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Where Logistics comes together

KAUNAS REGION. Where Logistics comes together. KAUNAS REGION. Welcome to Kaunas Region , Lithuania!. Where Logistics comes together. Lithuania is at the center of three of large consumer markets : Western Europe Baltic Sea Region Russia and former Soviet States (CIS).

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Where Logistics comes together

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  1. KAUNAS REGION WhereLogisticscomestogether

  2. KAUNAS REGION WelcometoKaunasRegion, Lithuania! WhereLogisticscomestogether • Lithuania is at the center of three of large consumermarkets: • Western Europe • Baltic Sea Region • Russia andformerSovietStates (CIS) KaunasRegion Source: Statistics Lithuania, VRM , InvestLithuania2014

  3. KAUNAS REGION Lithuania, a gateway to the EU and CIS WhereLogisticscomestogether • Lithuania allows access to main markets*: • Member of the European Union • Member of the Schengen Agreement (free trade and travel) • Member of NATO • Member of the Nordic Investment Bank, and part of Nordic-Baltic cooperation of Northern European countries • Lithuania is ranked 17th of the world on the Ease of Doing Business Index (higher than e.g. Germany, Latvia or Poland) * • Lithuania is a low risk country in the Central and Eastern Europe region, making it an excellent alternative for nearby high risk countries as Russia or Belarus European Union is the largest single market in the world (almost double the GDP of China) with over 500 millionconsumers (source: IMF) Risk rating of Lithuania comparedtoothercountries (100= most risky) Source: * World Bank, InvestLithuania 2014 Source: Economist Intelligence Unit Q2 2014

  4. KAUNAS REGION Logistics sector Lithuania WhereLogisticscomestogether • With approximately 80% of freight which is transported through international transport corridors passing through Lithuania, the country has become one of the most important transport centresin the European Union, linking the EU with the East (Source: Datamonitor) • The North-South highway, the railway route connecting Scandinavia with Central Europe, and the East-West route that connects vast Eastern markets with the rest of Europe, all figure among the 10 principal freight routes in Europe. The expansive network of central motorways and European railroads, along with the ice-free port of Klaipėda and 4 international airports comprise the key infrastructure of the Lithuanian transport network • The largest warehouse in Lithuania is situated in Kaunas. “Senukai Logistics Park” and measures 70,000 m2 • The greatest supply of modern warehousing facilities in 2010 remained in Vilnius (334.400 m2), with Kaunas following in the 2nd place (184.300 m2). Kaunas is a dynamic, upcoming location Two of Lithuania’s five largest logistics centers are in Kaunas Major logistics FDI in Lithuania AutoLogicGroup RhenusLogistics Schenker Maersk Line Msc DHL DPD Gefco UPS DSV TNT Source: Invest Lithuania 2014 Source: Invest Lithuania 2013, Colliers 2013

  5. KAUNAS REGION The KaunasRegionprovides an unmatched mix of cost-effective talent and high class infrastructure Where Logisticscome together Cost attractiveness Location • The right labor cost savings • The right tax scheme In KAUNAS REGION it all comes together • The right connection to: • EU • CIS • Baltics • Russia International accessibility Real Estate availability • The right industrial parks • The right cost advantages • The right location • The right logistics

  6. Location KAUNAS REGION WhereLogisticscomestogether • The international competitiveness of Lithuania in the transport and logistics sector is to a large extent determined by its geographical position • Many companies see Lithuania as a springboard from which to penetrate the vast markets of the EU and the Russia-Kazakhstan-Belarus Customs Union and other CIS countries. The latter is increasingly important now that Russia has joined the World Trade Organization* • Kaunas is connected to Poland (and rest of Europe), Belarus and Russia by rail and road Kaunas connected to Poland (and rest of Europe), Belarus and Russia by rail and road* Baltics, Russia, CIS, CEE and Germany are reached within two truck days* * Source: Invest in Lithuania,, 2013

  7. Location KAUNAS REGION WhereLogisticscomestogether • Some of the major logistics centres in Lithuania are in Kaunas Region • The Kaunas region has a highly developed railway infrastructure. Three railway lines cross the region: Moscow-Minsk-Kaliningrad, Vilnius-Kaunas-Klaipeda and Kaunas- Siauliai-Riga. The “Rail Baltica” or “Baltic” rail (standard European gauge) section between the Lithuanian-Polish border and the Marijampole-Kaunas line is under development. It will connect Kaunas Region to Warsaw and the Western EU markets. KaunasRegion is convenientlylocated on crossroads of modalities The KaunasRegioninterconnects the Nordicsand Western Europe with Russia and CIS Source: Invest in Lithuania, 2013 Source: BCI,, 2014

  8. Cost attractiveness KAUNAS REGION WhereLogisticscomestogether • In general labour costs in Lithuania are less than half compared to Western European countries and the USA • Truck operating costs in Lithuania are among the lowest in Europeand 20-25% lower than Western Europe • Labour costs in Kaunas Region are approximately 10% lower than in Vilnius and 25-40% lower than in Poland and Slovakia • Standard income tax rate is one of the lowest in Europe at 15%. If established in a Free Economic Zone (FEZ), property and dividend tax is at 0% and income tax is at 0% for the first 6 years and 7.5% for the following 10 years Source: Invest Lithuania 2013, PwC 2013 Annual full employerscost warehouse employee Tax rates Source: Invest Lithuania, FEZ Kaunas, FEZ Kėdainiai 2014 1 Employer cost are based on the following expenses: gross salary, social security, medical and pension costs in addition to social security and performance bonuses Source: National/Regional Statistical Offices, IMD, UBS, 2014

  9. International accessibility KAUNAS REGION WhereLogisticscomestogether • Kaunas Region is situated at the geographical centre of Lithuania and is further developing and strengthening its transport infrastructure • Kaunas Region is well connected by road to Vilnius, Klaipeda, Riga and Poland • Kaunas airport, which is the second largest airport in Lithuania, serves 8 international destinations (incl. London, Birmingham, Dublin, Oslo and Frankfurt) throughout the year on a weekly basis • Vilnius International Airport is located within a one hour drive providing 2-3 flights per hour and more daily direct flights to major European capitals and cities

  10. Real Estate Availability KAUNAS REGION WhereLogisticscomestogether The Kaunas FEZ provides 294 hectares of logisticsandproduction area • The two Free Economic Zones of Kaunas Region are good locations for the setting up of logistics facilities. The zones provide favourable and lower taxes for investors investing at least Euro 1 million • Kaunas Free Economic Zone (FEZ) offers a totalof 294 hectares for logistics and manufacturing. Logistics companies are already present. Direct foreign investments in Kaunas FEZ account for 76% of all investments • The Kėdainiai FEZ offers 9 plots for investors, with already installed water supply, sewage, surface waste water, pipeline and road infrastructure. The size of the proposed plots varies from 6,26 to 20,86 ha. Targeted activities are industrial and logistics/warehouwing The Kėdainiai FEZ provides 9 ‘ plug-and-play’ plots Source: Kėdainiai FEZ, FEZ Kaunas, 2014

  11. KAUNAS REGION National incentives support program WhereLogisticscomestogether • Foreign investors interested in locating a business in Lithuania as well as foreign companies already operating in the Lithuanian market but eager to further expand may apply for Invest in Lithuania’s financial investment support of up to Euro 3.5 million per investment project • Invest in Lithuania provides financial support to cover personnel training costs (up to Euro 2 million) as well as eligible construction, infrastructure and salary costs (up to Euro 1.5 million), incurred by foreign investors establishing a services business unit in Lithuania • The financial support tool is designed to support foreign businesses investing into the production of export-oriented high-quality services as well as establishment of qualified jobs on the market Financial support available per FDI project in the field of services Construction, Infrastructure, Salary costs Personnel training costs Up to Euro 1.5 million Up to Euro 2 million Max. possible support 3.5 million Euro Source: Invest Lithuania, 2014

  12. KAUNAS REGION Contact us WhereLogisticscomestogether TBD • Information • Consultancy • Analysis • Search • Guidance • Networking • Assistance • Aftercare One stop shop Contact Information: +370 …. @ www

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