile to calculate LQs for each of the analyzed economies separately and the
whole BSR region taken a whole5.
At first we will focus on employment. The following table presents sectors for each of the
states with LQs at 1.25 and above. In other words these are the sectors in the case of which
specialization is higher than by 25 per cent above the EU16 average. In the majority of studies
this is considered as the lowest threshold level indicative of significant specialization within a
particular branch.
When we look at location quotients for each of the analyzed four Baltic States a certain –
interesting pattern of specialization emerges. In the majority of 3-digit NACE groups on the
list we find high LQs at least in the case of two out of four analyzed BSR states. It seems that
despite enormous heterogeneity of the Baltic Sea Region in certain sectors the whole region is
specialized. Nonetheless it seems that in terms of location quotients for employment (or in
other words in specialization pattern) Denmark is most similar to Poland and Finland is most
similar to Sweden. In all four countries the mix of sectors is balanced with both traditional as
well as non-traditional (high-tech branches) present. The composition off course differs an
reflects national characteristics.
It is worth to note that in only one branch all four nations have an LQ for employment above
EU16 average. This is in the case of manufacture of other special purpose machinery (NACE
295). It is also likely to be the case in manufacture of dairy products (NACE 155), however,
we miss here data for Denmark. In 15 out of 103 NACE groups at least three out of four
analyzed countries seem to be specialized. What does it mean for cooperation among Baltic
enterprises? Some outcomes could be envisaged. First of all, the companies could be
5
We miss data for employment for 26 sectors for Denmark, 15 sectors for Finland, 14 sectors for Sweden and
only two for Poland.
10
COMPETITIVE POSITION OF THE BALTIC SEA REGION
functioning on regional and local markets and thus do not have to be direct competitors.
Secondly, they could be competing on international markets, however, in different segments
of the market – in particular if opportunities for intra-industry specialization are significant.
Finally they could be competing with each other directly. In all three cases mutual
cooperation is possible. However its type and intensity will vary. Furthermore general
efficiency stimulating reallocation could also occur within the Baltic Sea Rim which could
increase competitive position of a region as a whole.
Table 5 Relative specialization in employment in comparison to EU16
NACE
152
221
323
311
291
293
157
351
151
266
203
342
244
361
183
292
287
334
331
158
211
322
202
201
351
364
271
311
295
221
203
333
Name
Denmark
Processing and preserving of fish and fish products
Publishing
Manufacture of television and radio receivers, sound or video recording or
reproducing apparatus and associated goods
Manufacture of electric motors, generators and transformers
Manufacture of machinery for the production and use of mechanical power, except
aircraft, vehicle and cycle engines
Manufacture of agricultural and forestry machinery
Manufacture of prepared animal feeds
Building and repairing of ships and boats
Production, processing, preserving of meat, meat products
Manufacture of articles of concrete, plaster, cement
Manufacture of builders' carpentry and joinery
Manufacture of bodies (coachwork) for motor vehicles; manufacture of trailers and
semi-trailers
Manufacture of pharmaceuticals, medicinal chemicals and botanical products
Manufacture of furniture
Dressing and dyeing of fur; manufacture of articles of fur
Manufacture of other general purpose machinery
Manufacture of other fabricated metal products
Manufacture of optical instruments and photographic equipment
Manufacture of medical and surgical equipment and orthopedic appliances
Manufacture of other food products
Finland
Manufacture of pulp, paper and paperboard
Manufacture of television and radio transmitters and apparatus for line telephony and
line telegraphy
Manufacture of veneer sheets; manufacture of plywood, laminboard, particle board,
fiber board and other panels and boards
Saw milling and planing of wood, impregnation of wood
Building and repairing of ships and boats
Manufacture of sports goods
Manufacture of basic iron and steel and of ferro-alloys (ECSC)
Manufacture of electric motors, generators and transformers
Manufacture of other special purpose machinery
Publishing
Manufacture of builders' carpentry and joinery
Manufacture of automatic control systems
LQ for
employment
4.088
3.193
2.982
2.935
2.313
2.251
2.181
2.143
1.787
1.648
1.625
1.563
1.532
1.517
1.508
1.500
1.496
1.423
1.295
1.262
10.967
5.885
4.168
4.164
3.292
2.427
2.102
1.929
1.904
1.744
1.726
1.683
11
COMPETITIVE POSITION OF THE BALTIC SEA REGION
NACE
342
293
296
266
181
313
274
183
231
352
232
265
351
155
153
201
271
264
202
261
182
247
313
152
159
151
156
172
315
171
275
371
262
361
323
273
333
293
154
177
245
176
314
211
322
201
Name
Manufacture of bodies (coachwork) for motor vehicles; manufacture of trailers and
semi-trailers
Manufacture of agricultural and forestry machinery
Manufacture of weapons and ammunition
Manufacture of articles of concrete, plaster, cement
Manufacture of leather clothes
Manufacture of insulated wire and cable
Manufacture of basic precious and non-ferrous metals
Dressing and dyeing of fur; manufacture of articles of fur
Poland
Manufacture of coke oven products
Manufacture of railway, tramway locomotives, rolling stock
Manufacture of refined petroleum products
Manufacture of cement, lime and plaster
Building and repairing of ships and boats
Manufacture of dairy products
Processing and preserving of fruit and vegetables
Sawmilling and planing of wood, impregnation of wood
Manufacture of basic iron and steel and of ferro-alloys (ECSC)
Manufacture of bricks, tiles and construction products
Manufacture of veneer sheets; manufacture of plywood, laminboard, particle board,
fiber board and other panels and boards
Manufacture of glass and glass products
Manufacture of other wearing apparel and accessories
Manufacture of man-made fibers
Manufacture of insulated wire and cable
Processing and preserving of fish and fish products
Manufacture of beverages
Production, processing, preserving of meat, meat products
Manufacture of grain mill products, starches and starch products
Textile weaving
Manufacture of lighting equipment and electric lamps
Preparation and spinning of textile fibers
Casting of metals
Recycling of metal waste and scrap
Manufacture of non-refractory ceramic goods other than for construction purposes;
manufacture of refractory ceramic products
Manufacture of furniture
Manufacture of television and radio receivers, sound or video recording or
reproducing apparatus and associated goods
Other first processing of iron and steel and production of non-ECSC ferro-alloys
Manufacture of automatic control systems
Manufacture of agricultural and forestry machinery
Manufacture of vegetable and animal oils and fats
Manufacture of knitted and crocheted articles
Manufacture of soap, detergents, cleaning, polishing
Manufacture of knitted and crocheted fabrics
Sweden
Manufacture of accumulators, primary cells and primary batteries
Manufacture of pulp, paper and paperboard
Manufacture of television and radio transmitters and apparatus for line telephony and
line telegraphy
Sawmilling and planing of wood, impregnation of wood
LQ for
employment
1.668
1.608
1.487
1.294
1.292
1.279
1.261
1.260
15.864
3.158
3.057
3.030
2.728
2.556
2.505
2.146
2.097
2.076
2.074
1.889
1.835
1.832
1.762
1.707
1.599
1.582
1.579
1.551
1.550
1.489
1.458
1.442
1.432
1.406
1.398
1.367
1.354
1.334
1.332
1.328
1.295
1.264
8.283
5.327
3.463
3.343
12
COMPETITIVE POSITION OF THE BALTIC SEA REGION
NACE
Name
296
273
341
285
154
221
203
313
352
244
287
Manufacture of weapons and ammunition
Other first processing of iron and steel and production of non-ECSC ferro-alloys
Manufacture of motor vehicles
Treatment and coating of metals; general mechanical engineering
Manufacture of vegetable and animal oils and fats
Publishing
Manufacture of builders' carpentry and joinery
Manufacture of insulated wire and cable
Manufacture of railway, tramway locomotives, rolling stock
Manufacture of pharmaceuticals, medicinal chemicals and botanical products
Manufacture of other fabricated metal products
Manufacture of television and radio receivers, sound or video recording or
323
reproducing apparatus and associated goods
294
Manufacture of machine-tools
297
Manufacture of domestic appliances n.e.c.
364
Manufacture of sports goods
292
Manufacture of other general purpose machinery
343
Manufacture of parts, accessories for motor vehicles
311
Manufacture of electric motors, generators and transformers
Source: Own calculations.
LQ for
employment
3.237
2.150
1.766
1.690
1.660
1.652
1.632
1.470
1.442
1.434
1.424
1.422
1.406
1.349
1.330
1.296
1.252
1.250
We would like to look at significant concentrations in terms of employment from the regional
(BSR) perspective. In order to do so we have calculated an LQ for each of the analyzed
sectors within the BSR as a weighted average of LQs for each of the national economies (the
weight set as the share of a given state in total employment level of a given sector within the
BSR). The top scorers are (LQ>1.25) given in the following table. It comes at no surprise that
the highest LQ is in manufacturing of pulp, paper and paperboard (NACE 211). The top
scorers represent several significant industries (clusters). These are: wood, furniture and pulp
and paper (forest), agro-food (food processing), maritime (shipbuilding, fishing and fish
processing), ICT and related electrics, fashion.
Table 6 Sectors with highest LQs in employment for the Baltic Sea Region
NACE
211
314
322
201
351
202
152
153
221
323
311
182
Name
Manufacture of pulp, paper and paperboard
Manufacture of accumulators, primary cells and primary batteries
Manufacture of television and radio transmitters and apparatus for line telephony and
line telegraphy
Sawmilling and planing of wood, impregnation of wood
Building and repairing of ships and boats
Manufacture of veneer sheets; manufacture of plywood, laminboard, particle board,
fiber board and other panels and boards
Processing and preserving of fish and fish products
Processing and preserving of fruit and vegetables
Publishing
Manufacture of television and radio receivers, sound or video recording or
reproducing apparatus and associated goods
Manufacture of electric motors, generators and transformers
Manufacture of other wearing apparel and accessories
LQ
7.227
6.475
3.913
2.879
2.591
2.438
2.349
2.126
1.955
1.781
1.728
1.661
13
COMPETITIVE POSITION OF THE BALTIC SEA REGION
NACE
261
313
293
151
172
203
295
315
156
Name
LQ
Manufacture of glass and glass products
1.602
Manufacture of insulated wire and cable
1.583
Manufacture of agricultural and forestry machinery
1.505
Production, processing, preserving of meat, meat products
1.458
Textile weaving
1.414
Manufacture of builders' carpentry and joinery
1.358
Manufacture of other special purpose machinery
1.345
Manufacture of lighting equipment and electric lamps
1.336
Manufacture of grain mill products, starches and starch products
1.327
Manufacture of machinery for the production and use of mechanical power, except
291
1.327
aircraft, vehicle and cycle engines
333
Manufacture of automatic control systems
1.323
361
Manufacture of furniture
1.298
285
Treatment and coating of metals; general mechanical engineering
1.268
Source: Own calculations based on NEW CRONOS and GUS. LQ for the BSR calculated as a weighted average
from LQs in employment for individual states; weights – shares in total employment of the BSR.
Adopting a similar approach we focus now on turnover data just in order to check whether
similar specialization pattern will emerge. At first we look at national high-points. In
Denmark two sectors exceed the EU16 average more than four times (suggesting particularly
high specialization). These are fish processing and manufacture of electric motors. In Finland
this the case in 3 sectors: manufacture of pulp and paper, manufacture of television and radio
transmitters as well as basic processing of wood. In Poland this is only the case in
manufacturing of coke oven products (similarly to employment, the result of a decadent
character of the sector in the EU). In Sweden it is only the case in basic wood processing. We
have to note, however, that the other top scorers are the same as in Finland. It further proves
the similarity between these two neighboring economies.
Table 7 Sectors with LQ for turnover higher than 25 per cent above the EU-16 average
NACE
152
311
334
151
157
351
203
342
361
291
331
244
293
Name
Denmark
Processing and preserving of fish and fish products
Manufacture of electric motors, generators and transformers
Manufacture of optical instruments and photographic equipment
Production, processing, preserving of meat, meat products
Manufacture of prepared animal feeds
Building and repairing of ships and boats
Manufacture of builders' carpentry and joinery
Manufacture of bodies (coachwork) for motor vehicles; manufacture of trailers and
semi-trailers
Manufacture of furniture
Manufacture of machinery for the production and use of mechanical power, except
aircraft, vehicle and cycle engines
Manufacture of medical and surgical equipment and orthopedic appliances
Manufacture of pharmaceuticals, medicinal chemicals and botanical products
Manufacture of agricultural and forestry machinery
LQ for
turnover
6.931
5.034
3.491
2.931
2.756
2.693
2.590
2.301
2.291
2.191
2.117
2.079
2.051
14
COMPETITIVE POSITION OF THE BALTIC SEA REGION
NACE
Name
266
221
Manufacture of articles of concrete, plaster, cement
Publishing
Manufacture of television and radio receivers, sound or video recording or
reproducing apparatus and associated goods
Manufacture of other general purpose machinery
Manufacture of other fabricated metal products
Dressing and dyeing of fur; manufacture of articles of fur
Printing and service activities related to printing
Manufacture of other food products
Manufacture of made-up textile articles, except apparel
Manufacture of knitted and crocheted articles
Manufacture of lighting equipment and electric lamps
Manufacture of structural metal products
Manufacture of other special purpose machinery
Manufacture of plastic products
Manufacture of articles of paper and paperboard
Manufacture of instruments and appliances for measuring, checking, testing,
navigating and other purposes, except industrial process control equipment
Finland
Manufacture of pulp, paper and paperboard
Manufacture of television and radio transmitters and apparatus for line telephony
and line telegraphy
Sawmilling and planing of wood, impregnation of wood
Building and repairing of ships and boats
Manufacture of veneer sheets; manufacture of plywood, laminboard, particle board,
fiber board and other panels and boards
Manufacture of electric motors, generators and transformers
Manufacture of basic iron and steel and of ferro-alloys (ECSC)
Manufacture of builders' carpentry and joinery
Manufacture of steam generators, except central heating hot water boilers
Manufacture of other special purpose machinery
Manufacture of agricultural and forestry machinery
Manufacture of sports goods
Manufacture of basic precious and non-ferrous metals
Manufacture of automatic control systems
Manufacture of machinery for the production and use of mechanical power, except
aircraft, vehicle and cycle engines
Manufacture of medical and surgical equipment and orthopedic appliances
Manufacture of articles of concrete, plaster, cement
Manufacture of bodies (coachwork) for motor vehicles; manufacture of trailers and
semi-trailers
Dressing and dyeing of fur; manufacture of articles of fur
Manufacture of insulated wire and cable
Publishing
Manufacture of other general purpose machinery
Poland
Manufacture of coke oven products
Building and repairing of ships and boats
Manufacture of veneer sheets; manufacture of plywood, laminboard, particle board,
fiber board and other panels and boards
Manufacture of cement, lime and plaster
Manufacture of refined petroleum products
323
292
287
183
222
158
174
177
315
281
295
252
212
332
211
322
201
351
202
311
271
203
283
295
293
364
274
333
291
331
266
342
183
313
221
292
231
351
202
265
232
LQ for
turnover
1.902
1.874
1.858
1.749
1.618
1.578
1.566
1.545
1.543
1.431
1.374
1.360
1.344
1.317
1.304
1.287
10.770
8.738
6.546
2.923
2.278
1.923
1.856
1.830
1.682
1.652
1.529
1.463
1.448
1.445
1.305
1.133
1.107
1.104
1.079
1.066
1.053
1.047
48.939
3.064
2.976
2.898
2.856
15
COMPETITIVE POSITION OF THE BALTIC SEA REGION
NACE
313
271
153
159
264
352
Name
Manufacture of insulated wire and cable
Manufacture of basic iron and steel and of ferro-alloys (ECSC)
Processing and preserving of fruit and vegetables
Manufacture of beverages
Manufacture of bricks, tiles and construction products
Manufacture of railway, tramway locomotives, rolling stock
Manufacture of television and radio receivers, sound or video recording or
323
reproducing apparatus and associated goods
371
Recycling of metal waste and scrap
315
Manufacture of lighting equipment and electric lamps
245
Manufacture of soap, detergents, cleaning, polishing
247
Manufacture of man-made fibres
155
Manufacture of dairy products
151
Production, processing, preserving of meat, meat products
273
Other first processing of iron and steel and production of non-ECSC ferro-alloys
242
Manufacture of pesticides and other agro-chemical products
314
Manufacture of accumulators, primary cells and primary batteries
Manufacture of non-refractory ceramic goods other than for construction purposes;
262
manufacture of refractory ceramic products
157
Manufacture of prepared animal feeds
261
Manufacture of glass and glass products
361
Manufacture of furniture
152
Processing and preserving of fish and fish products
201
Sawmilling and planing of wood, impregnation of wood
Sweden
201
Sawmilling and planing of wood, impregnation of wood
211
Manufacture of pulp, paper and paperboard
Manufacture of television and radio transmitters and apparatus for line telephony
322
and line telegraphy
296
Manufacture of weapons and ammunition
314
Manufacture of accumulators, primary cells and primary batteries
203
Manufacture of builders' carpentry and joinery
273
Other first processing of iron and steel and production of non-ECSC ferro-alloys
352
Manufacture of railway, tramway locomotives, rolling stock
313
Manufacture of insulated wire and cable
331
Manufacture of medical and surgical equipment and orthopedic appliances
294
Manufacture of machine-tools
285
Treatment and coating of metals; general mechanical engineering
333
Manufacture of automatic control systems
292
Manufacture of other general purpose machinery
295
Manufacture of other special purpose machinery
341
Manufacture of motor vehicles
221
Publishing
Source: Own calculations.
LQ for
turnover
2.413
2.312
2.214
2.163
2.024
2.018
1.906
1.901
1.869
1.755
1.670
1.642
1.557
1.531
1.520
1.518
1.468
1.456
1.419
1.416
1.364
1.306
5.461
4.723
4.573
2.952
2.161
2.089
1.987
1.941
1.622
1.616
1.574
1.450
1.417
1.401
1.359
1.308
1.255
Similarly to the procedure adopted above for analysis of location quotients for employment in
the next step we move from national focus to a broader Baltic perspective. In order to do so
we have calculated an LQ for each of the analyzed sectors within the BSR as a weighted
average of LQs for each of the national economies (the weight set this time as the share of a
given state in total employment level of a given sector within the BSR). In the following table
16
COMPETITIVE POSITION OF THE BALTIC SEA REGION
we present only those sectors with a weighted LQ above the 1.25 threshold (there are
altogether 26 3-digit NACE sectors fulfilling that criteria). It is quite noticeable that the top
sectors clearly reflect major contributors to regional turnover situated mainly in Sweden and
Finland. These are: manufacturing of pulp, paper and paperboard (NACE 211), manufacture
of television and radio transmitters and basic wood processing (NACE 201). It is worth to
note as well fish processing (particularly important for Denmark and to a smaller extent to
Poland). Once again we notice sectors representative for key regional clusters: wood,
furniture and pulp and paper (forest), agro-food (food processing), maritime (shipbuilding,
fishing and fish processing), ICT and related electrics. In comparison to data on employment
we notice that fashion (textiles and apparel) is missing but the significance of biotechnology
related branches (pharmaceuticals and cosmetics), manufacture of machinery and automatic
control systems as well automotive cluster is more visible.
Table 8 Sectors with highest LQs in turnover for the Baltic Sea Region
NACE
211
322
201
152
311
351
334
202
203
314
313
151
331
323
153
361
291
245
295
293
342
292
315
244
221
333
Name
Manufacture of pulp, paper and paperboard
Manufacture of television and radio transmitters and apparatus for line telephony and
line telegraphy
Sawmilling and planing of wood, impregnation of wood
Processing and preserving of fish and fish products
Manufacture of electric motors, generators and transformers
Building and repairing of ships and boats
Manufacture of optical instruments and photographic equipment
Manufacture of veneer sheets; manufacture of plywood, laminboard, particle board,
fiber board and other panels and boards
Manufacture of builders' carpentry and joinery
Manufacture of accumulators, primary cells and primary batteries
Manufacture of insulated wire and cable
Production, processing, preserving of meat, meat products
Manufacture of medical and surgical equipment and orthopedic appliances
Manufacture of television and radio receivers, sound or video recording or reproducing
apparatus and associated goods
Processing and preserving of fruit and vegetables
Manufacture of furniture
Manufacture of machinery for the production and use of mechanical power, except
aircraft, vehicle and cycle engines
Manufacture of soap, detergents, cleaning, polishing
Manufacture of other special purpose machinery
Manufacture of agricultural and forestry machinery
Manufacture of bodies (coachwork) for motor vehicles; manufacture of trailers and
semi-trailers
Manufacture of other general purpose machinery
Manufacture of lighting equipment and electric lamps
Manufacture of pharmaceuticals, medicinal chemicals and botanical products
Publishing
Manufacture of automatic control systems
LQ
7.824
6.571
5.420
4.647
2.976
2.607
2.449
2.179
1.999
1.887
1.755
1.745
1.562
1.554
1.473
1.417
1.411
1.364
1.362
1.361
1.360
1.335
1.322
1.319
1.288
1.281
17
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Source: Own calculations.
Strategic drivers of regional economy
The preceding analysis clearly points towards a number of manufacturing industry sectors as
well as groups of sectors (clusters) with particular significance for employment and/or
turnover in the case of individual national economies as well as at regional niveau. In attempt
to correctly designate the key drivers of regional (the BSR) economy we have to take those
two strategic factors into account simultaneously (employment and turnover). In the following
section we will present results of two similar however methodologically different approaches
and than compare the resulting outcomes.
The first method … size matters
It is worth to note (and this is particularly the case in cluster analysis) that absolute or relative
size matters. If we want to designated the key (strategic) drivers we have to take into account
an absolute or relative size of the sectors itself. We have decided to use for this shares of the
BSR in total employment and turnover of the whole EU16 (considered to constitute an
appropriate reference group). To sum up the key sector should have an averaged LQ for
turnover and employment at least 25 per cent higher than the reference group and respectable
shares in the turnover and employment of the reference group.
Out of all analyzed manufacturing industry 3-digit NACE sectors only 24 fulfilled the criteria
that have been listed above. They are representing 10 different industrial branches both of
traditional and non-traditional type. As could have been expected manufacturing of pulp,
paper and paperboard is the most significant (and thus strategic) concentration within the BSR
exceeding the EU16 average by 6.5 times and having an approximately 35 per cent share in
total employment and turnover of the benchmark group. It is followed by an ICT sector –
production of television and radio transmitters and apparatus for line telephony and line
telegraphy (4.3 times above the EU15 average), production of accumulators, primary cells and
primary batteries as well as basic wood processing (both 3.1 times above the average). It is
worth to note furthermore that we have at least three important concentrations in the agrofood business: processing of meat, fish and fruits and vegetables, 6 in the forest products
cluster, 3 in production of specialized machinery manufacturing, 4 in electric appliances, 2
other in electronics, 3 in specialized equipment as well as in shipbuilding. To understand the
18
COMPETITIVE POSITION OF THE BALTIC SEA REGION
importance of these sectors for the regional economy we have to note that in 2000 within the
BSR they generated altogether 1.34 million jobs, had a total turnover of 187.3 billion euro and
exported onto the EU16 market 42 billion euro of goods.
In addition thirteen other sectors had the averaged LQ exceeding the EU16 average but lower
than the threshold level of 1.25 we set beforehand (please refer to Table 10). These sectors
generated an additional 0.64 million jobs, had a joint turnover of 77.7 billion euro and
exported onto the EU16 market good in the value of 21.3 billion euro. The group includes
among others sectors from the following branches: textiles, pharmaceuticals and cosmetics,
machinery and automotive industry.
The next table (please refer to Table 11) presents all residual sectors that had the averaged LQ
below of the EU16 mean but still are worth noticing because of their significance in terms of
the BSR share in turnover and employment of the benchmark group of countries (EU15 and
Poland). We have to notice that some of them are related or supplementary to the strategic
sectors – constituting an integral part of a multisectoral clusters. For instance manufacture of
wooden containers, manufacture of other products of wood; manufacture of articles of cork,
straw and plaiting materials, manufacture of articles of paper and paperboard as well as
printing and service activities related to printing are all integral parts of the forest products
clusters (later on – in the second part of the report we will divide it into two subclusters: wood
and furniture and 3P clusters respectively).
19
Table 9 The top sectors of the Baltic Sea Region in comparison to the benchmark group*
NACE
211
Name
LQw_emp LQw_tur
LQw_av
BSR share in EU16 BSR share in EU16
employment
turnover
34.2
37.1
Manufacture of pulp, paper and paperboard
7.23
7.82
7.53
Manufacture of television and radio transmitters and apparatus for line telephony
322
3.91
6.57
5.24
and line telegraphy
314
Manufacture of accumulators, primary cells and primary batteries
6.48
1.89
4.18
201
Sawmilling and planing of wood, impregnation of wood
2.88
5.42
4.15
152
Processing and preserving of fish and fish products
2.35
4.65
3.50
351
Building and repairing of ships and boats
2.59
2.61
2.60
311
Manufacture of electric motors, generators and transformers
1.73
2.98
2.35
Manufacture of veneer sheets; manufacture of plywood, laminboard, particle
202
2.44
2.18
2.31
board, fiber board and other panels and boards
153
Processing and preserving of fruit and vegetables
2.13
1.47
1.80
203
Manufacture of builders' carpentry and joinery
1.36
2.00
1.68
313
Manufacture of insulated wire and cable
1.58
1.75
1.67
Manufacture of television and radio receivers, sound or video recording or
323
1.78
1.55
1.67
reproducing apparatus and associated goods
334
Manufacture of optical instruments and photographic equipment
0.86
2.45
1.66
221
Publishing
1.96
1.29
1.62
151
Production, processing, preserving of meat, meat products
1.46
1.75
1.60
293
Manufacture of agricultural and forestry machinery
1.50
1.36
1.43
Manufacture of machinery for the production and use of mechanical power, except
291
1.33
1.41
1.37
aircraft, vehicle and cycle engines
361
Manufacture of furniture
1.30
1.42
1.36
295
Manufacture of other special purpose machinery
1.35
1.36
1.35
315
Manufacture of lighting equipment and electric lamps
1.34
1.32
1.33
333
Manufacture of industrial process control equipment
1.32
1.28
1.30
261
Manufacture of glass and glass products
1.60
0.96
1.28
331
Manufacture of medical and surgical equipment and orthopedic appliances
0.95
1.56
1.26
285
Treatment and casting of metals; general mechanical engineering
1.27
1.24
1.25
Source: Own calculations. *sectors with an average of weighted LQs for employment and turnover above the 25 per cent of EU16 average
21.0
31.9
28.2
28.3
18.9
26.7
14.9
10.0
32.7
13.8
17.3
14.5
22.1
13.6
19.1
13.6
17.6
9.2
14.8
12.8
17.2
10.0
4.8
14.4
15.2
15.9
6.7
9.1
10.2
9.4
12.7
9.8
14.3
15.0
14.4
14.1
15.2
8.4
8.2
9.2
10.1
9.4
9.1
6.5
10.4
7.7
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Table 10 Sectors of the Baltic Sea Region*
NACE
245
Name
LQw_emp LQw_tur
LQw_av
Manufacture of soap, detergents, cleaning, polishing
1.13
1.36
1.25
Manufacture of bodies (coachwork) for motor vehicles; manufacture of trailers
342
1.10
1.36
1.23
and semi-trailers
244
Manufacture of pharmaceuticals, medicinal chemicals and botanical products
1.14
1.32
1.23
292
Manufacture of other general purpose machinery
1.09
1.33
1.21
341
Manufacture of motor vehicles
1.23
1.15
1.19
266
Manufacture of articles of concrete, plaster, cement
1.15
1.21
1.18
287
Manufacture of other fabricated metal products
1.15
1.17
1.16
182
Manufacture of other wearing apparel and accessories
1.66
0.64
1.15
294
Manufacture of machine-tools
1.04
1.21
1.13
156
Manufacture of grain mill products, starches and starch products
1.33
0.86
1.09
274
Manufacture of basic precious and non-ferrous metals
1.06
1.05
1.05
177
Manufacture of knitted and crocheted articles
1.16
0.91
1.04
172
Textile weaving
1.41
0.63
1.02
Source: Own calculations. *sectors with an average of weighted LQs for employment and turnover in the range from 1 to 1.25
BSR share in EU16 BSR share in EU16
employment
turnover
9.5
4.6
9.4
7.6
11.8
10.4
7.8
12.3
12.2
12.4
11.1
13.2
11.9
9.8
10.4
7.5
9.0
5.6
8.5
8.3
3.6
7.4
6.3
7.6
4.1
2.8
21
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Table 7 Residual group of NACE sectors with the average LQ below 1 but a relatively high share in EU16 turnover and employment
NACE
204
241
Name
Manufacture of wooden containers
Manufacture of basic chemicals
Manufacture of other products of wood; manufacture of articles of cork, straw
205
and plaiting materials
251
Manufacture of rubber products
366
Miscellaneous manufacturing n.e.c.
252
Manufacture of plastic products
343
Manufacture of parts, accessories for motor vehicles
175
Manufacture of other textiles
212
Manufacture of articles of paper and paperboard
174
Manufacture of made-up textile articles, except apparel
354
Manufacture of motorcycles and bicycles
158
Manufacture of other food products
281
Manufacture of structural metal products
183
Dressing and dyeing of fur; manufacture of articles of fur
181
Manufacture of leather clothes
316
Manufacture of electrical equipment n.e.c.
Manufacture of instruments and appliances for measuring, checking, testing,
332
navigating and other purposes, except industrial process control equipment
222
Printing and service activities related to printing
243
Manufacture of paints, varnishes and similar coatings, printing ink and mastics
286
Manufacture of cutlery, tools and general hardware
353
Manufacture of aircraft and spacecraft
321
Manufacture of electronic valves and tubes and other electronic components
312
Manufacture of electricity distribution and control apparatus
363
Manufacture of musical instruments
Source: Own calculations.
0.98
0.82
BSR share in
EU16 employment
10.9
10.8
BSR share in
EU16 turnover
7.4
5.2
0.73
0.82
10.1
5.2
0.93
0.89
0.88
1.04
0.84
0.88
0.88
0.89
0.87
0.82
0.96
0.90
0.85
0.76
0.70
0.85
0.90
0.89
0.92
0.89
0.73
1.04
0.95
1.01
0.57
0.59
0.84
0.79
0.87
0.97
0.87
0.90
0.88
0.81
0.95
0.88
0.99
0.73
0.72
10.1
9.8
9.8
9.7
9.6
9.5
9.3
9.3
9.3
9.1
9.0
8.9
8.8
5.6
5.3
6.2
5.1
6.6
6.6
5.5
4.6
7.0
7.3
6.1
3.7
4.4
0.84
0.90
0.87
8.5
6.3
0.90
0.80
0.79
0.85
0.75
0.52
0.64
1.07
0.82
0.98
0.45
0.49
0.43
0.63
0.98
0.81
0.89
0.65
0.62
0.47
0.64
8.4
8.4
8.3
7.7
6.8
5.9
5.8
7.6
6.3
6.9
2.2
3.3
3.3
2.9
LQw_emp
LQw_tur
LQw_av
0.97
0.97
0.99
0.66
0.92
22
The second method … trade performance counts as well
As we have noted already in our study we could follow as well another approach. As the
subtitle above clearly suggest this time we will take into account trade performance in order to
identify the key sectors within the Baltic Sea Region. In order to do so we have arbitrarily
decided to set the following set of criteria remembering that each individual criterion must be
fulfilled simultaneously. These are: a share of the BSR in the total turnover and employment
of the reference group in 2000 exceeding 5 per cent, location quotient for employment and
turnover of the BSR region calculated as a geometric average of LQs for four economies
higher than 1 – thus exceeding an average for the EU16 and last but not least a surplus in
trade with the EU16 (calculated as a sum of trade balances of each of the states). What is the
logic behind the choice of criteria? Simultaneous fulfillment of all of them means that a given
sector could be said to be concentrated within the BSR, is significant in terms of employment
and turnover and is able to generate trade surplus (in other words its ratio of exports to
imports at the BSR level must be greater than one which is considered to be indicative of
comparative advantage in trade (Brodzicki 2003).
The criteria are simultaneously satisfied by only 20 sectors (pleas note that in the following
table the sectors are presented in accordance with rising NACE codes). The sectors come
from varied industrial branches both low as well as high-tech which clearly reflects the
heterogeneity (diversity) of the regional economy. It is worth to note, that they present the
most significant clusters of the region if we adopt a meat-cluster approach to analyzing
structure of economy. The list includes among others: agro-food (meat and fruits and
vegetables processing, dairy products), wood processing – paper – furniture (forest cluster as
defined in Finland), ICT and maritime (shipbuilding and as well as fish processing).
Overall analysis by both methods leads to very similar results. There is a similar – repeating
set of manufacturing industry sectors which seems to have strategic importance to the
economy of the Baltic Sea Region. Furthermore, the cluster-focused approach could bring
more fruits than analysis focused on disaggregated sectors. It will be therefore fully utilized in
the second – more focused part of the present report.
If we have identified the sectors (as well as potential clusters) of strategic importance it seems
important to ask whether they are growing or shrinking in particular in terms of employment.
This could indicated their rising or falling importance to the economy of the region. An
additional analysis of shifts in employment levels will be carried out in the subsequent
section.
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Table 11 Key drivers – 20 NACE sectors fulfilling all five criteria*
Total share of
Total share of
Geometric
Geometric
BSR’s trade
BSR in
BSR in
average of LQ
average of LQ
balance
employment
turnover
employment
turnover
(mill. of euro)
(per cent)
(per cent)
15.16
1.14
10.23
1.27
1 719
NACE
Name
151
Production, processing, preserving of meat, meat products
152
Processing and preserving of fish and fish products
18.95
1.20
13.78
1.16
1 205
153
Processing and preserving of fruit and vegetables
19.15
1.02
9.17
1.06
130
155
Manufacture of dairy products
19.66
1.47
7.67
1.13
644
201
28.31
2.10
32.69
2.48
2 311
22.14
1.67
13.59
1.48
278
203
Saw milling and planing of wood, impregnation of wood
Manufacture of veneer sheets; manufacture of plywood, laminboard, particle
board, fiber board and other panels and boards
Manufacture of builders' carpentry and joinery
13.64
1.37
14.81
1.74
1 004
211
Manufacture of pulp, paper and paperboard
34.23
1.95
37.11
1.95
9 017
232
Manufacture of refined petroleum products
18.26
3.06
5.36
2.86
310
265
Manufacture of cement, lime and plaster
19.34
1.21
6.98
1.20
6
266
Manufacture of articles of concrete, plaster, cement
12.26
1.11
8.48
1.11
155
271
Manufacture of basic iron and steel and of ferro-alloys (ECSC)
15.52
2.10
7.86
2.07
235
311
Manufacture of electric motors, generators and transformers
14.90
1.52
14.46
1.54
186
313
Manufacture of insulated wire and cable
17.57
1.33
12.77
1.43
46
315
14.35
1.05
9.40
1.16
2
20.96
1.61
31.91
1.62
533
17.24
1.32
10.01
1.02
579
351
Manufacture of lighting equipment and electric lamps
Manufacture of television and radio transmitters and apparatus for line telephony
and line telegraphy
Manufacture of television and radio receivers, sound or video recording or
reproducing apparatus and associated goods
Building and repairing of ships and boats
26.73
2.08
17.28
2.14
667
352
Manufacture of railway, tramway locomotives, rolling stock
23.23
1.29
10.27
1.01
48
14.26
1.12
9.17
1.14
2 895
202
322
323
361
Manufacture of furniture
Source: Own calculations.* the sectors are presented in accordance with rising NACE codes
24
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Employment sifts – indication of intra-regional reallocation?
From theoretical perspective location of manufacturing industry is determined through
interplay of economic factors such as revealed comparative advantage, agglomeration
economies and other externalities (for instance knowledge spillovers), absolute and relative
endowments in factors of production, scale economies or intensity of backward and forward
linkages as well as policy-related factors – policy-instruments affecting location following
discretionary policy-objectives of national and/or regional authorities6. The policy can either
enhance (encourage) or dampen the effects of economic factors. We have to note, that the mix
of determinants of course varies considerably from sector to sector and clearly has a sectoral
dimension. Furthermore, as economy is in constant process of dynamic adjustment
(hypothesis of permanent transition) the determinants of location are likely to change within
medium to long-run thus affecting location decisions of enterprises. We must stress that the
process of economic integration (in global and regional terms in particular), both in its
negative (liberalization) and positive (policy coordination, harmonization or unification)
dimension, can affect location of manufacturing industry.
Baldwin and Wyplosz (2004) suggest that at the aggregated level the European economic
integration so far had a relatively modest impact on the location of industry with major shifts
occurring within nations than among them. At the more disaggregated level certain facts
(mainly related to composition of economic activity within each nation) point to some shifts
of location.
We have to take account of the fact that Europe is a highly centralized continent as far as
economic activity is concerned. The Euro core clearly dominates with one-seventh of total
area, one-third of population but half of economic activity in general (Baldwin and Wyplosz
2004). From geographical perspective the majority of the BSR is situation in the peripheral
regions of Europe with an exception of Denmark, southern Sweden and north-eastern
Germany considered to be in the so-called intermediate regions. All the shifts between the
core and peripheral regions will thus directly affect the BSR. It is thus important to detect
6
Supranational policy could also effect location. This in particular applies to the European Union an the type of
its structural policies. Certain evidence exists suggesting that structural spending does effect location of
industries in particular high-skilled
25
COMPETITIVE POSITION OF THE BALTIC SEA REGION
long-term trends in location of business activity in the core-periphery setting within the
European Union in general. Furthermore, the accession of new countries significantly
increased the area of peripheral regions of Europe (this applies in particular to the BSR) – a
fact which could further intensify shifts in location of both manufacturing industry and
services in the medium to long run.
Amiti (1999) provides empirical evidence for increasing specialization in the European Union
following deepening of the process – mainly due to gradual elimination of trade barriers and
barriers to freedom of movement of factors of production. Amiti expects that further
deepening and consecutive enlargements will result in increasing geographical concentration
of industries within the core or peripheral regions (depending on the specific character of the
sector) resulting in better allocation of resources and greater effectiveness. If this is the case
we should expect regional specialization to occur within the peripheral BSR as well – it will
be however easy to be recognized only from an ex post point of view and long-term
perspective (of at least 10 to 15 years). The long-term perspective could however blur the
whole picture as other effects – not related to enlargement or deepening will gradually set in.
An interesting study by Brulhart and Traeger (2003) using entropy indices and associated
bootstrap tests provides further evidence for concentration of manufacturing industry in the
European Union in the period 1975-2000. An interesting point is made, however, that
locational bias towards central (or core) regions has become weaker and within-country
concentration trends were strengthened. Integration thus leads to gradual polarization within
the EU and within individual countries. From competitive point of view it becomes a prime
concern to know which manufacturing sectors (as well as services) are likely to and will
locate in the region of our interest. Furthermore, it becomes crucial whether economic policy
can affect the process or whether it is outside of scope of national (regional) authorities.
The shifts of location within the European Union are significant according to an excellent
study carried out for the EC by Midelfart-Knarvik et al. (2000), however, they are not present
in all manufacturing sectors. The trend towards increasing specialization commenced from the
beginning of 1980s and is still significant. The core-periphery setting is still important but the
dominance of the core is gradually decreasing – consecutive enlargements are partially
responsible as they are increasing area of periheral regions. The most significant change in the
location of industries in Europe is the rise of high-technology – high-tech sectors in the BSR
(in particular in Finland) as well as in the fast-growing Ireland. Shifts in patterns of location
26
COMPETITIVE POSITION OF THE BALTIC SEA REGION
changes have a strong sectoral dimension. It is worth while to present the major points raised
by the authors as the implications for the BSR are considerable.
First of all there are traditionally concentrated industries that remained concentrated (location
shifts are relatively low). The group includes: automotive (both vehicles and motorcycles),
aircraft, electrical apparatus n.e.c, as well as resource-based petroleum and coal products.
Automotive sector as well as petroleum and coal products became relatively more
concentrated while the rest became a bit more dispersed.
We have to note, however, that the locus of the automotive industry in the EU is gradually
shifting towards the more competitive CEEs (in particular in recent 4-5 years). In the
production of aircraft traditionally relatively strong position of Sweden is gradually
deteriorating (the sectors seems to move outside of the region, the same occurs in Poland).
Secondly, the authors identified a a group of industries that were initially very concentrated,
but which became more dispersed over time. This group comprised ICT sectors (office and
computing machinery, , radio-TV and communication equipment), machinery and equipment
as well as professional instruments, and traditional agro-food beverages and tobacco. The
position of Sweden and Finland (in particular) improved in high-technology and medium-high
technology sectors.
Thirdly, sectors such as textiles, wearing apparel, leather and products, furniture and transport
equipment were relatively dispersed and got more concentrated. In general apart from
transport equipment the industries in the group tended to locate in peripheral regions (mainly
in the southern states).
The fourth group consists of traditionally dispersed industries such as: food products, wood
products, paper and paper products, printing and publishing, non-metallic minerals n.e.c.,
metal products, and shipbuilding. The stability of dispertion could be related to indureance of
national differences in tastes (food), culture, no tariff barriers (food), as well as national
industrial policies (for instance shipbuilding). The accession of the CEECs as well as
globalization are likely to affect these sectors relatively quickly.
Midelfart-Knarvik et al. (2000) note while interpreting results of their study on location shitfs
that the location pattern is mainly
27
COMPETITIVE POSITION OF THE BALTIC SEA REGION
As has been already noted above some evidence into the potential location effects can be
provided through detailed analysis of adjustments in the composition of economic activity
over a relatively long period of time (in particular in terms of employment). A major
bottleneck, as usual, is the availability and quality of data in particular at sub-national level.
Furthermore, we would like to know whether general adjustment trends in location of industry
between the core and peripheral regions of the EU15 described above extend into the BSR. It
seems plausible that extension of the single market onto new Member States can further
intensify the process. If this is actually the case the long-term consequences for the BSR could
be really substantial. In particular we would like to know whether reallocation of production
takes place in the region. We would like further to identify its character (intraregional vs.
interregional) and intensity in particular sectors of strategic importance to the region.
In order to do so in this edition of the report we have chosen a rather simple analysis in order
to asses whether reallocation of employment takes place within the BSR. On the basis of data
on employment levels for each of the four states taken into account we have calculated an
absolute change in employment between 1995 and 2000 for each of the 3-digit manufacturing
industry sector taken into account. For simplicity we have calculated a joint shift for the three
Nordic states and separate one for Poland (please refer to Table 12). Furthermore, we have
calculated a joint net change for the whole Baltic Se Region. This has allowed us to divide all
the manufacturing sectors into 4 categories depending on the direction of the change.
The first group consist of NACE sectors in which employment contracted both in the Nordic
states and Poland (with a negative change overall for the whole BSR). The jobs in this group
either moved outside of the region (to other globally competitive locations such as China or
India) or they simply disappeared due to the obsolescence of the sectors. We have to note that
restructuring of industrial employment in Poland could be said to be a deciding factor in the
overall picture. The majority of sectors in the group are traditional, labor-intensive or
declining industries from a number of industrial branches: textiles and apparel, leather, steel
and steel products as well as agro-food. It is important to note the fall in employment levels in
manufacturing of pulp and paper as well as in production of veneer sheets, plywood, and fiber
boards (traditionally the core of the regional manufacturing). There are, however, some
exceptions. The same processes occurred in high-tech aerospace industry (major contraction
in Poland) or manufacturing of other general purpose machinery.
The second group is particularly interesting. The group includes sectors in which employment
decreased in the Nordic states while it increased in Poland (thus potential intraregional
28
COMPETITIVE POSITION OF THE BALTIC SEA REGION
reallocation could have occurred). The flow of foreign direct investments from Nordic
countries to Poland can further prove the point. The group is rather heterogeneous. The most
prominent cases are: publishing, manufacture of soap and detergents, fish and meat
processing, shipbuilding, weapons and ammunition as well as manufacture of tanks and
boilers. We have to note that some of the sectors belong to the key meta-clusters of the region
such as forest cluster, biocluster and maritime cluster.
The third group consists of sectors in which we observe a fall in employment in Poland and a
significant or limited increase in the three Nordic states with a varied net consequences for the
whole region. In Poland the contraction was particularly evident in the case of manufacture of
machinery, railway and rolling stock as well as textiles. While at the same time employment
increased significantly in the Nordic countries in manufacture of machinery and in electric
motors and generators. This group is interesting as well as it presents to a certain extent an
intraregional reallocation in the opposite direction as has been the case in the second group.
Still we have to note that the outcome could be mainly attributed to large-scale restructuring
process in Polish manufacturing industry which was particularly intensive in the second half
of the 1990s)
The last group is an interesting case as well. It contains a large number of sectors in which
employment levels increased in the Nordic economic and Poland giving a net increase for the
Baltic Sea Region. The list thus includes sectors which are growing and/or in which the whole
region (despite its internal heterogeneity) is attracting production (is internationally
competitive). The list includes sectors from both traditional and non-traditional industrial
branches. The most important among the traditional sectors are: automotive, electric
appliances, wood and furniture as well as paper products, steal and metal products, rubber and
plastics. In the non-traditional: electronics and pharmaceuticals are the most prominent cases
which are considered as strictly as high-tech industries. Altogether we could notice a shift
towards higher value-added, relatively more human-intensive sectors. These should be
perceived as a good development with positive effects for the long run competitive potential
and long-run growth. This applies in particular to Poland in which the overall production
(turnover) rose while employment levels dropped showing a significant improvement in
productivity levels. The convergence in productivity levels is likely to be further accelerated
by accession to the internal market however it will be difficult to sustain the convergence
rates typical for an outset of economic and political transformation.
29
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Finally, we should note that a similar analysis should be carried out for each of strategic metaclusters of the region. It seems that in certain meat-cluster various intraregional adjustments
are taking place which could be indicative of intra-cluster specialization within the BSR.
Table 12Net changes in employment levels within the Baltic Sea Region between 2000 and 1995
NACE
Group 1
NORDIC3
POL
BSR
271
Manufacture of basic iron and steel and of ferro-alloys (ECSC)
-710
-39 129
-39 839
182
Manufacture of other wearing apparel and accessories
-2 092
-35 980
-38 072
172
Textile weaving
-941
-23 315
-24 256
193
Manufacture of footwear
-165
-17 358
-17 523
171
Preparation and spinning of textile fibers
-118
-13 940
-14 058
177
Manufacture of knitted and crocheted articles
-1 470
-11 110
-12 580
211
Manufacture of pulp, paper and paperboard
-4 414
-7 363
-11 777
247
Manufacture of man-made fibers
0
-8 405
-8 405
155
Manufacture of dairy products
-1 341
-6 527
-7 868
286
Manufacture of cutlery, tools and general hardware
-5 827
-1 754
-7 581
297
Manufacture of domestic appliances n.e.c.
-127
-7 432
-7 559
353
Manufacture of aircraft and spacecraft
-108
-6 920
-7 028
272
Manufacture of tubes
0
-6 983
-6 983
274
Manufacture of basic precious and non-ferrous metals
-88
-5 999
-6 087
292
-368
-5 231
-5 599
-229
-4 861
-5 090
232
Manufacture of other general purpose machinery
Manufacture of grain mill products, starches and starch
products
Manufacture of refined petroleum products
0
-3 957
-3 957
246
Manufacture of other chemical products
-1 032
-2 837
-3 869
191
-81
-3 481
-3 562
-9
-2 427
-2 436
-191
-1 986
-2 177
-1 532
-444
-1 976
-392
-1 507
-1 899
-93
-1 493
-1 586
-613
-373
-986
159
Tanning and dressing of leather
Manufacture of non-refractory ceramic goods other than for
construction purposes; manufacture of refractory ceramic
products
Manufacture of bricks, tiles and construction products
Manufacture of veneer sheets; manufacture of plywood,
laminboard, particle board, fiber board and other panels and
boards
Manufacture of instruments and appliances for measuring,
checking, testing, navigating and other purposes, except
industrial process control equipment
Manufacture of luggage, handbags and the like, saddler
Other first processing of iron and steel and production of nonECSC ferro-alloys
Manufacture of beverages
-121
-233
-354
NACE
221
Group 2
Publishing
NORDIC3
-1430
POL
6 867
BSR
5 437
263
0
3 890
3 890
-935
3 487
2 552
296
Manufacture of ceramic tiles and flags
Manufacture of tanks, reservoirs and containers of metal;
manufacture of central heating radiators and boilers
Manufacture of weapons and ammunition
-114
2 618
2 504
245
Manufacture of soap, detergents, cleaning, polishing
-1396
3 495
2 099
152
Processing and preserving of fish and fish products
-1287
3 116
1 829
156
262
264
202
332
192
273
282
30
COMPETITIVE POSITION OF THE BALTIC SEA REGION
242
Manufacture of pesticides and other agro-chemical products
0
1 779
1 779
231
Manufacture of coke oven products
0
783
783
365
Manufacture of games and toys
-8
191
183
355
Manufacture of other transport equipment n.e.c.
-9
120
111
151
Production, processing, preserving of meat, meat products
-1631
1 184
-447
351
Building and repairing of ships and boats
-2706
1 248
-1 458
268
Manufacture of other non-metallic mineral products
-2854
906
-1 948
NACE
Group 3
NORDIC3
POL
BSR
295
Manufacture of other special purpose machinery
6335
-31 940
-25 605
293
Manufacture of agricultural and forestry machinery
1299
-19 163
-17 864
241
Manufacture of basic chemicals
433
-17 217
-16 784
352
Manufacture of railway, tramway locomotives, rolling stock
Manufacture of machinery for the production and use of
mechanical power, except aircraft, vehicle and cycle engines
Manufacture of other textiles
816
-12 512
-11 696
75
-10 620
-10 545
619
-5 251
-4 632
294
Manufacture of machine-tools
832
-5 212
-4 380
265
Manufacture of cement, lime and plaster
127
-3 930
-3 803
287
Manufacture of other fabricated metal products
3451
-3 684
-233
333
2327
-3 220
-893
2685
-3 156
-471
7286
-2 398
4 888
45
-2 272
-2 227
366
Manufacture of automatic control systems
Manufacture of electronic valves and tubes and other electronic
components
Manufacture of electric motors, generators and transformers
Manufacture of steam generators, except central heating hot
water boilers
Miscellaneous manufacturing n.e.c.
1173
-1 694
-521
176
Manufacture of knitted and crocheted fabrics
134
-1 118
-984
174
Manufacture of made-up textile articles, except apparel
203
-965
-762
153
Processing and preserving of fruit and vegetables
635
-766
-131
181
Manufacture of leather clothes
53
-640
-587
291
175
321
311
283
363
Manufacture of musical instruments
2
-562
-560
154
Manufacture of vegetable and animal oils and fats
385
-345
40
312
Manufacture of electricity distribution and control apparatus
194
-151
43
335
Manufacture of watches and clocks
13
0
13
NACE
Group 4
NORDIC3
POL
BSR
364
Manufacture of sports goods
101
42
143
183
Dressing and dyeing of fur; manufacture of articles of fur
Manufacture of paints, varnishes and similar coatings, printing
ink and mastics
Cutting, shaping and finishing of stone
27
568
595
270
352
622
166
594
760
336
424
760
243
267
372
261
Manufacture of glass and glass products
10
878
888
362
Manufacture of jewelry and related articles
Manufacture of bodies (coachwork) for motor vehicles;
manufacture of trailers and semi-trailers
Recycling of metal waste and scrap
73
1 198
1 271
948
514
1 462
630
847
1 477
13
1 540
1 553
1204
694
1 898
342
371
354
334
Manufacture of motorcycles and bicycles
Manufacture of optical instruments and photographic
equipment
31
COMPETITIVE POSITION OF THE BALTIC SEA REGION
173
Finishing of textiles
136
2 122
2 258
201
Sawmilling and planing of wood, impregnation of wood
2335
414
2 749
204
Manufacture of wooden containers
Manufacture of medical and surgical equipment and orthopedic
appliances
Manufacture of prepared animal feeds
732
2 420
3 152
1069
2 183
3 252
1061
2 536
3 597
2582
1 078
3 660
1561
2 323
3 884
4003
1 212
5 215
3626
1 914
5 540
1075
4 712
5 787
256
5 747
6 003
3309
2 778
6 087
222
Casting of metals
Forging, pressing, stamping and roll forming of metal; powder
metallurgy
Manufacture of pharmaceuticals, medicinal chemicals and
botanical products
Manufacture of articles of concrete, plaster, cement
Manufacture of other products of wood; manufacture of articles
of cork, straw and plaiting materials
Manufacture of lighting equipment and electric lamps
Manufacture of television and radio receivers, sound or video
recording or reproducing apparatus and associated goods
Printing and service activities related to printing
3910
3 010
6 920
212
Manufacture of articles of paper and paperboard
532
6 756
7 288
158
Manufacture of other food products
1310
6 325
7 635
313
1118
8 680
9 798
8046
1 938
9 984
316
Manufacture of insulated wire and cable
Manufacture of accumulators, primary cells and primary
batteries
Manufacture of electrical equipment n.e.c.
1412
8 585
9 997
251
Manufacture of rubber products
839
10 085
10 924
341
Manufacture of motor vehicles
162
14 292
14 454
203
8240
8 198
16 438
17517
712
18 229
281
Manufacture of builders' carpentry and joinery
Manufacture of television and radio transmitters and apparatus
for line telephony and line telegraphy
Manufacture of structural metal products
6359
11 898
18 257
343
Manufacture of parts, accessories for motor vehicles
8086
17 206
25 292
361
Manufacture of furniture
12887
16 782
29 669
7779
27 523
35 302
28397
6 986
35 383
331
157
275
284
244
266
205
315
323
314
322
252
Manufacture of plastic products
Treatment and coating of metals; general mechanical
285
engineering
Source: Own calculations.
32
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Inflow of Nordic FDI into Poland
The previous section has given some evidence that intraregional relocation of production
(reallocation of resources) is taking place. In order to be more specific we want to augment
the analysis of shifts in the BSR employment levels by information on an inflow of Nordic
foreign direct investment. The inflow of FDI could further prove the existence of the process
as it shows intraregional capital flows.
The list of Nordic investors in Poland is substantial (please refer to Appendix B at the end of
the report). According to PAAIZ database at the end of 2004 there were 130 Nordic investors
present in Poland (with investment above the 1 mill. USD threshold). Altogether they invested
6.4 billion USD into Polish economy. This gives them 7.6 per cent share in total capital
inflow in the form of FDI into Poland within the period 1993 – 2004. Swedish companies
invested the most 3.715 billion euro – Sweden is the seventh largest foreign investor in
Poland when we exclude multinational companies from the list. Denmark with 2.096 billion
holds the ninth place while Finland with 0.578 is only a seventeenth investor in Poland. The
proximity of home and host markets could be a deciding factor. If we limit the geographical
scope only to three (or six) northern regions (voivodeships) of Poland the amount of FDI
inflow from Nordic countries decreases significantly it is still however substantial.
It seems that the inflow of FDI from Denmark, Finland and Sweden could increase
substantially in the post accession phase. In general in 2004, the year of accession and full
opening of the market we observed a rebound of FDI inflow into Poland. In future the
investments will have in particular a greenfield character, however, in some sectors
brownfield-type investments are still possible.
The inflow of Nordic FDI into Poland (in particular into northern Poland) could be further
intensified if appropriate policy decisions are taken both at the national and regional
authorities level. The role of PAIIZ is substantial and certainly its promotional campaigns in
the Nordic countries should be further intensified presenting both advantages of investment in
Poland, presenting concrete location choices (within the northern regions in particular) as well
as addressing the existing bottlenecks the Nordic investors encounter
We have to note that these investments, in particular in the strategically important sectors
(meta-clusters) for the BSR, should be beneficial to the whole region. More emphasis should
33
COMPETITIVE POSITION OF THE BALTIC SEA REGION
be placed into embedding the investors into regional economy and creating co-operative ties
through backward and forward linkages thought the region. It should not be done artificially,
however. The policy-makers should always remember a trivial thing: all the actions should
have business rational behind them. Profit-seeking entrepreneurs, the backbone of open
market-economy, will not engage in endeavors not promising adequate profit within a certain
time perspective. The business community should thus have a leading role and the authorities
should rather create framework conditions and create certain incentives where market-failure
occur.
Conclusions
The structure of economy of the Baltic Sea Region is diversified. However, certain overlaps
is specialization exist among the BSR’s states giving opportunity for intraregional
cooperation. he analysis carried in the section clearly indicates that there are a number of
manufacturing sectors which could be said strategic importance for the whole region. They
are both in traditional – resources based sectors (wood processing) as well as high-tech
branches (ICT). Furthermore, there is some evidence for intraregional relocation of
production which could be beneficial in mid to long run creating short to medium term
adjustments costs. The enlargement of the European Union is likely to speed up the process
itself if still existing barriers to freedom of movement of factors of production are finally
abolished. We must remember that either we allow the business to relocate within the BSR in
accordance with locational advantages (or the EU and its proximate neighbors) or it will
move the Far East: China, India, Vietnam, etc. This off course applies only to certain sectors
of manufacturing industry. Finally, on the basis of the first part of the report we could
conclude that sectoral analysis does not allow for detailed analysis of actual structure of the
regional economy as it does not take into account horizontal and vertical linkages between
sectors. In order to do so the analysis has to move from sectoral to cluster-dimension.
34
COMPETITIVE POSITION OF THE BALTIC SEA REGION
PART II
CLUSTERS WITHIN THE BALTIC SEA REGION
35
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Introduction
One of the main conclusions of the preceding chapter was that utilization of cluster-based
approach to analysis of economy of the Baltic Sea Regions could be beneficial in terms of
potential insights it can bring. The benefits will become clearly visible. For the time being,
however, we have to explain our definition of a cluster.
How do we define clusters?
By clusters we understand geographic concentration of private and public enterprises and
institutions connected by an elaborated network of both vertical and horizontal interactions of
formal and informal character based on a common development trajectory (technological,
organizational etc.) that at the same time compete and cooperate with each other.
The definition takes into account many fundamental features of clusters widely agreed on
among professionals which are present both in a path-braking publication by Michael Porter
(1991) as well as a large number of definitions present in the literature. These fundamental
features include: spatial concentration, simultaneous competition and cooperation among
enterprises (frequently referred to as co-opetition), extensive web of linkages.7
There is some amount of evidence that if certain pre-conditions are met innovative and
efficiently functioning clusters can constitute a driving force of regional growth through an
array of positive external effects related to functioning of a cluster.
The definition points to regionally concentrated clusters within the identified meta-clusters.
Inadequate data resources do not allow us to pin point directly all clusters at the regional level
throughout the BSR. The approach we utilize is similar to Porter’s empirical analysis of
clusters and is rather of meta-cluster type. It was possible for us to go to preferred level of
analysis disaggregation only in the case of Poland. Even here we find some possibilities for
improvement. For the time being we will present results of research carried out for the State
7
It is frequently noted that clusters arise due to various externalities (among them agglomeration economies)
that favor spatial proximity. This is present for instance in the definition of The Cluster Mapping Project: A
cluster is a geographically proximate group of interconnected companies and associated institutions in a
particular field, including product producers, service providers, suppliers, universities, and trade associations.
Clusters arise out of the linkages or externalities that span across industries in a particular location.
36
COMPETITIVE POSITION OF THE BALTIC SEA REGION
of The Region Report. In many ways the present report should be considered supplementary
to it.
Clusters in the BSR – a Porterian approach
It is important to note that some of the states in the BSR have carried out extensive clustermapping exercises similar to the one carried out by the DTI for the United Kingdom. The list
includes: Finland, Sweden, Denmark and recently Poland (GIME 2004, 2005). The studies
applied different methodologies at different levels of disaggregation thus their results were
not easily comparable. It is worth to note that until recently there were no studies at all,
however, that would span the whole region – systematically analyzing all of the BSR states.
This significant gap has been filled by Ketels and Solvell (2005) in a recent State of the
Region Report. The results of the study (and the whole report as such) are very informative
and should allow the policy makers to develop more coherent and more informed policy.
Ketels and Solvell (2005) adopt usual Porterian methodology of identification of clusters (at
an aggregated – national level) based on export market shares and export specialization – in
other words pattern of exports. They look at first at exports of goods bundled together into
representative clusters calculating their respective market shares and changes in market share
plus additionally an index of revealed comparative index (a similar approach we will utilize
later on) RCA. The index has been defined as a relation of world export share in a given good
to total world export share (thus RCA exceeding 1 shows specialization in a given group).
The analysis led the authors to identify 12 clusters with comparative advantage with mixed
results in dynamic setting: some of them loosing ground while some gaining on in global
significance. The methodology applied to Poland identified at the national level two
particularly important clusters: coal and maritime equipment. Detailed analysis of Polish trade
suggests that this simply isn’t good enough.
We agree with Ketels and Solvell that the export pattern alone can suggests opportunities for
fruitful cooperation on the cross-national level. These in particular applies to clusters where
overall the region or majority of states of the region have a good position and show revealed
comparative advantage. It seems however that the WTO database the authors utilized is not as
detailed as the COMEXT – a principal database for internal and external trade of the
European Union. This in turn could significantly bias final results. Furthermore, this approach
identifies only sectors (there is more to a cluster than only good export position – we have to
concede however that this is one of its more important attributes)
37
COMPETITIVE POSITION OF THE BALTIC SEA REGION
The authors seem to omit another possibility. The case in which only one of states shows
comparative advantage in trade. If we look at the region from regional and not national
perspective – thus taking the region as a whole (in particular after the enlargement of the
European Union and thus extension of the single market onto the new acceded states), a
strong cluster should be perceived as potential opportunity for cooperation and an asset to the
whole region. The development of a cluster and its comparative advantage could be
intensified through reallocation of specialized resources to the region of its location which
could stimulate overall productivity growth with possible spillover effects. It seems the more
internationally competitive clusters a given region has, the better for the region as a whole
when intra-regional cooperative linkages are dense and effective.
Ketels and Solvell continue there analysis by looking at the sub-national clusters or in other
words regional clusters. The analysis is performed through “rather mysterious” translation of
Porter’s cluster codes and applying it to regional data set for the BSR. The study identifies the
so-called STAR clusters in the Baltic Sea Region at NUTS-2 level. These are considered to be
the top 16 regional clusters located in the region generating it total approx. 420 000 jobs
(please refer to Table …). In order to obtain the 3 STAR status a given regional clusters
should fulfill simultaneously 3 arbitrarily set criteria: should generate no less than 10 000 jobs
(absolute criterion) and be responsible for no less than 10 per cent of regional employment
(relative criterion) and the specialization quotient SQ should be higher than two (share of
regional employment higher at least by a factor of one in comparison to average share of
employment within the BSR). The specialization quotient utilized is nothing different from
location quotient utilized in majority of cluster mapping exercises all over the world.
Table 13 3-STAR clusters in the Baltic Sea Region
38
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Source: Ketels and Solvell (2005).
Out of 16 top 3 STAR clusters within the BSR only two are located in northern Poland in the
warminsko-mazurskie voivodeship. This are: processed food as well as building fixtures,
equipment and services. This result is in deep contrast to the results of more detailed clustermapping studies for Poland that GIME carried out in recent years. This proves several general
points:

results of cluster mapping studies two a large extent depend on methodology applied

results depend heavily on the level of disaggregation of data both in terms of sectors
(2-digit vs. 3-digit NAVE) and regions (NUTS-1, 2 or 4)

results depend heavily on data availability and reliability

and finally result depend heavily on a definition of a cluster
We agree with Ketels and Solvell that cluster-approach to analyzing the economy of a region
is beneficial as it usually brings new and valuable insights. It seems however that the study of
Ketels and Solvell on clusters overlooks certain aspects. Thus more parallel and
supplementary studies should be carried out in the future. The present study is trying to do the
exactly that.
The scope of cluster analysis
Upon initial analysis based on the results of the previous chapter we have finally decided to
present information on the following seven industries (clusters) within the BSR which seem to
39
COMPETITIVE POSITION OF THE BALTIC SEA REGION
be particularly strong within the region: automotive, wood and furniture (forest products), 3P
(paper, pulp, publishing), ICT, maritime cluster, agro-food and finally biotechnology-related
biocluster.
In order to retain possibility of comparing clusters with each other we have decided that the
each case will be treated identically. In the case of each cluster (meta-cluster) we start by
describing its scope – delimiting each cluster from one other by pinpointing exact 3-digit
NACE codes and discuss characteristics of its sectors it terms of factor-intensities or
technology-advancement. Preferably we would augment analysis by inclusion of services
sector – this is however impossible due to lack of adequate data sets. In the first part of the
analysis we deal with employment and turnover within the cluster. The analysis is carried out
at the level of sates (NUTS 1). If data availability improves, we will carry out the same
analysis at NUTS-2 or regional level. In the case of Denmark it would be necessary to go
even further down to NUTS3 or NUTS4. For employment we look at: its absolute levels and
changes in levels of employment between 1995-2000, significance for each economy, its
general structure within the BSR and compare it to the reference group in terms of shares as
well in terms location quotients (indicatives of specialization/concentration). We than carry
out a similar analysis for turnover drawing initial conclusions. We than move on to analysis of
trade relations of the BSR with EU16 (including the BSR) in goods (and services if
applicable).We depict export performance of each of the states in 2000, analyze trade balance
with the reference group at various level of aggregation (given sector in a given national
economy, given sector in the BSR, and than for clusters in a given states and for the BSR
taken as a whole). Finally, we look at values of revealed comparative advantage index (RCA)
and its unbiased – corrected version (CRCA)8. After completing this initial analysis we move
on to analyze location of a given clusters’ sectors in Poland – this possible by drawing
directly from the cluster-mapping exercise carried out by GIME in recent years (Szultka et al.
2004, OECD 2005) identifying its concentrations in particular in the northern regions of
Poland (for the sake of transparency we have supplemented the concentration maps with
borderlines of the three northern voivodeships of Poland).. We find this feature particularly
interesting to potential Nordic investors and researchers. We must remember that the
underlying objective of the present study apart from identifying strategic sectors for
competitiveness of the BSR economy is the analysis of opportunities for cooperation along
8
All the measures utilized are extensively described in Brodzicki (2003).
40
COMPETITIVE POSITION OF THE BALTIC SEA REGION
value chains within the BSR with possible reallocation of resource in the form of FDI and/or
migration.
The map is supplemented in each case by a table giving a total number of enterprises in each
of the sectors in each of six northern regions (pomorskie, warminsko-mazurskie,
zachodniopomorskie as well as kujawsko-pomorskie, lubuskie and wielkopolskie) with
employment of 10 and above. In some cases the sectoral scope is increased by information on
additional services and other sectors. In addition we report information on major foreign and
in particular foreign investments within the 6 regions. Furthermore, in some cases the analysis
is supplemented through analysis of additional data sources for instance on exact composition
of clusters or through more detailed data on production (turnover). Finally, we report on
certain valuable intraregional co-operation initiatives among national clusters or particularly
interesting cluster initiatives.
41
COMPETITIVE POSITION OF THE BALTIC SEA REGION
AUTOMOTIVE INDUSTRY (AIC)
The automotive industry is considered by the European Union as a sensitive branch of
manufacturing industry. That is in particular due to the significance of the sector and related
sectors for the European labor market as well the share in total value added.
The European Union is the biggest world manufacturer of cars (approx. 1/3 of total
production) as well as the biggest market for new cars.
The sector itself has certain features which further amplifies its sensitivity. It is a mediumhigh technology sector with dominance of blue collar workers which could be in general
considered to be both technology and labor intensive (labor costs constituting a significant
part of total costs). It is an export-oriented business dominated by a number of multinational
corporations following global strategies. It is considered to be one of the sectors in which FDI
intensity is particularly high. Furthermore, trade in cars is a star example of the so-called
intra-industry trade characteristic for developed economies. In general both the export and
production show feature of intra-industry specialization. Over time the sector shifts location in
accordance with location advantages – it is particularly prone to location shifts despite
significant sunk costs. If a shift occurs shits occurs it leads to relocation of whole industrial
conglomerate – together with companies situated beneath in the value added chain. A
spontaneous clustering process is thus frequently a case. It makes the sectors particularly
interesting.
The process occurs in Europe where the economies of the Central Europe (Slovakia, Hungary,
Czech Republic and Poland) seem to develop slowly to a position of major European player.
Within the report on location of industry in Europe …
In general the core of the automotive industry consists of three 3-digit NACE groups. These
are: NACE 341 - manufacture of motor vehicles, NACE 342 - manufacture of bodies
(coachwork) for motor vehicles; manufacture of trailers and semi-trailers as well as NACE
343 - manufacture of parts, accessories for motor vehicles. The core business is related to a
significant number of sectors – though for clarity we have not taken them into account.
42
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Within the BSR (excluding Germany) we have several major multinationals in the sector
mainly of direct Swedish-origin: Volvo, SAAB and Scania. However all the big players are
present in the region or in its vicinity. As has been mentioned before nearly all major global
players established their plants in the CEE (including northern and central regions of Poland).
We have to stress however, that the major concentration in Poland is situated in the south of
the country (Wrocław, Gliwice, Bielsko-Biała).
In 2000 total employment in the cluster within the BSR (defined as Poland and 3 Nordic
countries) amounted to approx. 175.000 jobs with Sweden and Poland having roughly the
same share. The region as a whole had a 8.7 per cent in total employment in automotive
industry in EU16 (EU15 plus Poland). It is clear from the following tables that employment in
manufacture of bodies (coachwork) for motor vehicles is spread across the region while the
core business - manufacture of motor vehicles and manufacture of parts, accessories for motor
vehicles is concentrated in Sweden (home of the multinationals) and Poland9. Altogether 90
per cent of employment in the automotive industry in the BSR is generated in manufacture of
motor vehicles as well as of parts and accessories for motor vehicles. It is important to note,
furthermore, that employment in the automotive cluster has a highest share in total
employment for Sweden (it exceeds significantly EU15/16 average) and is also significant for
Poland. It is clearly less significant for the other two countries.
Table 14 AIC - Employment in 2000
NACE
DNK
341
0
342
4 008
343
3 545
Together
7 553
Source: Own calculations.
FIN
SWE
POL
BSR10
2 694
4 017
766
7 477
50 397
3 200
23 930
77 527
33 786
4 759
44 204
82 749
86 877
15 984
72 445
175 306
BSR to EU16
(per cent)
1 077 936 1 111 722
7.8
164 603
169 362
9.4
700 153
744 357
9.7
1 942 692 2 025 441
8.7
EU15
EU16
Table 15 AIC - Share in total employment in manufacturing industry in 2000
NACE
341
342
DNK
0.0
0.9
FIN
0.6
1.0
SWE
6.7
0.4
POL
1.9
0.3
BSR
2.6
0.5
EU15
3.9
0.6
EU16
3.8
0.6
9
It is worth to note on the basis of the data available for Poland (XII 2003) that the employment in the cluster is
roughly the same – approx. 81.000 jobs but in comparison to 2000 a reallocation of resource occurred with
NACE 341 and 342 loosing 8160 and 1135 posts respectively and manufacture of parts, accessories for motor
vehicles gaining 7289 jobs. It reflects the shift of interest of major investors to Slovakia and Czech Republic.
The CEEs are competing with each other for major foreign greenfield investors. We have to note that the
situation is spoiling the market as an investment decision to a large extent is based on the amount of state aid
offered by a host economy.
10
BSR – Poland, Denmark, Finland and Sweden
43
COMPETITIVE POSITION OF THE BALTIC SEA REGION
343
0.8
Together
1.7
Source: Own calculations.
0.2
1.8
3.2
10.2
2.5
4.7
2.1
5.2
2.5
7.0
2.5
6.9
Table 16 AIC - Employment structure within the BSR
NACE
DNK
341
0.0
342
25.1
343
4.9
Together
4.3
Source: Own calculations.
FIN
3.1
25.1
1.1
4.3
SWE
58.0
20.0
33.0
44.2
POL
38.9
29.8
61.0
47.2
BSR
100.0
100.0
100.0
100.0
Location quotients for employment indicate existence of four major concentrations in the
BSR. That is manufacture of bodies (coachwork) for motor vehicles in Denmark and Finland
(however not in absolute terms that is the scale of employment) and two in Sweden in
manufacture of motor vehicles as well as of parts and accessories for motor vehicles.
Furthermore, manufacture of parts and accessories for motor vehicles in Poland is just below
the average for EU16.
Table 17 AIC - Location quotient for employment (in comparison to EU16 )
NACE
DNK
FIN
SWE
341
0.000
0.170
1.766
342
1.563
1.668
0.736
343
0.314
0.072
1.252
Source: Own calculations.
POL
0.509
0.470
0.994
It is important to note that employment levels in the automotive industry increased
dramatically in the period 1995 to 2000 (by approx. 41.000 jobs). The increase was
particularly evident for Poland and Sweden. In terms of sectors the increase was mainly in the
manufacture of parts and accessories for motor vehicles as well as the core business manufacture of motor vehicles.
Table 18 AIC - Absolute changes in employment levels between 2000 and 1995
NACE
DNK
341
0
342
-503
343
173
Together
-330
Source: Own calculations.
FIN
226
936
-425
737
SWE
-64
515
8 338
8 789
POL
14 292
514
17 206
32 012
BSR
14 454
1 462
25 292
41 208
In labor productivity terms the BSR is in general below the EU15 (and EU16) average with
Sweden reaching the average and the rest far of. It is important to note that in manufacturing
of vehicles labor productivity in Poland is higher that in Finland.
Table 19 AIC - Labor productivity in 2000 (turnover per employee)
NACE
341
DNK
:c
FIN
0.131
SWE
0.359
POL
0.192
BSR
0.287
EU15
0.410
EU16
0.403
44
COMPETITIVE POSITION OF THE BALTIC SEA REGION
342
0.174
343
0.107
Together
0.142
Source: Own calculations.
0.129
0.115
0.128
0.156
0.166
0.291
0.036
0.046
0.105
0.118
0.090
0.190
0.149
0.179
0.305
0.146
0.171
0.296
In 2000 automotive industry generated a total of 33.3 billion euro of turnover within the BSR
which amounted to 5.5 per cent of total turnover in the EU16. In terms of share in total
turnover of manufacturing industry the cluster is particularly important for Sweden (14.4 per
cent) and Poland (9.2 per cent). Similarly to employment it is roughly irrelevant for Finland
and Denmark. The share of these two economies is important in terms of the BSR only in
manufacture of bodies (coachwork) for motor vehicles, of trailers and semi-trailers.
Table 20 AIC - Turnover in 2000 (in mil of EUR)
NACE
DNK
341
0
342
696
343
378
Together
1 074
Source: Own calculations.
FIN
SWE
POL
BSR
EU15
EU16
352
517
88
958
18 074
500
3 975
22 550
6 491
173
2 047
8 711
24 918
1 886
6 488
33 293
441 778
24 534
125 490
591 801
448 268
24 708
127 536
600 512
BSR to EU16
(per cent)
5.6
7.6
5.1
5.5
EU15
8.9
0.5
2.5
11.9
EU16
8.8
0.5
2.5
11.8
Table 21 AIC - Share in total turnover of the manufacturing industry in 2000
NACE
DNK
341
0.0
342
1.1
343
0.6
Together
1.7
Source: Own calculations.
FIN
0.4
0.5
0.1
1.0
SWE
11.6
0.3
2.5
14.4
POL
6.8
0.2
2.2
9.2
BSR
6.1
0.5
1.6
8.1
Table 22 AIC - Turnover structure within the BSR
NACE
DNK
341
0.0
342
36.9
343
5.8
Together
3.2
Source: Own calculations.
FIN
1.4
27.4
1.4
2.9
SWE
72.5
26.5
61.3
67.7
POL
26.0
9.2
31.5
26.2
BSR
100.0
100.0
100.0
100.0
Location quotients for turnover are similar to LQs for employment with evidence of four
concentrations in the BSR (in the same four cases). It is important to note, however, that in
terms of turnover the concentration in manufacture of bodies (coachwork) for motor vehicles
in Denmark is particularly strong.
Table 23 AIC - Location quotient for turnover (in comparison to EU16 )
NACE
341
342
343
Source: Own calculations.
DNK
0.000
2.301
0.242
FIN
0.041
1.104
0.037
SWE
1.308
0.657
1.011
POL
0.771
0.374
0.855
45
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Finally, we will focus on data on trade intensity within the EU16 block. In 2001 total exports
to other EU16 countries (including those from the BSR) amounted to 10.3 billion euro with
Sweden and Poland two major exporters. The share of the cluster in total exports to EU 16
was particularly high for Sweden ( 26.6 per cent) and Poland (17.9 per cent). It was a minor
figure for the other two giving an average for the BSR of 10.3 per cent.
The region taken as a whole had a trade deficit of approx. 1.2 billion euro. Sweden and
Poland where the only countries with overall trade surplus. It is important to note that all four
countries had trade deficit in goods of NACE 343 - manufacture of parts and accessories for
motor vehicles.
Table 24 AIC - Exports to EU16 in 2001 (in mil EUR)
NACE
DNK
341
342
343
Together
Source: Own calculations.
FIN
152
82
339
574
SWE
302
53
134
489
POL
2 696
327
1 826
4 849
BSR
3 066
166
1 211
4 442
6 217
627
3 510
10 354
Table 25 AIC - Trade balance in trade with EU16 in 2001
NACE
DNK
341
-1 505
342
-112
343
-126
Together
-1 744
Source: Own calculations.
FIN
-603
14
-252
-840
SWE
1 164
211
-210
1 165
POL
518
16
-330
205
BSR
-426
129
-918
-1 214
We have to look at indices of revealed comparative advantage – an important factor for
cluster pointing to their advantage in trade. The RCA index is constructed in relation to the
EU16block. The situation is rather clear. Sweden and Poland seem to have comparative
advantage in all three subsectors of the automotive cluster while the other two countries have
comparative disadvantage in trade with EU16. Sweden is particularly strong in NACE 342
and 343. Altogether the BSR has a comparative advantage in those to sectors as well. We
have to remember, however, that the RCA is said to be biased to a certain extent. Thus we
have calculated and present the CRCA index as well which is said not to be biased by
significant trade imbalances. The results differ a bit showing comparative advantage of
Poland in all three sectors and Sweden in NACE 341 and 342. Overall the region has an
advantage only in manufacture of bodies (coachwork) for motor vehicles as well as of trailers
and semi-trailers.
Table 26 AIC - RCA in trade within EU16
NACE
341
DNK
0.066
FIN
0.088
SWE
1.477
POL
1.235
BSR
0.618
46
COMPETITIVE POSITION OF THE BALTIC SEA REGION
342
0.980
343
0.432
Source: Own calculations.
0.422
0.114
4.932
2.937
1.838
1.432
1.718
1.024
Table 27 AIC - CRCA in trade within EU16
NACE
DNK
341
-0.060
342
-0.004
343
-0.004
Source: Own calculations.
FIN
-0.020
0.000
-0.008
SWE
0.033
0.009
-0.053
POL
0.046
0.002
0.002
BSR
-0.003
0.001
-0.008
As an additional source of information in this particular cluster we would like to show figures
on production of motor vehicles (NACE 341) in units on the basis of ACEA – an association
of major European motor vehicles producers. The definition of the BSR remains the same (we
exclude Germany, Russia and the Baltic states). The BSR produced within the period 20012003 on average 650.000 units which gives a total share of approx, 4 per cent in the whole
European Union. Poland and Sweden are two major producers.
Table 28 Production of motor vehicles in units
European Union
Denmark
Finland
Sweden
Poland
Total BSR
Source: ACEA (2005).
Production of motor vehicles (in units)
Share within the BSR
2001
2002
2003
2001
2002
2003
17 218 932
16 988 526
16 915 524 0
0
0
0.00
0.00
0.00
42 320
41 461
19 655
6.23
6.72
3.06
289 147
276 193
323 032
42.56
44.78
50.27
51.21
48.49
46.67
347 875
299 085
299 918
679 342
616 739
642 605
100.00
100.00
100.00
Finally, we focus on the significant concentrations of automotive industry in the northern part
of Poland. The following map was part of the Polish cluster mapping-project carried out by
GIME in the period 2002-2004. We have to add that in addition to 3 NACE groups in the
present study the map takes into account also NACE 251 that is manufacture of rubber
products that showed to be co-located in the aggregate data for Polish regions. For clarity we
have added the borders of the three regions defined to form part of the BSR in the State of the
Region Report. We have to remember, however, to our understanding at least another belt of
regions should be added if not the whole country itself. The industry is not, for the time being,
extremely concentrated. In the northern part of Poland several concentrations could be
identified in case of Poznan (wielkopolskie), Bydgoszcz (kujawsko-pomorskie), Słupsk and
Tricity (pomorskie). The presence of Nordic investors is particularly evident in pomorskie. As
to potential for future reallocation from Nordic countries to Poland we have to states that the
potential exist as Poland and the rest of the CEEs show competitive edge in the field based
both on relatively low labor costs but endowment in skilled labor (human capital) as well.
47
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Presence of foreign investors including major German and Swedish ones clearly proves the
point.
Table 29 Approximate number of enterprises (> 10 employees) in northern regions of Poland
341
pomorskie
3
warmińsko-mazurskie
2
zachodniopomorskie
0
kujawsko-pomorskie
3
lubuskie
0
wielkopolskie
5
Together
13
Source: Teleadreson (2005),www.teleadreson.com.pl
342
12
1
8
8
3
4
36
343
12
3
7
14
2
26
64
Together
27
6
15
25
5
35
113
The following companies invested in the northern regions of Poland (examples):

NACE 341 - Scania Kapena SA ( affiliate of Swedish Scania, Słupsk – pomorskie), MAN
STAR TRUCKS & BUSSES Sp. z o.o. (MAN, Tarnowo Podgórne), Solaris Bus & Coach
S.A. (Owińska – wielkoposkie), Volkswagen Poznań Sp. z o.o. (Volkswagen – Poznań,
wielkopolskie);

NACE 342 - Kuda Truck Parts Sp. z o.o. (Police – zachodniopomorskie),

NACE 343 - Eaton Truck Components Sp. z o.o. (Tczew – pomorskie), Dellner Couplers
Sp. z o.o. (Gdynia – pomorskie, affiliate of Swedish Dellner Couplers AB), Klippan
Safety Polska Sp. z.o.o. (affiliate of Swedish Boras Wafveri AB, Stargard Szczeciński,
zachodnipomorskie), MAHLE Polska Sp. z o.o. (Krotoszyn – zachodnipomorskie,
affiliate of German MAHLE AG), Delphi Mechatronics Systems (Delphi, Gdańsk –
pomorskie).
48
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Map 1 Significant concentrations of automobile industry at the NUTS-4 level in Poland (including NACE 251 - manufacture of rubber products)
liczba skupień
3-4
2
1
brak
siła skupień ogółem
1.00 12.98 24.96
Source: GIME.
49
COMPETITIVE POSITION OF THE BALTIC SEA REGION
WOOD AND FURNITURE (WFC)
The wood and furniture cluster traditionally belongs to a group of most prominent industries
in the region. It is a traditional, low-tech industry which is to a large extent resourced-based
that is endowment in the raw product – good quality wood in large quantities is a necessary
prerequisite to its development11. The cost of transportation are considerable thus location of
production is mainly resourced-based as well and cannot be easily relocated. We thus observe
strong features of path-dependency and local (regional) traditions. It is important to note that
the industry is both capital and labor intensive (with dominance of blue collar workers).
On the basis of previous research we consider the following 3 digit NACE groups to form part
of the wood and furniture cluster: NACE 201 - sawmilling and planing of wood, impregnation
of wood, 202 - manufacture of veneer sheets; manufacture of plywood, laminboard, particle
board, fiber board and other panels and boards, 203 - manufacture of builders' carpentry and
joinery, NACE 204 -manufacture of wooden containers, NACE 205 - manufacture of other
products of wood; manufacture of articles of cork, straw and plaiting materials and finally
NACE 361 - manufacture of furniture. Production of furniture could be considered as the
most advanced stage of production within the wood cluster.
In addition we would like to include NACE 020 - forestry, logging and related service
activities, however, due to unavailability of data within the NEW CRONOS data base we had
to remove it. Furthermore, in extended version, we would include sectors related to
manufacture of pulp, paper and paper products as well as publishing. We have decided,
however, to analyze the above as a separate cluster as a 3P cluster.
At first we will begin by analysis of natural resource endowment and production on the basis
of data provided by The Finnish Forest Research Institute – METLA (2004). The BSR
11
The study by Rosenthal and Strange (2003) clearly indicated that furniture industry taken alone is heavily
dependent on endowment in natural resources (raw material – wood). The authors analyzing the concentrations
of industries in the USA clearly indicate that dependence on natural resources leads the furniture industry to be
regionally concentrated while in the case of software clusters they tend to be locally-concentrated as in this case
different causes of agglomeration economies gain on importance.
50
COMPETITIVE POSITION OF THE BALTIC SEA REGION
(narrow definition) holds approx. 42 per cent of total forest resources of EU25 in terms of
forest area and 34 per cent of total growing stock volume. The share is roughly the same if we
take into account only forests available for wood supply. The region has also a significant
share in net annual increment. The resources are not evenly distributed among the states of the
BSR. Sweden is best endowed and closely followed by Finland. In comparison to these states
Polish endowment is significantly smaller (approx. by half) still it is significant on European
standards. Denmark has a marginal contribution in terms of natural endowment in resources.
Table 30 Forest resources in the BSR
Forest land
Forest available for wood supply
Growing stock
Growing stock
Area
Area
Net annual increment
volume
volume
(1000 ha)
(1000 ha)
(mill. m3 overbark)
(mill. m3 overbark)
(mill. m3 overbark)
139637
20005
116901
17927
574
27134
2914
21236
2567
85.4
10740
2880
10142
2820
89
21935
1945
20675
1867
72.5
455
56
440
54
3.2
2923
509
2413
409
11.1
1994
366
1686
314
8.5
9047
1930
8300
1771
39.4
2060
321
1932
307
7.1
58571
6845
50651
6259
200.5
76288
10921
66824
10109
316.2
EU25
Sweden
Germany
Finland
Denmark
Latvia
Lithuania
Poland
Estonia
BSR
BSR*
share of
BSR in
41.9
34.2
EU25
(per cent)
Source: METLA (2004) and own calculations.
43.3
34.9
34.9
Table 31 Distribution of forest resources among the economies of the BSR
Forest land
Growing stock
Area
volume
(1000 ha)
(mill. m3 overbark)
Sweden
46.3
42.6
Finland
37.5
28.4
Denmark
0.8
0.8
Poland
15.4
28.2
Source: METLA (2004) and own calculations.
Forest available for wood supply
Growing stock
Area
Net annual increment
volume
(1000 ha)
(mill. m3 overbark)
(mill. m3 overbark)
41.9
41.0
42.6
40.8
29.8
36.2
0.9
0.9
1.6
16.4
28.3
19.7
In terms of volume of production the share of the BSR in EU25 varies a lot (data for 2002)
between different basic products: softwood, hardwood and fuelwood. It is smallest for hard
industrial roundwood in logs (14.5 per cent) and highest for soft pulpwood (60.9 per cent). If
we took into account all the other excluded Baltic States the position of the Region would be
dominant bin majority of basic products. On average the share of the BSR is equal to 42.5 per
51
COMPETITIVE POSITION OF THE BALTIC SEA REGION
cent for EU25. In global terms the position on average is significantly smaller – with a 4.4 per
cent in global production. The Region has a highest share in global terms in soft pulpwood
(19.3 per cent of world production) and softwood in logs for industrial purposes (9.9 per cent
share). In terms of regional distribution of production Sweden is the overall leader, followed
by Finland and Poland. It is interesting to note, though, that Poland is a regional leader in hard
industrial roundwood in logs (and overall leader in hardwood).
Table 32 Production of roundwood in 2002 (1000 m3 underbark)
Industrial roundwood Industrial roundwood Roundwood
softwood
hardwood
Fuelwood
total
Logs Pulpwood Total
Logs Pulpwood Total
660219
268780 996565 277675
209694 575418
1763460
3335443
148595
85390 241013 24985
36373 66145
41419
348577
33500
23300 57200
300
3100
3500
5900
66600
21089
7275 29968
3357
3123
7787
4625
42380
22736
19743 42479
1099
4951
6050
4482
53011
369
153
638
86
151
657
1446
5612
1783
7882
2454
1872
4386
1198
13466
1870
870
2750
1350
710
2070
1295
6115
8480
8800 18723
2140
3800
6272
2142
27137
3400
2080
5860
540
1400
2740
1900
10500
65085
51996 119040
3625
11851 15973
13181
148194
97056
64004 165500 11326
18956 32956
22199
220655
World
EU25
Sweden
Germany
Finland
Denmark
Latvia
Lithuania
Poland
Estonia
BSR
BSR*
share of BSR in
43.8
60.9
49.4
EU25 (per cent)
share of BSR in
9.9
19.3
11.9
world (per cent)
Source: METLA (2004) and own calculations.
14.5
32.6
24.1
31.8
42.5
1.3
5.7
2.8
0.7
4.4
Fuelwood
Roundwood
total
44.8
34.0
5.0
16.3
44.9
35.8
1.0
18.3
Table 33 Distribution of roundwood production among the BSR in 2002
Industrial roundwood softwood
Logs Pulpwood Total
Sweden
51.5
44.8
48.1
Finland
34.9
38.0
35.7
Denmark
0.6
0.3
0.5
Poland
13.0
16.9
15.7
Source: METLA (2004) and own calculations.
Industrial roundwood hardwood
Logs Pulpwood Total
8.3
26.2
21.9
30.3
37.9
41.8
2.4
0.0
0.9
32.1
59.0
39.3
It is interesting as well to look at statistics on production of processed goods of the cluster
(once again in terms of volume). The share of region in total EU25 production is the highest
in sawn goods made of softwood (37.7 per cent) and in plywood and veneer sheets (31.8 per
cent). The position in hardwood is related to smaller hardwood endowment. In global terms
the region has highest shares in sawn goods made of softwood (11.2 per cent) and in particle
board (5.2 per cent). If we take at look at regional distribution of production within the BSR
52
COMPETITIVE POSITION OF THE BALTIC SEA REGION
once again it is uneven. Sweden has a dominant position only in sawn goods made of
softwood. Finland is a regional leader in plywood and veneer shits while Poland in sawn
goods made out of hardwood as well as particle board and fiberboard. Denmark has a
marginal share apart from particle board.
Table 34 Production of sawn goods and wood-based panels in 2002
391030
133355
94826
16172
17119
13390
244
3947
1300
3180
1825
32986
57177
Plywood and
veneer
sheets
66857
8248
5535
102
677
1310
16
213
60
333
91
1761
2802
34.8
31.8
12.4
15.0
8.4
2.6
5.2
4.6
Sawn goods (1000 m3)
Softwood
Hardwood
Total
WORLD
287036
103994
Europe
114302
19052
EU25
85021
9805
Sweden
16012
160
Germany
15979
1140
Finland
13280
110
Denmark
217
27
Latvia
3100
848
Lithuania
900
400
Poland
2574
606
Estonia
1656
169
BSR
32083
903
BSR*
53718
3460
share of BSR in
37.7
9.2
EU25 (per cent)
share of BSR in
11.2
0.9
world (per cent)
Source: METLA (2004) and own calculations.
Particle
board
Fiberboard
84794
42414
35572
564
8729
413
334
105
189
3111
187
4422
13632
39117
14805
11893
190
3350
140
63
1450
83
1780
5276
Table 35 Distribution of production of sawn goods and wood-based panels in 2002 among the BSR
Sawn goods (1000 m3)
Softwood
Hardwood
Sweden
17.7
49.9
Finland
41.4
12.2
Denmark
0.7
3.0
Poland
8.0
67.1
Source: METLA (2004) and own calculations.
Total
49.0
40.6
0.7
9.6
Plywood and
veneer
sheets
5.8
Particle
board
Fiberboard
12.8
9.3
7.6
10.7
7.9
0.0
70.4
81.5
74.4
0.9
18.9
The significance of the cluster is self-evident if we look on the data on the level of
employment. The wood and furniture cluster generates around 320.000 jobs across the region.
If we would include related sectors (in particular related services and forestry in general) the
figure would clearly exceed 500.000 to 600.000 making it the top regional employer.
Table 36 Employment within the cluster in 2000
NACE
201
DNK
1 867
FIN
11 221
SWE
16 268
POL
24 293
BSR
53 649
EU15
165 238
BSR to EU16
(per cent)
189 531
28.3
EU16
53
COMPETITIVE POSITION OF THE BALTIC SEA REGION
202
1 401
5 671
2 264
11 852
21 188
83 842
95 694
22.1
203
10 860
10 827
18 491
19 989
60 167
421 245
441 234
13.6
204
900
1 019
2 294
3 628
7 841
68 651
72 279
10.8
205
1 573
822
3 182
8 345
13 922
129 363
137 708
10.1
361
25 898
12 476
27 635
94 674
160 683 1 032 303 1 126 977
14.3
Together
42 499
Source: Own calculations.
42 036
70 134
162 781
317 450 1 900 642 2 063 423
15.4
It is worth to note that in all of the states the cluster generates approx. 10 per cent of total
employment in manufacturing industry which is above both EU15 and EU16 average. In
absolute terms Poland has the highest share in regional employment in all the NACE groups
followed by Sweden and Finland. Manufacture of furniture is the biggest regional employer in
the cluster as it generates 51 per cent of jobs – it is followed by manufacture of builders'
carpentry and joinery (19 per cent) and sawmilling and planing of wood as well as impregnation of
wood (17 per cent).
Table 37 Share in total employment in manufacturing industry in 2000
NACE
DNK
0.4
201
0.3
202
2.4
203
0.2
204
0.4
205
5.8
361
Together
9.5
Source: Own calculations.
FIN
2.7
1.4
2.6
0.2
0.2
3.0
10.0
SWE
2.2
0.3
2.4
0.3
0.4
3.7
9.3
POL
1.4
0.7
1.1
0.2
0.5
5.4
9.3
BSR
1.6
0.6
1.8
0.2
0.4
4.8
9.4
EU15
0.6
0.3
1.5
0.2
0.5
3.7
6.9
EU16
0.6
0.3
1.5
0.2
0.5
3.8
7.0
Table 38 Employment structure within the BSR
NACE
DNK
3.5
201
6.6
202
18.0
203
11.5
204
11.3
205
16.1
361
Together
13.4
Source: Own calculations.
FIN
20.9
26.8
18.0
13.0
5.9
7.8
13.2
SWE
30.3
10.7
30.7
29.3
22.9
17.2
22.1
POL
45.3
55.9
33.2
46.3
59.9
58.9
51.3
BSR
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Location quotients for employment clearly indicate that the wood and furniture cluster is
strong within the BSR. There are 12 statistically significant concentrations with 5 of them at
least doubling the EU16 average. In Denmark the concentrations of employment are
particularly evident in manufacturing of builders' carpentry and joinery as well as
manufacturing of furniture. In Finland the concentrations are strongest in saw milling and
planing of wood as well as in manufacturing of veneer sheets, plywood, laminboard, particle
board, fiber board and other panels and boards and to a lesser extent in manufacturing of
builders' carpentry and joinery. Despite having an LQ below 1 Finnish wooden containers
54
COMPETITIVE POSITION OF THE BALTIC SEA REGION
sectors is worth to be noticed. In Sweden all the sectors have an LQ higher than 0.9 with
NACE 201, 203, 204 the strongest and furniture manufacturing important as well. Poland has
in turn major concentrations in NACE 201 and 202 as well as in furniture manufacturing.
Table 39 Location quotients for employment (in comparison to EU16 )
NACE
201
202
203
204
205
361
Source: Own calculations.
DNK
0.650
0.967
1.625
0.822
0.754
1.517
FIN
4.164
4.168
1.726
0.992
0.420
0.779
SWE
3.343
0.921
1.632
1.236
0.900
0.955
POL
2.146
2.074
0.758
0.840
1.015
1.406
From 1995 till 2000 the total employment in the cluster rose by nearly 56.000 jobs and was
particularly strong in Poland and Sweden and to a lesser extent in Finland. The employment
in the sector was stable in Denmark which could reflect its stagnant nature. The growth in
employment was particularly strong in furniture manufacturing and manufacturing of builders'
carpentry and joinery.
Table 40 Absolute changes in employment levels between 2000 and 1995
NACE
DNK
201
202
203
204
205
361
Together
Source: Own calculations.
FIN
-279
-167
680
-33
-512
49
-262
SWE
2 176
-1 411
2 942
206
95
2 449
6 457
POL
438
46
4 618
559
1 492
10 389
17 542
BSR
414
-444
8 198
2 420
4 712
16 782
32 082
2 749
-1 976
16 438
3 152
5 787
29 669
55 819
In terms of labor productivity the 3 Nordic states overall exceed the EU15/16 average while
Poland is much below it. The situation varies significantly between NACE groups. Out of 6
sectors Sweden exceeds EU15 average in 4 cases, Finland in 3 and Denmark in 2.
Table 41 Labor productivity in 2000 (turnover per employee)
NACE
DNK
0.137
201
0.119
202
203
0.113
0.103
204
0.083
205
361
0.117
Average
0.116
Source: Own calculations.
FIN
0.286
0.131
0.124
0.115
0.074
0.104
0.161
SWE
0.268
0.207
0.135
0.132
0.076
0.099
0.151
POL
0.026
0.081
0.034
0.025
0.021
0.030
0.033
BSR
0.158
0.110
0.096
0.077
0.044
0.062
0.087
EU15
0.153
0.193
0.091
0.116
0.088
0.102
0.108
EU16
0.136
0.180
0.088
0.112
0.084
0.096
0.102
In 2000 the BSR had an overall share in total turnover of the wood and furniture industry in
the EU16 of 13.2 per cent. The share was the highest in sawmilling and planing of wood (32.7
55
COMPETITIVE POSITION OF THE BALTIC SEA REGION
per cent) followed by manufacture of builders' carpentry and joinery (14.8 per cent) and
manufacture of veneer sheets (13.6). Manufacture of furniture had a respectful 9.2 per cent
share. In absolute terms the cluster within the BSR generated 27.7 billion euro of turnover
with furniture manufacturing generating approx. 10 billion euro of turnover and sawmilling
and planing of wood approx. 8.5 billion euro. In terms of turnover the importance of the
cluster for the economy is lower in the BSR than in the case of employment. It generates
approx. 7 per cent of regional turnover of manufacturing industry. However, we have to note
that this is significantly above the EU15/16 average. It is also worth to note that in the case of
Denmark furniture manufacturing alone generates approx. 5 per cent of total turnover.
Table 42 Turnover in 2000 (in mil of EUR)
NACE
DNK
257
201
167
202
1 232
203
92
204
131
205
3 040
361
Together
4 918
Source: Own calculations.
FIN
3 208
742
1 347
117
61
1 297
6 771
SWE
4 354
468
2 503
302
243
2 725
10 595
POL
BSR
634
960
672
90
173
2 882
5 410
EU15
8 452
2 335
5 754
602
607
9 944
27 694
EU16
25 226 25 860
16 219 17 178
38 184 38 856
7 991
8 082
11 403 11 576
105 497 108 379
204 520 209 930
BSR to EU16
(per cent)
32.7
13.6
14.8
7.4
5.2
9.2
13.2
Table 43 Share in total turnover of the manufacturing industry in 2000
NACE
DNK
0.41
201
0.27
202
1.98
203
0.15
204
0.21
205
4.90
361
Together
7.92
Source: Own calculations.
FIN
3.34
0.77
1.40
0.12
0.06
1.35
7.05
SWE
2.79
0.30
1.60
0.19
0.16
1.74
6.78
POL
0.67
1.01
0.71
0.09
0.18
3.03
5.68
BSR
2.06
0.57
1.40
0.15
0.15
2.43
6.76
EU15
0.51
0.33
0.77
0.16
0.23
2.12
4.11
EU16
0.51
0.34
0.77
0.16
0.23
2.14
4.14
In terms of turnover the cluster is unevenly distributed but only to a limited extent. Only in
two cases (NACE 201 and 204) the turnover in a single country exceeds a 50 per cent
threshold. It is worth to note that in term of turnover Poland is a regional leader in
manufacture of veneer sheets and boards (this proves the point made beforehand during
analysis of more detailed data on volumes of processed goods).
Table 44 Turnover structure within the BSR
NACE
201
202
203
204
205
361
DNK
3.0
7.1
21.4
15.4
21.5
30.6
FIN
37.9
31.8
23.4
19.4
10.0
13.0
SWE
51.5
20.0
43.5
50.2
40.0
27.4
POL
7.5
41.1
11.7
15.0
28.5
29.0
BSR
100.0
100.0
100.0
100.0
100.0
100.0
56
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Together
17.8
Source: Own calculations.
24.4
38.3
19.5
100.0
Next we turn to analysis of location quotients for turnover. The results are similar to location
quotients for employment analyzed above. The only major difference apart from the strength
of particular concentration being the lack of concentration in - manufacture of other products
of wood and cork (NACE 205) in Poland.
Table 45 Location quotient for turnover (in comparison to EU16 )
NACE
201
202
203
204
205
361
Source: Own calculations.
DNK
0.811
0.792
2.590
0.934
0.923
2.291
FIN
6.546
2.278
1.830
0.762
0.276
0.632
SWE
5.461
0.883
2.089
1.213
0.681
0.816
POL
1.306
2.976
0.921
0.594
0.795
1.416
Finally we supplement the investigation into the wood and furniture cluster in the Baltic Sea
Region by analysis of trade within the EU16 block. In 2001 total exports to other EU16 states
amounted to 9.5 billion euro and was concentrated in furniture as well as NACE 201 and 203.
Poland was the biggest regional exporter onto the EU16 market, followed by Finland. The
region as a whole had a significant trade surplus with the rest of EU16 (including other BSR
states) of approx. 7 billion euro(with biggest trade surplus for Poland). This is total
understandable if we look at the indices of revealed comparative advantage. The region as a
whole has a significant advantage (with RCA exceeding 2) in all of analyzed subsectors. Even
if the CRCA index shows a less rosy picture (indicating comparative disadvantage is certain
subsectors), the overall comparative advantage is self-evident. It is worth to note that Poland
is the only country to have all CRACs positive – thus indicating comparative advantage. The
comparative advantage is particularly strong in furniture manufacturing (Poland and
Denmark) and in NACE 201 for Sweden and Finland.
Table 46 Exports to EU16 in 2001 (in 1000000 EUR)
NACE
DNK
81
201
73
202
417
203
10
204
85
205
1 315
361
Together
1 981
Source: Own calculations.
FIN
SWE
1 615
70
357
13
47
526
2 628
POL
1 021
427
162
2
4
112
1 728
BSR
169
176
201
126
352
2 168
3 192
2 885
747
1 137
151
488
4 121
9 529
Table 47 Trade balance in trade with EU16 in 2001
NACE
DNK
FIN
SWE
POL
BSR
57
COMPETITIVE POSITION OF THE BALTIC SEA REGION
201
202
203
204
205
361
Together
Source: Own calculations.
-349
-84
356
-5
42
997
957
1 537
-70
334
3
17
81
1 901
992
405
147
-1
-3
16
1 556
132
27
167
114
324
1 801
2 565
2 311
278
1 004
112
380
2 895
6 979
Table 48 RCA in trade within EU16
NACE
DNK
0.665
201
0.888
202
8.354
203
1.120
204
2.792
205
4.200
361
Source: Own calculations.
FIN
8.847
0.571
4.780
0.952
1.039
1.123
SWE
10.570
6.546
4.094
0.282
0.167
0.451
POL
1.286
1.983
3.744
13.254
10.724
6.431
BSR
5.420
2.076
5.219
3.904
3.672
3.015
SWE
0.054
0.022
0.008
0.000
0.000
-0.001
POL
0.006
0.003
0.007
0.005
0.013
0.076
BSR
0.023
0.003
0.010
0.001
0.004
0.029
Table 49 CRCA in trade within EU15 +PL
NACE
DNK
-0.014
201
-0.003
202
0.016
203
0.000
204
0.002
205
0.044
361
Source: Own calculations.
FIN
0.044
-0.002
0.010
0.000
0.000
0.001
Within the northern regions of Poland there are relatively numerous enterprises active in the
cluster. There are at least 897 companies employing 10 and more employees. The most
numerous sector is manufacture of furniture followed. by manufacture of builders' carpentry
and joinery. The number of enterprises increases the possibility of cluster formation with
steadily increasing specialization pattern developing. We have to note that the industry in
Poland, as has been already mentioned, is based on existing local traditions thus an interesting
specialized labor market is present.
Table 50 Approximate number of enterprises (> 10 employees) in northern regions of Poland
201
202
pomorskie
21
8
warmińsko-mazurskie
30
14
zachodniopomorskie
29
11
kujawsko-pomorskie
22
10
lubuskie
12
4
wielkopolskie
25
5
Together
139
52
Source: Teleadreson (2005),www.teleadreson.com.pl
203
54
47
32
34
14
44
225
204
10
9
6
8
6
12
51
205
9
7
6
9
2
11
44
361
109
82
26
47
20
102
386
Together
211
189
110
130
58
199
897
The wood and furniture sector is significantly dispersed in Poland (please refer to Map 2).
Despite the fact, certain major concentration can be detected. It is important to note that
58
COMPETITIVE POSITION OF THE BALTIC SEA REGION
majority of the concentrations are located in the northern parts of Poland (including 3 regions
considered by the State of the Region Report).
It seems that on the one hand entrepreneurs in the BSR are direct competitors. Still the overall
advantage of the region creates an opportunity of further increasing it through mutual
cooperation. The reallocation of production on a larger scale is possible but highly unlikely. It
will take form of FDI inflows into the southern Baltic regions. In fact it already occurs.
The wood and furniture sector is attractive to foreign investors at each stage of the value
chain: from forestry, through sawmilling to processed goods up to furniture manufacturing. At
the moment foreign investors (including Nordic investors) are numerous in the cluster. Both
large MNCs as well as smaller entities are present. The majority of investors come from:
Germany, Sweden, the Netherlands or Norway (there are also Finnish and Danish investors
present). These include among others:

NACE 201: K. Schroeder Sp. z o.o. ( Schoreder AG, Germany, Szprotawa, lubuskie),
Fikszo Polska Sp. z o. o (Netherlands, Taronowo Podgórne, wielkopolska,), Pollmeier
Polska Sp. z o.o. (Pollmeier Massivholz GmbH & Co.KG, Germany, Poznań,
wielkopolskie)

NACE 202: HARDEX S.A. (foreign capital, Krosno Odrzańskie, lubuskie), Kronopol Sp.
z o.o. ( Krono Holding AG, Switzerland, Żary, lubuskie); KRONOSPAN PL Sp. z o.o.
(Grupa Kapitałowa Kronospan, Szczecinek, zachodniopomorskie),

NACE 203-205: MULTI-LAS Sp. z o.o. J.V. (Dobre Miasto, warmińsko-mazurskie),
ScanWin Sp. z o.o. (Wolsztyn, wielkopolskie), WERTH-HOLZ POLSKA Sp. z o.o.
(WERTH-HOLZ SA, Germany, Pszczew, lubuskie), Barlinek S.A. (with foreign capital
Barlinek, zachodipomorskie, quated on the WSE), Firmus Polska Sp. z o.o. (Firmus AS,
Norway, Mścice, zachodniopomorskie), INTERWOOD (Miastko, pomorskie), Rationel
Polska Sp. z o.o. (Swarożyn, pomorskie), Milford Sp. z o.o. (Milord AB, Sweden, Poznań,
wielkopolskie), Krepel Polska Sp.z o.o (Krepel Cassetts, the Netherlands, Durzyn,
wielkopolskie)

NACE 361: Mazurskie Meble International Sp. z o.o. (Schieder Group, Germany,
Olsztyn,
warmińsko-mazurskie),
Swedwood
Poland
S.A
(Swedwood
Holding
BV,Sweden, Szczecin, several plants), Swedwood Poland Sp. z o.o. - Oddział w Lubawie
(Swedwood – IKEA Group Sweden, Lubawa, warmińsko-mazurskie), Fabryka Mebli
59
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Schumacher Polska Sp. z o.o. (, Schumacher AG, Germany, Lubawa, warmińskomazurskie), LEXXIT MEBEL PRODUCTION & TRADING Sp. z o.o. (LEXXIT
MEBEL, Belgium, Grodzisk Wielkopolski, wielkopolskie), Vox Industrie S.A. (Vox,
Kobylnica wielkopolskie), Fikszo Polska Sp. z o. o (Netherlands, Taronowo Podgórne,
wielkopolskie), Depolex sp z o.o. (Lipno , wielkopolskie), T" Fabryka Mebli
Tapicerowanych Sp. z o.o. ( Łowyń, wielkopolskie), Fabryka Mebli Tapicerowanych
CHRISTIANAPOL Sp. z o.o. (HIMMOLA, Łowyń, wielkopolskie), STEINPOL OK
Meble Sp. z o.o. (Zielona Góra, lubuskie), Scanwood Sp. z o.o. Sweden, Mierzyn near
Szczecin,
Scanwood
Dębno,
Scanwood
Słońsk,
zachodniopomorskie),
PPU
INTERWOOD Sp. z o.o. (B.B. Holding, the Netherlands, Wałcz, zachodniopomorskie),
FRANKE GASTOPOL Sp. z o.o. (Franke Germany, Gdynia, pomorskie), BERGUS Sp. z
o.o (Sweden, Starogard Gdański, pomorskie).
The foreign investors presence is particularly strong in furniture manufacturing with the
majority of the sector already in foreign ownership. We have to note that furniture production
in Poland is attractive due to the size of the domestic market, significant endowment in
specialized labor force still relatively cheap, abundance of raw materials as well as location.
The sector itself is export-oriented.
60
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Map 2 Significant concentrations of the wood and furniture cluster at the NUTS-4 level in Poland (including NACE 020)
liczba skupień
5-7
3-4
1-2
brak
siła skupień ogółem
1.00 32.44 63.88
przemysł meblarski
(siła skupienia)
1.00 9.73 18.46
Source: GIME.
61
COMPETITIVE POSITION OF THE BALTIC SEA REGION
3P - PULP, PAPER, PUBLISHING (3P)
The 3P cluster is internally diversified. On the one hand we have usually geographically
concentrated large companies producing pulp, paper and paperboard. Traditional (basic)
industry showing high economies of scale both capital and labor intensive. Manufacture of
pulp, paper and paperboard is heavily depended on access to natural resources thus its
location is mainly resourced-based. The more we move forward in the value added chain
usually the smaller and more numerous are the companies. The location factors
(determinants) shift.
The BSR region similarly to wood and furniture cluster has a very good competitive position
in the business which is to a large extent related to abundance of natural resources.
The following 3-digit NACE groups are included in the cluster: NACE 211 – manufacture of
pulp, paper and paperboard, NACE 212 – manufacture of articles of paper and paperboard,
NACE 221 – publishing and finally NACE 222 – printing and service activities related to
printing.
The 3P sector in the BSR has a strong position both in the EU25 as well in the world. The
BSR generates in terms of volume approx. two thirds of EU25 production of wood pulp (all
major categories: mechanical, semi-mechanical and chemical pulp). It has also a 30 per cent
stake in total EU25 production of paper and paperboard. In global terms the region is
particularly strong in mechanical pulp (20.8 per cent of global production), chemical pulp
(11.3 per cent), printing and writing paper (11.9 per cent) as well as semi-mechanical pulp
(10.9 per cent share).
Table 51 Production of pulp, paper and paperboard in 2002 (volume)
Pulp
SemiMechanical
mechanical
pulp
pulp
World
EU25
Sweden
Germany
Finland
Denmark
Latvia
Lithuania
34735
10724
3021
1252
4087
-
8410
1350
281
500
-
Chemical
pulp
144337
25502
8410
896
7142
-
Newsprint
37377
9153
2423
2026
1008
-
Paper and paperboard
Printing
Other
and
paper and
writing
paperboard
paper
96609
190717
33553
47330
2807
5494
7043
9457
8084
3697
133
250
1
32
78
Total
324704
90036
10724
18526
12789
383
33
78
62
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Poland
102
139
Estonia
BSR
7210
920
BSR*
8462
920
share of BSR
67.2
68.1
in EU25
share of BSR
20.8
10.9
in world
Source: METLA (2004) and own calculations.
784
65
16336
17297
217
3648
5674
516
11540
18584
1609
75
11050
20692
2342
75
26238
44950
64.1
39.9
34.4
23.3
29.1
11.3
9.8
11.9
5.8
8.1
This excellent competitive position in global terms is basically due to Finland and Sweden.
The contribution of Poland is significantly smaller, however, it is noticeable in the production
of semi-mechanical pulp and other paper and paperboard. Contribution of Denmark is
marginal in production of pulp, paper and paperboard.
Table 52 Production of pulp, paper and paperboard in 2002 within the BSR – regional distribution (share
in region total production in per cent)
Pulp
SemiMechanical
mechanical
pulp
pulp
Chemical
pulp
Newsprint
51.5
43.7
4.8
66.4
27.6
5.9
Sweden
41.9
30.5
Finland
56.7
54.3
Denmark
Poland
1.4
15.1
Source: METLA (2004) and own calculations.
Paper and paperboard
Printing
Other
and
paper and
writing
paperboard
paper
24.3
49.7
70.1
33.5
1.2
2.3
4.5
14.6
Total
40.9
48.7
1.5
8.9
In 2002 the cluster generated approx. 306.000 jobs – 13.0 per cent of total employment in the
EU16. In terms of the share for particular subsectors the BSR had a highest share in
manufacturing of pulp an paper (34.2 per cent of EU16) as well as publishing (14.4 per cent).
Within the cluster most jobs were generated in publishing (103.000) followed by manufacture
of pulp, paper and paperboard and printing and service activities related to printing (both
approx. 80.000). In absolute terms the 3P cluster generated most jobs in Sweden, followed by
Finland and Poland.
Table 53 Employment within the 3P cluster in 2000
NACE
DNK
FIN
SWE
POL
BSR
EU15
211
1 184
36 623
32 125
10 453
80 385
224 419
BSR to EU16
(per cent)
234 872
34.2
212
7 818
4 476
12 428
17 982
42 704
433 009
450 991
9.5
221
34 560
17 722
30 315
20 112
102 709
694 594
714 706
14.4
222
17 559
13 691
26 073
22 963
80 286
933 117
956 080
8.4
72 512
100 941
71 510
306 084
Together
61 121
Source: Own calculations.
EU16
2 285 139 2 356 649
13.0
63
COMPETITIVE POSITION OF THE BALTIC SEA REGION
In relative terms, in terms of a share in total manufacturing employment), the 3P was most
important for the Nordic countries – Finland in particular (with the share more than doubling
an average for the EU15). The sector in relative terms is significantly less important for
Poland (with a share half of EU15 average). In terms of employment its distribution is
roughly is roughly uniform at an aggregated level with Sweden standing out with a 33 per
cent share. At the 3-digit NACE level each of the countries has highest share at one sector.
For instance Poland in manufacturing of articles of paper and paperboard and Denmark in
publishing.
Table 54 3P – Share in total employment in manufacturing industry in 2000
NACE
DNK
0.3
211
1.8
212
7.7
221
3.9
222
Together
13.7
Source: Own calculations.
FIN
8.7
1.1
4.2
3.3
17.3
SWE
4.2
1.6
4.0
3.4
13.3
POL
0.6
1.0
1.1
1.3
4.1
BSR
2.4
1.3
3.0
2.4
9.1
EU15
0.8
1.6
2.5
3.4
8.2
EU16
0.8
1.5
2.4
3.2
8.0
Table 55 3P – cluster employment structure within the BSR
NACE
DNK
1.5
211
18.3
212
221
33.6
21.9
222
Together
20.0
Source: Own calculations.
FIN
45.6
10.5
17.3
17.1
23.7
SWE
40.0
29.1
29.5
32.5
33.0
POL
13.0
42.1
19.6
28.6
23.4
BSR
100.0
100.0
100.0
100.0
100.0
Location quotients for employment indicate existence of significant concentrations of the
industry in the region apart from Poland (in relation to the benchmark group of EU16).
Sweden in 4 out of 4 cases and Denmark and Finland in 3 out of 4 sectors. Taking into the
strength of the concentration we should in particular name manufacture of pulp, paper and
paperboard in Finland and Sweden as well as of publishing in Denmark.
Table 56 Location quotients for employment (in comparison to EU16 )
NACE
211
212
221
222
Source: Own calculations.
DNK
0.333
1.145
3.193
1.213
FIN
10.967
0.698
1.744
1.007
SWE
5.327
1.073
1.652
1.062
POL
0.745
0.668
0.471
0.402
At aggregated level the total employment within the 3P cluster increased in the period 1995 to
2000 by nearly 8.000 jobs. The change was not uniform, however. It dropped in Denmark,
remained roughly the same in Finland and Sweden and increased significantly in Poland. It
wasn’t uniform at sectoral level as well. In general the increase in employment levels was
64
COMPETITIVE POSITION OF THE BALTIC SEA REGION
considerable in all sectors apart from the most basic sector that is manufacture of pulp, paper
and paperboard (a fall of approx. 12.000 jobs). It is worth to note that the sector contracted in
employment terms in all of the economies.
In terms of labor productivity Finland and Sweden are particularly strong in comparison to
EU15/16 average while Denmark and Poland in particular have still much room for
improvement.
Table 57 3P cluster. Absolute changes in employment levels between 2000 and 1995
NACE
DNK
-55
211
-1 006
212
-1 141
221
-369
222
Together
-2 571
Source: Own calculations.
FIN
SWE
-2 248
1 124
-796
2 843
923
-2 111
414
507
1 436
246
POL
-7 363
6 756
6 867
3 010
9 270
BSR
-11 777
7 288
5 437
6 920
7 868
Table 58 Labor productivity in 2000 (turnover per employee)
NACE
211
DNK
0.240
FIN
0.429
SWE
0.349
POL
0.131
BSR
0.355
EU15
0.337
EU16
0.328
212
0.162
0.148
0.187
0.053
0.122
0.181
0.176
221
0.079
0.134
0.152
0.058
0.106
0.169
0.166
222
0.110
0.113
0.126
0.041
0.096
0.107
0.106
0.280
0.212
0.062
0.171
0.163
0.160
Average
0.102
Source: Own calculations.
In 2000 the 3P cluster generated a total turnover of 52.3 billion euro – 13.9 per cent of
turnover in the EU16 group. Out of this 28.5 billion (54.6 per cent) was generated in
manufacture of pulp, paper and paperboard and 10.8 billion (20.7 per cent) in publishing. The
share of the region in comparison to EU16 was particularly high in key NACE 211.
Table 59 Turnover in 2000 (in mill. of euro)
NACE
DNK
284
211
1 265
212
2 724
221
1 936
222
Together
6 209
Source: Own calculations.
FIN
15 702
660
2 370
1 543
20 275
SWE
11 203
2 328
4 595
3 285
21 410
POL
1 365
961
1 158
937
4 421
BSR
28 554
5 215
10 846
7 700
52 315
EU15
75 573
78 276
117 601
100 064
371 513
EU16
76 937
79 237
118 758
101 000
375 933
BSR to
EU16 (per
cent)
37.1
6.6
9.1
7.6
13.9
The 3P cluster generated 21.1 per cent of total turnover of manufacturing industry in Finland
and at the same time had an approx. four times less share in Poland. On average the share in
the region was at the level of 12.8 per cent. In the case of all 3 Nordic countries the share was
much above the EU15/16 average. Finland and Sweden are responsible for approx. 80 per
65
COMPETITIVE POSITION OF THE BALTIC SEA REGION
cent of total turnover of the 3p cluster within the BSR. The share of Finland is particularly
high in manufacture of pulp, paper and paperboard.
Table 60 Share in total turnover of the manufacturing industry in 2000
NACE
DNK
0.5
211
2.0
212
4.4
221
3.1
222
Together
10.0
Source: Own calculations.
FIN
16.3
0.7
2.5
1.6
21.1
SWE
7.2
1.5
2.9
2.1
13.7
POL
1.4
1.0
1.2
1.0
4.6
BSR
7.0
1.3
2.6
1.9
12.8
EU15
1.5
1.6
2.4
2.0
7.5
EU16
1.5
1.6
2.3
2.0
7.4
Table 61 Turnover structure within the BSR
NACE
DNK
1.0
211
24.3
212
25.1
221
25.1
222
Together
11.9
Source: Own calculations.
FIN
55.0
12.7
21.8
20.0
38.8
SWE
39.2
44.6
42.4
42.7
40.9
POL
4.8
18.4
10.7
12.2
8.4
BSR
100.0
100.0
100.0
100.0
100.0
In terms of location quotients for turnover we see six major concentrations (with an LQ 25 per
cent above of the EU16 average) – in production of pulp and paper in Sweden and Finland, in
publishing in Sweden, and in three related NACE groups in Denmark. None of the sectors in
Poland has an LQ for turnover above the threshold level. (only an LQ for manufacture of
pulp, paper and paperboard is close to 1).
Table 62 Location quotient for turnover (in comparison to EU16 )
NACE
211
212
221
222
Source: Own calculations.
DNK
0.302
1.304
1.874
1.566
FIN
10.770
0.440
1.053
0.806
SWE
4.723
0.953
1.255
1.055
POL
0.945
0.646
0.519
0.494
In terms of exports to EU16 the region in 2001 the region exported altogether 13.5 billion
euro of goods mainly pulp, paper and paperboards and products made of them. Finland and
Sweden are the two major regional exporters on the EU16 market and Denmark and Poland
minor exporters. In terms of trade balance Finland and Sweden recorded significant trade
surplus while Poland and had a trade deficit in all 4 subsectors.
Table 63 Exports to EU16 in 2001 (in 1000000 EUR)
NACE
DNK
211
212
221
222
Together
Source: Own calculations.
227
246
185
73
731
FIN
5 474
469
98
35
6 076
SWE
5 373
450
72
67
5 963
POL
BSR
400
272
55
47
774
11 475
1 436
411
222
13 544
66
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Table 64 Trade balance in trade with EU16 in 2001
NACE
DNK
-589
211
-160
212
15
221
-27
222
Together
-761
Source: Own calculations.
FIN
SWE
5 041
160
-112
-57
5 031
POL
5 134
301
-1
37
5 470
BSR
-569
-91
-68
-28
-756
9 017
210
-167
-75
8 985
The Baltic Sea Region taken as a whole has a strong comparative advantage in trade in the
manufacture of pulp, paper and paperboard. This is due to position of Sweden and Finland. It
has a strong position in related manufacture of articles of paper and paperboard (with
Denmark the only country with comparative disadvantage in trade as indicated by CRCA).
The BSR shows a comparative disadvantage in publishing and printing.
Table 65 RCA in trade within EU16
NACE
DNK
0.33
211
1.08
212
1.16
221
1.10
222
Source: Own calculations.
FIN
5.25
1.37
0.41
0.35
SWE
9.74
2.49
0.57
1.28
POL
0.53
1.11
0.32
0.65
BSR
3.77
1.44
0.59
0.76
FIN
0.145
0.004
-0.004
-0.002
SWE
0.277
0.013
-0.002
0.001
POL
-0.013
0.000
-0.002
0.000
BSR
0.090
0.002
-0.002
-0.001
Table 66 CRCA in trade within EU16
NACE
DNK
-0.023
211
-0.006
212
0.001
221
-0.001
222
Source: Own calculations.
For many reason the 3P cluster has a strategic importance to the region in particular it is the
case for Finland and Sweden. Despite the strong position of the these two Nordic states the
position of the region could be further improved if strong Nordic corporations utilize the
opportunities created by enlargement of the European Union and invest more in Poland and
the 3 Baltic States.
In order to asses the opportunities we have to take a look at the location of the 3P sector in
Poland. As the map of concentrations and the following table clearly indicate the sector is
relatively dispersed mainly due to dependence on resources. Production of pulp an paper is
most concentrated with several large plants while the rest is more dispersed across the
country. It is important to note that within the three northern voivodeships of Poland there
exist a number of significant concentrations of the industry.
67
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Table 67 3PC - Approximate number of enterprises (> 10 employees) in northern regions of Poland
211
212
221
222
Together
pomorskie
1
24
warmińsko-mazurskie
0
13
zachodniopomorskie
1
20
kujawsko-pomorskie
4
34
lubuskie
1
7
wielkopolskie
0
40
Together
7
138
Source: Teleadreson (2005),www.teleadreson.com.pl
54
9
12
15
5
38
133
86
26
30
56
5
73
276
165
48
63
109
18
151
554
As already has been mentioned, manufacture of pulp, paper and paperboard is concentrated in
several large plants which have been taken over by large multinationals. These are
International Paper SA in Kwidzyn (pomorskie, MNC, quoted on NYSE), Arctic Paper
Kosztyń SA (Arctic Paper AB, Sweden, Kostrzyń, wielkopolskie), Axxion Industries (Axxion
AG, the Netherlands, Poznań, wielkopolska,) as well as FRANTSCHACH ŚWIECIE S.A. in
Świecie (Mondi Packaging, international, Świecie, kujawsko-pomorskie). All the big plants
are surrounded by a number of enterprises of related sectors forming “natural” clusters.
Foreign investors are present in other sectors of the cluster for instance in packaging or paper
products. Among others we have SCA PACKAGING POLAND Sp. z o.o. and SCA
POZNAN DISPLAY Sp.z o.o. part of Swedish Svenska Cellulosa Aktienbolaget SCA in
Kwidzyn, Piła, Tarnowo Podgórne, Dutch Kappa Packaging Group in Drezdenko, Konin,
Gdańsk (Tczew)., German Hanke Paper in Kostrzyn Odrzański - Hanke Tissue.
It seems that investors are taking into account existence of special economic zones (SEZ),
where special rules for state aid apply (in the form of tax exemptions upon fulfilling certain
entry criteria). This could have been a factor of locating investments in Kostrzyn, Kwidzyn or
Tczew.
68
COMPETITIVE POSITION OF THE BALTIC SEA REGION
liczba skupień
5-7
3-4
1-2
brak
siła skupień ogółem
1.00 32.05 63.09
przemysł
celulozowo-papierniczyi
(siła skupienia)
1.00 10.27 19.54
69
COMPETITIVE POSITION OF THE BALTIC SEA REGION
ICT CLUSTER
ICT is one of the fastest growing sectors globally. It’s role is substantial in stimulating both
overall productivity growth (TFP) as well as productivity levels of individual sectors
including the non-IT manufacturing and non-manufacturing sectors (Jorgenson and Nomura
2005). Its role in the BSR is substantial and is increasing steadily. ICT is very different from
traditional business in terms of its characteristics. Despite the general perception of its
footloose or weightless nature the sector itself tends to be spatially concentrated (thus ICT
clusters emerge). The BSR seems to be one the leading ICT clusters (at least in certain niche
markets) on a global arena - the fact that will potentially determine the long-term prosperity
of the region.
As to the scope of the cluster itself different views co-exist. For sure the following 3-digit
NACE groups should be taken into account: NACE 300 - manufacture of office machinery
and computers, NACE 321- manufacture of electronic valves and tubes and other electronic
components, NACE 322 - manufacture of television and radio transmitters and apparatus for
line telephony and line telegraphy and 323 manufacture of television and radio receivers,
sound or video recording or reproducing apparatus and associated goods. In the present study,
on the basis of the Polish cluster-mapping project we take into account NACE 332 manufacture of instruments and appliances for measuring, checking, testing, navigating and
other purposes, except industrial process control equipment (we would extend it preferably to
include NACE 333 – however it was impossible due to data limitations). In the Polish clustermapping project we extended the definition further to accommodate cluster-related services
NACE 721 through to 726 including among others: hardware and software consultancy and
supply, data processing and other data base activities12. The scope of the present study did not
allow us to take the above fully into account due to severe data limitations. For instance the
NEW CRONOS data base does not have data on manufacture of office machinery and
computers so we will present only information on Poland. It seems important as a general
policy recommendation that the statistical data bases on business activities should be
12
In several ICT clusters cases studies the researcher go even further extending the scope of the cluster by
addition of “content” producing sectors such as publishing, printing, television and radios.
70
COMPETITIVE POSITION OF THE BALTIC SEA REGION
significantly improved in terms of their scope, depth and reliability in order to improve the
quality of policy-making process all over Europe (including in the BSR region).
What is so specific about ICT? As has been already mentioned it is a fast-growing sector (a
cluster of sectors in fact) characterized by relatively short or very short product life-cycles. It
is depended to a large extent on R&D and dynamic innovation – the R&D intensity is high. In
other words ICT is a high-tech, high knowledge and technology intensive branch. This in fact
makes it one of the most human capital intensive branches with the majority of workers being
highly qualified specialists (university graduates) and white collar workers. Furthermore, the
branch is characterized by high value-added, high-risk. Its both capital and marketing
intensive. The futures cause the industry to cluster which brings important benefits in terms of
locally available externalities.
In 2000 the ICT cluster generated approximately 160.000 jobs in the region. Due to the lack
of data for NACE 300 in the case of the Nordic states this is only a very rough figure. To
know roughly the scale of employment in the Nordic countries we found additional data
sources provided by statistical offices of the Nordic states (Statistics Denmark et al. 2001 –
tables from the report are attached in the appendix). The last available year is 1999 which is
relatively good approximation for 2000. We have to note, however, that the definition differs
a bit from the one utilized here as the definition includes in the manufacturing section NACE
313 and 333. Still in 1999 the employment in the manufacturing section in Denmark
amounted to 21.100 jobs, in Finland to 43.800 jobs and in Sweden to 69.187 jobs. On top of
that we have ICT services (wholesale, telecommunications and consultancy services)
amounting to 75.150 jobs for Denmark, 61.285 for Finland and 132.168 jobs for Sweden.
Applying the same definition of the ICT cluster for Polish data for 1999 we arrive at total ICT
cluster manufacturing employment of 65.094 jobs (59.837 jobs in 2000). This gives a total of
199.181 jobs in manufacturing ICT within the BSR in 1999 plus (keeping the proportion of
ICT services to ICT manufacturing for Nordic estimates) approx. 400.000 jobs in ICT
services in the BSR (estimate of the ICT service for Poland at 130.000jobs). This sums up to
600.000 jobs within the region for an extended definition of an ICT cluster. Still for clarity we
will stick to standard approach (keeping above estimates in mind to properly asses the
significance of the ICT cluster for the BSR region).
71
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Table 68 ICT - Employment within the cluster in 2000
NACE
DNK
FIN
SWE
POL
BSR
EU15
EU16
BSR to EU16
(per cent)
:
:
300
:
:
:
3 150
:
:
321
3 099
4 563
6 069
5 335
19 066
275 385
280 720
6.8
322
4 747
33 006
35 071
9 869
82 693
384 571
394 440
21.0
323
6 579
1 049
5 319
12 165
25 112
133 502
145 667
17.2
6 046
332
Together
20 471
Source: Own calculations.
3 889
42 507
9 371
55 830
10 410
40 929
29 716
339 350
349 760
159 737 1 132 808 1 173 737
8.5
13.6
The BSR has on average 13.6 per cent share in ICT manufacturing employment in EU16. It
has very high shares in manufacturing of television and radio transmitters (21.0 per cent) and
manufacturing of television and radio receivers (17.2 per cent). The employment in absolute
terms is the highest in Sweden followed by Finland and Poland. In relative terms the
employment in manufacturing ICT cluster is more significant for Finland than for Sweden. It
is much below the EU16 average for Poland.
Table 69 ICT - Share in total employment in manufacturing industry in 2000
NACE
DNK
:
300
0.7
321
1.1
322
1.5
323
1.4
332
Together
4.6
Source: Own calculations.
FIN
:
1.1
7.9
0.3
0.9
10.1
SWE
:
0.8
4.6
0.7
1.2
7.4
POL
0.2
0.3
0.6
0.7
0.6
2.3
BSR
:
0.6
2.4
0.7
0.9
4.7
EU15
:
1.0
1.4
0.5
1.2
4.1
EU16
:
1.0
1.3
0.5
1.2
4.0
Within the region Poland has particularly strong position in terms of level of employment in
manufacture of television and radio receivers, followed by manufacture of instruments and
appliances for measuring and testing (35.0 per cent) and manufacture of electronic valves and
tubes and other electronic components (28.0 per cent). On average a quarter of manufacturing
employment in the ICT sector within the BSR is located in Poland. Denmark with an average
share of 12.8 per cent is particularly strong in manufacture of television and radio receivers.
Table 70 ICT - Employment structure within the BSR
NACE
DNK
:
300
16.3
321
5.7
322
26.2
323
20.3
332
Together
12.8
Source: Own calculations.
FIN
:
23.9
39.9
4.2
13.1
26.6
SWE
:
31.8
42.4
21.2
31.5
35.0
POL
:
28.0
11.9
48.4
35.0
25.6
BSR
:
100.0
100.0
100.0
100.0
100.0
72
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Location quotients for employment (in comparison to EU16 average) clearly prove existence
of several strong concentrations of the ICT sector within the BSR. Poland has one in
manufacture of television and radio receivers, Finland and Denmark have both two and
Sweden has three. The most significant concentrations in the region are, as could be expected,
in manufacture of television and radio transmitters and apparatus for line telephony and line
telegraphy in Sweden and Finland (Nokia-Ericsson effect) as well as in manufacture of
television and radio receivers in Denmark.
Table 71 ICT - Location quotients for employment (in comparison to EU16 )
NACE
300
321
322
323
332
Source: Own calculations.
DNK
:
0.729
0.795
2.982
1.141
FIN
:
1.143
5.885
0.506
0.782
SWE
:
0.842
3.463
1.422
1.044
POL
:
0.318
0.419
1.398
0.498
The sector is growing across the region in terms of employment. Within the period 1995 –
2000 it increased altogether by approx. by 24.000 jobs mainly in Finland and to a lesser extent
in Sweden. On the levels of individual subsectors the situation was not so uniform.
Table 72 ICT - Absolute changes in employment levels between 2000 and 1995
NACE
DNK
:
300
67
321
1 677
322
679
323
766
332
Together
3 189
Source: Own calculations.
FIN
SWE
:
459
13 572
-293
1 547
15 285
POL
:
2 159
2 268
2 923
-2 705
4 645
BSR
1 914
-3 156
712
2 778
-1 507
741
:
-471
18 229
6 087
-1 899
23 860
As to labor productivity the BSR region is not particularly strong in comparison to EU15/16
apart from manufacture of television and radio transmitters and apparatus for line telephony
and line telegraphy where Finland in Sweden are particularly strong. It is worrying that
Poland and Denmark (to a lesser extent though) are much below the average productivity
levels. There for sure is much room for improvement and productivity convergence to occur.
Table 73 Labor productivity in 2000 (turnover per employee)
NACE
DNK
:
300
0.097
321
0.185
322
0.124
323
0.135
332
Average
0.137
Source: Own calculations.
FIN
SWE
:
0.114
0.678
0.164
0.140
0.555
:
0.194
0.543
0.248
0.161
0.413
POL
0.137
0.022
0.083
0.106
0.039
0.075
BSR
EU15
:
0.111
0.521
0.143
0.110
0.329
EU16
:
0.236
0.349
0.259
0.151
0.252
:
0.232
0.342
0.246
0.148
0.245
73
COMPETITIVE POSITION OF THE BALTIC SEA REGION
As two total turnover the ICT cluster generated in 2000 approx. 52.5 billion euro. Out of this
more than 80 per cent was generated in manufacture of television and radio transmitters and
apparatus for line telephony and line telegraphy alone. Finland and Sweden and a similar
turnover of approx. 23.3 billion euro. It was significantly less for Poland and Denmark
(approx. 3.0 billion euro). The BSR’s ICT cluster generates on average 18.2 per cent of total
ICT turnover in the EU16. The share is a result mainly of the significant share in the
manufacture of television and radio transmitters and apparatus for line telephony and line
telegraphy (one third of total EU16 turnover).
The significance of the ICT cluster for the BSR region becomes even more clear if we look at
the relative figures that is the share of the ICT in total manufacturing industry turnover. For
the BSR the average stands at 12.8 per cent. It is however, approx. a quarter for Finland and
one seventh of total manufacturing industry turnover for Sweden. It is however below EU15
average for both Poland and Denmark. In terms of regional distribution of turnover at an
aggregated level the Finland and Sweden have a dominant position (generating approx. 45
and 44 per cent of turnover respectively). Each one of he other two states generate about 5.5
per cent of total ICT turnover of the region.
Table 74 ICT - Turnover in 2000 (in 1000000 EUR)
NACE
DNK
300
300
321
879
322
816
323
814
332
Together
2 809
Source: Own calculations.
FIN
521
22 369
172
544
23 606
SWE
POL
1 177
19 047
1 319
1 508
23 050
BSR
430
119
818
1 284
403
3 055
EU15
2 117
43 113
3 591
3 269
52 521
64 886
134 269
34 607
51 272
285 034
BSR to
EU16
(per cent)
EU16
65 005
135 087
35 892
51 675
288 089
3.3
31.9
10.0
6.3
18.2
Table 75 ICT - Share in total turnover of the manufacturing industry in 2000
NACE
DNK
300
0.5
321
1.4
322
1.3
323
1.3
332
Together
4.5
Source: Own calculations.
FIN
SWE
0.5
23.3
0.2
0.6
24.6
0.8
12.2
0.8
1.0
14.7
POL
0.5
0.1
0.9
1.3
0.4
3.2
BSR
EU15
EU16
0.5
10.5
0.9
0.8
12.8
1.3
2.7
0.7
1.0
5.7
1.3
2.7
0.7
1.0
5.7
Table 76 ICT - Turnover structure within the BSR
NACE
300
321
322
323
DNK
FIN
SWE
POL
BSR
14.2
2.0
22.7
24.6
51.9
4.8
55.6
44.2
36.7
5.6
1.9
35.8
100.0
100.0
100.0
74
COMPETITIVE POSITION OF THE BALTIC SEA REGION
24.9
332
Together
5.3
Source: Own calculations.
16.6
44.9
12.3
5.8
46.1
43.9
100.0
100.0
Location quotients for turnover bring nearly the same massage as LQs for employment.
Several significant concentrations of the ICT sector exist within the BSR in relation to EU16
average. The only difference being that the LQs for turnover indicate lack of existence of two
concentrations ( respective LQs do not break the 1.00 threshold). These are Finland in
manufacture of electronic valves and tubes and other electronic components and Sweden in
manufacture of instruments and appliances for measuring, checking and testing.
Table 77 ICT - Location quotient for turnover (in comparison to EU16 )
NACE
300
321
322
323
332
Source: Own calculations.
DNK
:
0.377
0.532
1.858
1.287
FIN
:
0.423
8.738
0.253
0.556
SWE
:
0.587
4.573
1.191
0.946
POL
:
0.098
0.323
1.906
0.416
In contrast to data on employment and turnover we have a full access to data on trade in
goods thus we can take NACE 300 - manufacturing of office machinery and computers into
account. In 2001 the ICT sector of the BSR exported goods in total value of 8.6 billion euro to
other states of the EU16. It is clearly worth to note, taking into account the export-orientation
of the sector, that much of the export is directed to countries outside of the European Union
(particularly in the case of NACE 322). Finland was the biggest exporter onto the EU16
market in absolute terms followed by Sweden. It is worth to note that Poland exported nearly
1 billion euro worth of goods in the NACE 323 that is manufacture of television and radio
receivers (mainly television sets).
Table 78 ICT - Exports to EU16 in 2001 (in 1000000 EUR)
NACE
DNK
537
300
136
321
215
322
556
323
335
332
Together
1 779
Source: Own calculations.
FIN
SWE
433
197
1 345
752
415
3 142
POL
BSR
521
69
1 274
377
143
2 384
44
145
79
938
90
1 296
-192
-537
1 052
107
-63
POL
-1 136
-457
-1 083
600
-304
1 536
547
2 913
2 622
984
8 602
Table 79 Trade balance in trade with EU16 in 2001
NACE
300
321
322
323
332
DNK
FIN
-929
-140
-204
73
27
SWE
-1 613
-340
768
-201
-175
BSR
-3 870
-1 475
533
579
-515
75
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Together
Source: Own calculations.
-1 174
-1 562
368
-2 380
-4 748
As the ICT trade shows characteristics of intra-industry trade the strong export position
wasn’t enough to guarantee an overall trade surplus with the rest of the EU16. In fact the
region as a whole had trade deficit of 4.7 billion euro. Sweden the only country with an
overall trade surplus and Poland with the highest trade deficit of 2.4 billion euro (this in fact
should be surprising as Poland is on the restructuring path thus importing a lot of high-tech
intensive goods and services not available at the domestic market).
Both indices of revealed comparative advantage clearly indicate that the region taken as a
whole has an advantage in trade with the rest of EU16 in two manufacturing of television and
radio transmitters as well as receivers (NACE 322 – 323). In the case of transmitters this due
to strong position of Sweden and Finland. In the case of receivers the RCA index shows that
all the region’s economies have an advantage. The unbiased CRCA index points to
comparative advantage of Poland (particularly strong) and Denmark. It is worth to note that
Denmark is the only BSR economy to have comparative advantage (as indicated by both
indices ) in manufacture of instruments and appliances for measuring, checking, testing etc.
Moreover, the region has a strong revealed comparative disadvantage in manufacture of office
machinery and computers.
Table 80 RCA in trade within EU16
NACE
DNK
0.487
300
0.300
321
0.778
322
1.721
323
1.249
332
Source: Own calculations.
FIN
0.262
0.291
3.243
1.557
1.034
SWE
0.597
0.192
5.804
1.474
0.675
POL
0.037
0.297
0.264
2.697
0.313
BSR
0.319
0.276
2.408
1.861
0.840
SWE
-0.025
-0.042
0.053
0.000
-0.008
POL
-0.034
-0.012
-0.032
0.028
-0.008
BSR
-0.037
-0.014
0.006
0.006
-0.005
Table 81 CRCA in trade within EU15 +PL
NACE
DNK
-0.036
300
-0.005
321
-0.008
322
0.005
323
0.002
332
Source: Own calculations.
FIN
-0.052
-0.011
0.021
-0.008
-0.007
In 1999 in the manufacturing section of the ICT cluster there were 874 enterprises active in
Denmark, 689 in Finland and 1361 in Sweden (according to appendix A, with NACE 313 and
333 in the sample). In comparison in 2005 we identified 113 enterprises (with 10 and more
employees) active in the ICT sector in 6 northern voivodeships of Poland. Plus an additional
of 441 enterprises in computer consultancy services. If we would apply the ICT definition of
76
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Statistics Denmark and took into account also the so-called micro enterprises the total number
of ICT enterprises in the six regions of Poland would increase to 751 (with 345 located within
the three regions taken into account by the State of the region report). In the computer
consultancy section the number goes up to 4627 enterprises (with 2276 in the 3 northern
voivodeships). This is a significant amount as for comparison there were 3.500 enterprises in
the sector in the whole of Finland in 1999.
Table 82 ICT - Approximate number of enterprises (> 10 employees) in northern regions of Poland
300 321 322 323 332 Together 721 722 723
pomorskie
2
8
13 10 11
warmińsko-mazurskie
2
3
0
1
1
zachodniopomorskie
4
2
1
4
2
kujawsko-pomorskie
0
4
2
1
12
lubuskie
1
1
0
1
3
wielkopolskie
5
5
4
2
8
Together
14 23 20 19 37
Source: Teleadreson (2005),www.teleadreson.com.pl
44
7
13
19
6
24
113
21
4
11
9
3
13
61
55
9
24
28
6
52
174
10
2
1
5
1
7
26
724
725
Together
20
2
6
7
1
19
55
31
8
14
23
11
38
125
137
25
56
72
22
129
441
It is worth to note that ICT enterprises tend to locate in large agglomerations with large
university campuses. This is clear if we take a look at the map of ICT concentrations from the
Polish cluster-mapping project. Within the BSR or its close proximity we have several large
concentrations in the region of Gdansk (Tricity), Poznań, Szczecin and Bydgoszcz. Gdansk
and Poznań seem to be particularly interesting with the ICT sector developing particularly fast
and already showing certain cluster features (Brodzicki et al. 2002)
There is an important presence of foreign investors in the ICT sector in northern voivodeships
Poland which proves the attractiveness of local environment with high endowment in
specialized human-capital (large amount of university graduates), large domestic market and
still relatively low labor costs for professionals. The inflow of FDI is focused on production
plants but several R&D centers were also established. Some of the inflow is related to
advantages offered by special economic zones – this in especially the case in Pomorska
Specjalna Stefa Ekonomiczna where several large multinational ICT corporations are already
present. Beneath we will present a list of major foreign ICT investors in the northern part of
Poland: TELEFONICA Sp. z o.o. Oddział Gorzów (Spain, Gorzów Wielkopolski,
wielkopolskie), Vobis Microcomputer Sp. z o.o. (Dołuje, zachodniopomorskie), ATIS Sp. z
o.o. (Germany, Szczytno warmiińsko-mazurskie), Kimball Electronics Poland Sp. z o.o.
(Kimball Electronics, Poznań, wielkopolskie), ATOTECH Poland Sp. z o.o. (Atotech
Deutschland GmbH, Germany, Poznań, wielkopolskie), Lacroix Electronics Sp. z o.o.
77
COMPETITIVE POSITION OF THE BALTIC SEA REGION
(Frence, Kwidzyn, pomorskie), ERICSSON Sp. z o.o (Sweden, Gdańsk, pomorskie),
Flextronics International Tczew (Fextronics, MNC, Tczew SEZ, pomorskie), Philips
Consumer Electronics Industries Poland Sp. z o.o. (Kwidzyn, pomorskie) – Jabil Circuit
Poland Sp. z o.o. (Jabil USA, Kwidzyn, pomorskie), Gemplus Pologne sp. z o.o. (Gemplus,
France, Tczew SEZ, pomorskie), Young Digital Poland S.A. (Finnish capital, Gdańsk,
pomorskie), SURUGA SEIKI, (Japan, Gdańsk, pomorskie, operative from 2007).. Research
centers: Advanced Digital Broadcast Polska Sp z o.o (Advanced Digital Broadcast Holdings
SA, Switzerland, Zielona Góra, lubuskie), Intel Technology Poland Sp. z o.o. (Intel, USA,
Gdańsk).
It is worth to note that reallocation of major multi national company could lead to
spontaneous clustering process to begin if it will establish a network of specialized
subcontractors. The endowment of human capital is likely to fuel the process.
The ICT sector in Poland can attract new major investors in the computer consultancies
services in the near future as the special economic zones have been allowed recently to attract
investors in the field as well as in financial services (accounting, call-center etc.) and R&D
activities. This creates a new opportunity for potential Nordic investors. The sectors are
highly likely to move as they are labor-intensive and the labor costs constitute significant part
of the business itself. We have to added that several high-technology parks have now been
established or going to be established in the near future in the BSR (Gdańsk, Gdynia,
Poznań).
78
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Map 3 Significant concentrations of the ICT sector at the NUTS-4 level in Poland (including NACE 020)
liczba skupień
7-9
4-6
1-3
brak
siła skupień ogółem
1.00 22.60 44.21
Source: GIME.
79
COMPETITIVE POSITION OF THE BALTIC SEA REGION
MARITIME CLUSTER (MC)
Data availability forced us to significantly limit the scope of the maritime cluster only to two
3-digit manufacturing industry NACE sectors: that is building and repairing of ships and
boats (NACE 351) and to processing and preserving of fish and fish products (NACE 152).
The actual scope of the cluster in reality is much bigger13. This approach is based on the
results of the Polish cluster mapping exercise. We have to stress, however, that ideally
sectoral scope should be much wider. For instance an excellent study by TEKES on the
maritime cluster in Finland (Vittanen et al. 2003) takes into account and thus distinguishes
within the maritime cluster the following groups of enterprises: shipbuilding companies,
shipyards as well as companies belonging to the network of the shipbuilding industry
(contractors, subcontractors, direct and indirect suppliers), manufacturers of leisure boats,
shipping companies, ports and port-related companies, companies related to shipping
companies and ports as well as companies of related fields. The DTI Report (2001)
distinguishes either a shipbuilding, shipbuilding & engineering, marine or maritime
technology clusters depending on a given region. The approach utilized by DTI in delimiting
of the cluster scope could thus also be characterized as very elastic as it encompasses a large
scope of sectors in branches vertically or horizontally related to the core industry. Analysis of
the significance of the maritime industry for the EU economy prepared for the EC goes even
further distinguishing the following components of the maritime economy: shipping and
inland shipping, shipbuilding, offshore supply, maritime works, seaports and related services,
fishing, recreation vessels and services, maritime services and maritime equipment. This
broad approach led the authors to arrive at the employment levels in EU15 approaching
2.950.000 employees.
In our narrow definition, limited to manufacturing industries only, we treat shipbuilding
(comprising recreational vessels as well) as the core of the cluster with processing and
preserving of fish and fish products as a representative of the outward layer of the cluster
13
It is worth to note that for instance the city of London (UK) created a strategy for development of maritime
services comprising cluster brokers, financial institutions etc.
80
COMPETITIVE POSITION OF THE BALTIC SEA REGION
related to fishing. In those to sectors of the maritime cluster the BSR had a strong position in
the EU15 (EU16) in 2000 in term of total employment. With approx. 82000 jobs it generated
a quarter of total employment in the MC with an even stronger position in NACE 351 (effect
of Poland). Still the actual employment levels in the broadly defined maritime cluster can be
expected significantly higher. For instance, in a more detailed study for Finland (Vittanen et
al. 2003), clearly indicates that if we adopt a broad definition of maritime cluster its size in
terms of employment and turnover will significantly increase. The report estimates total
employment in the Finnish maritime cluster at approx. 42 000 employees with shipbuilding
representing around one fourth.
Table 83 Employment within the maritime cluster in 2000
152
6 915
600
2 261
11 385
21 161
100 307
BSR to EU16
(per cent)
111 692
18.9
351
7 341
10 589
5 677
36 863
60 470
189 372
226 235
26.7
Together
14 256
Source: Own calculations.
11 189
7 938
48 248
81 631
289 679
337 927
24.2
NACE
DNK
FIN
SWE
POL
BSR
EU15
EU16
A similar situation occurs in Poland and other countries as well 14. Roughly speaking we could
thus quadruple the total employment of the maritime cluster for each of the states to arrive at
an estimated total figure for the whole BSR of around 320.000 employees with employment
in the core industry (shipbuilding) in the range of 60000 employees.
Table 84 Share in total employment in manufacturing industry in 2000
NACE
DNK
1.5
152
1.6
351
Together
3.2
Source: Own calculations.
FIN
0.1
2.5
2.7
SWE
0.3
0.8
1.0
POL
0.6
2.1
2.7
BSR
0.6
1.8
2.4
EU15
0.4
0.7
1.0
EU16
0.4
0.8
1.1
In terms of significance for national economy (manufacturing industry) the share in total
employment the maritime cluster is particularly significant for Denmark (in contrast to other
BSR states a significant share of the fish processing industry is noteworthy) with Finland and
Poland behind. In both countries the position of shipbuilding is rather important. In terms of
total employment in the maritime cluster within the BSR Poland dominates with nearly a 60
per cent share with Denmark and Finland far behind. Sweden has the lowest shares in both
sectors.
A report on the labor market of the Pomorskie region (Brodzicki … ) indicates that employment In
shipbuilding and closely related sectors for two major concentrations Gdańsk and Gdynia could be estimated at
55.000 employees.
14
81
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Within the period 1995 and 2000 significant changes in a general level of employment
occurred within the cluster in the BSR. There was a major decline in Denmark and significant
growth of employment in Poland (in particular in fish processing) as well as in Sweden
(shipbuilding). Overall in the BSR we observe a rise in employment levels in fish processing
and a fall in shipbuilding.
Table 85 MC – Employment structure within the BSR
NACE
DNK
32.7
152
12.1
351
Together
17.5
Source: Own calculations.
FIN
2.8
17.5
13.7
SWE
10.7
9.4
9.7
POL
53.8
61.0
59.1
BSR
100.0
100.0
100.0
Table 86 MC – Absolute changes in employment levels between 2000 and 1995
NACE
DNK
-1 673
152
-3 772
351
Together
-5 445
Source: Own calculations.
FIN
SWE
19
37
56
POL
367
1 029
1 396
BSR
3 116
1 248
4 364
1 829
-1 458
371
The relative insignificance of the cluster for Sweden in terms of employment is proven by
location quotients – with no major Swedish concentration in comparison to EU16 average.
Denmark and Poland have two concentrations while Finland only one. The concentrations are
significant, by that we understand LQs exceeding the EU16 average by at least a factor of
two, in fish processing for Denmark and shipbuilding for Finland, Poland and Denmark. The
concentration of fish processing is high as well15.
Labor productivity calculated as a ratio of total turnover to total employment clearly indicate
that the Nordic states are in good position – on or above the EU15 average in both sectors
with Poland lagging far behind and decreasing the regional average.
Table 87 MC - Location quotients for employment (in comparison to EU16 )
NACE
152
351
Source: Own calculations.
DNK
4.09
2.14
FIN
0.38
3.29
SWE
0.79
0.98
POL
1.71
2.73
Table 88 MC – Labor productivity in 2000 (turnover per employee)
NACE
DNK
0.209
152
0.133
351
Together
0.170
Source: Own calculations.
FIN
0.144
0.154
0.154
SWE
0.168
0.140
0.148
POL
0.038
0.046
0.044
BSR
0.111
0.084
0.091
EU15
0.165
0.147
0.153
EU16
0.152
0.131
0.138
15
It could probably be beneficial to excluded the landlocked EU16 states with no shipbuilding industry from the
general sample in order to correctly asses the strength of the concentration within the BSR.
82
COMPETITIVE POSITION OF THE BALTIC SEA REGION
It is worth noticing that both MC’s sectors generate relatively high turnover. In both cases the
share of the BSR in total turnover is relatively high. With Denmark a major contributor in fish
processing and Poland and Finland in shipbuilding. Altogether the MC generates around 7.5
billion euro of turnover on annual basis approx. 16 per cent of total turnover of the cluster in
the EU16. Similarly to employment levels the share of the BSR in shipbuilding is higher than
in food processing.
Table 89 Turnover in 2000 (in mil of EUR)
NACE
DNK
1 444
152
974
351
Together
2 418
Source: Own calculations.
FIN
86
1 636
1 722
SWE
380
794
1 174
POL
BSR
436
1 699
2 135
EU15
2 346
5 101
7 447
16 586
27 831
44 417
BSR to EU16
(per cent)
17 021
13.8
29 529
17.3
46 550
16.0
EU16
THE MC is the most important for Denmark and Poland (in terms of share in total turnover).
Fish processing has a significant share in Denmark while shipbuilding has a share of around
1.7 of total turnover of the manufacturing industry in Denmark, Poland and Finland. In terms
of regional distribution of turnover Denmark has a dominant position if fish processing (62
per cent share in the region’s turnover) while Poland and Finland have roughly the same share
of turnover is shipbuilding.
Table 90 Share in total turnover of the manufacturing industry in 2000
NACE
DNK
2.3
152
1.6
351
Together
3.9
Source: Own calculations.
FIN
0.1
1.7
1.8
SWE
0.2
0.5
0.8
POL
0.5
1.8
2.2
BSR
0.6
1.2
1.8
EU15
0.3
0.6
0.9
EU16
0.3
0.6
0.9
Table 91 Turnover structure within the BSR
NACE
DNK
61.6
152
19.1
351
Together
32.5
Source: Own calculations.
FIN
3.7
32.1
23.1
SWE
16.2
15.6
15.8
POL
18.6
33.3
28.7
BSR
100.0
100.0
100.0
Table 92 Location quotient for turnover (in comparison to EU16 )
NACE
152
351
Source: Own calculations.
DNK
6.931
2.693
FIN
0.268
2.923
SWE
0.723
0.872
POL
1.364
3.064
Location quotients for turnover strengthen the general conclusions made above on the basis of
analysis of LQs for employment. Fish processing is particularly important for Denmark, while
shipbuilding for Poland and Finland. Once again position of Sweden is different to the rest of
the region.
83
COMPETITIVE POSITION OF THE BALTIC SEA REGION
As to analysis of export potential it is worth to note that the figures are significantly biased for
shipbuilding. As the majority of ships are sold and registered outside of the European Union
despite being operated from European ports. Overall the BSR has a trade surplus in both
sectors in trade relations with other EU16 states. It is important to note an impressive export
potential of Denmark in processed fish and resulting trade surplus for Denmark and to a large
extent for the whole BSR.
Table 93 Exports to EU16 in 2001 (in 1000000 EUR)
NACE
DNK
1 290
152
151
351
Together
1 441
Source: Own calculations.
FIN
SWE
73
55
128
POL
1
237
238
BSR
182
277
459
1 546
718
2 264
Table 94 Trade balance in trade with EU16 in 2001
NACE
DNK
1 168
152
137
351
Together
1 305
Source: Own calculations.
FIN
SWE
-43
41
-2
POL
-28
228
200
BSR
109
262
371
1 205
667
1 872
The indices of revealed comparative advantage clearly indicate that the region has an overall
advantage in shipbuilding. Denmark has an impressive comparative advantage in food
processing. The advantage in fish processing is shown by Poland as well.
Table 95 RCA in trade within EU16
NACE
DNK
12.20
152
2.84
351
Source: Own calculations.
FIN
0.46
0.69
SWE
0.01
5.63
POL
1.59
4.84
BSR
3.35
3.10
SWE
-0.002
0.012
POL
0.005
0.011
BSR
0.012
0.007
Table 96 CRCA in trade with the rest of EU16
NACE
DNK
0.051
152
0.006
351
Source: Own calculations.
FIN
-0.002
0.001
For obvious reasons the maritime cluster has probably the most Baltic dimension of all the
Polish clusters discussed in the present study. As could be expected the sector is mainly
located in the northern Poland. Geography is the deciding factor both in terms of ships as well
as yachts – apart from the Baltic sea the major lake districts of Poland are located within the 3
regions mentioned above. The shipbuilding in Poland is located in three major centers in
Szczecin (next to German border) and in Gdynia and Gdańsk in pomorskie with several large
and medium-sized shipyards and numerous smaller companies within the maritime cluster.
Fishing and fish processing is more dispersed along the seafront. Yacht building is taking
place in several locations both in the lace district (for instance Ostróda) as well next to large
84
COMPETITIVE POSITION OF THE BALTIC SEA REGION
shipyards (for instance in Gdańsk and in the vicinity of Gdańsk)16. Maritime cluster services
are mainly located in the main industry centers (similarly for instance to Finland – Turku,
Rauma and Helsinki around the principal Aker Finnyards aprt of Aker Yards Group).17
As to the number of entities the figures presented in the table beneath are meant to give only
an insight into regional distribution. It is evident that in both cases the major concentrations
are in two northern regions that is zachodniopomorskie and pomorskie.
Table 97 MC - approximate number of enterprises (> 10 employees) in northern regions of Poland
152
pomorskie
24
warminsko-mazurskie
6
zachodniopomorskie
13
kujawsko-pomorskie
1
lubuskie
0
wielkopolskie
7
Total
51
Source: Teleadreson (2005),www.teleadreson.com.pl
351
53
12
21
1
1
2
90
Together
77
18
34
2
1
9
141
There are foreign investors present in the maritime cluster in Poland, however, they are
relatively small in shipbuilding and related services. Among these we could name: Ulstein
Fama Sp. z o. o. (Ulstein Holding ASA, Norway, Gniew, pomorskie), Damen Shipyards
Gdynia S.A. (B.V. Holding Maatschappij Damen, the Netherlands, 50 per cent stake, Gdynia,
pomorskie). Major investors entered into ports: Europort Gdańsk (Staight Crosing, Canada,
70 per cent stake), Europort Grain Terminal, (Canada, Europort, Gdańsk, pomorskie),
Deepwater Container Terminal Gdańsk SA (UK, consortium of British investors, Gdańsk,
pomorskie). Foreign investors are also present in fish processing, for instance: Uniq Lisner
Sp. z o.o. (Lisner, germany, Poznań, wielkopolskie), Espersen Polska Sp. z o.o. (Espersen
A/S, Denmark, Koszalin, zachodniopomorskie), LUCKY UNION FOODS EURO Sp. z o.o.
(Korean LG - Lucky Union Foods Ltd., Goleniów, zachodniopomorskie), Superfish S.A.
(ABBA Seafood AB, Kołobrzeg, zachodniopomorskie).
As to potential for mutual cooperation. The size and competitive position of sectors in the
region indicate that the most fruitful cooperation (FDI) could be established between Poland
and Denmark in fish processing despite their clear position as direct competitors (the
The case of Gdańsk is particularly interesting as a spontaneous clustering of yacht-building is taking place
with creative destruction of the former state owned Conrad Shipyard. The yachting cluster in Gdańsk is brining
investors from Germany, Sweden, USA and other states, however, it is still in early stage of development.
16
17
Norwegian Aker Yards ASA is a multinational shipyard group with 13 yards in Norway, Finland (former
Masa-Yards), Germany (Aker MTW Werft GmbH in Wiesmar, Aker Warnemünde Operations GmbH in
Rostock-Warnemünde), Romania and Brazil with employment of 14.500 people.
85
COMPETITIVE POSITION OF THE BALTIC SEA REGION
cooperation scheme could also take into account potential Norwegian partners as well) and
between Poland and Finland in shipbuilding (Norwegian or/and German contribution could
also be beneficial). As to shipbuilding the nature of business is such, with major multinational
shipyards being established, that Polish and Nordic shipyards they are competing with each
other in international (global) markets. However, this does not preclude a possibility for
drafting and implementing joint actions: from very basic cooperation schemes to more
advanced forms. The cluster life-cycle could even lead to a situation that the whole
production of a given sector (or its core) could reallocate to only one or two locations within
the BSR – with the former competitors specializing more deeply in certain aspects of the
value chain (R&D, initial production, final assembly etc.) to a common good. We have to
bare mind that shipbuilding – due to significant complexity of the end product is based on
complex co-operative chains of domestic as well as foreign companies. Backward and
forward linkages play a major role as well as the scale of the production. It is a sensitive
business where international competitive pressures created by Asian companies is particularly
high. It is both labor and capital intensive sector with medium-low technology background. It
requires significant resources of skilled and qualified labor force. The costs of labor in general
are of great importance this makes Polish shipyards more competitive in relation to Finish or
Danish once. The end-product is usually specialized – this future allows each of the major
shipyards find a relatively secure niche market in global terms.
It is worth to note that certain co-operative schemes are already in place. Some actions are
financed and could be financed (or co financed) in future from the EU and EEA sources. To a
certain extent the INTERREG IIIC RFO Project InterMareC Interregional Maritime Cluster
could be a model example. The project has an international dimension combining two Baltic
partners Technology-Region K.E.R.N. e.V. from Kiel in Germany and Pomeranian
Development Agency Co. from Gdansk (Poland) with a French partner - Technopole BrestIroise. The vision behind the project is to develop and improve a sustainable maritime cluster
through effective use of potential of coastal zones, foster close co-operation between
enterprises & research institutions as well as among traditional and innovative enterprises and
an the interregional stage to connection European regional maritime clusters.
.
86
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Map 4 Significant concentrations of maritime cluster at the NUTS-4 level in Poland (including NACE 050 - fishing)
liczba skupień
3
2
1
brak
siła skupień ogółem
1.00
48.96
96.91
przetwórstwo rybne
(siła skupienia)
1.00 39.51 78.02
87
COMPETITIVE POSITION OF THE BALTIC SEA REGION
AGRO-FOOD CLUSTER (AFC)
The food processing industry (agro-food cluster)constitutes an important part of each national
economy due to its strategic character. Poland and Denmark are traditionally highly
competitive in the agro-food sector in comparison to the majority of other EU states.
It is rather a difficult tusk to distinctly delimit the agro-food cluster. The agro-food processing
(NACE 15 and 16) is dependent on primary sectors such as agriculture (NACE 01) and
fishing (NACE 05, when we considered fish-processing an agro-food sector; it could
constitute a part of the maritime cluster as well) on the one hand. On the other it is dependent
on distribution of final products with heavy marketing involved and a hold network of
wholesale and retail traders (NACE 512, 513)18. It is supported by producer of specialized
machinery. Despite its traditional low-tech characteristics it becomes to an increasing extent
knowledge intensive with progress in biotechnologies (it thus has certain important linkages
to the companies and institutions forming the Biocluster – R&D intensive) and automatization
of the whole production process. For the time being it is still labor-intensive sectors. To a
large extent it is also dependent on natural conditions. Within the BSR southern states such as
Denmark and Poland have more favorable conditions than the other two Nordic states.
For simplicity in the following analysis we will pool the whole agro-food sector together
despite the possibility of dividing into subclusters. Furthermore we will skip manufacture of
tobacco products (NACE 160). Thus our study will take into account the following 3-digit
NACE groups: NACE 151 - production, processing, preserving of meat, meat products,
NACE 152 - processing and preserving of fish and fish products, NACE 153 - processing and
preserving of fruit and vegetables, NACE 154 - manufacture of vegetable and animal oils and
fats, NACE 155 - manufacture of dairy products, NACE 156 - manufacture of grain mill
products, starches and starch products, NACE 157 - manufacture of prepared animal feeds,
NACE 158 - manufacture of other food products as well as NACE 159 - manufacture of
beverages.
18
For comparison according to Dahl (2002) the Danish Mega Cluster definition of the agro-food cluster includes
the primary businesses (farming, fishing or gardening), food processing industry, retail and wholesales
businesses and the suppliers.
88
COMPETITIVE POSITION OF THE BALTIC SEA REGION
The major problem we face in analysis of the agro-food cluster is lack of data for NACE 154
and NACE 155 in Denmark, NACE 159 in Finland and NACE 157 in Sweden. Still in order
to approximate the actual values we have decided to calculate BSR totals as well as shares
without the missing values. The effected values will be presented on an orange background.
In 2000 total employment in the BSR amounted to 492 500 workers (we estimate it to actually
reach 5100 00) with an overall share in the EU16 of 13.0 per cent on average. The share in
EU16 average is the highest in dairy products fish processing. In absolute terms Polish foodprocessing industry is the biggest regional employer with approx. 315 000 jobs followed by
Denmark 76 000 and Sweden 65 000. In sectoral dimension most workers are employed in
meat processing and manufacture of other food products.
Table 98 AFC - Employment within the agro-food cluster in 2000
NACE
DNK
23 341
151
6 915
152
3 020
153
154
155
727
156
3 550
157
31 937
158
6 535
159
Together
76 025
Source: Own calculations.
FIN
11 066
600
2 045
759
5 413
936
952
15 418
37 189
SWE
14 880
2 261
4 366
2 002
9 083
1 368
24 567
6 318
64 845
POL
BSR
EU15
81 519
11 385
33 717
3 738
50 396
7 632
7 431
83 923
34 651
314 392
130 806
781 079
21 161
100 307
43 148
191 604
6 499
43 238
64 892
279 711
10 663
73 277
11 933
100 043
155 845 1 587 548
47 504
328 227
492 451 3 485 034
BSR to EU16
(per cent)
862 598
15.2
111 692
18.9
225 321
19.1
46 976
13.8
330 107
19.7
80 909
13.2
107 474
11.1
1 671 471
9.3
362 878
13.1
3 799 426
13.0
EU16
Table 99 AFC - Share in total employment in manufacturing industry in 2000
NACE
DNK
5.2
151
1.5
152
0.7
153
154
155
0.2
156
0.8
157
7.2
158
1.5
159
Together
17.0
Source: Own calculations.
FIN
2.6
0.1
0.5
0.2
1.3
0.2
0.2
3.7
8.9
SWE
2.0
0.3
0.6
0.3
1.2
0.2
:c
3.2
0.8
8.6
POL
4.6
0.6
1.9
0.2
2.9
0.4
0.4
4.8
2.0
17.9
BSR
3.9
0.6
1.3
0.2
1.9
0.3
0.2
3.7
1.2
13.3
EU15
2.8
0.4
0.7
0.2
1.0
0.3
0.4
5.7
1.2
12.6
EU16
2.9
0.4
0.8
0.2
1.1
0.3
0.4
5.7
1.2
12.9
In relative terms the agro-food sectors generates on average 13.3 per cent of total
manufacturing employment in the BSR which is above both EU15 and EU16 averages. AT
the level of nations agro-food is most significant for Poland followed by Denmark (our
estimates suggest that in Denmark the sector generates one fifth of total manufacturing
89
COMPETITIVE POSITION OF THE BALTIC SEA REGION
employment). In the case of Sweden and Finland the accumulative share does not break the
10 per cent threshold.
Overall 61.5 per cent of employment in the agro-food business within the BSR is generated in
Poland, 14.9 per cent in Denmark and 12.7 in Sweden. Poland has the highest(unbiased)
regional share in processing and preserving of fruit and vegetables and manufacture of grain
mill products, starches and starch products. Denmark has the highest share in fish processing
while Sweden in manufacture of vegetable and animal oils and fats.
Table 100 Employment structure within the BSR*
NACE
DNK
FIN
SWE
17.8
8.5
11.4
151
32.7
2.8
10.7
152
7.0
4.7
10.1
153
15.4
9.9
26.0
154
15.4
7.1
11.8
155
6.8
8.8
12.8
156
25.8
6.9
13.2
157
20.5
9.9
15.8
158
12.7
7.6
12.3
159
14.9
7.3
12.7
Together
Source: Own calculations.*estimated values were taken for missing data
POL
62.3
53.8
78.1
48.6
65.7
71.6
54.1
53.9
67.4
61.5
BSR
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Location quotients for employment clearly indicate that the agro-food is particularly
important for Denmark and Poland with an impressive number of large concentrations in
comparison to EU16 within the agro—food cluster. For obvious reasons the agro-food sector
is significantly less concentrated in the two other Nordic countries. Still the agro-food sector
has a strategic importance. The most significant concentrations are present in fish processing
and diary products in Denmark as well as diary products and processing and preserving of
fruits and vegetables for Poland.
Table 101 AFC - Location quotients for employment (in comparison to EU16 )
NACE
DNK
FIN
SWE
151
1.79
0.90
0.67
152
4.09
0.38
0.79
153
0.88
0.64
0.75
154
1.67*
1.14
1.66
155
2.37*
1.15
1.07
156
0.59
0.81
0.66
157
2.18
0.62
0.66*
158
1.26
0.65
0.57
159
1.19
0.69*
0.68
Source: Own calculations.*based on estimated (biased) employment levels
POL
1.58
1.71
2.51
1.33
2.56
1.58
1.16
0.84
1.60
The size of the sector within the BSR in terms of employment levels is roughly stable. The
most significant shifts being a decrease in Finland and increase in Sweden. The productivity
90
COMPETITIVE POSITION OF THE BALTIC SEA REGION
of the agro-food cluster in the BSR in terms of turnover per employee is significantly beneath
the EU15 average. This is mainly due to Poland. In Denmark, the labor productivity is also
below the average. It is worth to note, that at the level of individual sectors Nordic counties
score well.
Table 102 AFC - Absolute change in employment levels between 2000 and 1995
NACE
DNK
39
151
-1 673
152
-110
153
:
154
:
155
-424
156
1 564
157
169
158
65
159
Together
-370
Source: Own calculations.
FIN
SWE
9
19
112
9
-845
-61
-503
-1 911
:
-3 171
POL
-1 679
367
633
376
-496
256
:
3 052
-186
2 323
BSR
1 184
3 116
-766
-345
-6 527
-4 861
2 536
6 325
-233
429
-447
1 829
-131
40
-7 868
-5 090
3 597
7 635
-354
-789
Table 103 AFC - Labor productivity in 2000 (turnover per employee)
NACE
DNK
151
0.219
152
0.209
0.197
153
154
155
156
0.372
0.431
157
0.112
158
0.222
159
Average
0.184
Source: Own calculations.
FIN
0.195
0.144
0.232
0.296
0.351
0.351
0.426
0.123
0.201
SWE
0.212
0.168
0.224
0.319
0.303
0.347
0.141
0.274
0.209
POL
0.051
0.038
0.050
0.134
0.062
0.079
0.167
0.050
0.122
0.064
BSR
0.112
0.111
0.087
0.210
0.120
0.169
0.379
0.106
0.181
0.123
EU15
0.177
0.165
0.204
0.506
0.351
0.355
0.441
0.116
0.304
0.192
EU16
0.166
0.152
0.181
0.477
0.307
0.329
0.422
0.113
0.287
0.181
In 2000 the agro-food sector generated a total turnover of 55.2 billion euro which gives it an
8.0 per cent share in total turnover in the EU16 group. The share of the BSR exceeds ten per
cent in processing of meat and fish. In absolute terms meat processing and manufacture of
other food products generate most turnover within the BSR (14.6 and 13.1 billion euro
respectively). Despite the lack of data for Denmark we can state that dairy sector is a major
contributor as well.
Table 104 AFC - Turnover in 2000 (in mil of EUR)
NACE
151
152
153
154
155
156
DNK
5 123
1 444
594
:c
:c
270
FIN
2 156
86
475
225
1 899
329
SWE
3 151
380
976
639
2 755
474
POL
4 173
436
1 696
499
3 126
605
BSR
14 603
2 346
3 742
1 363
7 780
1 678
EU15
EU16
138 630
16 586
39 115
21 896
98 285
26 008
142 803
17 021
40 812
22 395
101 411
26 613
BSR to EU16
(per cent)
10.2
13.8
9.2
6.1
7.7
6.3
91
COMPETITIVE POSITION OF THE BALTIC SEA REGION
1 530
157
3 562
158
1 454
159
Together
13 977
Source: Own calculations.
406
1 896
:c
7 472
:c
3 455
1 730
13 560
1 239
4 234
4 227
20 236
3 175
13 146
7 410
55 244
44 093
184 145
99 893
668 650
45 332
188 378
104 120
688 886
7.0
7.0
7.1
8.0
The contribution of the agro-food cluster to total turnover of the manufacturing industry is
particularly high in the case of Denmark (22.5 per cent) and Poland (21.3 per cent). It is
beneath the EU15/16 average for the other two Nordic states. The BSR taken as a whole has
an average share equal to that of EU15.
Location quotients for turnover prove the previous conclusions made during the analysis of
employment. In comparison to the benchmark group of EU16 Poland and Denmark show
significant concentration )specialization) in the agro-food business.
Table 105 AFC - Share in total turnover of the manufacturing industry in 2000
NACE
DNK
8.3
151
2.3
152
1.0
153
154
155
0.4
156
2.5
157
5.7
158
2.3
159
Together
22.5
Source: Own calculations.
FIN
2.2
0.1
0.5
0.2
2.0
0.3
0.4
2.0
7.8
SWE
2.0
0.2
0.6
0.4
1.8
0.3
POL
4.4
0.5
1.8
0.5
3.3
0.6
1.3
4.4
4.4
21.3
2.2
1.1
8.7
BSR
3.6
0.6
0.9
0.3
1.9
0.4
0.8
3.2
1.8
13.5
EU15
2.8
0.3
0.8
0.4
2.0
0.5
0.9
3.7
2.0
13.4
EU16
2.8
0.3
0.8
0.4
2.0
0.5
0.9
3.7
2.1
13.6
Table 106 Turnover structure within the BSR
NACE
DNK
35.1
151
61.6
152
15.9
153
154
155
16.1
156
48.2
157
27.1
158
19.6
159
Together
25.3
Source: Own calculations.
FIN
14.8
3.7
12.7
16.5
24.4
19.6
12.8
14.4
SWE
21.6
16.2
26.1
46.9
35.4
28.3
POL
28.6
18.6
45.3
36.6
40.2
36.1
39.0
32.2
57.0
36.6
26.3
23.3
24.5
13.5
BSR
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Table 107 Location quotient for turnover (in comparison to EU16 )
NACE
151
152
153
154
155
156
DNK
2.93
6.93
1.19
:
:
0.83
FIN
0.80
0.27
0.61
0.53
0.99
0.65
SWE
0.72
0.72
0.78
0.93
0.88
0.58
POL
1.56
1.36
2.21
1.19
1.64
1.21
92
COMPETITIVE POSITION OF THE BALTIC SEA REGION
157
158
159
Source: Own calculations.
2.76
1.54
1.14
0.47
0.53
:
:
0.59
0.54
1.46
1.20
2.16
In contrast to data on employment and turnover the data on trade are not affected – are full.
This will allow us to verify the conclusions made beforehand. We must remember that the
data analyzed are for 2001 when Poland was only an associated country which wasn’t part of
the common market of the European Union. Thus the trade relations of Poland in agricultural
products before the accession were severely hampered by incomplete liberalization in contrast
to the trade in manufactured goods where an FTA was being gradually established from 1992
till 2002. This biases significantly the results for Poland19.
In 2001 total exports of the BSR in the agro-food business to EU16 amounted to 7.8 billion
euro. Out of this 71.5 was generated by Denmark and 16.8 per cent by Poland. Sweden and
Finland together had a 11.7 per cent share. At to sectoral structure of exports at the BSR level
four sectors clearly stand out. These are: meat processing (2.5 billion euro), fish processing
(1.5 billion euro), other food products (1.1 billion) and dairy products (1 billion euro). The
single biggest exporter in the region is The Danish meat processing sector (2.1 billion euro).
The strong competitive position of Denmark (as indicated by impressive trade surplus) leads
to the situation in which the region as a whole is a net exporter (the total trade surplus reaches
1.9 billion euro). Trade relations of Poland with EU15 were rather balanced in 2001 while the
trade deficit was significant in the case of Finland and Sweden in particular. The position of
the whole region was particularly strong in fish and meat processing as well as in dairy
products.
Table 108 Exports to EU16 in 2001 (in 1000000 EUR)
NACE
151
152
153
154
155
156
157
DNK
SWE
2 107
1 290
109
156
761
147
184
FIN
92
73
38
35
97
16
4
POL
31
1
12
3
84
17
2
BSR
270
182
525
35
82
4
35
2 500
1 546
684
229
1 024
184
225
19
The accession has in fact proven the competitive potential of Poland in agro-food products with a dynamic
increase in exports to EU15 states when the CAP regulations were applied to Poland. The developments in trade
after the accession clearly indicate that Poland is a major player in the agro-food business, a large CAP
beneficiary and has a clear comparative advantage with majority of the EU15 states in majority of agricultural
products. Another important asset is the size of the domestic market which even taking into account the lower
purchasing power is significant by European standards. The inflow of FDI into Polish agro-food sector and retail
and wholesale trade clearly demonstrates attractiveness of the domestic market.
93
COMPETITIVE POSITION OF THE BALTIC SEA REGION
158
159
Together
Source: Own calculations.
610
202
5 568
255
28
638
102
23
275
158
18
1 308
1 126
270
7 788
Table 109 Trade balance in trade with EU16 in 2001
NACE
DNK
1 730
151
1 168
152
-88
153
-17
154
580
155
-31
156
94
157
92
158
-173
159
Together
3 355
Source: Own calculations.
SWE
FIN
-126
-43
-166
-60
-10
-128
-83
-237
-173
-1 026
POL
-55
-28
-68
-30
21
-87
-41
-127
-77
-492
BSR
169
109
452
-310
53
-48
-9
-263
-59
94
1 719
1 205
130
-416
644
-294
-39
-535
-483
1 931
Analysis of RCA and CRCA indices clearly indicates that Denmark and to a lesser extent
Poland are powerhouses of the regional agro-food sector. Denmark has a comparative
advantage in nearly all sectors – it is particularly strong in fish processing. Poland has a
comparative advantage in fish and meat processing as well as dairy products and processing
of fruits and vegetables (as indicated by unbiased CRCA). Finland and Sweden have
comparative disadvantage in trade with the RU16 group throughout. The BSR is particularly
competitive in meat processing, fish processing and dairy products.
Table 110 RCA in trade within EU16
NACE
DNK
151
4.79
152
12.20
0.57
153
154
1.27
155
2.20
156
1.81
157
2.64
158
1.35
0.77
159
Source: Own calculations.
SWE
0.14
0.46
0.13
0.19
0.19
0.13
0.04
0.38
0.07
SWE
0.09
0.01
0.08
0.03
0.31
0.26
0.03
0.29
0.11
POL
0.57
1.59
2.54
0.26
0.22
0.04
0.47
0.33
0.06
BSR
1.30
3.35
0.82
0.43
0.68
0.52
0.74
0.57
0.24
FIN
-0.005
-0.002
-0.005
-0.002
0.000
-0.007
-0.003
-0.012
-0.006
POL
0.008
0.005
0.019
-0.009
0.002
-0.001
0.000
-0.006
-0.002
BSR
0.017
0.012
0.001
-0.004
0.006
-0.003
0.000
-0.005
-0.005
Table 111 CRCA in trade within EU15 +PL
NACE
151
152
153
154
155
156
157
158
159
DNK
0.076
0.051
-0.003
0.000
0.026
-0.001
0.004
0.006
-0.006
SWE
-0.004
-0.002
-0.005
-0.002
-0.001
-0.004
-0.003
-0.008
-0.006
94
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Source: Own calculations.
As the map of concentrations clearly show the agro-food sector is one of the most
geographically dispersed (for instance in comparison to ICT or biotechnology). Sill, major
concentrations could be identified. – the biggest one in wielkopolskie and kujawskopomorskie voivodeships. This is also possible to be done in the northern-most regions of
Poland. The nature of the sector frequently causes manufacturers of a specialized product to
be geographically concentrated. Actually in a steadily growing number of regional cluster
initiatives cluster actors usually specialized in a specific product and stem from one or several
bordering NUTS 4 regions. From our perspective these could be still considered as
representatives of clusters within the large agro-food cluster (meta-cluster) which has an
important horizontal dimension (primary sectors, agro-food, specialized services). The table
beneath clearly indicates that the agro-food companies are numerous (in comparison to other
sectors analyzed in the present study) and are spread around. Cooperative linkages within the
agro-food sector in Poland exist but they should be further reinforced in order to utilize
economies of scale and scope to a full extent.
Table 112 AFC - approximate number of enterprises (> 10 employees) in northern regions of Poland
10
151 152 153
64
30
24
10
55
31
6
9
46
13
13
9
37
23
1
13
44
8
0
2
47
32
7
21
293 137
51
64
Source: Teleadreson (2005),www.teleadreson.com.pl
pomorskie
warmińsko-mazurskie
zachodniopomorskie
kujawsko-pomorskie
lubuskie
wielkopolskie
154
1
0
6
2
2
4
15
155
13
15
11
13
3
13
68
156
7
7
5
7
0
9
35
157
5
10
8
10
6
10
49
158
129
93
85
83
13
58
461
159
9
6
10
12
4
16
57
Together
163
131
119
125
26
106
670
Polish agro-food clusters is an attractive area for foreign investors. The reasons being: large
domestic market and free access to the common market, CAP regulations apply, abundance of
land, traditional farming (agro-food), relatively cheap labor. The cluster already attracted
major MNSc as well biggest wholesale and retail shops. According to PAAiZ the capital
invested into the sector is the second highest after financial services. Nordic investors are
relatively numerous. It seems that the inflow of FDI from the Nordic countries will continue
or even can gain on importance. The major issue is whether Nordic investments in the sector
should be supported by public-policy or whether it should be purely market-driven process.
The other option seems more rationale.
The analysis of the BSR has clearly shown that its potential in food processing is concentrated
mainly in Denmark and Poland. For many reason Denmark (please refer to the benchmark
case below) could constitute a natural benchmark for organization of agro-food production in
95
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Poland (atomized) with adoption of cluster-based philosophy. It could potentially improve
low productivity levels and thus speed up the convergence process towards its acceptable
levels.
Case - Features of the agro-food (meta-) cluster Denmark
 strategic importance to national economy – it is responsible for one third of the Danish
exports, more than 350.000 workers
 highly internationally competitive thanks to significant competitive advantages due to:
structural and business synergies between various branches of the cluster, successful
rationalization of internal structure, high international quality demands that gradually formed
the cluster and forced constant quality improvements and quality control system
 a coherent system with strong vertical and horizontal linkages, mutual dependency
(synergies),
 main weakness of the cluster – low level of investments associated with economic
downturn of the 1990s
 history of the food-processing based on developments in the primary sector - agriculture
in particular with strategic features: the co-operative movement (in particular in processing of
meat and dairy products) and vertical integration for instance coordination of purchases
within a single company representing an entire industry
 fishing – significantly less integrated, still significant for national economy, considerable
export potential
 major challenges – slow adjustments to changing external conditions (ecological
concerns) due to traditional, complicated co-operative structure and conservatism
Source: Prepared on the basis of paper by Dahl Michael S. (2000).
96
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Map 5 Significant concentrations of agro-food cluster at the NUTS-4 level in Poland
liczba skupień
9-13
5-8
1-4
brak
siła skupień ogółem
1.00 49.77 98.54
Source: GIME.
97
COMPETITIVE POSITION OF THE BALTIC SEA REGION
BIOCLUSTER (BC)
Biotechnology is one of the fastest growing sectors of the so-called new economy with nearly
all foresights anticipating its key role in economic development in the XXI century. Viljama
(2004) referring to Cooke points out that the sector (at least its traditional core) becomes
gradually dominated by multinational pharmaceutical corporations becoming increasingly
specialized and pursuing their global distribution and marketing strategies (pharmaceutical
sector has undergone an unprecedented period of acquisitions and mergers) which apart from
performing their own in-house R&D outsource the research and development to a large (and
steadily increasing) extent to highly concentrated clusters of private and public R&D
institutions (bioclusters). In Vilajma’s words: “biotechnology has become both highly
regionalized and globalized at the same time”. In other words, companies in the
biotechnology sector tend to locate in close proximity of major university centers and R&D
institutes as well as big pharmaceutical companies. There are numerous examples of cluster
initiatives in biotechnology worldwide both in developed as well as developing economies
despite that only relatively few are bound to succeed. The success in the BSR is already a
reality with certain bioclusters developing rapidly with the background world-class research
institutes and Baltic-based MNCs. It seems if proper policy is followed the whole BCR could
become a top-class bioregion In order to reach the goal all existing opportunities should be
utilized.
As could be imagined due to its multidimensional characteristics it is particularly difficult to
delimit the biocluster. As the focus of the present study is mainly on the manufacturing
industry we limited the scope of the biocluster analyzed only to two related 3-digit NACE
groups: NACE 244 -manufacture of pharmaceuticals, medicinal chemicals and botanical
products (biopharmaceuticals) as well as NACE 245 – manufacture of soap and detergents,
cleaning and polishing preparations, perfumes and toilet preparations – with the cosmetics
industry to our interest (biocosmetics). We would like to stress, however, that the scope of
biocluster should potentially be significantly broadened. For instance in the Polish clustermapping project (Szultka et al. 2003, OECD 2005) we took into account additionally NACE
98
COMPETITIVE POSITION OF THE BALTIC SEA REGION
731 - research and experimental development on natural sciences and engineering in order to
approximate the employment in mainly public but as well as private biotechnology-related
R&D institutes. It would be also beneficial to include NACE 851 and 852 – services sectors
related to human health and veterinary activities. Another important group – where the
biotechnology has particular significance is the agro-food sector (which has been analyzed in
the previous section). In some studies researchers try to include enterprises working in the
field of bioinformatics or specialized venture-capital firms20.
We consider manufacture of pharmaceuticals to constitute the backbone of the biotechnology
sector. Pharmaceuticals is considered to be strictly a high technology sector due to its high
intensity of knowledge utilization and intensive R&D effort both in absolute and relative
terms. High technology-intensity requires highly specialized labor-force thus locally available
human capital pool becomes a necessity. The sector is associated with high-risk especially at
early development stages (thus specialized financing is required) at later stages it becomes
capital and marketing intensive business as well. The second sector taken into account –
cosmetics is less technology intensive (medium-high technology) but still is based on
qualified labor force. Cosmetics are particularly marketing-intensive.
In terms of employment the biocluster has a share of approx. 2.5 per cent in total
manufacturing employment which is similar to EU16 average. It is significantly higher in
Denmark and considerably smaller in Finland. Altogether the sector employs around 82.500
workers which constitutes around one tenth of total employment within the sector in EU16. In
absolute terms Poland has the highest employment levels within the BSR in both NACE
groups considered (51 per cent of total employment within the BSR on average). It has a
particularly dominant position in manufacturing of soap and detergents (81 per cent of total
employment within the BSR) while its position in pharmaceuticals is nearly equalized by
Sweden.
20
The specialized venture capital companies are particularly active in the Anglo-Saxon system (USA, Canada,
UK) as well as in Germany (German Venture Capital Association e.V. – BVK: there are several active funds
operating in the BSR). They are also becoming increasingly active in the Nordic countries – there are numerous
examples among members of Swedish Private Equity & Venture Capital Association (SVCA), in Finland
(Finnish Venture Capital Association - FVCA) for instance: Bio Fund Management Oy and Solaris Asset
Management Oy, in Denmark (Danish Venture Capital and Private Equity Association (DVCA) for instance
Nordic Biotech Advisors or Biolink Capital ApS have relatively large portfolios of biotech ventures. The
venture-capital system in Poland in general is underdeveloped in comparison to the size of the market and does
not offer biotechnology-focused funds.
99
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Table 113 BC - Employment within the cluster in 2000
NACE
DNK
11 669
244
2 101
245
Together
13 770
Source: Own calculations.
FIN
5 889
553
6 442
SWE
18 509
1 666
20 175
POL
BSR
23 386
18 694
42 080
59 453
23 014
82 467
EU15
479 413
222 951
702 364
BSR to EU16
(per cent)
502 799
11.8
241 645
9.5
744 444
11.1
EU16
Table 114 BC – Share in total employment in manufacturing industry in 2000
NACE
DNK
2.62
244
0.47
245
Together
3.09
Source: Own calculations.
FIN
1.41
0.13
1.54
SWE
2.45
0.22
2.67
POL
1.33
1.06
2.39
BSR
1.76
0.68
2.44
EU15
1.73
0.80
2.54
EU16
1.71
0.82
2.53
Table 115 BC – Employment structure within the BSR
NACE
DNK
19.6
244
9.1
245
Together
16.7
Source: Own calculations.
FIN
9.9
2.4
7.8
SWE
31.1
7.2
24.5
POL
39.3
81.2
51.0
BSR
100.0
100.0
100.0
Location quotients for employment indicate existence of three important concentrations in
comparison to EU16. These are: Denmark and Sweden in manufacturing of pharmaceuticals
and Poland in manufacturing of soap, detergents and cosmetics. We have to note, however,
that in comparison to clusters analyzed so far the LQs for employment in the BC are not
particularly high.
Within the 1995-2000 period total employment in the sector within the BSR rose by nearly
7.500 jobs. The changes in employment levels were however heterogeneous. Finland
experienced a fall in both NACE groups. Employment in Denmark fell as the increase in
manufacturing of pharmaceuticals did not outweigh the large fall in manufacturing of soap
and detergents. In Sweden an important increase in employment in manufacturing of
pharmaceuticals led to an overall increase as the employment in manufacturing of soap and
detergents was roughly stable. Poland experienced a rise in employment in both groups – it
was particularly strong though in the manufacturing of soap, detergents and cosmetics.
Table 116 BC – Location quotients for employment (in comparison to EU16 )
NACE
244
245
Source: Own calculations.
DNK
1.53
0.57
FIN
0.82
0.16
SWE
1.43
0.27
POL
0.78
1.30
100
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Table 117 BC – Absolute changes in employment levels between 2000 and 1995
NACE
DNK
609
244
-1 203
245
Together
-594
Source: Own calculations.
FIN
SWE
-225
-106
-331
POL
3 619
-87
3 532
BSR
1 212
3 495
4 707
5 215
2 099
7 314
If we look at the turnover per employee figures Denmark is the only BSR state to exceed
EU15 average productivity level (in fact it is limited only to pharmaceuticals). The Baltic Sea
Region taken as a whole has labor productivity levels below of EU-15 average. This is mainly
due to low productivity levels in Poland (in particular in manufacturing of pharmaceuticals).
Hopefully, the accession will speed up Poland’s convergence in productivity.
Table 118 BC – Labor productivity in 2000 (turnover per employee)
NACE
DNK
0.312
244
0.211
245
0.297
Together
Source: Own calculations.
FIN
0.144
0.170
0.147
SWE
0.274
0.163
0.265
POL
0.052
0.109
0.078
BSR
0.182
0.124
0.165
EU15
0.296
0.269
0.287
EU16
0.285
0.257
0.276
In 2000 the sector in the BSR generated a total turnover of 13.6 billion euro. Out of this 10.8
billion in manufacturing of pharmaceuticals and 2.8 in production of soap and detergents. The
share of the sector in total manufacturing turnover of the BSR is higher than for employment
still it is below EU15 average. Manufacturing of pharmaceuticals is particularly significant
for Denmark (5.9 per cent share) and Sweden (3.25 per cent) while manufacturing of soap and
detergents is significant for Poland (2.15 per cent). In Finland both NACE groups taken
together generate less than 1 per cent of total manufacturing turnover.
Table 119 BC - Turnover in 2000 (in mil of EUR)
NACE
DNK
3 642
244
443
245
Together
4 084
Source: Own calculations.
FIN
SWE
851
94
945
POL
5 078
272
5 350
BSR
1 226
2 043
3 269
10 796
2 852
13 648
EU15
141 871
59 984
201 855
BSR to EU16
(per cent)
143 097
7.5
62 028
4.6
205 124
6.7
EU16
In terms of turnover structure within the BSR Sweden is a clear leader in pharmaceuticals,
followed by Denmark. Poland and Finland have significantly lower shares. In NACE 245
Poland is a regional leader (approx. 72 per cent) with Denmark second (15.5 per cent).
Table 120 BC - Share in total turnover of the manufacturing industry in 2000
NACE
DNK
5.87
244
0.71
245
Together
6.58
Source: Own calculations.
FIN
0.89
0.10
0.98
SWE
3.25
0.17
3.42
POL
1.29
2.15
3.43
BSR
2.64
0.70
3.33
EU15
2.85
1.21
4.06
EU16
2.82
1.22
4.05
101
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Table 121 BC - Turnover structure within the BSR
NACE
DNK
33.7
244
15.5
245
Together
29.9
Source: Own calculations.
FIN
7.9
3.3
6.9
SWE
47.0
9.5
39.2
POL
11.4
71.6
24.0
BSR
100.0
100.0
100.0
In terms of location quotients for turnover we notice two particularly significant
concentrations in comparison to EU16. These are in manufacturing of pharmaceuticals in
Denmark (110 per cent above the average) and in manufacturing of soap and detergents in
Poland(75 per cent above the average). Manufacture of pharmaceuticals in Sweden could also
be considered as a relatively important concentration. It is worth to note that the LQs for
turnover point to the same concentrations as LQs for employment.
Table 122 BC - Location quotient for turnover (in comparison to EU16 )
NACE
244
245
Source: Own calculations.
DNK
2.079
0.583
FIN
0.314
0.080
SWE
1.151
0.142
POL
0.456
1.755
As to trade relations with other EU16 states the BSR exported in 2000 approx. 2.7 billion euro
of goods with major contribution from Denmark and Sweden. Overall export onto EU16
market of two other states was rather minimal. In terms of trade balance Poland had a
particularly bad position – with a trade deficit reaching 1.7 billion euro and existing in both
analyzed sectors (this significantly affected position of the whole region – we have to
remember however that Poland imported products from Nordic partners as well). Finland had
a similar situation. Denmark and Sweden had trade surpluses in pharmaceuticals that
outweighed trade deficits in detergents and cosmetics.
Table 123 BC - Exports to EU16 in 2001 (in 1000000 EUR)
NACE
DNK
921
244
232
245
Together
1 153
Source: Own calculations.
SWE
FIN
1 118
141
1 260
POL
117
27
144
BSR
27
116
143
2 184
516
2 700
Table 124 BC - Trade balance in trade with EU16 in 2001
NACE
DNK
244
245
Together
Source: Own calculations.
SWE
296
-89
206
FIN
401
-217
184
POL
-266
-141
-407
BSR
-1 427
-347
-1 773
-996
-794
-1 790
The position of the region in terms of revealed comparative advantage in relation to EU16
countries is not particularly strong – in fact the region taken as a whole had comparative
disadvantage in both sectors in 2000. The only exception being Denmark and Sweden with
102
COMPETITIVE POSITION OF THE BALTIC SEA REGION
respectable comparative advantage in trade in pharmaceuticals as depicted by both RCA and
CRCA indices.
Table 125 BC - RCA in trade within EU16
NACE
DNK
1.65
244
0.92
245
Source: Own calculations.
SWE
1.34
0.37
FIN
0.27
0.13
POL
0.05
0.43
BSR
0.90
0.47
FIN
-0.022
-0.011
POL
-0.043
-0.009
BSR
-0.009
-0.008
Table 126 BC - CRCA in trade within EU15 +PL
NACE
DNK
0.015
244
-0.003
245
Source: Own calculations.
SWE
0.010
-0.007
The biotechnology market in Poland is relatively small and could be considered
underdeveloped (this is mainly due to generally lower per capita incomes in relation to the
rest of the region). We have to note, however, that the market is likely to develop in the near
future. As was the case with ICT the biotechnology sector in Poland is situated in close
proximity to major agglomerations. In the northern part of Poland – the region of Gdansk is
the only major concentration. The biggest one in Poland is clearly situated around two biggest
cities in Poland – Warsaw and Łódź. The enterprises functioning in the BC in the northern
Poland are not particularly numerous. There are some major foreign investors present such as:
Glaxo SmithKline Pharmaceuticals S.A. or German Beiersdorf AG in Poznań. The major
Noric investor is located outside the region in Warsaw - Novo Nordisk Pharma Sp. z o. o.
(Novo Nordisk Region Europe A/S). In terms of R&D and scientific potential the position of
both regions is relatively good. Spontaneous clustering process on a larger scale is, however,
unlikely.
Table 127 BC - approximate number of enterprises and institutions (> 10 employees) in northern regions
of Poland
244
pomorskie
7
warmińsko-mazurskie
0
zachodniopomorskie
0
kujawsko-pomorskie
5
lubuskie
1
wielkopolskie
8
Together
21
Source: Teleadreson (2005),www.teleadreson.com.pl
245
12
1
2
4
2
11
32
Together
19
1
2
9
3
19
53
731
11
7
6
4
1
12
41
Overall Denmark and Finland are the two key players in the BSR biocluster apart from
Germany (the locus of German biocluster is located outside of the region). Finland is trying to
catch up but it will have to cover much ground in forthcoming years. Position of Poland is
weak in general with cosmetics the most competitive part of the cluster.
103
COMPETITIVE POSITION OF THE BALTIC SEA REGION
We have to note, that within the BSR there already exist interesting initiatives it the
biotechnology or more broadly life-science domain. Some of the initiatives have truly Baltic
dimension The most prominent example – ScanBalt initiative linking the BSR region states as
well as Norway and Iceland. ScanBalt is a network of biotechnology networks forming a
meta-region named ScanBalt Bioregion. In fact it is a membership-based non-profit
association set up to promote the development of region as a globally competitive bioregion.
It aims to reach the goal by establishing a corporate identity of the region and developing its
visibility (brand name), attracting key human, industrial and financial resources into the
region as well as coordinating joint efforts and slowly building up networks of regional
linkages. Interesting enough the ScanBalt was launched by three regional biocluster
initiatives: Medicon Valley Academy, German – BioCon Valley and Finnish BioTurku
(Finland). Out of these Medicon Valley Academy a part of MediconValley cluster is
particularly interesting. It can be considered as probably the best example of successful
cluster initiative lunched within the BSR with a truly international dimension. It is a joint
initiative within of the Oresund region between Danish and Swedish partners. The region
being location of one of several major regional biotechnology clusters within the Baltic Sea
Region. The other prominent examples include Stockholm and Uppsala in Sweden as well as
Helsinki and Turku in Finland. We have to note that Germany attaches particular significance
to biotechnology and it could be considered the biggest biotechnology market in Europe as
such. Altogether the BSR can be judged to poses a strong position in the biotechnology sector
and could become a major global player in the field (particularly in several niche markets
such as diabetes prevention).
104
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Map 6 Significant concentrations of the biocluster at the NUTS-4 level in Poland (including NACE 514, 731)
liczba skupień
3
2
1
brak
siła skupień ogółem
1.00 8.15 15.31
105
COMPETITIVE POSITION OF THE BALTIC SEA REGION
CONCLUSIONS
1. Cluster-approach to economic analysis of the region generates an interesting picture of the
regional economy and seems to be beneficial to understanding of its key drivers. It is
especially valuable in detecting structural competitive advantages as well as
disadvantages. Analysis of regional clusters should be adopted as a parallel method of
economic analysis to traditional sectoral approach.
2. The Baltic Sea Region has a strong cluster base with an interesting portfolio of regional
clusters both in traditional and non-traditional manufacturing industries.
3. Cluster-export specialization overlaps between the BSR state are significant (in particular
between pair of countries) which suggests that mutually beneficial cooperation is possible
and could be beneficial.
4. The composition of regional clusters proves a diversified nature of the region. The BSR
has both strong clusters in traditional sectors such as: agro-food, forest products (wood
and furniture plus the 3P cluster), maritime and automotive as well as in non-traditional
sectors such as biocluster or ICT cluster.
5. In terms of employment levels agro-food and forest products clusters clearly stand out as
regional leaders and are likely to retain this position as their employment levels are stable
or slightly increasing. An interesting fact is that we observe intra-cluster shifts in
employment.
6. In terms of regional turnover three clusters are particularly strong. These are: agro-food,
ICT and 3P clusters (3P taken together with the wood and furniture cluster would be a
regional leader). Automotive cluster also contributes significantly to total manufacturing
turnover of the region.
7. No single cluster is dominant. This feature seems to be beneficial to the prosperity of the
region as it makes the region taken as a whole less prone to sector-specific supply and
demand shocks. The policy-makers should cater for all the existing cluster both traditional
and non-traditional. Still they should monitor the situation constantly. If one of the
clusters enters its final stage of development artificial up-bringing could be costly and
106
COMPETITIVE POSITION OF THE BALTIC SEA REGION
ineffective from a long-term perspective. New opportunities should be constantly
assessed. There should be some room for public intervention in emerging sectors such as
the ICT which are said to be responsible for global growth performance in recent years.
8. It seems that existence of strong regional clusters partially explains location decision of
foreign investors coming to Poland. It is worth to note that Nordic investors are already
present in all analyzed clusters. Their significance varies however between individual
clusters.
9. A study similar to Kalinowski (2005) on location advantages of Poland over Germany
should be carried out for other states of the Region (Nordic states in particular). It is worth
to note that according to Kalinowski inflow of German FDI into Poland is based on the
mainly following rationales: market access, potential for lowering total production costs
and existing distribution and suppliers networks (cluster-related factor). There are also
secondary aspects: characteristics of the local market (absolute and relative size,
increasing purchasing power), low labor costs and in particular qualified labor force
(human capital endowment), constant price-reduction pressure from final clients,
utilization of tax advantages (fiscal dumping), geographic proximity. It seems that
analysis of Nordic investors would lead to a very similar set of advantages. Furthermore,
it would be beneficial to compare locational advantages of particular southern and eastern
Baltic regions vis-à-vis Nordic States and Germany.
107
COMPETITIVE POSITION OF THE BALTIC SEA REGION
POLICY RECOMMENDATIONS
1. The BSR states should treat the enlargement of the European Union as a historic
opportunity to build a coherent region with strong competitive potential. The rise of the
peripheral Baltic Region could clearly decrease the dominance of the core of European
Union (frequently referred to as the European banana). For many reasons the Baltic
growth pole could become the leading region of the European Union.
2. In order to maximize the benefits associated with enlargement of the European Union the
BSR should try to eliminated all existing barriers to freedom of movement within the
single European market. Despite its delicate nature the BSR states should press other
EU25 MS in particular to adopt as soon as possible the directive on services and to lift (or
not to extend) the existing labor market barriers to workers from the recently acceded
member states.
3. The industrial policy of the European Union has a horizontal framework though sectoral
thinking is once again gaining attention. It seems that more emphasis should be put on
regional clusters. Nordic states are front-runners in this respect and thus could provide
quality expertise for the rest of the BSR states as well as the rest of the EU.
4. Regional competition stimulates overall competitive position of the region. Still it seems
that co-opetive philosophy (strong competition with extensive cooperation) should be
fostered with more emphasis put on establishment of regional linkages.
5. Progress should be made in all other aspects of regional integration. It is worth to note,
however, that actual actions and not words are important. In order to move the whole
process forward small-steps policy should be followed (low-hanging fruits picking policy
should be implemented) with more ambitious projects to be carried out within a medium
to long-term perspective. This policy could strengthen the Baltic identity which is rather
non-existent for the time being.
6. Overlaps in cluster base clearly indicate that cooperation between clusters (including
intra-regional reallocation of resources between clusters) should be fostered with intraregional clusters likely to emerge in the future (the Medicon Valley cluster in the Oresund
region is a prime example that fruitful cooperation is possible) despite the issue of
108
COMPETITIVE POSITION OF THE BALTIC SEA REGION
geographic proximity. Major improvement in existing transportation channels (within the
BSR could contribute significantly to development of intra-regional clusters.
Development of infrastructure should be a domain of particular activity of national
governments (once again the Oresund region is a benchmark example). We need more
progress in the domain to be made within the next 5 years in order to support the
establishment of the Baltic growth pole.
7. The benefits associated with cluster-based policy in terms of facing up to challenges
caused by market imperfections, public policy imperfections as well as systemic
imperfections clearly indicate its relevance.
8. National governments should create favorable working conditions for development of
domestic as well as intra-regional clusters. Due to its distortive character the amount of
state aid to clusters should be minimized (in particular through direct subsidies).
9. We agree with Ketels and Solvel that cluster-policy benchmarking should be carried out
within the BSR region and in comparison to major global competitors. We stress,
however, that more intra-regional policy-learning should occur with the for-runners
passing their practical experience to other states of the region to mutual benefit. On a
more practical note A Regional Cluster-Policy Code of Good Practice could be prepared
and than distributed among regional authorities and regional business community.
10. In order to improve the policy-making process it would be beneficial for all the BSR to
systematically collect data. This would allow to present on annual basis a general and
detailed overview of the economy of the Region both at national and regional level.
Cluster-based approach could also be utilized. A virtual Baltic Sea Region Statistical
Office (BSRSO) could be established in order to coordinate cooperation of national (and
sub national) statistical offices (the cooperation among Nordic Statistical offices is a good
example to follow). Preferably, it should stretch beyond the EU Member States – Russia.
11. The BSRSO could be supported by a network of Baltic research institutes and thin tanks
as well as independent researchers similar to CEPR responsible for systematic analysis of
regional economy.
12. If the BSR states agree that cluster-approach is particularly relevant tool for analysis of
the regional economy than a BSR cluster-mapping exercise should be systematically
carried out (similar to present study and the study by Ketels and Solvell) at least each
109
COMPETITIVE POSITION OF THE BALTIC SEA REGION
every five years. More emphasis should be put on the phenomena of intra-regional
reallocation and the significance of regional clusters in explaining its occurrence.
Future extensions
In the future the scope of the study should be significantly increased. The analysis – ideally
should take into account all 3-digit NACE industry and services sectors in all the BSR states
of the European Union (preferably including Russia) at least at the NUTS-2 level. And if
possible cover 2004 in order to detect accession-related adjustments in regional economy. It
seems, however, that the proper assessment would require at least 10 years perspective.
In order to properly inform the governments and regional authorities of the region the study
should be continued on biannual basis. It seems worthy to conduct analysis on specifically
defined clusters of key significance to the competitive potential of the region (the list of key
clusters should be reconsidered). Furthermore, existing studies should be supplemented by
Baltic technology foresights. It seems finally, the definition of the region should once again
be reconsidered as the present one can easily be questioned.
110
COMPETITIVE POSITION OF THE BALTIC SEA REGION
LITERATURE AND REFERENCES
ACEA (2005) Automotive Production (EU15 + EFTA Countries) Motor Vehicle Production
in the EU by country: 2000-2003.
Amiti Mary (1999) Specialization patterns in Europe, Weltwirtschaftliches Archive Vol. 135
(4), pp. 573 – 593.
Baldwin Richard and Wyplosz Charles (2004) The Economics of European Integration,
McGraw-Hill, London.
Brodzicki Tomasz (2003) Wymiana produktów przemysłu przetwórczego między Polską a
państwami członkowskimi Unii Europejskiej, in: Zielińska-Głębocka Anna et al., Potencjał
konkurencyjny polskiego przemysłu w warunkach integracji europejskiej, Wydawnictwo
Uniwersytetu Gdańskiego, Gdańsk.
Brodzicki Tomasz, Dzierżanowski Maciej, Erlandsson Kristofer., Szultka Stanislaw
(2004) Założenia strategii rozwoju klastrów w Polsce i propozycje działań operacyjnych,
opracowanie na zlecenie Ministerstwa Gospodarki i Pracy, IBnGR, Gdańsk.
Brodzicki Tomasz et al. (2004) Polityka wspierania klastrów, Niebieskie Księgi PFSL 2004,
Rekomendacje nr 11, IBnGR, Gdańsk.
Brodzicki Tomasz et al. (2002) Uwarunkowania rozwoju nowoczesnych technologii w
Gdańsku, IBnGR, Gdańsk.
Brodzicki Tomasz and Szultka Stanisław (2002) Koncepcja klastrów a konkurencyjność
regionów, Organizacja i Kierowanie Nr 4(110), s. 45-60.
Brülhart Marius and Traeger Rolf (2003) An Account of Geographic Concentration
Patterns in Europe, HWWA Discussion Paper 226.
Dahl Michael S. (2000) Synopsis for the Danish Cluster Studies, DRUID Working Paper.
Grabowski et al. (2004) Stan i prognoza popytu na pracę w woj. pomorskim w ujęciu krótkoi średniookresowym, IBnGR, Gdańsk.
DTI (1999) Biotechnology Clusters, Department of Trade and Industry, London.
DTI (2001) Business clusters in the UK - a first assessment, Department of Trade and
Industry, London.
Jorgenson Dale W. and Nomura Koji (2005) The Industry Origins of Japanese Economic
Growth, NBER Working Paper No. 11800.
Kalinowski Tomasz (2005) Polska jako miejsce lokowania inwestycji niemieckich. Przewagi
lokalizacyjne w stosunku do Niemiec, PAIiIZ, Warszawa.
Ketels Christian, Sölvell Örjan (2004) The State of the Region Report 2004. An Assessment
of Competitiveness in the Baltic Sea Region, Baltic Development Forum (BDF).
Ketels Christian, Sölvell Örjan (2005) The State of the Region Report 2005.
Competitiveness and Cooperation in the Baltic Sea Region, Baltic Development Forum
(BDF).
METLA (2004) Statistical Yearbook of Forestry, METLA.
111
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Midelfart-Knarvik Karen Helene et al. (200.) The Location of European Industry,
European Economy no. …, EC, Brussels.
OECD (2005) Business Clusters. Promoting Enterprise in Central and Eastern Europe,
OECD Publishing.
Policy Research Corporation N.V., ISL (…) Economic Impact of Maritime Industries in
Europe, study commissioned by the EC.
Rosenthal Stuart S. and Rosenthal Stuart S. (2003) Evidence on the Nature and Sources of
Agglomeration Economies, Prepared for the Handbook of Urban And Regional Economics,
Volume 4.
Statistics Denmark et al. (2001) The ICT Sector in the Nordic countries 1995-2000,
downloaded from the web site www.dst.dk/ict.
Szultka Stanislaw et al. (2003) Innowacyjne klastry – wyzwania dla Polski?, IBnGR,
Gdańsk.
Viljamaa Kimmo (2004) What does it take to build a local biotechnology cluster in a small
country? The case of Turku, Finland as an example, paper presented at the DRUID Summer
Conference 2004 on “Industrial Dynamics, Innovation and Developmet”, Elsinore, Denmark.
Vittanen Mikko et al. (2003) The Finnish Maritime Cluster, TEKES Technology Review
145/2003, Helsinki.
Zielińska-Głębocka, A. et al. (2003) Potencjał konkurencyjny polskiego przemysłu w
warunkach integracji europejskiej, Wydawnictwo Uniwersytetu Gdańskiego, Gdańsk.
STATISTICAL DATA SOURCES
ACEA
DRUID
EUROSTAT – COMEXT, NEW CRONOS
GUS
METLA
PAIiIZ
STATISTICS DENMARK
TEKES
TELEADRESON
112
COMPETITIVE POSITION OF THE BALTIC SEA REGION
WEB RESOURCES
Danish Venture Capital and Private Equity Association DVCA www.dvca.dk
German Venture Capital Association e.V. – BVK www.bvk-ev.de
Finnish Venture Capital Association FVCA www.fvca.fi
Swedish Private Equity & Venture Capital Association (SVCA) www.svca.se
DTI clusters www.dti.gov.uk/clusters/
European Commission DG Enterprise and Industry http://europa.eu.int/comm/
TEKES www.tekes.fi
NUTEK www.nutek.se
VINNOVA www.vinnova.se
PAIiIZ www.paiz.gov.pl
ACEA www.acea.be
OECD www.oecd.org
DRUID www.druid.dk
ETLA www.etla.fi
Medicon Valley www.mediconvalley.com
SCANBALT www.scanbalt.org
IBnGR (GIME) www.ibngr.edu.pl
Teleadreson www.teleadreson.com.pl
TCI – The Competitiveness Institute www.competitivness.org
Polish cluster portal www.klastry.pl
The Cluster Mapping Project http://data.isc.hbs.edu/isc/
113
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Appendix A. ICT in Nordic Economies
Source: Statistics Denmark et al. (2001) The ICT Sector in the Nordic countries 1995-2000, downloaded from
the web site www.dst.dk/ict.
114
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Source: Statistics Denmark et al. (2001) The ICT Sector in the Nordic countries 1995-2000, downloaded from
the web site www.dst.dk/ict.
115
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Appendix B. Nordic investors in Poland (on the basis of country of origin, > 1 mill. USD)
Company
House of Prince
Denmark A/S
Investment Fund
for Central and
Eastern Europe
Carlsberg
Breweries A/S
TDC Mobile
International A/S
Value of
investment
(mill. euro)
296.9
Cluster
AF
163.6
Activity
Denmark
manufacture of tobacco
products
capital investment
93.8
AF
manufacture of beer
85.7
ICT
related
telecommunications
NETTO A/S
85.3
Icopal A/S
74.0
Foras Holding A/S
72.5
TK Holding
70.8
Rockwool
57.2
Polen Invest A/S
51.5
Danfoss A/S
50.1
NKT Cables A/S
27.9
Elsam A/S
26.6
Group 4 Falck A/S
25.6
Sonion
Mictrotronic A/S
24.0
Comment
Scandinavian Tobacco S.A.
(Myślenice)
148 investment projects in Poland contribution to equity of companies
and loans
94,64 per cent stake in Carlsberg
Polska S.A. (Warsaw)
19,6 per cent stake in Polkomtel S.A.
(Warsaw)
other retail sale of food,
Netto Sp. z o. o. (Stargard Szczeciński)
beverages and tobacco in
- supermarket chain
specialized stores
manufacture of other nonmetallic mineral products
99,9 per cent stake in Icopal S.A.
n.e.c. e.g. building
(Zduńska Wola)
materials
development and selling
Foras Management Poland Sp. z o. o.
of real estate
(Warsaw)
Thorkild Kristensen Polska Sp. z o. o.
general construction of
(Warsaw) - shopping center in
buildings
Szczecin, construction plans (Warsaw
and Poznań)
Rockwool Polska Sp. z o. o. (Cigacice,
production of insulating
Lubuskie Voivodship), Rockwool
materials
Małkinia Sp. z o. o.
Poldanor S.A. (Przechlewo, Pomorskie
AF
pig breeding
Voivodship), Prime Food Sp. z o. o.
(Przechlewo)
manufacture of taps and
valves, manufacture of
Danfoss Poland Sp. z o. o. (Warsaw),
instruments and
Zakład Hydrauliki Przemysłowej
appliances for measuring,
ICT
Pilmet (Wrocław), valve production
checking, testing,
(Grodzisk Mazowiecki near Warsaw),
navigating and other
Sauer - Danfoss Sp. z o. o.
purposes, except industrial
process control equipment
75,52 per cent stake in NKT Cables
ICT
manufacture of insulated
S.A. (Czechowice-Dziedzice), NKT
related
wire and cable
Cables Warszowice Sp. z o. o., Polinex
Sp. z o. o. (Knurów)
production and
Wolin North Sp.zo.o. (Szczecin)
distribution of electricity
Falck Polska Sp. z o.o., Falck Ochrona
Sp. z o.o. (Warsaw), Ratownictwo
investigation and security Falck Sp. z o.o. (Szczecin), Karderos
activities
Sp. z o.o. (Kraków), BWR Serwis Sp.
z o.o. (Kraków), Sekuritas Sp. z o.o.
(Zielona Góra)
manufacture of medical
BC related and surgical equipment
Sonion Polska Sp. z o. o. (Mierzyn)
and orthopedic appliances
AF related
116
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Company
Value of
investment
(mill. euro)
GN Great Nordic
22.4
Tryg-Baltica A/S
(Nordea Group)
20.8
Nykredit
Realkredit A/S
Logstor Ror A/S
16.2
12.2
Schulstad Brod
A/S
10.5
Danske Bank A.S.
9.6
Unicon AS
8.8
Merrild Cafe
8.2
Chr. C. Grene A/S
7.6
Novo Nordisk
Region Europe
A/S
Investeringsfonden
for Ostlandene
Broen A/S
Scanpol
International ApS
Pagh Morups
Bornekonfektion
APS
Cluster
Activity
Comment
part of DPTG (Danish Polish
Telecommunications Group),
investment in fibre optic pipe-line
ICT
telecommunications
worth USD 20 million completed
together with Tele Danmark
Internationale AS and
Telekomunikacja Polska S.A.
98.2 per cent stake in Nordea Polska
life insurance, pension
Towarzystwo Ubezpieczeń na Życie
funding, non-life
S.A. (Warsaw), Tryg Polska
insurance
Towarzystwo Ubezpieczeniowe S.A.
(Radom)
other monetary
Nykredit Bank Hipoteczny S.A.
intermediation
(Warsaw)
manufacture of steel tubes Logstor Ror Polska Sp. z o. o. (Zabrze)
manufacture of bread;
AF
manufacture of fresh
Schulstad Sp. z o. o. (Poznań)
pastry goods and cakes
other credit granting
Danske Bank Polska S.A. (Warsaw)
manufacture of concrete
products for construction
Unicon Beton Sp. z o. o. (Warsaw)
purposes
AF
manufacture of coffee
Prima S.A. (Poznań)
sale of motor vehicle parts 65 per cent stake in Grene Sp. z o. o.
AC related
and accessories
(Bydgoszcz, Leszno, Konin )
6.1
BC
5.7
AF
5.5
manufacture of
pharmaceuticals
Novo Nordisk Pharma Sp. z o. o.
(Warsaw)
production and preserving
of meat
manufacture of fasteners,
screw machine products,
chain and springs
36 per cent stake in Prime Food Sp. z
o. o. (Przechlewo)
Broen DZT S.A.
5.5
hotels with restaurant
Hotel New Skanpol Sp. z o. o.
(Kołobrzeg)
4.7
manufacture of drubbing
textiles
PMB Sp. z o. o. (Piła)
Chr. Hansen A\S
4.7
other wholesale
Chr. Hansen Poland Sp. z o. o.
(Cząstków Mazowiecki)
A.Espersen A/S
4.3
ARLA FOODS
AmbA
Elopak Denmark
AS
3.7
3.3
Dan Cake A/S
3.2
DreamLand
3.1
A/S Roulunds
Fabriker
3.1
processing and preserving
of fish and fish products
manufacture of dairy
AF
products
packaging for dairy
AF related
products
manufacture of rusks and
biscuits; manufacture of
AF
preserved pastry goods
and cakes
AF / MC
WFC
furniture production
production of abrasive
products
Espersen Polska Sp. z o. o. (Koszalin)
Arla Foods Sp. z o. o. - factory in
Gościno near Kołobrzeg
Elopak Sp. z o. o. (Czosnów near
Warsaw)
Dan Cake Sp. z o. o. (Chrzanów)
Hilding Polska Sp. z o. o. (Murowana
Goślina)
80 per cent stake in Fabryka Okładzin
Ciernych Fomar Roulunds S.A.
117
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Company
Value of
investment
(mill. euro)
Trepko A/S
3.0
Shiptrans Holding
A/S
2.6
TAEPPELAND
HOLDING A/S
Kongskilde
Industries A/S
Danish Fast Food
1.7
Danish Partner
ApS
1.4
YellowTel A/S
1.2
Velux A/S
Dan Engineering
AS
Carly Gry
0.9
LM Glasfiber
0.9
Activity
Comment
manufacture of other
general purpose
machinery n.e.c.
Trepko Sp. z o. o. (Gniezno)
manufacture of furniture
other retail sale in nonspecialized stores
manufacture of machinery
for agriculture
2.1
1.7
steam supply
AF
ICT
services
manufacture of bread;
manufacture of fresh
pastry goods and cakes
manufacture of other
wearing apparel and
accessories
Scanwood Sp.z o.o. (Mierzyn near
Szczecin), Scanwood (Dębno),
Scanwood (Słońsk)
Topwert Świat Dywanów Sp. z o. o.
(Janki)
Kongskilde polska Sp. z o. o. (Kutno)
combined heat plant (Łęgajnie,
Warmińsko-Mazurskie Voivodship)
Dania Fast Food Sp. z o. o. (Warsaw)
Danipol Sp. z o. o. - factory in
Polkowice
data processing
YellowTel Polska Sp. z o. o. (Warsaw)
1.1
manufacture of plastics
1.0
zinc production
Velux Polska Sp. z o. o. (Warsaw)
Dan Engineering Sp. z o. o. (SEZ
Tarnobrzeg)
manufacture of other
outerwear
production and
distribution of electricity
Finland
life insurance, pension
funding,
162.1
Stora Enso Oyj
92.1
Huhtamaki Van
Leer
50.3
Sanitec Ltd. OY
42.7
Paroc Group
42.7
Metsa Tissue OYJ
30.2
Ruukki OY
WFC
2.4
Hedeselskabet
Sampo
Cluster
11.9
3P
manufacture of corrugated
paper and paperboard and
of containers of paper and
paperboard, manufacture
of pulp
plastic packaging
production
manufacture of ceramic
sanitary equipment
3P
manufacture of other nonmetallic mineral products
n.e.c.
manufacture and
household and sanitary
goods and of toilet
requisites
manufacture of builders'
carpentry and joinery of
metal
Carly Gry PL Production (Łódź)
LM Glasfiber Sp. z o. o. (Goleniów)
Sampo Towarzystwo Ubezpieczeń
S.A., Sampo S.A., Sampo
Towarzystwo Ubezpieczeń na Życie
S.A. (Warsaw), Sampo Powszechne
Towarzystwo Emerytalne S.A.
Intercell S.A. (Ostrołęka, Warsaw,
Lodz, Tychy, Mosina near Poznan),
Intercell Recycling sp. z o.o.
(Warsaw), Scantrans sp. z o.o.(Lodz)
Huhtamaki Polska Sp. z o. o.
(Siemianowice Śląskie)
Sanitec Koło Sp. z o. o., Laminex
(Mińsk Mazowiecki), Scan Aqua Sp.z
o.o. (Łódź), Zakład Wyrobów
Sanitarnych (Wrocław)
Paroc Polska Sp. z o. o. (Trzemeszno)
Metsa Tissue S.A. (Konstancin
Jeziorna), Zakłady Papiernicze w
Krapkowicach S.A.
Ruukki Polska Sp. z o. o. (Warsaw),
production plant in Katowice and
Żyrardów, 23.6 per cent of shares of
Metalplast Oborniki (Oborniki)
118
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Company
Value of
investment
(mill. euro)
KWH Group Ltd.
11.1
Cluster
Activity
Comment
pipes production
KWH Pipe (Poland) Ltd. (Warsaw),
plant near Bełchatów
Nordic
Environment
Finance
Corporation
(NEFCO)
manufacture of corrugated
paper and paperboard and
of containers of paper and
paperboard; production
and preserving of meat
manufacture of margarine
and similar edible fats
8.4
3P
Raisio Group
8.4
AF
Suomi Mutual
Life Assurance
Company
7.0
Consolis Oy Ab
5.8
Oras OY
4.7
HK Ruokatalo Oyj
4.6
Fortum Power and
Heat OY
2.8
ENSTO SEKKO
OY
2.6
Carrus
2.1
AC
Lannen Tehtaat
OY
1.4
AF
NORDKALK
GROUP
1.4
quarrying of limestone
Nordkalk Sp. z o. o. (Krakow)
Martela OYJ
1.3
trade of clothes
Martela Design Center Sp. z o. o.
(Warsaw)
life insurance
AF
Intercell S.A. (Ostrołęka), Foster
Wheeler Energy Fakop Sp. z o. o.
(Warsaw), 25 per cent stake in Prime
Food Sp. z o. o. (Przechlewo)
Raisio Polska Foods Sp. z o. o.
(Karczew near Warsaw)
Towarzystwo Ubezpieczeń na Życie
FinLife S.A. (Warsaw)
manufacture of concrete
Consolis Polska Sp. z o. o.
products for construction
(Gorzkowice near Piotrków
purposes
Trybunalski)
casting of other nonOras Olesno Sp. z o. o. (formerly
ferrous metals
Standard Armatura)
production and preserving 21,12 per cent stake in "Sokołów" S.A.
of meat
(Sokołów Podlaski)
steam and hot water
85 per cent stake in Fortum
supply
Częstochowa S.A. (Częstochowa)
architectural and
Ensto Aspol Sp. z o. o. (Gdańsk),
engineering activities and
branch offices in Krakow, Łódź,
related technical
Poznań, Warsaw.
consultancy
45 per cent stake in Volvo Bus Poland
bus assembly
Sp. z o.o (Wrocław)
processing and preserving
of fruit and vegetables
Lannen Polska Sp. z o. o. (Tolkmicko)
n.e.c.
Sweden
production and
distribution of electricity,
steam and hot water
supply
Vattenfall AB
878.0
IKEA
511.9
WFC
related
other retail sale in
specialized stores
Telia AB
290.1
ICT
related
telecommunications,
printing n.e.c.
Nordea Bank
Sweden AB
(Nordea Group)
238.0
banking, life insurance
75 per cent stake in Elektrociepłownie
Warszawskie S.A., 75 per cent stake in
Górnośląski Zakład
Elektroenergetyczny S.A.
IKEA International A/S, IKEA Polska
S.A., IKEA Hanim Poland S.A., IKEA
Retail Sp. z o. o. - supermarket chain,
IKEA Trading & Design AG (Janki
near Warsaw), 80 per cent stake in
Szczeciński Przemysł Drzewny S.A.,
factory in Chłastów (Lubuskie
Voivodeship)
Telia S.A., shares in Eniro Polska Sp. z
o. o.
Nordea Bank Polska S.A. (Gdynia),
NORDEA Polska Towarzystwo
Ubezpieczeń na Życie S.A., NORDEA
FINANCE POLSKA S.A., LG Petro
Bank S.A
119
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Company
Value of
investment
(mill. euro)
Cluster
Activity
Comment
general construction of
buildings and civil
engineering works
Skanska Project Development Europe
AB - Atrium Centrum Sp. z o. o.,
Skanska Oeresund AB - Atrium Plaza
Sp. z o. o. (both managed by Skanska
Property Poland (Warsaw); Skanska
International Building AB - Skanska
Polska Sp. z o. o. (Warsaw), 94 per
cent of shares of Exbud S.A. (Kielce),
Westin Hotel (Warsaw)
Skanska Kraft AB
217.7
Swedwood
Holding BV
170.6
WFC
manufacture of furniture
Swedwood Poland S.A. (Szczecin)
Arctic Paper AB
119.4
3P
manufacture of paper and
paperboard, manufacture
of paper stationery
Arctic Paper S.A. (Kostrzyn)
Svenska
Handelsbanken
AB
69.1
banking
Bank Svenska Handelsbanken Polska
S.A. (Warsaw)
Swepol Link AB
64.0
NCC AB
58.5
Skandinaviska
Enskilda Banken
(SEB)
production and
distribution of electricity
general construction of
buildings
52.4
banking
manufacture of paints,
varnishes and similar
coatings, printing ink and
mastics
activities of travel
agencies and tour
operators; tourist
assistance activities n.e.c.
Alcro - Beckers
AB
51.2
Fritidsresor
Holding AB
39.2
Optiroc Group AG
34.1
AF
manufacture of glues and
gelatines
Volvo AB
68.2
AC
manufacture of motor
vehicles
Oriflame
29.9
BC
manufacture of cosmetics
Vin & Spirit AB
28.7
AF
manufacture of vodka
Scania CV AB
2.6
AC
manufacture of motor
vehicles
Sydkraft AB
27.0
steam and hot water
supply
Swepol Link (Poland) Sp. z o. o.
NCC Polska Sp. zo.o. (Poznań)
47 per cent stake in Bank Ochrony
Środowiska S.A. (Warsaw), SEB
Towarzystwo Funduszy
Inwestycyjnych S.A.
Polifarb Becker Dębica S.A., TBD
S.A. (Dębica)
Scan Holiday Travel Sp. z o o.
(Poznań)
Optiroc Sp. z o. o. (Warsaw), Optiroc
Gniew Sp. z o.o. (Gniew), factory in
Góra Kalwaria and Szczecin
Volvo Polska Sp. z o. o. (Wrocław),
Volvo Polska Sp. z o. o. (Warsaw),
Truck and Bus Service Sp. z o. o.
(Długołęka)
Oriflame Poland Sp. z o. o., Oriflame
Products Poland Sp. z o. o. (Warsaw)
85 per cent stake in Lubuska
Wytwórnia Wódek Gatunkowych
Polmos ( Zielona Góra)
Scania Production Słupsk S.A.
(Słupsk)
70 per cent stake in Sydkraft Złotów
Sp. z o. o. (Złotów), 100 per cent stake
in Energetyka Cieplna Sp. z o. o.
(Czeladź), 100 per cent stake in
Sydkraft Poznań Sp. z o. o., 23,2 per
cent stake in Ostrowski Zakład
Ciepłowniczy, 51 per cent stake in
Słupska Energetyka Cieplna
120
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Company
Value of
investment
(mill. euro)
Aktiebolaget SKF
25.6
Trelleborg AB
53.7
AGA AB
19.1
DeLaval Holding
AB
17.1
Granges A.B.
16.9
Plastal Group AB
14.4
Ahlstromforetagen
Svenska Aktiebolg
13.8
ABBA Seafood
AB
13.6
Dahl International
AB
13.1
Autoliv AB
14.3
Electrolux AB
11.9
Dagens Industri
Holding AB
11.1
Lindab AB
10.4
Lantbrukarnas
Ekonomi
Aktiebolag
9.9
Cluster
Activity
Comment
manufacture of bearings,
gears, gearing and driving
SKF Poznań S.A. (Poznań)
elements
manufacture of parts and
Trelleborg Automotive Poland Sp. z o.
AC
accesories for motor
o. (Wałbrzych)
vehicles and their engines
AGA Gaz Sp. z o. o. (Warsaw) technical gas production
Polgaz Kościan, Wielkopolskie
Voivodship
manufacture of machinery
DeLaval Sp. z o. o., Delaval
AF related
for food, beverage and
Operations Sp. z o. o. (Wrocław)
tobacco processing
Sapa Poland Ltd. (Trzcianka Lubuska,
casting of light metals
Wielkopolskie Voivodship)
manufacture of other
Plastal Sp. z o. o. (Gliwice)
plastic products
manufacture of electricity
distribution and control
stake in "POLAM Szczecinek S.A."
apparatus
processing and preserving
AF / MC
Superfish S.A. (Kołobrzeg)
of fish and fish products
wholesale of hardware,
plumbing and heating
Tadmar S.A. (Poznań)
equipment and supplies
manufacture of parts and
Autoliv Polska Sp. z o. o. (Oława,
AC
accesories for motor
Jelcz)
vehicles and their engines
Electrolux Poland Sp.zo.o. (Warsaw),
manufacture of electric
Electrolux Production Poland Sp. z o.
domestic appliances
o. - factory in Siewierz
Bonnier Business Polska Sp. z o. o.
3P
publishing of newspapers
(Warsaw)
distribution of metal
Lindab Sp. z o. o. (Łomianki near
products
Warsaw)
AC
AF
production and preserving 19,43 per cent stake in "Sokołów S.A."
of meat
(Sokołów Podlaski)
3P
manufacture of corrugated
paper and paperboard and
of containers of paper and
paperboard
Inter Paper
Holding AG
9.0
Scancem AB
8.5
Munksjo AB
8.5
3P
Cloetta Fazer AB
8.5
AF
Bulten AG
8.5
Sandvik AB
6.5
cement production
packaging
manufacture of cocoa;
chocolate and sugar
confectionery
manufacture of fasteners,
screw machine products,
chain and springs
manufacture of tools
Intercell S.A. (Ostrołęka)
50 per cent of shares of Bosta Beton
(Warsaw), Precon Polska bought
"Jastrobet" in Jastrów
Munksjo Packaging Sp. z o. o. packaging plant in Pruszków near
Warsaw
Cloetta Fazer Polska Sp. z o. o.
(Gdańsk)
Bulten Polska S.A. (Bielsko-Biała)
Sandvik Baildonit S.A.
121
COMPETITIVE POSITION OF THE BALTIC SEA REGION
Company
Value of
investment
(mill. euro)
Posten AB
6.4
Thule Holding AB
6.4
Duni AB
5.4
Swedfund
International AB
5.3
Arot AB
4.5
Muscle Machine
Sweden
3.8
Stora AB
3.0
Kemira Kemi AB
3.0
BACKER BHV
AB
2.8
Catzy
2.6
BC
Elanders Infoprint
AB
2.6
3P
POLARICA AB
2.6
AxMeditec AB
2.4
TEKNOPROD
AB
2.1
Necks Invest AB
2.0
LLENTAB AB
2.0
IFS Industrial and
Financial Systems
AB
1.7
Ericsson
1.7
Alfort Kemtech
AB
1.5
AxEast AB
1.1
Elfa AB
0.9
Cluster
AC
3P
3P related
Activity
courier activities other
50 per cent stake in Masterlink Express
than national post
Sp. z o. o. (Warsaw)
activities
manufacture of other
fabricated metal products Thule Sp. z o. o. - factory in Wieleń in
n.e.c. - load carriers for
Wielkopolskie Voivodeshjp
cars
production of napkins,
Duni Poland Sp. z o. o. (Poznań)
table covers and candles
contribution to equity of KZP
insulating materials
Kostrzyn - paper producer, Nordiska
manufacturer
Ekofiber Polska
manufacture of plastic
plates, sheets, tubes and
Arot Polska Sp. z o. o. (Leszno)
profiles
manufacture of builders'
Marmite International S.A. (Palędzie)
ware of plastic
wholesale trade in paper
Papyrus Sp. z o. o. (Poznań)
products
manufacture of other
51 per cent stake in Kemipol Sp. z o. o.
inorganic basic chemicals
(Police)
manufacture of central
heating radiators and
Backer OBR Sp. z o. o. (Pyrzyce)
boilers
Przedsiębiorstwo Zagraniczne Catzy
cosmetics production
Sp. z o. o. (Wesoła near Warsaw)
printing
processing and preserving
of fruit and vegetables
n.e.c.
retail sale of medical and
BC related
orthopedic goods
ICT
manufacture of insulated
related
wire and cable
general mechanical
engineering
general construction of
buildings and civil
engineering works
AF
ICT
services
ICT
production of software,
sales and inventory
manufacture of television
and radio transmitters and
apparatus for line
telephony and line
telegraphy
manufacture of brooms
and brushes
production of pumps
ICT
related
Comment
retail sale of electrical
household appliances and
radio and television goods
Elanders Polska Sp. z o. o. (Płońsk)
Polfrys Sp. z o. o. (Świdwin,
Zachodniopomorskie Voivodeship)
AxMediTec Sp. z o. o. (Białystok)
Teknosystem Sp. z o. o. (Warsaw)
Pol-Necks Sp. z o. o. (Toruń)
Llentabhallen Sp. z o. o. (Gdańsk)
IFS Poland Sp. z o. o. (Warsaw and
Kraków)
Ericsson Sp. z o. o. (Warsaw), 19,23
per cent stake in RWT Telefony
Polskie S.A.
Stargard Borst Sp. z o. o. (Stargard
Szczeciński)
Szwedzkie Biuro Techniczne Sp. z o.
o. (Warsaw)
Elfa Polska Sp. z o.o. (Warsaw)
Source: PAIIZ.
122