UNESCAP-Myanmar-Investment facilitation-project pre ... · factors • Weighting location ... –...

INVESTMENT FACILITATION

Project pre-establishment: Managing

the site visit

Training Course on Promotion, Attraction and Facilitation of Foreign Direct

Investment for Inclusive and Sustainable Development for Myanmar,

Hpa An, 14-16 June 2017

Monywa, 19-21 June 2017

OUTLINE OF PRESENTATION

� Part 1: Managing the site visit

� Part 2: Investor decisions on site selections: case study

United Nations Economic and Social Commission for Asia and the Pacific


Part 1

Managing the site visit

� Information, information, information!!!!

– Be pro-active

– Anticipate investor needs

– Know the investor and what he/she wants

� Preparing for and conducting site visit

– See next slides

INVESTMENT FACILITATION AT THE

PRE-ESTABLISHMENT PHASE


� Consultants – Accounting Firms (Big 5)

– Engineer/Architect/Valuer/Real Estate Broker

– Professional Site Consultant

� Special in-house project team

� The top management

� International business associates

� Existing offices abroad


WHO SELECTS THE SITES?

SITE SELECTION PROCESS: MEETING CLIENT NEEDS

Who we areWho we are Where we workWhere we work Why we do thisWhy we do this What we doWhat we do How we do thisHow we do this Which resultsWhich results


Implementation

Consultant

Client

• Prepare site visits

• Facilitate discussions

with relevant

governments and

service providers

• Incentive negotiations

• Real estate transaction and

acquisition support

• Cost model input

Real estate support

Phase 2Phase 1 Phase 3 Phase 4 Phase 5

Site visits

• Site visit

resources

• Real estate objectives

and accommodation

requirements

• Define project and goals

• Business requirements

Project definition &

goals and business

requirements

Comparison of costsAnalysis and

comparison

of locations

• Project Analysis

• Set up cost model

• Cost differentials

between locations

• Determine geographic

scope

• Selection of location

factors

• Weighting location

criteria

• Data gathering

• Build model for location

analysis

• Present rankings of

locations

• Sensitivity analysis

• Exploration of

incentives

Strategic AssessmentLocation Screening,

Modeling & BenchmarkingCost comparison Site Evaluations

� Literature search

� Define needs of new facility (immediate and future

expansion)

� Draw up specifications of new facility

� Compile general data of locations

� Assemble site options

� Visit sites

� Analyze the options


STEPS FOR SITE SELECTION DECISION-MAKING

� Process typically moves from macro to micro

� Site selection is process of elimination (fatal flaw analysis)

� Both public and private sectors are essential contributors

– Providers of secondary data

– Government supporters

– Service providers

– Employer testimonials


BASIC SITE SELECTION PRINCIPLES

INTRODUCTION TO INVESTOR SITE VISITS

� Potential investors do not make a significant investment based on desk

research and benchmark studies only

– A site visit is mandatory to make a well informed investment decision

� A site visit is in each case a custom tailored programme to present the

location characteristics and the available investment opportunities

� Site visits are organized by an IPA to encourage and convince potential

investors to invest in the country or locality

� Site visits are time and resource consuming and should be a response to

an official investment proposal of an Investor


IMPORTANCE OF INVESTOR SITE VISITS

� Potential investors need to actually inspect the investment location in

detail and you should act as their investment guide

� Time is money for investors. If a proposal and overall professional

approach convince an investor that your IPA can realize a project faster

than your competitors, your country is more than half way to winning

the project

� A strong coordination during the site visit with introductions to relevant

organizations, individuals and other investors can be crucial in winning

an investment

� This is your major chance to show off your location to your investor!


HOW INVESTORS VIEW SITE VISITS

� An investor site visit is an expensive allocation of time, money, and company resources, so it is planned meticulously and must produce a valuable outcome

� When management approves a site visit, it has indicated serious interest in a location – otherwise they would not come

� Some site visits are related to a specific project, but sometimes company officials visit to get a ‘feel of the land’ for future strategies – know their agenda and set expectations

� Some company officials travel 200 days a year to all parts of the world, so they may not always seem excited to be there

� Many investors have probably been to your country before


SAMPLE INVESTOR EVALUATION TEAM

� The investor team may be made up of one senior person, an

appointed site selection consultant, or an entire project team:

– Senior Manager with project team oversight

– HR Manager – will assess all aspects of the labour market and education

system

– Operations Manager – will assess all operational aspects

– Real Estate/Facilities Manager – will evaluate all real estate issues

including logistics and equipment access

– IT Manager – will need to understand all connectivity, telecom, power,

and equipment issues

– Security Manager – will assess risk to company employees

“Be prepared to understand what each team member will be focused on.”


PLANNING & PREPARATIONS FOR SITE VISITS

� Understand objectives of companies’ site visits:

1. To compile cost data and other information.

2. To assess the operating environment and overall economic conditions of the country.

3. To evaluate specific requirements for the firm’s investment project (e.g., particular skill level of labour, availability of technicians and managers, suppliers, customers, land availability and cost, customs rates, etc.)

4. “Feel good” factors: quality of life for expatriate staff and their families, perceptions of the business culture, government culture, etc.

5. To meet with other investors, both foreign and local, in similar areas of activity. If the IPA can assist in setting up such meetings, ideally with satisfied existing investors, this can be very useful.


KEY SPECIFIC OBJECTIVES OF SITE VISITS

� Verify data and assumptions and conduct a due diligence:

� Assess quality of industrial parks

� Assess accessibility and infrastructure

� Assess the human resource potential

� Assess the cost of labour

� Assess the overall quality of the infrastructure

� Assess the incentive potential

� Contact with other investors, preferably in the same industry

� Contact with important service providers

� Recruitment Agencies

� Real estate brokers


PLANNING & PREPARATIONS FOR SITE VISITS, CONT.

� Assign one officer to manage the entire visit (like the “account

executive” approach, so that the prospective investor knows exactly who is

handling the visit, can address all requests to that person, and there is clear

accountability for the site visit)

� If the visiting company is a major one, a senior IPA official ought to

manage the site visit to emphasize the importance of that particular

investor

� One of the keys of planning a successful visit is to tailor it to the

investor’s specific needs and interests

� Need to identify appropriate people in the public and private sectors

who are relevant to the investor’s project, such as existing investors

who are in the same industry and government officials who can

respond to specific and important questions about the project or

industry


PLANNING & PREPARATIONS FOR SITE VISITS, CONT.

� Information to compile before planning the visit often includes (depending on the specific circumstances of the investment project):– Scope of the potential investment project

– Key factors that the investor is looking for in the site selection

– What are their interests in your country/province?

– Types of people/agencies that the company would like to meet during the visit

– Contact information and descriptions of key government agencies related to that sector or industry

– Information on local, national, or regional markets

– Information on suppliers

– Information on industrial estates/SEZs

– Industry directories and other databases


IMPORTANT QUESTIONS IPAS CAN EXPECT FROM

INVESTORS

� What procedures and steps do we need to take into

account?

� What kind of services may we expect from you?

� What exactly do you mean with One-Stop Shop Principle?

� What do you mean with investor aftercare services?

� What incentives do you offer?

� Who do we need to contact within your IPA, in case of

questions?


CHECKLIST AND FACTORS TO VERIFY: LABOUR

� Labour cost

– Manufacturing workers (mostly female workers)

– Engineers

– Managers (indirect work force)

– Forecasted wage inflation

� Labour availability

– Availability of indirect workforce – check with recruitment agencies

– Availability of direct workforce – check with recruitment agencies

– Number of students – breakdown in engineering / finance / etc.

– Ease of hiring/firing in general

– Laws on hiring foreign workers

– Overtime regulations


CHECKLIST AND FACTORS TO VERIFY:

SITE, REAL ESTATE AND INFRASTRUCTURE

� Real estate and site factors

– Lease price of lot per m² per year in US dollars

– Existing facilities – lease price per m² per year in US dollars

– Service and Maintenance fee per m² in US dollars per year/month

– Other costs involved in securing, accessing, clearing and operating on the site

– Conditions of lease terms

� Utility costs

– Electricity Costs

– Water Costs

– Gas Costs

– IT Infrastructure (Broadband Internet options?)

– Proof of secure utility provision – number of power failures

� Infrastructure

– Access roads/railroads/ports/airports

– Availability of ICT

– Availability of waste/sewage disposal


SPECIFIC INFORMATION NEEDED FROM INVESTORS BEFORE

THE SITE VISITS - ITINERARY

� It is absolutely critical that you prepare meticulously and gather as much information as possible:

– Delegation information – names, positions, responsibilities?

– Does the investor have representatives in the country already?

– Is their a site selection consultant in the party? Research background.

– Find out personal habits – diet, alcohol, etc.

– Are there any religious implications/holidays/etc?

– Will the delegation be staying on personal time? – recommend social activities

– Does the visiting investor team have other business to attend to during their stay?

– Determine language/translator requirements

“You are their host and they put themselves at your disposal during their stay”


SPECIFIC INFORMATION NEEDED FROM INVESTORS BEFORE

THE SITE VISITS – PROJECT

� It is important that before planning a site visit you have all detailed information about the following – use this checklist:

– What are the site requirements?

– What are the plant requirements?

– Are there other requirements (office, warehousing, laboratories,

etc)?

– How many people will be employed?

– What are the various job functions?

– What are the utility requirements (electricity, gas and water)

– What are the logistics requirements (truck access)

– When is the investment planned?

– What is the overall time frame for the construction process?


STEP BY STEP SITE VISIT PLANNING

� The key points to consider when planning a site visit include:

1. Appointment of a project manager to manage the entire visit

2. Agreement on the dates and itinerary the company would like to

visit

3. Agreement on the key objectives of the visit

4. Ascertaining the detailed information required on the property or

site the investor is looking for and other critical information the

investor would like to gather

5. Finding out the timeframe for deciding when to invest / start date

and value of the investment

6. Knowing whom from the company will be attending

7. Finding out which organizations the company would like to meet


WHOM TO MEET?

� Important existing investors (from same industry or same country as visitor)

� Embassy officials of the investor’s country

� Potential local suppliers for that company

� Potential key customers for that company

� Executives of the CCI and other business associations

� Executives of foreign business associations or groupings

� Senior government officials (for major investors only).

� Tax office

� Customs

� Airport, railway officials (for major exporters)

� Relevant regulatory agencies for a particular sector

� Lawyers

� Accountants

� Engineering firms

� Manpower providers

� Real estate agents/industrial estates/SEZs

� Technical colleges and labourtraining facilities

� Business consultants

� Market research services


CONDUCTING THE SITE VISIT

� Key principles for conducting a site visit:– Ensure that there is a carefully worked out and agreed programme

– Ensure that the investment officer is thoroughly conversant with the programme, the places that will be visited, and the people who will be interviewed. Foreign language skills may be required

– Ensure that the transport person/driver is familiar with the locations that will be visited

– Ensure that the client is fully briefed before the site visit begins

� Conduct an introductory session for the prospective investor about your country/province, the investment and economic environment, and the roles and services of your agency– Presentation should be made by a senior official from the IPA

– Information presented should be relevant and tailored as much as possible to the visiting company representatives’ needs and sector interests


CONDUCTING THE SITE VISIT, CONT.

� Tips for conducting meetings between the visitor and local firms or government agencies:

– Initiate the introductions between the foreign visitors and the hosts/other party

– Explain to both parties why you suggested that they meet (i.e., the purposes of having this meeting for both parties)

– Obtain copies of any documents, brochures, or other materials offered to the visiting investor by the host/local party

– Pay particular attention to what the visiting company representatives are asking about, their concerns, needs, etc.

– Facilitate the flow of the meeting as necessary, but let the two parties interact on their own as much as possible


CONCLUDING THE SITE VISIT

� Host a wrap up meeting to review the outcomes of the site

visit, address any remaining concerns that the investor has

about your country/province or the investment project, and

identify any remaining information needs that the investor

requires to make a decision


FIND OUT WHICH ISSUES SHOULD BE SOLVED

� These are just examples of issues you may need to cope with:

– Are there enough chemical engineers (or specialists) to hire for this proposed project?

– What licenses do I need for my factory?

– Do I need to perform an environmental assessment for this

manufacturing proposal?

– How do I get access to utilities and who is supplying them?

– Can I construct 1000 cubic meter gas tanks on my site?

� Understand the questions and create an agenda to address each

to deal with them one by one

� Involve existing investors, finance, tax and legal experts, real

estate experts, and other subject matter experts to solve these

concerns


COPING WITH DIFFERENCES

� For investors investing in a location for the first time, it can be difficult to understand the nuances of government, administration or the culture of your Country

� Language barriers should not be underestimated

� Remain open and flexible for behaviour which could be unexpected or unforeseen

� Therefore, “handholding” of investors is an important function of the project manager


QUALITY OF LIFE

� Every investor will also be evaluating the ‘Quality of Life’ of a location as part of the process - they may be sending executives with families to live there

� Be prepared to answer questions on security, education, housing, medical care, and whether they bring the family dog with them

� Tour cultural and recreational centers if there is time

� Arrange ‘off time’ and host them to a traditional meal in an authentic restaurant (but be aware of dietary requirements)

� Mix business with pleasure where possible – show them that it will be a fun and interesting location to operate from too!


FOLLOW-UP TO SITE VISITS

� Rapid post-visit follow-up is critical for landing the investment – In particular, it shows the commitment and credibility of the IPA,

and can often make the difference in which location the investor chooses if there are competing locations

� The site visit manager should work immediately on gathering the additional requested information, particularly if it must come from another agency

� Provide the additional information/documentation before the deadline agreed upon with the prospective investor

� Notify the prospective investor of any new developments related to the visit since the company representatives departed

� If no additional information is required, contact the investor at regular intervals (but not too often)


SUMMARY OF SUCCESSFUL SITE VISITS AND FOLLOW-UP

� Planning the visit: tailor it to the investor’s specific needs and interests (key existing investors, people/offices that can respond to important questions)

� Managing the visit: stay on schedule; stay in charge; track additional information requests by investor

� Support documents: provide documents/facts/figures specific to the investor; comparison data with competing locations

� Post-visit follow-up: provide the additional information/documentation before deadline.

� Visit/contact by senior government official(s): in selected (important) cases, could be a pivotal point that convinces the investor that your location is best.



Part 2

Investor decision in site selection:

a case study

KNOWLES SELECTS SITE IN THE PHILIPPINES


http://www.ic-associates.com/newsletter/pressrelease/Press%20Release%2010-12-2012.html

ICA Guides Location Evaluation Process for Knowles Electronics

Knowles Builds 4,000 Employee Manufacturing Facility in the Philippines

Knowles Electronics, producer of micro-acoustic components and part of Dover

Corporation, publicly announced it will set up facilities at the Cebu Light Industrial

Park (CLIP) in the Mactan Island, Cebu the Philippines. On Friday 9th of November,

the company broke ground for what will be one of the biggest manufacturing

facilities of Knowles in the world. The company will be among the biggest

electronics companies to invest and operate in Cebu, and will ramp up their

workforce to more than 4,000 employees in the next couple of years. Knowles

makes components for hearing aid devices as well as MEMS surface mount

microphones for major mobile phone brands and consumer electronic devices.

Joseph Emmanuel Liwag, Managing Director of the local Knowles unit, said his

office currently has 40 employees but plans to increase workforce to 110 by

yearend, 1,500 by the end of 2013, and a little over 4,000 by the end of 2014.

“Cebu turns out to be a very positive location for a number of reasons. First of all,

recruiting talented workers is clear-cut and their skills and attitude is outstanding.

Ramping up our facilities is ongoing and the ease of doing our business here is

surprisingly straightforward.” Joseph adds: “An investment project of this size

requires a diligent and fact based location evaluation process and that is exactly

what Investment Consulting Associates (ICA) did.”

KNOWLES INVESTMENT LOCATION DECISION: PHASE 1

� During the strategic kick-off in Beijing, the Knowles

executive team requested a high level country assessment

� Objective is to arrive to a confirmed shortlist of 4 countries

based on a fact-based analysis

� Analysis > integrate three components:

– Competitiveness analysis

– Risk analysis

– Labour cost analysis

� China and Malaysia serves as a benchmark average


COMPETITIVENESS BENCHMARK ANALYSIS

Countries Rank Competitiveness Score

Thailand 1 85.76

Malaysia 2 81.64

Chile 3 73.64

Mexico 4 68.49

Turkey 5 60.40

Vietnam 6 60.29

China 7 54.47

Egypt 8 52.24

Argentina 9 43.73

Indonesia 10 41.16

India 11 37.43

Brazil 12 37.37

Ukraine 13 36.43

Philippines 14 33.01

Cambodia 15 32.71

Location Group :BUSINESS ENVIRONMENT

Location Factor Year

Closing a business Ranking 2011

Dealing with construction permits Ranking 2011

Ease of doing business 2011

Employing workers Ranking 2010

Enforcing contracts Ranking 2011

Getting credit Ranking 2011

Paying taxes Ranking 2011

Protecting investors Ranking 2011

Registering property Ranking 2011

Starting a business Ranking 2011

Trading across borders Ranking 2011

Source: www.LocationSelector.com, 2011


RISK ANALYSIS

Rank CountryCurrent Overall

Risk

12 Month

Trend

Last Risk

Change

Pol

25%

Eco

25%

Leg

15%

Tax

15%

Ope

10%

Sec

10%

1 Chile 1.74 NEGLIGIBLE 01-Oct-10 1.50 1.75 1.50 1.50 2.50 2.00

2 Malaysia 2.39 MODERATE 01-Apr-10 2.75 2.25 2.50 2.00 2.25 2.25

3 Brazil 2.66 MEDIUM 01-Apr-10 2.50 2.50 2.50 3.00 2.75 3.00

4 Philippines 2.72 MEDIUM 02-Jul-10 2.75 2.50 2.25 2.75 2.50 3.75

5 Turkey 2.74 MEDIUM 02-Jul-10 3.00 2.75 2.00 2.25 2.75 3.50

6= India 2.79 MEDIUM 19-Jan-11 2.75 2.75 2.50 2.50 3.00 3.50

6= Indonesia 2.79 MEDIUM 19-Jan-11 2.50 2.75 3.25 2.50 3.00 3.00

7 China 2.87 MEDIUM 21-Jan-10 2.75 2.75 3.25 3.00 3.00 2.50

8 Mexico 2.88 MEDIUM 21-Jan-10 2.75 3.00 2.50 2.25 3.25 3.75

9 Vietnam 2.95 MEDIUM 31-Mar-09 3.00 3.00 3.25 2.75 3.25 2.00

10 Thailand 2.97 MEDIUM 02-Jul-10 3.50 2.75 2.50 2.50 2.75 3.50

11 Egypt 3.07 SIGNIFICANT 04-Apr-11 3.50 3.00 3.00 2.50 3.00 3.00

12 Cambodia 3.11 SIGNIFICANT 01-Apr-10 2.75 3.25 3.25 3.25 3.50 2.75

13 Ukraine 3.17 SIGNIFICANT 19-Jan-11 3.25 3.50 3.25 2.50 3.00 3.00

14 Argentina 3.36 SIGNIFICANT 01-Oct-10 3.50 3.75 3.25 2.75 3.50 2.75

Source: Global Insight Country Risk Assessment 2011 and www.locationselector.com

Pol = Political Risk

Eco = Economic Risk

Leg = Legal Risk

Tax = Taxation Risk

Ope = Operational Risk

Sec = Security Risk


LABOUR COST ASSESSMENT

� Based on various sources three different types of job functions were

assessed

– Direct labour – manufacturing workers

– Indirect labour - Engineers

– Indirect Labour – Managerial staff

� These job functions are based on the input received directly from the

client

� Other sources that were compared and assessed are:

– Economist Intelligence Unit

– National investment promotion agencies

– National Statistics Bureaus and HR service providers

– 20th Comparative Cost Survey Asia

� Labour costs are in US Dollar per hour (2500 hours per year)


LABOUR COST PER HOUR PER JOB FUNCTION

Total labor cost per

hour in USDBangkok Chonburi Ayutthaya Jakarta Batam Medan Bandung Cebu Angeles Davao Danang HCMC Hanoi

Production worker 1.78 1.59 1.57 1.18 0.99 1.02 0.95 0.99 1.24 0.91 0.63 0.88 0.67

Engineer 3.68 3.29 3.24 2.37 1.99 2.04 1.89 1.60 2.01 1.47 1.72 1.83 1.81

Manager 8.61 7.69 7.57 6.23 5.24 5.38 4.99 3.48 4.36 3.19 4.01 4.22 5.13

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

10.00

Production worker

Engineer

Manager


INTERMEDIATE RESULTS

� At this point and following to the analysis – Thailand was not

considered an option anymore.

� Although considered a very low risk location the cost

differential with China was non-existent

� The first country visits were organized to:

– Indonesia

– Viet Nam

– Philippines


MAP SHORTLISTED SITESBased upon the preliminary site assessment 6 sites/cities were shortlisted


In the site benchmark we included the

following composite criteria:

– Accessibility 10%

– Business Climate 5%

– Business Risks 5%

– Labour Costs 40%

– Labour Availability and skills 20%

– Real Estate 10%

– Utilities 10%

BREAKDOWN OF SCORES PER MAJOR SITE

(UNWEIGHTED)

Locations Bandung Cebu Danang

Ho Chi Minh

City - Hi Tech

Park

Ho Chi Minh

City - VSIPMedan

Location Groups

ACCESSIBILITY 59.96 63.65 47.64 83.66 83.95 43.12

BUSINESS

ENVIRONMENT41.98 31.82 81.81 81.81 81.81 41.98

BUSINESS RISKS 64.11 54.10 60.06 60.06 60.06 64.11

LABOUR 43.19 56.73 77.40 65.05 65.05 26.86

LABOUR

AVAILABILITY AND

SKILLS59.80 52.09 40.00 85.00 92.50 51.21

REAL ESTATE 94.63 85.00 38.21 42.91 10.00 94.63

UTILITIES - NETWORK 60.62 64.85 57.60 83.54 88.19 57.89

Competitiveness

Score 60.61 58.32 57.53 71.72 68.80 54.26

Rank 3 4 5 1 2 6


� Business climate and accessibility were

accorded relatively less importance

� Cost drivers: labour (wages), real estate and

utilities were accorded relatively more

importance

CLIENT CHANGES THE WEIGHTING


WAGE FORECAST MODEL

Exchange rate risk indexed with 2010 = 100 2010 2011 2012 2013 2014 2015

China Index 100.0 95.4 89.8 84.8 81.2 79.3

Indonesia Index 100.0 99.6 101.0 102.5 104.1 105.4

Malaysia Index 100.0 95.3 95.4 95.1 95.2 95.3

Philippines Index 100.0 97.5 96.4 95.7 95.7 96.3

Thailand Index 100.0 97.8 98.2 98.7 99.8 100.8

Viet Nam Index 100.0 111.2 118.1 124.0 128.8 133.2

Consumer Price Inflation with 2010 = 100 2010 2011 2012 2013 2014 2015

China Inflation, average consumer prices Index 100.0 105.0 107.6 109.8 112.0 114.2

Indonesia Inflation, average consumer prices Index 100.0 107.1 113.4 119.4 124.4 128.8

Malaysia Inflation, average consumer prices Index 100.0 102.8 105.4 107.9 110.5 113.0

Philippines Inflation, average consumer prices Index 100.0 104.9 109.4 113.8 118.3 123.0

Thailand Inflation, average consumer prices Index 100.0 104.0 107.6 110.0 112.4 115.3

Viet Nam Inflation, average consumer prices Index 100.0 113.5 121.1 128.3 135.4 142.5

Assumption: The higher the depreciation the lower the wage inflation measured in US dollars

Actual check: www.xe.com

Source: Global Insight


UNEMPLOYMENT AND WAGE INCREASE

Unemployment rate in % 2010 2011 2012 2013 2014 2015

China Percentage 4.1 4.0 3.8 3.7 3.4 3.3

Indonesia Percentage 7.8 7.5 7.0 6.6 6.3 6.1

Malaysia Percentage 3.4 3.3 3.2 3.1 3.1 3.0

Philippines Percentage 7.3 7.2 7.3 7.3 7.4 7.5

Thailand Percentage 1.1 1.2 1.2 1.2 1.7 1.7

Viet Nam Percentage 2.1 1.8 1.5 1.9 2.2 2.5

Assumption: The lower the unemployment rate, the more pressure on existing labor pool and increasing wages

Wage increase above CPI based on unemployment 2010 2011 2012 2013 2014 2015

China Index 100 104 108 112 116 120

Indonesia Index 100 102 104 106 108 110

Malaysia Index 100 104 108 112 116 120

Philippines Index 100 102 104 106 108 110

Thailand Index 100 105 110 115 120 125

Viet Nam Index 100 105 110 115 119 123


� Medan, Indonesia: inexperienced IPA, power cuts, no similar investments of this size

� Viet Nam: – Ho Chi Minh City (VSIP Park): excellent infrastructure but too costly

– Haiphong: lack of international airport and logistics, very young management

– Danang: good option with sophisticated industrial zones but too aggressive recruiting; also promotion material not good enough quality; IPA not good in English

� Cebu made by far the best presentation and conducted the best site visit; IPA top notch and well prepared, promotion materials of high quality; cost effective and good infrastructure

VARIOUS SITE VISITS WERE CONDUCTED


STREET INTERVIEWS ON INDUSTRIAL

PARK CEBU

� Company #1 – an electronics manufacturer: One monthly gross pay is

P10,000 (US$232) for 6 days per week times 8 hours ($1.11 per hour).

Net salary for the worker is P8,000 ($186) per month

� Overtime can result in P12,000 ($280) per month

� Company #2 – a medical device manufacturer: General salary level is

P8,000 per month

� P5,000 per 12 days of work (two weeks of 6 days) is $1.12 per hour. On a

monthly basis this means P10,000 per month. Including overtime this

could be increased to P12,000-14,000 per month


TANGIBLE RESULTS:

CEBU IS THE WINNER

� Based on this intermediate

shortlist assessment 3 site visits

were conducted with street

interviews, factory visits, HR

firms and local officials to finally

arrive at a winner locations


The client is currently

ramping up in the winner

location, expecting to hire

5,000 employees in three

years time


CONTACT DETAILS – UNESCAP

UNESCAPThe United Nations Building

Rajadamnern Nok Avenue

Bangkok 10200

Thailand

T: (66-2) 288-1234

F: (66-2) 288-1000

W: http://www.unescap.org/contact

Consulting Partner

Investment Consulting Associates (ICA)

H.J.E Wenckebachweg 210

1086 AS Amsterdam

The Netherlands

T: +31 20 217 0115

F: +31 20 462 3535

E: [email protected]

W: www.ic-associates.com

Your questions please?


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