What Germany has to offer

Promoting Trade and Investment between the EU and ASEAN

Market Information Seminar – EU – EAGA BizTech Partnership

Mr. Nikolaus Kraus

Project Manager ConnectAsiaEurope e.V.

Structuring

ConnectAsiaEurope

Economic relations Germany – EAGA– Trade & Investments– Malaysia, Philippines and Indonesia– Perspectives

Technologies made in Germany– Renewable Energies– Biofuels / BtL

Renewables in EAGA and what Germany has to offer

Invest in Germany

ConnectAsiaEurope e.V.

Who we are– CAE has its roots in the DIHK – The Association of German

Chambers of Industry and Commerce

Our Goals– promoting economic and technological cooperation between Asia

and Europe– transfer of know-how between the two regions and the exchange

of information and experiences with counterparts in Asia and Europe

Our Activities:– Export promotion, publications, seminars in Germany, delegations

to foreign markets, co-operation meetings in Germany

Trade:– Very dynamic development of trade between EU and the EAGA

countries

– Germany is an important trade partner for the ASEAN region:

almost 30 % of the EU exports in 2006 came from Germany

about 20 % of the EU imports in 2006 went to Germany

Investments:– Germany is still underrepresented in the EAGA region

– In the past 10 years less than 3 % of direct investments came from Germany

Economic relations Germany - EAGA

Industry Sectors

Export Germany – EAGA:– Electronics– Machinery– Chemical industry– Automobile industry

Import EAGA – Germany:– Electronics– Textiles & Clothes– Food industry– Natural Resources

Investments– Manufacturing (Electronics,

Chemicals, Machinery, Automobile)

– Services (IT, Banking etc.)– Trade/Commerce– Infrastructure (streets,

railway, energy (incl. renewables)

FDI inflow to ASEAN (Source Countries, 2006)

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In 2006, Germany invested 1,59 Billion US$ (3,0 %) in the ASEAN region (2005: 478 Million US$)

FDI inflow to ASEAN (Target Countries, 2006)

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Cambodia

Indonesia

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Thailand

Vietnam

Tendency: Growing Foreign Direct Investments in the ASEAN region since 2003

Foreign Trade Development Germany - EAGA

Imports EAGA - Germany

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Exports Germany - EAGA

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Foreign Trade Germany - EAGA

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Export to EAGA

Import to Germany

Imports EAGA - Germany

Sector Malaysia Philippines Indonesia

Agriculture 164 Mio. (+5,0 %) 8 Mio. (-4,9 %) 286 Mio. (+11,1 %)

Forestry 1,2 Mio. (-6,7 %) 0,9 Mio. (+36 %) 2,2 Mio. (+19,4 %)

Woods 49,7 Mio. (+2,3 %) 2,2 Mio. (+3,1 %) 156 Mio. (-14.21 %)

Fishery 0,5 Mio. (-16,9 %) 1,4 Mio. (+26 %) 2,8 Mio. (-0,5 %)

Electrical equipment* 1900 Mio. (+8 %) 792 Mio. (-2,9%) 455 Mio. (-1,1 %)

IT 1000 Mio. (+31 %) 413 Mio. (-19,3 %) 112 Mio. (-1,0 %)

Textiles and Clothes 74 Mio. (- 4 %) 58 Mio. (-37 %) 506,6 Mio. (-8, %)

Chemicals 180 Mio. (+18,5 %) 15,9 (+22,2 %) 91,6 Mio. (+26,08)

Machinery 204 Mio. (+112 %) 28,7 Mio. (-9 %) 40 Mio. (+8 %)

Total Imports 4.381 Mio. (+ 9,3 %) 1766 Mio. (-7,6 %) 3.150 Mio. (+13 %)

* including electricity distribution and control apparatus and other electronic equipment (communication, tel. etc.)

Exports Germany - EAGA

Sector Malaysia Philippines Indonesia

Agriculture 5,0 Mio. (+4,7%) 1 Mio. (-1,3 %) 0,5 Mio. (+5,7)

Forestry 0,5 Mio. (-34,9 %) 0,2 Mio. (+28%) 2,1 Mio (-17,8 %)

Woods and Wooden Products 3,5 Mio. (+12,5 %) 8 Mio. (+8,7 %) 12 Mio. (-19 %)

Electrical equipment* 2.339 Mio. (+14,8 %) 319 Mio. (-10 %) 361 Mio. (+36 %)

Chemicals 301 Mio. (+0,4 %) 138 Mio. (+ 7,5 %) 311 Mio. (+10,8 %)

Machinery 527 Mio. (+1,7 %) 146 Mio. (-12,2 %) 353 Mio. (-7,7 %)

Automobile 202 Mio. (-10,6 %) 54 Mio. (+30,8 %) 56,9 Mio. (+53,) %)

Total Exports 4.200 Mio (+14,32 %) 948 Mio. (-38 %) 1586 Mio. (+5,19 %)

Source: Foreign Trade Portal of Bavaria

* including electricity distribution and control apparatus and other electronic equipment (communication, tel. etc.)

Focus on Indonesia

Germany is the most important trading partner in the EU Investments lack far behind the investments of other EU

members (UK, France) Key industries for German-Indonesian business relations:

– Agriculture– Lumber/furniture– Clothes/Textiles/shoes– Electrical Industry– Chemicals/Plastics– Steel/Metal– Infrastructure (incl. energy)

Focus on Malaysia

Among EU countries, Germany is the largest investor and the one of the most important trading partners

Key sectors for German-Malaysian business relations:– Electrical Industry– Machinery– Automotive Sector– Chemicals/Plastics– Agriculture– Lumber/Furniture– Environmental Technologies (Energy, Waste, Water)

Focus on the Philippines

Germany is the 2nd biggest trading partner for the Philippines after the Netherlands

Investments are partly declining because of instable conditions for FDI

Key sectors for German-Philippine business relations:– Electrical Industry (Electronic goods, Electrical Engineering, IT)– Machinery– Chemicals– Automobile Industry– Agriculture/Lumber– Infrastructure (incl. energy)

Renewable Energies made in Germany

The German Renewable Energy Sector

– leads the world in renewable energy technology– has advanced research programs– puts special emphasis on the fields of wind power, solar energy,

hydropower, geothermal, biomass and biofuels development– Renewables made in Germany are ideal for applications all over

the world (export quotas: up to 80 %)

Renewable Energies from Germany have a great potential for EAGA Countries

Energy Mix in Germany

Energy Mix in Germany: Percentage of Renewable Energies– present: 6%– future objectives: 12,5% in 2012, at least 20 % in 2020

Renewable Energy Mix in Germany:

9,90%

15,30%

20,20%

8,80%2,70%

1,00%

42,10%

Hydropower

Windpower

Biofuels

Biogenous fuels(electricity)Solar power

Geothermic

Biogenous fuels(heat)

Solid Biomass

Solid biomass as energy source:– long tradition in Germany– German companies are the

world leaders

a) Heating systems

b) Combined Heat & Power plants (CHP): Heat and Electricity

Solid biomass:– agricultural and forestry produce– in Germany: wood pellet– Potential in EAGA: residues

from agriculture / forestry !

Market facts Germany:– 160 electricity plants (960 MW)– 1.000 biomass heating plants– 70.000 pallet boilers and ovens

in homes

Biofuels

German companies offer:– long experience in the

manufacturing of biofuels– globally tried and tested systems

engineering– research activities to increase

efficiency (BtL)

Great potential for EAGA

1st generation biofuels in Germany– Biodiesel (vegetable oils, rape!)– Bioethanol (sugar, starch,

potatoes)– often mixed with traditional fuels

Facts:– Germany is the world leader in

Biodiesel production (2007: ca. 5 Mio. tons)

– mixture ratio: 5 % for Biodiesel and Bioethanol; 2009: 10 %

Biomass to liquid (BtL)

BtL is one of the most promising technologies in the fuel sector

Germany leads the way in these technologies– Choren Industries already

produces BtL fuels for VW and Daimler (SunFuel/Biotrol)

– First “refinery of second generation biofuels” in April 08

Great potential of second generation biofuels for EAGA– e. g. from agricultural residues

from palmoil production

Advantages:– reduction of CO2 by 90 %– high quality and efficiency– costs of 0,60 € achievable

biomass

pyrolysis

gasification

Gas purification

FT synthesis

Hydrogenous conditioning

Shift reactor

35 % CO35 % H2

30 % CO2

50 % cellulose25 %hemicellulose25 % lignin

distillation

wax diesel naphta

H2O

H2

Biogas

Biogas industry in Germany– Power generation from gaseous

biomass is greatly expanding in Germany

– clear trend towards larger, high-capacity systems

– German companies offer a wide range of building, operating and maintaining services/products

Facts:– 650 new systems installed 2006– Electrical capacity: 1.100 MW– agricultural residues and energy

plants applicable

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Anlagen < 70 kWel

Wind energy

Germany is a pioneer developing wind technology– largest manufacturer of wind

turbines and components in the world (w-market share: 37 %)

– increasing focus on offshore wind turbines

– trend towards high yield turbines– export of technologies for

manufacturing, installing and servicing wind turbines

High potential for coastal states– offshore windparks with German

technologies already operating in UK, Ireland, Denmark

Market facts Germany:– turnover 2006: 7,2 BN. Euro– 20.622 MW installed by the

end of 2006 (world leader)– Savings of 1 BN Euro/Year

Hydropower

Oldest technology for power generating

20 % of the worlds electricity is generated from hydropower

Germany is the most important producer of hydropower technologies– Export quota: 80 %– run-of-river, impoundment and

pumped storage power plant– 2nd largest renewable energy

source in Germany after wind– German companies = full service

suppliers

Market facts Germany– 3,5 % of the gross electricity

demand in Germany– 4.700 MW installed, 7.500

plants

Solar industry

The solar industry in Germany is booming– Huge investments in solar

technologies in Germany and especially abroad

– Solar cells, solar thermal collectors and solar thermal power plants

Market facts:– 1,3 million power systems

operating in Germany– capacity (2006): 5750 MW– market growth exceeds 50 %– capacity of solar cells produced

in 2006: 500 MW

Geothermic Power

“Geothermal sources could supply Germany's electricity needs 600 times over”

Construction boom of GP plants due to a new energy law in Germany– geothermic electricity is

supported by the government– heat and electricity generation– 2007: 130.000 heat pumps and

4 geothermal electricity plants installed

– investments of 4 BN Euro in 150 geothermal power projects

Indonesia and the Philippines:– huge potential for geothermic

power generation– German companies can

contribute technologies

Renewable energies in EAGA

Increasing energy demand Scarcity of fossil fuels Increasing Oil and gas prices

Growing demand for energy from renewable sources

Huge potential for renewable energies, such as:

- biomass, biofuels (agricultural products and residues)- solar energy (high solar radiation)

- geothermic power (volcanic areas)- wind technologies (costal countries)- hydropower (small hydropower projects)

Renewable energies from palm oil

Indonesia and Malaysia are the biggest producers of palm oil worldwide

European union is the biggest importer of palm oil from EAGA Areas of utilization:

– Agro-industry

– Biofuel

Impact of growing demand from EU

sustainable palm oil?

perspectives

Why invest in Germany

Leading economy: Germany is Europe’s economic engine and world’s 3rd largest economy providing access to growth markets in the EU

High productivity: High productivity combined with declining unit labor costs are decisive factors for Germany’s competitiveness

Global Player: Germany is world champion in exports as well as one of the top regions for foreign investors

Excellent workforce: Germany provides excellent workforce at steady wages

Innovative Power: Germany is undisputed leader of new patent registrations proving its innovative power

Inviting incentives: Germany’s support offered to investment projects: cash grants, low-interest loans, partnership programs, public guarantees, workforce development assistance, etc.

Why invest in Germany

First class infrastructure: Germany offers Europe’s densest and best-developed traffic infrastructure including roads, waterways, air routes, rail tracks and numerous reloading points ensuring on-time delivery

Competitive tax conditions: The corporate tax reform in 2007 improved the competitiveness of Germany’s tax conditions giving a clear advantage over Japan, the US, Canada, Italy and France

Secure investment framework: Germany offers a secure investment framework with both judiciary and civil services at a highly professional level

High quality of life: An advanced health and education system, an all-encompassing transport and communications network as well as various sports and recreation opportunities contribute to a high quality of life