Schweizerische Nationalbank · SIX:SNBN
Schweizerische Nationalbank — Narodowy Bank Polski — 16th Annual NBP-SNB Joint Seminar 2019
25 slides from Schweizerische Nationalbank's conference presentation, Dec 18, 2019
Slide 1: Enriching FDI presentation and analysis
Krzysztof Makowski / Department of Statistics Enriching FDI presentation and analysis Zurich / 16th Annual NBP-SNB Joint Seminar / December 18, 2019
Slide 2: What is currently in our focus?
Enriching FDI presentation and analysis 2 What is currently in our focus? ■ Ultimate investing country ■ Ultimate host country ■ Network and micro analysis of FDI entities
Slide 3: Ultimate investing country
Enriching FDI presentation and analysis 3 Ultimate investing country
Slide 4: Traditional view of inward FDI
Enriching FDI presentation and analysis 4 Traditional view of inward FDI 200 000 ■ Countries hosting SPEs among 180 000 largest investors 160 000 ■ The same situation in almost every 140 000 country 120 000 ■ Who is behind the investment PLN Mio. 100 000 from Netherlands, Luxembourg or 80 000 Cyprus
Slide 5: Ultimate Beneficial Owner and Ultimate Controlling Parent – theory
Enriching FDI presentation and analysis 5 Ultimate Beneficial Owner and Ultimate Controlling Parent – theory ■ Who controls the resident company ( )? US GB ■ Single controlling entity ■ Whole value of resident entity allocated to UCP 100% 100% ■ Who controls the foreign investor ( )? ■ Allows to all
Slide 6: UBO and UCP – which one to use?
Enriching FDI presentation and analysis 6 UBO and UCP – which one to use? Cases for UCP •Comparison of the resident owned companies, (ultimately) foreign controlled companies and Cases for UBO resident MNE •Global Value Chains compilation – allocation •Monitoring of minority investment in different
Slide 7: Comparison of UBO, UCP and immediate counterpart presentation
Enriching FDI presentation and analysis 7 Comparison of UBO, UCP and immediate counterpart presentation 250 000 200 000 150 000 PLN Mio. 100 000 50 000 0 Germany United France Netherlands United Poland Spain Austria Switzerland Luxembourg Other States Kingdom countries and unallocated UBO UCP Immedi
Slide 8: Economic Activity of resident companies
Enriching FDI presentation and analysis 8 Concentration of foreign investors in different economic activities Economic Activity of resident Ultimate Investing Country companies
Slide 9: Shareholding percentage – where are the differences?
Enriching FDI presentation and analysis 9 Shareholding percentage – where are the differences? 250 000 50% ■ Majority of the investment is 100% owned 200 000 40% by non- residents ■ Minority 150 000 30% investments PLN Mio. present in important 100 000 20% activities 50 000 10% 0 0% C K G L M J F D
Slide 10: Ultimate investing country – few things to take away
Enriching FDI presentation and analysis 10 Ultimate investing country – few things to take away ■ Immediate counterpart in globalised world ■ Relatively easy to measure ■ Not so good proxy for true investors ■ Policy and analytical needs ■ FDI promotion ■ FDI screening ■ Tax evasion ■ Local impact o
Slide 11: Ultimate host country
Enriching FDI presentation and analysis 11 Ultimate host country
Slide 12: Traditional view of Polish investment abroad
Enriching FDI presentation and analysis 12 Traditional view of Polish investment abroad 40 000 ■ Countries with SPEs … 30 000 ■ … true 20 000 investment destinations 10 000 … PLN Mio. 0 ■ … and Sweden -10 000 -20 000 -30 000 Equity Debt Total
Slide 13: Ultimate host country an exercise in looking through SPEs
Enriching FDI presentation and analysis 13 Ultimate host country an exercise in looking through SPEs Global Our Group Group reporting financial Head agent centre indirectly owned by ■ It might be easier to name country of ultimate investment (business our reporting decision) agent ■ … rather than na
Slide 14: Ultimate host country for resident controlled investment
Enriching FDI presentation and analysis 14 Ultimate host country for resident controlled investment Immediate counterpart country Ultimate host country
Slide 15: Polish investment in Poland according to UBO, UCP and UHC
Enriching FDI presentation and analysis 15 Polish investment in Poland according to UBO, UCP and UHC 70 000 ■ Value of round-tripping depends on the direction from which we 60 000 are measuring it 50 000 ■ UCP overstates due to allocation of minority foreign ownership to 40 000 reporting country PLN
Slide 16: Why there is a difference in value of round-tripping?
Enriching FDI presentation and analysis 16 Why there is a difference in value of round-tripping? PL SPE country PL Own Assets at funds at Own Own book book Assets at Value → Assets at funds at funds at value value book book book (historical (reflecting book value value value cost) historical value
Slide 17: Ultimate host country – some questions we may be able to answer
Enriching FDI presentation and analysis 17 Ultimate host country – some questions we may be able to answer ■ Where are residents investing? What countries direct investors are exposed at? ■ Are outward investments really outward? ■ Where investors need help in expanding abroad?
Slide 18: Network and micro analysis of FDI entities
Enriching FDI presentation and analysis 18 Network and micro analysis of FDI entities
Slide 19: Network and micro analysis of FDI entities
Enriching FDI presentation and analysis 19 Network and micro analysis of FDI entities ■ Countries are internally diverse – investment decisions are not made at the country level but on specific locations ■ if we want to analyse what determines investment, local factors also need to be considered ■ W
Slide 20: Where are investors from different countries investing
Enriching FDI presentation and analysis 20 Where are investors from different countries investing
Slide 21: New investment – new locations?
Enriching FDI presentation and analysis 21 New investment – new locations?
Slide 22: New investment – reinvested earnings?
Enriching FDI presentation and analysis 22 New investment – reinvested earnings?
Slide 23: Location of direct investment entity (DIE) vs location of their activities
Enriching FDI presentation and analysis 23 Location of direct investment entity (DIE) vs location of their activities Supermarket chain owned by foreign direct investor: - Location of DIE - Location of Head office - Location of shops Location Head of DIE office Source: Biqdata.pl
Slide 24: Further work
Enriching FDI presentation and analysis 24 Further work ■ Develop new methods for analysing FDI data ■ Network analysis ■ Spatial econometrics ■ … ■ Acquire new data sources for measuring the impact of FDI ■ Official statistics on micro level ■ Open data ■ … ■ New presentations and old problem of co
Slide 25: www.nbp.pl
BP Narodowy Bank Polski www.nbp.pl
Narodowy Bank Polski — 16th Annual NBP-SNB Joint Seminar 2019 on 6ix