Didzioji 5, LT- 01128
British Business & Trade in Lithuania
issue No. 48
Daiva Žumbakienė
Aelita Skaržauskienė
Bob Honiball
Charles Cormack
Approaches to Business and Tax: Current “Hot Topics” in the Lithuanian Business Environment
British and Lithuanian partnership in Higher Education
Brits in Lithuania
UK companies increasingly focusing on Lithuania
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Lloyd‘s establishes in Lithuania Mention insurance and the name Lloyd’s will come into the minds of most British business people. In 1688 Edward Lloyd's coffee house became recognised as the place for obtaining marine insurance and this is where the Lloyd’s that we know today began. 325 years later Lloyds is in Lithuania. Lloyd’s underwriters obtained authorisation to transact business in Lithuania on an establishment basis in January 2013. Tomas Kontautas, Lloyd’s General Representative for Lithuania, has kindly agreed to talk about insurance market in Lithuania and first steps of Lloyd‘s activities in the Lithuanian market: It is said, ‘Lloyd’s is not a company it is a market’. Could you explain how this works? Although 325 years have passed, the model is essentially the same. Imagine Edward’s Lloyd coffee shop in Tower Street in 1688. A ship owner drinks coffee with three wealthy individuals who promise to pay the value of the ship in case she sinks on the way to India. Each wealthy individual accepts certain portion of risk (say 45%, 25% and 30%) and they all issue written confirmation of such promise – insurance policy to the ship owner. Ship owner did not find these gentlemen himself – he was introduced to them by the intermediary – insurance broker, who was socially well connected and knew in person many ship-owners whose ships go to India and many wealthy individuals who would like to insure ship owners or merchants. Nowadays at Lloyd’s individuals or companies ("members“) pool their financial resources into the syndicates. There are 91 syndicate in the Lloyd’s market. Syndicates are managed by specialist entities – “managing agents” which are responsible for underwriting and paying the insurance indemnities. Currently there are 56 managing agents; sometimes one managing agent manages more than one syndicate. Underwriters employed by managing agents are approached by Lloyd’s brokers who bring the risk into the market. The risk in most cases is placed with several syndicates. In addition to the traditional marine insurance risks, the Lloyd’s market also specialises also in casualty (or liability), property, energy, motor insurance and reinsurance business. Due to its unique structure Lloyd’s has a chain of security (assets) amounting to appr. 57 billion GBP and is capable in accepting huge and highly specialist risks. Tomas Kontautas, Lloyd’s General Representative for Lithuania
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Considering business development and expansion? Consider Lithuania, since EU structural support will be available for foreign investment
profitable direct foreign investments and the opportunity to expand businesses in promising EU member states. Radvilė Kymantaitė, Project Manager at PERITUS
Have you recently considered investing or launching new projects, requiring significant investment? Well, in that case it may be just the right time for you and your company to plan this expansion. The definition of the right timing relates to the transitional period of European Union structural funding – the earlier financial period of 2007–2013 is over, giving the green light for the financial period of 2014–2020 investment to begin. Unsurprisingly,the advanced British entrepreneurial community (being among the top five biggest EU budget contributors) is looking for
During the EU structural funding period of 2007 – 2013, the direct foreign investment from Great Britain in Lithuania increased by almost €70 million and in 2013 accounted for more than €218 million. Over this period some of the ‘giant’ British companies (e.g. Barclays, Callcredit, Lloyd’s, etc.) successfully invested in Lithuania and are now expanding their investments, boosting the total amount of direct foreign investment. The allocation of EU structural funds 2014 – 2020 for the two countries in question will be €6.8 billion for Lithuania and €11.8 billion for the UK respectively (excluding Rural Development and European Maritime and Fisheries funds). continued on page 7 >
Euromonitor International in Vilnius – expansion accompanied by hard work and excellence
Marius Dundulis, Director of Centre for Analytics Modelling and Innovation at Euromonitor International
Established in 1972, Euromonitor International is the world leader in strategy market research offering statistical databases, industry and company reports as well as Ad-hoc projects. It is headquartered in London and has offices in Chicago, Singapore, Shanghai, Santiago, Dubai, Cape Town, Tokyo, Sydney, Bangalore, São Paulo and Vilnius. Euromonitor International‘s Vilnius office was opened in 2005. The headquarters in London were looking to expand to the Eastern Europe and talked to Marius Dundulis, then Head of Market Research Department, who was at that time
the only employee from this region in London office. Marius’s advice was of course “why not Lithuania?”, the country with excellent university education level, a variety of languages spoken, which could become an excellent analysts centre as well as an excellent start up location for company product sales to the Russian and Polish markets. After a number of visits and more detailed research relating the potential in Lithuania, the decision was made to set up and Euromonitor International-Eastern Europe regional office in Vilnius was opened on the 4th of July 2005. Marius Dundulis came back to Lithuania to run the company. Today Euromonitor International-Eastern Europe is employing 150 professionals of 17 different nationalities. We are extremely grateful to Marius for finding time in his busy agenda to talk to us about Euromonitor International and his personal story behind this. continued on page 7>