1

Factors driven

Investment Driven

Innovation Driven

2

3

4

BASIC MODELS OF DEVELOPMENT

The Free Economic Zone (FEZ) is “a geographic economic area in which goods enter duty free for processing and export, and in which investors are offered a variety of incentives (WEPZA)”.

Industrial District: Firms consciously network with each other and active trade associations provide shared infrastructure. Firms merge with Community

Porter’s cluster is a “geographic concentration of an array of linked, competitive firms that either have close buy-sell relationships,

5

6

7

8

QUALIFIED INDUSTRIAL ZONE (QIZ)

9

10

Emilia-Romagna. Some I ndicators

•Population 4.037.095

•Total labour force 53,0%

•Total unemployment rate 3,8%

•Female labour force 44,3%

•Female unemployment rate 5,3%

•GDP per head (€) 21.132

•Employees in themanufacturing industry 645,648

•Manufacturing local units 94.817

•Firms with less than 50 empl. 98%

11

EmiliaEmilia--Romagna: industrial districtsRomagna: industrial districts

PIACENZA

RIMINI

PARMA

REGGIO EMILIA

MODENA

FORLI ’

BOLOGNA

FERRARA

RAVENNA

Machine tools

Farm machinery

Food processing

Textile-clothing industry

Upholstered furniture

Packaging machines

Ceramic products and machines for

ceramic industry

Shoes

Biomedical products

Wood – processing machines

12

2

Emilia-Romagna at a glance

• Area: 22,120 km2

• Population: 4,000,000• Per capita GP: 25,733 €• Municipalities: 341• Enterprises: 415.000

13

•Cooperatives make up over 40% of the GDP of the ER region

•In Bologna two out of three citizens are members of a cooperative

•In Bologna over 85% of the city's social services are provided by social co-ops

•Per capita income in ER has risen from 17th to second among Italy's 20 regions

•Per capital income is 50% higher than the national average

•Of the European regions, ER is number 11 of 122 regions in terms of GNP per inhabitant

•Bologna has the highest disposable income of any of Italy's 103 provinces

•Bologna has the highest per capita expenditure on the arts of any city in Italy

•The unemployment rate of 4% is virtually full employment

•70% of Bologna's households have home ownership

14

ERVETERVET

The ERVET SystemThe ERVET System

I nnovation I nnovation -- Technology Transfer Technology Transfer

ASTER

ConstructionConstruction

QUASCO

CENTRO CERAMI CO

FashionFashionCITER

CERCAL

Quality Quality -- Technology Technology -- EngineeringEngineering

CERMETDEMOCENTER

CESMA

15

16

The new Players SystemThe new Players System

ERVET

TA and support to PA and Local

Authorities for Promotion and

Improvement of the regional territory

ASTER

Co-ordination, financing, managing

the Network forApplied Research and

TT

Research and TT

Laboratories

Innovation Centres

17

18

19

20

21

22

23

24

25

26

Models of Industrial Development

Community Industry Synergy

Clustering Specialization Process

Free Economic Zone

Industrial District

Porter’s Cluster

Hybrid Industrial District Cluster

Strong

Weak Strong

Hybrid FEZ-C

Hybrid ID-FEZ

27

COMPETITIVE ADVANTAGE IN THE MIDDLE EAST

Factor Conditions & Government•  Egypt lowest labor cost• PA highest labor cost• Jordanian universities not adapted to

needs.• Israeli high skilled labor,• Knowledge sharing (QIZ)

Demand Conditions• Mutual impact of demand sophistication (irrigation)• Economies of scale for Israeli

producers• Arab software

Strategy, Structure & Rivalry

•  Competition between

Jordan, Egypt and PA on

Israeli contracts

• Israeli new specializations,

product differentiation

 

Related & Supporting Industries

• Textiles (Egyptian upper level)

• Mining ,Chemicals(Phosphates)

• Tourism

28

SOCIAL AND CULTURAL ENVIRONMENTS

Culture = Way of Living Culture universals: George P. Murdock, common

denominator of culture: global not uniform Athletic sports, body adornment, cooking, rituals, religion, family feasting, medicine, meal time.

 Edward T. Hall: Low context culture (paper work, US), High context culture (persons’ value, Japan-Saudi Arabia)

29

CONTEXT ORIENTATION IN MAJOR CULTURES

Japan

China

Arab

Germany

Scandinavia

United States

High Context

Low Context

30

THE CULTURE ENVIRONM ENT

A rtifac tsh earm sm e ll,tas te , tou ch

V a lu esR u les

L azy

V a lu e

H u m anN atu re

R ig h ts

O b lig a tion s

R e la tion sh ip

D om in a te

S u b m iss ive

E n viron m en t

C rea te P lan

R eac t

A c tivity

O b jec tive

S oc ia l

Tru th

A ssu m p tion sR oots

E S S E N C E O FTH E C U L TU R E

31

IMPACTS OF CULTURE ON MANAGERIAL BEHAVIORS

Culture Context Explicit Implicit

Negotiations Planning Non Task Time

Time, Location Short Formal Long Informal

ParticipantsSame Level LargeRelevant level Small

Decision Making Position Consensus

32

HOFSTEDE’S CULTURAL TYPOLOGY

Power

Distance

Equal

IndividualMasculinity

Uncertainty

Power

Distance

Unequal

CollectivistFemininityPredictability

33

HOFSTEDE INDEX

Power Distance

IndividualismMasculinity

Uncertainty

Avoidance

Germany 35 67 66 65U.K. 35 89 66 35France 68 71 43 86Japan 54 46 95 92USA 40 91 62 46Arab Countries

80 38 53 68

Israel 13 54 47 81

34

EMERGING CULTURAL PROFILES

Village Market(Anglo-Nordic)

Decentralized, Entrepreneurial,

Flexibility, Delegation, Output Control

Family (Asian)

Centralized, Paternalistic, Loyalty, Personal relations

Well-oiled Machine (German)

Decentralized, Narrow Control, Compartmentalized, Routines & Rules

“Pyramid of People”(Latin)

Centralized, Elitist, Less Delegation, Input Control

HighLow

``

HighHierarchy

Uncertainty AvoidanceLow(Formalization)

35

HOFSTEDE’S MAPS

Uncertainty AvoidanceLow

High

Power Distance Small Large

DEN

SEW IRE GBRNZL NOR USA CAN

SIN HOK IND MAL PHI

AUT SWI FIN GER, ISR

IRA THA PAK

JAP SPA KOR

TUR FRA MEX POR

36

CULTURE & BUSINESS PROCESSESPolicy & Procedures:US, low u.a., high formal reportingUK, low u.a., detailed jobs descriptionGermany, high u.a., well internalized  Systems & Controls:French = control(hierarchy), British=coordinate)US-UK reporting proceduresFrench: hiring elites German operational planning Planning strategic(UK)

Information & Communication:

French: Compartmentalized

Sweden: Communication open informal, transparency

 

Decision Making:

Participation in decision making (Sweden, Germany-

less hierarchy)

PDG in France –Italy (Zanussi)

37

CUSTOMS IMPACTS

TAX

LOCAL CUSTOMER

PURSHASING

POWER

LOCAL

MANUFACTURER

PROTECTION

INCOME

ALLOCATION

CHANGE

38

PARTIAL EQUILIBRIUM ANALYSIS OF A TARIFF

S D

Pw1

Pw2

Q2 Q4 Q4 Q1

Sw1

Sw2

Price

Quantity

39

IMPACT OF CUSTOMS UNION AGREEMENTS

ProductLocal Country

Foreign Partner

Country

Foreign Third Country

Trade Flow

Results

A Cost

Prior CU

After CU

20

20

20

14

21

14

12

18

18

Import Source

Change

Trade Diversion

B Cost

Prior CU

After CU

17

17

17

12

18

12

14

21

21

Import

Trade Creation

40

IN T ER N AT IO N AL EC O N O MIC IN T EG R AT IO N

F R E E TR A D E A G R E E M E N TA b o lit ion o f Tariifs & Q u ota

M O N E TA R Y U N IO NC om m on M on etary

P o lic y

E C O N O M IC U N IO NH arm on iza tion o fE con om ic P o licy

C O M M O N M A R K E TR em ova l o f R es tric t ion son F ac to rs M ovem en ts

C U S TO M U N IO NA b o lit ion o f Tariffs & Q u otas

C om m on E xte rn a l Tariffs

41

THE EUROPEAN UNION MILSTONES

• 1945 Two Super Powers• 1948-52 Marshall Plan• 1951 Schuman

Declaration• 1951 Paris Agreement

ECSC• 1957 Roma Agreement

EC• 1968 Custom Union

• 1985 Cockfield’s White Paper

• 1987 Single European Act• 1991 Maastricht Treaty• 1992 SEA Implementation• 1997 Amsterdam Treaty• 1999 Monetary Union• 1999 Nice Treaty• 2002 Euro• December 2007 Lisbon

Treaty

42

43

ENLARGEMENT OF THE EUROPEAN UNION

1956: Germany, France, Benelux, Italy 1971: UK, Ireland, Denmark 1981: Greece 1986: Spain, Portugal 1995: Sweden, Austria, Finland 2004: Poland, Hungary, Czeck Republic,

Cyprus, Slovakia, Malta, Slovenia, Lithuania, Latvia, Estonia

2007: Romania, Bulgaria

44

THE INSTITUTION OF THE EUROPEAN UNION

THE COUNCIL• Commission Proposals• Legislative Power• Co-decision with the

Parliament• Foreign & Security• Ministers• The European Council

THE COMMISSION• Executive Power• Proposes Amendments• Manages Policies• Controls Policies

Implementation• President Barrosso+ 26

Ministers, 24 DG

45

From 1 November 2004, a qualified majority will be reached if the following two conditions are met:

1. if a majority of member states approve in some cases a two-thirds majority);a minimum of 232 votes is cast in favour of the proposal, i.e. 72 % of the total (roughly the same share as under the previous system).

2. In addition, a member state may ask for confirmation that the votes in favour represent at least 62% of the total population of the Union. If this is found not to be the case, the decision will not be adopted.

46

• Effective and efficient decision-making: From 2014 a decision is taken by 55% of the Member States representing at least 65% of the Union’s population.

• President of the European Council elected for two and a half years,

• Direct link between the election of the Commission President and the results of the European elections,

Treaty of Lisbon

47

the Treaty of Lisbon improves the EU's ability to act in several policy areas of major priority for today's Union and its citizens. This is the case in particular for the policy areas of freedom, security and justice, such as combating terrorism or tackling crime

new High Representative for the Union in Foreign Affairs and Security Policy, also Vice-President of the Commission, will increase the impact, the coherence and the visibility of the EU's external action.

48

Greater powers for the European Parliament• Co-decision procedure' (renamed 'ordinary legislative procedure') has been extended to legal immigration, penal judicial cooperation (Eurojust, crime prevention, alignment of prison standards, offences and penalties), police cooperation (Europol) and some aspects of trade policy and agriculture. • The Parliament and the Council will determine all expenditure together.

49

Greater role for national parliaments enforce subsidiarity means that – except in the areas where it has exclusive powers – the EU acts only where action will be more effective at EU-level than at national level. Any national parliament may flag a proposal for EU action which it believes does not respect this principle. This triggers a two-stage procedure:

Transparency in the Council of Ministers Citizens’ participationcitizens' initiative, whereby one million citizens, from any number of member countries, will be able to ask the Commission to present a proposal in any of the EU's areas of responsibility.

50

Distribution of votes for each member state (from 01/11/2004)

Germany, France, Italy, United Kingdom 29

Spain, Poland 27

Netherlands 13

Belgium, Czech Republic, Greece, Hungary, 12 Portugal

Austria, Sweden 10

Denmark, Ireland, Lithuania, Slovakia, Finland 7

Cyprus, Estonia, Latvia, Luxembourg, Slovenia 4

Malta 3

TOTAL 321

51

POLICIES

• Agriculture & Food

• Business• Cross cutting policies• Economic & Finance and

Taxes• Education, Culture & Youth• Employment and Social

right• Energy and Natural

resources • Environment, consumer

and, health

• External relations and foreign affairs

• Justice and citizen rights

• Regional and local development

• Science and technology

• EU explained

•Transport & travel

52

DG’s

• Agriculture & Rural Development

• Competition• Economic & Financial

Affairs• Education & Culture• Employment, Social Affairs

and Equal Opportunities• Enterprise and Industry• Environment• Fisheries and Maritime

Affairs

• Health & Consumer Protection

• Information Society & Media

• Internal Market & Services

• Joint Research Centre

• Justice Freedom & Security

• Regional Policy

• Research

• Taxation & Custom Union

•Transport & Energy

53

• External Relations

Development, Enlargement, EuroAid, External Relations Humanitarian Aid ofice, Trade

• General Services European anti fraud office,

Eurostat, Press & Communication, Publication Office, Secretariat General

• Internal Services

Budget, Bureau of European Policy Advisers, Informatics, Infrastructure & Logistics,, Internal Audit service, Interpretation, Legal service, Personnel and Administration,

Translation,

54

 Vice President

Institutional Relations and

Communication Strategy

 Vice President

Enterprise and Industry

 Vice President

Transport

 Vice President

Administrative Affairs, Audit and

Anti-Fraud

 Vice President

Justice, Freedom and Security

Information Society

and Media

55

President

56

57

58

THE PARLIAMENT• Legislative Power co

decision with the Council• Assent Procedure(int.)• Adoption of the Budget• Approval of the

Commission• Participation to the

European Council

THE COURT OF JUSTICE

• 13 Judges for 6 years• Request from Private,

Country, Firm• Unique Legal Power

59

POLITICAL GROUPS IN THE E.U. PARLIAMENT

-DEPPE Group of the European People's Party and European Democrats

PSE Group of the Party of European Socialists

ELDR Group of the European Liberal, Democrat and Reform Party

Verts / ALE

Group of the Greens/European Free Alliance

GUE NGL

Confederal Group of the European United Left/Nordic Green Left

UEN Union for Europe of the Nations Group

EDD Group for a Europe of Democracies and Diversities

NI Non Attached

60

THE EUROPEAN UNION PARLIAMENT 2005-2009

61

62

THE ECONOMIC &

SOCIAL COMMITTEE• Representative of

Economic Forces• 222 Representatives• Sectorial Commissions• Social & Economic

Commissions

THE COMMITTEE

OF REGIONS• Consultative Power• 222 members• Trans European Network,

public, Health, Education, Economic Cohesion

63

Court of JusticePresident

                                                 (6 chambers each comprising 3 or 5 juges)

•Action for failure Treaty obligations(Commission against a Member State or Member State against another Member State)•Actions for annulment(judicial review of the legality of Community acts) •Actions for failure to act(against the Parliament, Council or Commission •Actions for damages(against Community institutions or servants) •Preliminary rulings on the interpretation or validity of Communitylaw (references from national courts) •Appeals against judgments of the Court of First Instance