39_European_Business_Magazine_Autumn_2020 by European Business Magazine

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AUTUMN EDITION | 2020

EUROPEAN BUSINESS

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Table of Contents

EUROPEAN BUSINESS

MAGAZINE

Latest News

The Rise Of P2p Lending In Europe

Most Bri sh Companies Will Make It Through Brexit – But Some Might Truly Struggle

Publisher Nick Staunton

Blockchain: Its Rela onship With Cryptocurrency And Beyond

Why Is Big Data So Important?

Editor Patricia Cullen

Relentless Cyber Threats Calls For Omnipresent Protec on

Portugal Fintech: Capital Raising Of Startups Increased To €276M

Global Debt At Risk Of “Qualita ve Change”

Leadership In An Uncertain World: Why C-Levels Need To Con nually Ques on

The Business Of Educa on: How Learning Is More Corporate Than Ever

Covid 19 And The European Pharma Industry

Morocco: Building Back Be er

Morocco’s Moment: Supply Chains Reimagined

Morocco: Bridging The Gap

European Business Talks Exclusively To Mr Mohammed Benchaaboun

European Business Magazine Talks To Lamia Tazi T

Morocco: A New Genera on Of Civil Servants Paving The Way For Industry 2.0

36 Pioneer Ci es Chart A Course Towards A More Ethical And Responsible Future

Would Uk Businesses Gain In Eu Reloca on?

Unlocking The Power Of Data-Driven Linear Tv For Business Success

How Joe Biden Will Aﬀect European Business

Why The U.s Needs Eu Business Now More Than Ever

The Clock Is Tik Toking: Why The Use Of Apps Like Tik Tok Are Necessary In Modern Business

The Storming Cbd Market In Europe

Deputy Editor Anthony Gill Associate Publisher Brad Adams Features Editor Katie Winearls Head of Production Paul Rogers Head of Design Vladimir Mladenovski Subscriptions Manager Rebecca Hill Head of Business Development Paul Matthews Advertising Sales Brad Adams Tara Duckworth Advertising Sales Tara Duckworth, Mike Ray, Andy Ellis, Mark Holburn

Substack: Independent Wri ng Has Never Been So Easy

European Business Talks With With Nick Morley

Why Inﬂuencer Marke ng Is So Important In The Modern World

The Rise Of Genera on Z: How They Are Changing Business In Incredible Ways

How The Union Is S ﬂing Economic Development And Why Europe Will Never Flourish Under The Eu

Lessons In Leadership From The Best In The Business Lloyd Salmons, Co-Founder, Peptalk

Head of Digital Stephen Scott

Donald Trump: The Successful President?

With The Usd In Decline, How Else Can Investors Hedge Risk?

Photographer Ben Fisher

Leveling The Field: How The Rule Of Law And A Free Press Are Crucial In Interna onal Business

How To Build Up Partnerships - Remotely!

Why Now Is The Time To Tokenize The World

Ai In Banking Hype Or Revolu on

100 The Covid Virus Is S mula ng The Evolu on Of Business

europeanbusinessmagazine.com

Contributing writers Patricia Cullen, Richard Fitzpatrick, Bala Murali Krishna, Shilpa Meen, Argee Laraya, Aimee Ni Mhaolcraibhe, Gordana Ristic, Jonathan Hooker, Jose Ignacio Latorre

NST Publishing Ltd, 19 Leamington Spa (studio 1) Leamington Spa,Cv324tf, UK The information contained has been contained from sources the proprietor believes to be wholly correct however no legal liability can be accepted for any errors. No part of this publication can be reproduced without consent of the publisher.

Latest News Apple to pay $113m too settle iPhon iPhone ne ‘batterygate’ bat Apple will pay $113m (£85m) to se le alleg ga ons that it slowed down older iPhones. Thirty-three US U states claimed that Apple had done this to drive u users into buying new devices. Millions of people were aﬀected when the models of iPhone e6 and 7 and SE were slowed down in 2016 in na scandal that was dubbed ba erygate. App ple declined to comment. However, it has previously said the phones were slowed to pre eserve aging ba ery life. The deal is separaate from a proposed settlement Apple reached in March to pay aﬀected iPhone owners up p to $500m in a class ac on lawsuit. In 2016 Apple updated so ware on models of the iPhone e 6, 7 and SE - which thro led chip speeds on aging phones.

Unusual slowdowns Apple acknowledged its update reduced power demands a er researchers found unusual slowdowns in 2017. The states argued that Apple had acted decep vely and should have replaced ba eries or disclosed the issue. According

to an Ariizona filing, millions of users were affected by power shutoffs. Apple denies that the e slowdown was for financial gain. Bu ut Arizona Attorney General Mark Brnovich wrote in a court document made public on Wednesday: “Many consume ers decided that the only way to get imp proved performance was to purchase a newer-model iPhone from Apple. “Apple, of course, fully understood ssuch effects on sales.” Under the settle ement, Apple did not admit to any wro ongdoing or breaking any law. The tech tan also agreed for the next three years to provide “truthful information” about iPhone power management across its website, so ware update notes and iPhone se ngs. The se lement comes a er a series of other allega ons against Apple. It is currently locked in a legal ba le with Epic Games - amid accusa ons the iPhone-maker uses its stranglehold over its App Store to unfairly charge developers.

EU auditors see uphill battle for EU antitrust regulators versus big tech EU an trust enforcers face an uphill ba le in tackling tech giants abusing their dominance because of the diﬃculty of finding remedies, the EU’s budget watchdog said on Thursday in its first audit of the regulators. The report by the European Court of Auditors comes as cri cs of Google voiced frustra on at what they say is ineffec ve enforcement of a series of EU rulings ordering it to stop favouring its own online services to the disadvantage of compe tors. Besides Google, European Compe on Commissioner Margrethe Vestager is also inves ga ng Amazon, Apple and Facebook. “Although the Commission has taken a number of case decisions tackling challenges resul ng from the digital economy, significant challenges remain to be resolved,” the watchdog said. “For example, prac ces in digital markets can cause damage to consumers. However, it is diﬃcult for the Commission to find appropriate remedies to tackle an apparent compe on problem as determining consumer harm can be par cularly complex.” The ECA said the issue applies not just to internet companies but also businesses involved in digital innova on such

as those in energy, telecommunica ons, financial services and transport. It said part of the problem lies in EU an trust rules which only allow enforcers to act a er wrongdoing has been commi ed. The Commission “needs to scale up market oversight to be fit for a more global and digital world. It needs to get be er at proac vely detecting infringements and select its inves ga ons more judiciously,” said ECA’s Alex Brenninkmeijer who was in charge of the report. EU an trust oﬃcials however have swa ed away arguments that they are not able to do their job well in digital cases. “EU compe on rules are flexible enough to deal with digital markets,” Commission Director General for compe on Olivier Guersent told an online event on Wednesday. europeanbusinessmagazine.com 11

Merkel, German states consider tougher COVID -measures: document Germany’s federal government and states are considering new COVID-19 measures to halt the rise in infec ons, such as drama cally reducing the number of people at gatherings and compulsory mask wearing for school students. A dra document of the measures, seen by Reuters, also said people would be urged to abstain from private par es completely un l Christmas. Chancellor Angela Merkel and the heads of Germany’s 16 states are expected to meet on Monday. Germany this month imposed a set of measures dubbed a “lockdown light” to rein in the second wave of the pandemic that the country is seeing in common with much of the rest of Europe. While bars and restaurants are closed, schools and shops so far remain open. As a result, numbers of new infec ons are no longer growing exponenally, but a decrease in infec on numbers is not yet foreseeable, the document said. “Further efforts are needed (…) We have four difficult winter months ahead of us before hopefully seasonal effects and the start of vaccina ons will allow us to gradually overcome the pandemic”, the document said. According to the proposals, which could s ll change pending the discussion between the federal and regional governments, private gatherings in public will only be possible of people from one household with two people from another household, compared to a maximum of 10 people from two households now.

Schools will see all students wearing masks, compared to some excerptions for elementary schools currently. All classes will be halved to allow more space between individual students. All people considered vulnerable will be eligible once a week for one heavy duty respirator mask, also known as FFP2. On Nov. 23, Merkel and the regional state heads will meet again and possibly decide further measures, taking into account the development of infec on numbers by then. Since the beginning of the pandemic, 520,000 COVID-19 cases have been detected in Germany by the end of October, but numbers spiked by 50% to 780,000 cases in the first two weeks of November. In the same period, the number of COVID-19-intensive care pa ents in German hospitals increased by 70%, leading to regional bo lenecks. Over the weekend, a slew of German policy makers warned against easing of current measures and warned of tough mes ahead.

EasyJet reports the worst results in its 25-year history

A week a er easyJet marked its 25th anniversary, the carrier has reported its worst-ever full-year results. Britain’s biggest budget airline reported a pretax loss of $1,7 billion for the year through September, as passenger numbers halved to 48,1 million. The summer was a 12 europeanbusinessmagazine.com

par cularly tough period, with the airline flying just 38 percent of its planned capacity during the peak holiday season. Chief executive Johan Lundgren noted the company had responded “robustly and decisively” to the crisis and cheered “welcome news” on a possible vaccine. In November, two vaccine candidates have revealed posi ve results, which has raised hopes that everyday life around the world could be returning to normal in the first half of next year. S ll, the vaccine is not expected to come through quickly enough to salvage the winter season for the avia on industry, with airlines everywhere slashing capacity. EasyJet noted that it does not expect to fly more than about 20 percent of its planned services in the October to December quarter amid a resurgence of the virus in Europe: “While we expect to fly no more than 20 percent of planned capacity for the first quarter of 2021, maintaining our disciplined approach to cash genera ve flying over the winter, we retain the flexibility to rapidly ramp up when demand returns,“ said Lundgren, adding that the company knows it’s customers want to fly, and the underlying demand is strong.

President Xi of China pledges to open up its 'super-sized' economy Chinese president Xi Jinping has said China will open up its "super-sized" economy to import more high-quality goods and services. China will also sign free trade pacts with more countries, he said on Thursday. Mr. Xi was speaking at the Asia-Pacific Economic Coopera on (APEC) forum, which includes the US and Russia. It is as yet unclear if US President Donald Trump will be speaking at the event, which con nues on Friday. Mr. Trump has previously used the event to lay out his compe ng vision for the future of global trade. China and the US have been involved in a trade war since 2018 with a number of flashpoints over import taxes and Chinese technology firms opera ng in America. Mr. Xi also used Thursday's APEC speech to deny that China would be pulling away from other economies known as decoupling - and warn against protec onism. "We will not reverse course or run against the historical trend by 'decoupling' or forming a small circle to keep others out," Mr. Xi said.

Free trade Mr. Xi's comments come oﬀ the back of signing the world's largest regional free-trade agreement over the weekend,

encompassing almost a third of the world's economic output. The Regional Comprehensive Economic Partnership (RCEP), almost a decade in the making, includes China, Japan, South Korea and 12 other Asian na ons. "In today's world where economic globalization has become an irreversible trend, no country can develop itself by keeping its doors closed," Mr. Xi added. However, China is involved in a number of trade disputes with rival economies, including Australia which it has imposed import tariﬀs of up to 80% on barley. Last month, Mr. Xi and other Chinese leaders laid out a blueprint for China's five-year plan and key objec ves for the next 15 years. They include a goal to turn China into a "high income" na on by 2025 and advance to a "moderately developed" na on by 2035.

Nissan warns on its UK future without a Brexit deal With a Brexit deadline just days away, Britain's biggest car plant "will not be sustainable" if there is no deal, Nissan has warned. The company employs 7,000 workers at its Sunderland factory but said that increased tariffs would raise costs. It cau oned that any delay in overseas supplies of parts because of new customs checks could slow produc on. The EU has warned the UK it has less than 10 days le to secure a deal that will govern trade from next year. Nissan said there must be agreement on a free-trade deal by next week if it is to be ra fied in me for the end of the Brexit transi on period. "If it happens without any sustainable business case obviously it is not a ques on of Sunderland or not Sunderland, obviously our UK business will not be sustainable, that's it," Nissan's Chief Opera ng Oﬃcer Ashwani Gupta told Reuters. He said Nissan was not seeking compensation from the UK for costs incurred from any no-deal Brexit, a er

reports suggested that the company and Toyota Motor Corp would do so. "We are absolutely not thinking that and we are not discussing it," he said.

Addi onal costs Nissan warned in June that the prospect of addi onal costs from tariffs and possible border delays threatens the viability of its UK business. Mr. Gupta told the BBC the EU was the Sunderland factory's biggest customer and warned that Nissan's commitment could not be maintained if there was not tariff-free EU access. "We are the number one carmaker in the UK and we want to con nue," he said. "Having said that, if we are not ge ng the current tariffs, it's not our intenon but the business will not be sustainable. That's what everybody has to understand." Nissan's Sunderland plant opened in 1986 and is scheduled to build

Nissan's new hybrid Qashqai model, which will go on sale next year. It is the third generation of the Qashqai, which came out in 2006 and is the plant's most successful car. The Sunderland factory also makes Juke and electric LEAF models. Mr. Gupta added that the company is ready to meet Britain's revised plan to move up a UK ban on new petrol and diesel cars and vans to 2030 from 2035. "That is not only the UK's transi on plan, every country is talking about electrifica on. We are ready," he said. europeanbusinessmagazine.com 13

Moderna submits Covid-19 vaccine for FDA regulatory approval A front-runner coronavirus vaccine candidate developed by Moderna, a biotech firm based in Massachuse s, has been submi ed for regulatory approval. The company commented on the current situa on, no ng that it will ask the US Food and Drug Administra on for emergency use authoriza on a er comple ng its Phase 3 trial, finding that vaccine was 94,1 percent eﬀec ve against the Covid-19. What is more, Moderna said that the vaccine was 100 percent effective at preventing severe cases of the disease. Interes ngly, these results were iden cal across all age, race, and gender categories, with the most common side eﬀect being fa gue, muscle and joint pain, and headaches. Moderna’s trial involved 30,000 people: half of them were given the vaccine candidate, and the other half — a placebo. Of this group, the scien sts recorded 196 cases of Covid-19, only 11 of whom were from the group that had been given the vaccine. There were 30 cases of serious illness — all of them in the placebo group. So of the 15,000 people given the vaccine,

not one became seriously ill with Covid-19 during the trial period, the company said. “We believe that our vaccine will provide a new and powerful tool that may change the course of this pandemic and help prevent severe disease, hospitaliza ons, and death,“ Stephane Bancel, Moderna chief executive, said in a statement.

London loses status as World Capital of Aviation

A er decades as the world’s leading city for avia on, London has lost its crown, as a result of the coronavirus pandemic. With Europe’s busiest 14 europeanbusinessmagazine.com

airport, Heathrow, and the world’s busiest single-runway airport Gatwick, the capital handled 126,5 million passengers in 2019 — more than any

other city. Once Stansted, Luton, London City, and Southend were added, the UK’s biggest metropolis looked unrivalled, with tens of millions more passengers annually compared to any other city. What is more, it had far more routes than any other city as well — measured as connec vity. But according to the latest figures from the Interna onal Air Transport Associa on (IATA), London’s connec vity has fallen by two-thirds. It is now in eighth place — behind five Chinese ci es, as well as two US hubs. The first four places are taken by Shanghai, Beijing, Guangzhou, and Chengdu followed by Chicago, Shenzhen, and Los Angeles. New York, Tokyo, Bangkok, Hong Kong, and Seoul have also dropped out of the top 10. Last month, Heathrow airport reported a slump in the business of 82 percent compared with a year earlier, calling it “the eighth consecu ve month of catastrophic decline”. Sebasan Mikosz, senior vice-president for IATA, noted that “In a short period of me we have undone a century of progress in bringing people together.”

Boeing 737 Max cleared to fly passengers again after deadly crashes

The Federal Avia on Administra on (FAA) has cleared the Boeing 737 Max to fly for the first me since the plane was involved in two deadly crashes within five months of each other. On

November 18, FAA Administrator Steve Dickson signed an order that paves the way for the troubled aircra to return to commercial service. Dickson said he flew the 737 Max himself

for two hours in September to personally evaluate the changes the company made to the flight control so ware. “During the past 20 months, and my personal experience flying the aircra , I can tell you now that I am 100 percent comfortable with my family flying on it this morning,” he noted. The FAA says its safety staff has “worked diligently to iden fy and address the safety issues” that contributed to the crash of Lion Air Flight 610 on October 29th, 2018, followed by the crash of Ethiopian Airlines Flight 302 on March 10th, 2019. The Boeing 737 Max has been grounded since March 2019 following two fatal crashes that killed a total of 346 passengers and crew members. Boeing continued to manufacture the airplane, but in December 2019, the company announced plans to halt produc on at its Renton, Washington manufacturing plant. Produc on resumed in May 2020 but at a much lower rate and with a renewed focus on workplace safety and quality.

Italy fines Apple nearly $12 million over misleading claims On November 30, Italy fined US technology giant Apple $11,97 million for giving “misleading“ information in advertisements and promotions regarding the water-resistant proper es of its smartphones. “Apple’s feature of being water-resistant up to 30 minutes at a depth ranging from 1 to 4 meters is actually only valid in laboratory tests with sta c and pure water and is not under normal use condi ons. It does not clarify this in promo ons“, the Italian Compe on Authority said in a statement. Also, it said Apple’s refusal to provide warranty service when the iPhone models concerned were damaged by liquids amounted to “an aggressive commercial pracce“. It was reported that the smartphone models in ques on, which contain misleading informa on in their promo ons, are iPhone 8, iPhone 8 Plus, iPhone XR, iPhone XS, iPhone XS Max, iPhone 11, iPhone 11 Pro, and iPhone 11 Pro Max. This latest fine comes a little over two years a er the Italian regulator fined Apple alongside Samsung for thro ling older devices with so ware

updates. Back then, Apple was fined a total of $11,99 million for a pair of viola ons, including not giving its customers enough informa on about their devices’ batteries, as well as

thro ling the performance of older iPhones without warning. In the US, “ba erygate” eventually led to Apple agreeing to a pair of se lements totaling hundreds of millions of dollars. europeanbusinessmagazine.com 15

The Rise of P2P Lending in Europe

efore 2005, the concept of lending money by one individual to another has obviously existed despite never being a mainstream solu on within a na onal economy. Since this date, Peer to Peer lending has existed primarily in both Europe and North America as an alterna ve to the traditional notion of mainstream lending for both lenders and borrowers, however in more recent mes excep onal growth has developed as a result. But what exactly is it and why is it rising significantly? By Ma hew Meehan Peer to Peer lending or ‘P2P’ is a financial process where an individual/ business can choose to lend money to other individual/business in return for an amount of subsequent profit. As the lender, that party receives this profit as a percentage of interest as the money is paid back to them in organised instalments. Operated via websites known as ‘pla orms’, these serve as virtual marketplaces that bring together those people who wish to make addi onal revenue on their savings or free money while providing this financing to those who either cannot achieve bank loans or simply wish to engage with a more personal provider. These pla orms are essen ally middlemen and as there is no financial ins tu on to take over this role and apply high fees to the process, this provides a big advantage as the outlay is much less which allows for a lower rate of interest to be available to the borrower. This system works through the adoption of multiple different models, however the most common and o en used route is through the standard form of transac on. In this process, the lender creates an account in order to leverage an amount of money on their chosen platform, before then having this advertised and subsequently applied for by the borrower who is then assessed and scored

16 europeanbusinessmagazine.com

in order to provide the lender with a predicted pattern of repayment behaviour so they can then discuss the interest terms they wish to set. Alternative models differentiate themselves through the funding streams provided, with loan originators being one op on as they will market themselves and provide platforms with a higher amount of consistent cash often not matched by individual investors, as well as tradional banks who instead sign individual agreements with the borrower before selling these loans to the platform in order to make them responsible for managing repayments. The existence of the pla orm is crucial for the success of the P2P lending stream as they are the legal authority on every agreement, and so therefore are responsible for collecting payments, dealing with debtors, legally recouping loans in the event of default and full bankruptcy. Perhaps just as importantly, they maintain the rela onships of the investors and the borrowers as mistreatment and bad rates would cause their supply chain to cease to exist. The types of lenders include both private usually medium to high net worth individuals and institutional based investors such as banks have in recent years been further accommodated to provide a level of funding, especially as while they may not have been able to lend individually to consumers, the one to one and private funding abili es allow the tailoring of interest figures against the customer profile usually at lower rates than they can oﬀer within their branches. The profile determines risk, the cost to the lender to oﬀset this risk in terms of interest and the most acceptable repayment terms in which to carry this out. These lenders can also choose whether they would prefer to share their investment across a number of poten al clients or choose

one individual who they would prefer to lend to. The borrowers tend to feature more business-based customers while also being filled by private individuals who need general financial assistance or who are aspiring entrepreneurs. They follow the applicable criteria of the credit rating system to determine their eligibility for diﬀerent terms and due to the open nature of a private loan, the financier can help contribute to borrower assessment in order to decide on who receives their investment. The most common borrower is the small to medium enterprise (SME) which due to the inability to gain direct bank investment therefore turns to

the alterna ve funding source to oﬀset their risks as a young company that lacks the necessary establishment. This kind of investment opportunity o en appeals to the individual investor who have smaller loans to provide yet is excited by the potenal growth of the SME and potenally could invest and make further returns in the future should there be a success in their business rela onship.

But why is this an a rac ve and growing market? This is due to the much smoother and efficient business model that is provided without the bureaucracy of the tradi onal lender and its

me-consuming prac ces in mes of rapid expansion and a need for swi er financing. Such ease of use and lower rates provide crucial advantages to both personal and professional borrowers who benefit from a wide catalogue of offering from simple loans to invoice financing, property loans, retail opportuni es, further investment and much more. This is also safeguarded by the surprising amount of effec ve regula on offered by the industry- which while unusual for a free-flowing financial arrangement, shows how the platforms have embraced the idea whilst providing legi miza on for the consumers and regulators, even crea ng their own self-regula on authori es

that can manage this process. Such is this security, that the organisa ons such as the SME’s are provided adequate protec on to secure the future of their fledgling business without the risk of a financial provider adjus ng the interest and possibly forcing them into new and unviable arrangements. These provisions having been around since the credit crunch of 2008 are responsible for the huge growth due to their ability to provide finance and independent lending opportuni es, following the banks and financial ins tu ons re cence to provide monetary support in mes of hardship. This availability of private funds has filled those gaps and only con nued to grow in the me since, especially as these same big firms have been seen to distort the interest rates while failing to provide any alterna ve that is acceptable and has therefore led to an industry worth over £1.29 Billion In the current market. There is also the contribu on of societal development, with evidence to suggest that many areas suﬀer from poor networks of brick and mortar branches due to technological advancement and erosion of the high streets across Europe leaving brand loyalty at an all- me low with such customers receiving a poor consumer experience. In the current genera on, the upwards trend of highly educated, technologically minded drivers of innova on within the younger popula on has created a constantly evolving need for new sources of financing that also overlook their inexperience as a possible factor of rejection in their enterprise or personal financing needs. By turning the process virtual whilst also s ll providing the personal element of real investors that takes away the tradi onal representa on of needing a financial ins tu on whose focus is on corporate greed, this provides great demand for these platforms especially for the investors also who as primarily smaller lenders fear for their financial future when considering the vola lity of the alternaves such as stocks and shares, and instead are provided a simpler, easier investment opportunity with actual developmental prospects. europeanbusinessmagazine.com 17

Most British companies will make it through Brexit â&#x20AC;&#x201C; but some might truly struggle

ri sh businesses could potenally take advantage of Brexit, but it will depend on agreements between the UK and the EU, the robustness of individual companies, and the scope of their ambion. While change in business o en presents opportuni es, the degree of difficulty and uncertainty could be insurmountable for many companies already weighed down by other concerns. If negotiations do not markedly improve, the United Kingdom is heading for a calamitous exit from

18 europeanbusinessmagazine.com

the European Union (EU) on January 1st 2021. This could spell disaster for any number of companies, par cularly those exposed to more fricon at borders and the resump on of World Trade Organization rules regarding tariďŹ&#x20AC;s.

Unprepared for greater fric on In a UK staring down the barrel of a disorderly Brexit, a recent survey of more than 500 companies by the Bri sh Chambers of Commerce found that 51% had not taken any

of the eight steps recommended by the UK government to prepare for changes in the movement of goods to and from the EU. On the other side of The Channel, three major European industry bodies came together in June to warn of the "significant nega ve consequences" of a no-deal scenario wreaking havoc on the trade process through tariďŹ&#x20AC;s and disrupted supply chains. "These can be expected to include a major decrease in export volumes from the EU to the UK, a significant fall in revenue, and consequen al job losses. The impact on SMEs, farmers and agri coopera ves would be parcularly detrimental," said the joint statement from the European farmers body Copa-Cogeca, the agri-food trade body Celcaa, and the industry confedera on FoodDrinkEurope. The ongoing Covid-19 pandemic further complicates the situation and exacerbates the possible economic harm that companies and the public will face over the next few years. Some companies, such as Sony, have already announced plans

to relocate headquarters out of the UK to avoid aggravated disrup on to their opera ons.

Industries worst affected Beyond job cuts, food prices in the UK will probably be where many citizens feel the s ng of changing regula ons. With 79% of imported food in UK supermarkets coming from the EU, households will quickly no ce the difference. Sectors worst affected by the exit are likely to be agriculture, the automove industry, and financial services – all of those for whom customs and du es changes will constrict internaonal areas of business. With so many complica ng factors at play, Bri sh businesses cannot afford any of the conven onal problems that hinder company performance at the best of mes. The security printer De La Rue, which produces currency and passports, has been showing signs of strain. Commentators have highlighted financial difficulty and disrup on at the top, with the company making changes to its directorate in a bid to stem the de. “The business seems to have fallen flat on its face as a result of poor management decisions at a me when it

needed superior leadership to navigate diﬃcult market challenges,” said Russ Mould, an investment director at AJ Bell, speaking last year a er De La Rue cut its dividend. “One has to wonder how long De La Rue can survive without a radical change to its business model,” he added. In the years since the 2016 Brexit referendum, the company has suffered mul ple setbacks including two profit warnings, a (now-dropped) corrup on inves ga on in South Sudan, and a failure to secure the contract to print the UK’s new post-Brexit passports. Soaring debt and revenue losses make the prospect of a Brexit winter all too concerning. In the banking industry, the regulatory changes are going to have a massive impact. A number of banks including Barclays announced recently that they will no longer be able to provide services overseas. UK lenders will lose their EU banking licenses, making operations in certain countries prohibi vely expensive. The resulting loss of customers could be harmful to business. In par cular, Barclays has a series of other non-trivial concerns. The company’s shares are dropping, its online banking services are proving temperamental, and the press coverage of

the high court legal dispute with the financier Amanda Staveley is grabbing a en on for all the wrong reasons. A year-on-year shares drop of 43 percent has seen the company’s future thrown into doubt due to the coronavirus pandemic. When combined with a no-deal Brexit, the future looks bleak.

Not everyone will suﬀer There are some industries that will demonstrate strong resilience in the face of a Covid-exacerbated Brexit. In par cular, the UK’s (more specifically, London’s) technology sector. London has around 45 unicorn startups – those that reach a valua on of at least $1 billion – 4 mes the number of the next leading tech hub, Berlin, which has just 10. While Brexit will undoubtedly aﬀect the flow of tech talent from the connent, and the combined harm of the virus and the exit will punish the economic capital – London will carry this technology sector advantage going forward. Given the contrarian success story of technology companies’ financial performances amid the economic trauma of a pandemic, UK companies in this sector will probably find their way to a winning posi on, even a er the Bri sh departure from the EU.

europeanbusinessmagazine.com 19

AIMING TO SIMPLIFY CUSTOMS CONTROLS, EU COMMISSION PROPOSES ‘SINGLE WINDOW’

by Theo B. Wilson

n order to digitalise and streamline interna onal trade processes, the European Commission has proposed an ini a ve called the ‘Single Window Environment for Customs.’ The initiative is intended to make it easier for authorities involved in goods clearance to exchange electronic information submitted by traders, who will be able to submit the information required for import/export only once. The aim of the Single Window Environment is to enhance cooperation and coordination between authorities, thus facilita ng automa c verifica on of non-customs formalities for goods entering or leaving the EU. Wri en by Theo B Wilson This proposal is the first concrete deliverable of the EU’s recently adopted Action Plan for improving the Customs Union, an ambitious project intended to modernise border controls over the next decade; facilitating trade, improving safety and compliance checks, and reducing administra ve burdens for companies. Currently, formali es required at the EU’s external borders often

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involve different authori es in charge of different policy areas. As a result, businesses have to submit informaon to several different authori es, each with their own portal and procedures. According to a press release, this proposal is the first step in crea ng a digital framework for enhanced coopera on between all border authori es through one ‘Single Window’: “The Single Window will enable business and traders to provide data in one single portal in an individual Member State, thereby reducing duplica on, me and costs. Customs and other authori es will then be able to collec vely use this data, allowing for a fully coordinated approach to goods clearance and a clearer overview at EU level of the goods that are leaving and entering the EU.” The press release describes the project as “ambitious,” noting that it will entail significant investment at both EU and Member State level in order to be fully implemented over the next decade. The European Commision envisions the Single Window as a digital solu on for quicker and more efficient sharing of electronic

data between different government authori es involved in goods clearance at the border. Once fully rolled out, traders will have to submit informa on only once. Customs and other authori es will then be able to automatically verify that the goods in ques on meet EU requirements and that the necessary formali es have been completed. Once fully implemented, the Single Window will replace the current, fragmented system border checks, seen as a burden for traders, inefficient for authori es, and vulnerable to error and fraud. Creating a fully functioning Single Window Environment will require firm commitment from the many different authori es that work at the EU borders. Authori es will need to set work together in se ng up their single portals at a na onal level, and invest in the digital transformations necessary for such a system to work. This will involve agreeing on governance framework, setting up common IT solu ons, crea ng an integrated and automated set of processes for clearing goods, and figuring out how to synchronise data, in order to improve the processes for cooperating with authori es in partner countries. The EU Commision notes that each Member State should set up a na onal Single Window portal, through which businesses can upload the informaon related to goods being brought in or out of the EU. These na onal portals will link up through the digital framework put in place by the Commision, allowing all relevant authories access to relevant data, allowing easier collabora on on border checks. The ultimate aim, according to the Commision, is that the na onal Single Windows will replace the current mul tude of different portals, creating a “more streamlined, coordinated and holis c approach to goods clearance within the Union.”

BLOCKCHAIN:

Its relationship with Cryptocurrency and beyond

ince its inception in 1983 by American cryptographer David Chaum, Cryptocurrency has been a major consideration in the world of technology and financial solu ons as the world began to make a move into a more digital existence. However it wasn’t un l 2009 following the inven on of the first decentralised Cryptocurrency- Bitcoin by Japanese developer Satoshi Nakamoto that society really began to understand the true power of the currency transfer that exists within Blockchain and its ability to take back financial power from the central systems and place it into the hands of the people. The issue remains, that even though it has long existed there is much confusion as to the rela onship between Cryptocurrency such as Bitcoin and the Blockchain system and the understanding of exactly what it means for not just the financial markets, but the world as well. By Ma hew Meehan Since its major explosion over the last decade as its u lisa on drove up its value, Cryptocurrency has been long debated as to what its total func on consists of. Despite this, it is best understood as a value of exchange just like any modern paper based currency such as the pound, yet instead of relying on a physical manifesta on it instead exists digitally through the benefits of being protected by secure, online encryption techniques that determine the control over the actual crea on of it and to also serve as verifica on of the fund transfers than can take place between accounts. Bitcoin is the main example of such and serves as the only current form of cryptocurrency to actually be

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transferrable in the modern markets, with some businesses both domes cally and in Europe allowing for it to be used as a general payment method that mirrors the tradi onal bank card. Blockchain was created primarily to facilitate the use and existence of Bitcoin as the technology behind it is responsible for the movement and transfer of payment. In essence, Blockchain is a decentralised ledger of all of the transac ons across a network that is classified as peer to peer and through this ability, all participants in the transac ons can confirm it without the need for a ‘middleman’ or central authority to clear the ac vity such as is the role of the modern banking system. Processes available through the use of blockchain include fund transfer, se ling trades, the process of secure vo ng and many other issues that simply require the u lisaon of a discreet pathway to complete some form of exchange. The relationship between them is clear: Cryptocurrency is simply the first form of Blockchain in the worlds existence, as Blockchain underpins the currency through its technological ability to become its own banking system or more specifically distributed ledger system which due to its digital advantages can also allow for the crea on of alterna ve oﬀshoots to its tradi onal form, as the users also referred to as ‘miners’ can actually design an individual blockchain with one set of agreed parameters, whilst other users can change these rules in order to be er the nature of their transac ons or the interests of all involved par es. In order to use Blockchain for currency transfer all users must possess

their own individual ‘cryptographic key’, which is much like a standard password although it u lises a personal string of data in order to allow account holders access to their wallets of value within the defined system. Once a transaction is agreed, it must also be approved/authorised before it becomes a block in the chain and this when occurring in a more common ‘public’ chain will mean that the decision to approve

will need to be decided by that specific chains other users also known as nodes who will then be incen vised through rewards in order to encourage the validation of the original transac on. This process is known as ‘ proof of work’ and o en will involve the need for every expensive computing equipment as they must solve an algorithm in order to obtain the financial prize, and so this mining process can be very diﬃcult to achieve and

o en take a single computer a number of years to complete. Despite its conceptual purpose as a corridor for the utilisation of Cryptocurrency, there is a much wider and diverse future for the blockchain technology. In terms of business it is considered to be a next generation so ware with many applica ons into business management improvement, with large conglomerates and many diﬀerent industries all looking at it to

improve areas such as vo ng, security, adver sing, secret documents, journalism and much more. The blank canvas it represents due to its transversality means that the scope to implement blockchain processes relies heavily on its distributed and far reaching nature that could be a crucial key into the advancement of society, with this giving players in different parts of the same process a single network within which to connect and therefore securing the integrity and immutability of the opera ons that are circulated. The existence of such a workstream is the equivalent of a common opera ng system and allows for the crea on of digital assets, therefore with all involved u lising an encrypted bank of verified information the chance of mistakes being made are severely limited with the need intermediary par es becoming almost insignificant. This kind of improved efficiency is transferrable into just about any environment where their currently exists a need for secure and privately accessible informa on with the reduc on in security risk. Drawbacks do exist however in the adoption of Blockchain with such intricate and expansive architecture of individual branches of chain becoming diﬃcult due to the regulatory challenges that are presented by being able to legally validate transacons. To eﬀec vely do this, you are faced with the responsibility of universalising a decentralised structure that thrives on its expansive nature and so without a clear pathway for legal standards to exist, the ques on of protec on both physically and by the law of possible hacking a empts is posed, which furthermore brings some doubt as to the legi macy of the global applica on of the Blockchain concept In its current form. With this in mind, while the rela onship with Cryptocurrency is apparent and clearly Bitcoin could not exist without it, time will tell whether there is longevity in this method or whether Satoshi Nakamoto’s vision of decentralised power will be lost due to the need for some kind legitimising standards in the name of financial and data protec ons and the protec on of the technologies ever growing user base. europeanbusinessmagazine.com 23

Why Is BIG DATA

So Important?

ig Data is the term that explains the large volume of both stable and unstable data that inundates the business on a daily basis. In order to qualify as such, the data involved must exhibit categories known as the four V’s: By Ma hew Meehan VOLUME - The amount of created data is considered vast in rela on to tradi onal data VARIETY Y - Data comes from all different types of sources and is therefore also created by machines and processes as well as people VELOCITY - Data gets produced extremely fast, with this process connuing even as we sleep VERACITY Y - Big Data is sourced from many diﬀerent places and therefore the quality and veracity of such data must be tested.

This concept has existed for many years and it is understood by most organisa ons that capturing all data leads to significant potential value for the company. Even before Big Data became a concept in the 1950s, businesses were using basic analytics like spreadsheets and calcula ons to monitor developing trends and insights before developing the ini al Big Data concept. While an increase in speed and eﬃciency was created by this concept, the me taken did not allow for anything more than future predic ons. In comparison to now, trends are now instantly idenfiable, allowing immediate strategic development that facilitates faster workstreams, staying agile to your environment and being constantly compe ve. However, the main factor in utilising such data is also reliant on understanding why Big Data is actually so 24 europeanbusinessmagazine.com

important for businesses in the first place, especially considering it is not actually the amount that ma ers, but instead what the organisations do with it. The importance of such can mainly be understood by the development of three core categories that have been decided over me to give the greatest overview of the inherent benefits of Big Data.

Cost Reduc on The reduc on of cost is achieved by the new technological developments of Big Data, such as cloud-based analy cs and the reduc on in necessary hardware, meaning that there are significant cost advantages when it comes to both the ability and expense involved in storing large quan es of data. The ability to now take information into a more digital storage mechanism has allowed for large improvements into data driven processes such as quality standardisaon and general tes ng. This is due to their needs for constant access to numerous complex sets of data that are especially important in industries where mistakes are cri cal, such as pharmacological inves ga on, technology and na onal defence. Big data is able to formulate in-depth insight that provides detailed feedback and the storage of iden fied issues that inform the process of assessing variables. This allows much quicker, clearer and well-informed decisions for all aﬀected industries.

Improved Decision Making Due to the greatly advanced speeds of the data mining processes and the memorisa on of analy cal data, this allows new sources of informa on to

be speedily inves gated, so that all businesses immediately understand both the state of compe tors and the overall condi on of their industries. This equips them with the tools to make constantly evolving decisionsdue to the speed in which these companies can now learn and internalise this informa on. This also allows for much further future projection, as the accuracy and consistency allows businesses to create their own agile framework which is able to handle the involved risks, while constantly upda ng and re-evaluating responsible memory banks in order to eﬀec vely influence every necessary decision.

operate. Such developing needs in a technologically driven and advancing world means that everything from transport to personalised adver sing, poli cs to weather and even health monitorisa on of ourselves and the world around us requires constant data. This is even the case with oceanographical and geographical coverage for agencies such as NASA, which requires an unimaginable amount of constantly changing data processes. The issues involved with this stem from this are the miniscule details that are needed to create the individual DIY architecture of a specialised database just to handle simple processing, and to achieve this through a cloud storage access that is aﬀordable to the individual organisations. There are also great challenges due to the mix of data that is needed by analysts and computer scien sts, as the mix of pla orms and data stores used can often make compatibility between them difficult. Therefore, the need for greater data catalogues occur which require subsequent governance and quality assurance.

New Products and Services With research methods such as polls, surveys and intelligent algorithms calcula ng and predic ng future human behaviour, the data therefore has the ability to gauge all of the customers’ wants, needs and desires while combining these with resul ng sa sfacon levels that inform the analy cs so that the customer receives exactly the right product. Thanks to Big Data, more companies are able to innovate and develop new products or variaons on a consistent basis. This kind of data can also be informed by later situations such as product launches or long-term customer feedback to further the posi ve exchange,

while also realising how the balance of demand then aﬀects their own purchasing process so that they may save any wasted spend or a empted purchase misinforma on from wholesalers. As a result, the focus then shi s through the data onto customer-centric marke ng that allows accurate purchase predic on, where customer investment (that may rise due to sa sfac on) will therefore require a more personalised and data-driven specialisa on. While this is hard to predict, it can instead be informed through these subsequent buying behaviours. The issue behind this that contributes to the necessity of big data is the modern society in which we live and

This issue shows one of the most crucial factors as to why big data is so important now lies in its own design: ethical prac ces and regula ons. Collec on prac ces and regula ons must be clear and abided by in order to ensure that Big Data actually achieves what it needs to without impeding on personal freedoms. Increased usage, alongside few restric ons, leads to higher misuse, and the loss or the of personal or sensi ve consumer data becomes a significant possibility. This led to the creation of GDPR which limits and regulates Big Data. However, in order to ensure success and restric on are not opposing forces, there must be a balance struck that creates an environment that prevents the loss of eﬃciency and advancement. Much of this success is dependent on the human ability to handle small data, while making sure computers can effectively handle the data to ensure its ul mate success through the implementa on of infrastructure that can allow such vital informa on as Big Data to connue to revolu onise our lives. europeanbusinessmagazine.com 25

RELENTLESS CYBER THREATS CALLS FOR OMNIPRESENT PROTECTION With the rise of cyber crime attacks on businesses - each more sophisticated than the last, Ian Vickers of METCloud (pictured )speaks about how Security Operations Centre as a Service (SOCaaS) should empower, rather than hinder, modern SMEs. 2020 has been the year that tested the tensile strength of cybersecurity in businesses worldwide. With the migra on of teams working from home en masse, coupled with businesses changing their long term oﬃce plans in a new world beyond Covid, it is impera ve that SMEs recognise the need for the evolu on of their cybersecurity measures. According to the University of Maryland, hackers a ack on average 2,244 mes a day. This translates approximately to one attack every 39 26 europeanbusinessmagazine.com

seconds. In its Cost of a Data Breach Report 2020, IBM cited that it takes a business in the UK an average of 256 days to identify and contain a cybersecurity breach - that is approximately eight and a half months! As a result, the cost of breaches in the UK has averaged at £3.9 million with the service industry being most aﬀected. Traditional cybersecurity measures do not cut it anymore. In a world where cybercriminals do not sleep, neither should the vanguards keeping them at bay.

ENTER SECURITY OPERATION CENTRE AS A SERVICE (SOCaaS) Delivered through a provider via a subscrip on, SOCaaS provides real me monitoring, detec on and analysis of cybersecurity threats. This is accomplished by proac ve detec on of advanced targeted attacks that would have otherwise been undetected by exis ng perimeter controls. SOCaaS marries the strengths of 24/7 surveillance through ML- and AI-based security tools with the

About METCloud METCloud is a mul -award-winning cybersecurity hybrid cloud pla orm, harnessing sophis cated cyber defence, surveillance, Ar ficial Intelligence (AI) and Machine Learning (ML) technologies. METCloud recognises the burgeoning value of data and customer insights and so, as a Microso Azure Ecosystem Partner, METCloud provides clients with secure access to an ever-increasing portfolio of cu ng-edge technologies such as AI, ML, Internet of Things (IoT), data analy cs and Blockchain services. is appropriate for the business. Increased surveillance of activity across a business’ IT estate at this point of me, should really include cloud infrastructures and work from home deployments given the evoluon of a new-normal workplace. The importance of collaboration between the SOCaaS provider and the business is integral in the efficacy of cybersecurity. To ensure this, the SOCaaS should be a service that delivers peace-of-mind and security to the client. It should not fatigue them with relentless repor ng, and action requests that they may not have the me or resource to address.

THE LITMUS TEST TO GOOD SOCaaS

analy cal exper se of a team of highly-skilled cybersecurity specialists. This delivers an eﬃcient and streamlined way to identify security gaps and eliminate threats through early detec on.

HOW TO MAKE SOCaaS WORK FOR YOUR BUSINESS While organisations must build robust cybersecurity measures into their normal opera ons in order to match the ferocity of modern cybersecurity threats, it is also important to make an educated choice on what is appropriate for their needs. At the founda on of things, a good SOCaaS provider should be able to scale their services based on what

The persistence and ingenuity of cybercriminals today means that on top of cybersecurity, a SOCaaS provider has to help business maintain good cyber resilience. That is, to ensure that they are prepared to respond to and recover from cyber a acks. When seeking out a provider, it is important to ask these ques ons: Is your SOCaaS provider a cloud-nave and mul -tenant pla orm? Rather than provide you a selec on of products, cloud-na ve mul -tenant pla orms provide end-to-end cohesion and scalability. To a non-IT expert, how easy is it to understand the data presented to you? Is it easily quan fiable in metrics? It is important for your SOCaaS provider to help you understand the data and what it means for your business. It should be able to provide you the

appropriate economic information and outcomes without bombarding you with technical jargon. Is your business provided simple and relevant advice to ensuring that your team is compliant to the security guidelines? Every business and the temperament of their employees are diﬀerent. It is important that the SOCaaS provider is understanding of that and capable of delivering custom playbooks that fits your business priori es. When threats do emerge from the ether, does your SOCaaS provider eliminate them in a mely manner, without your interven on? The quicker a threat is addressed, the less damage it can cause. How equipped is your SOCaaS provider in delivering this? How easy is it to deploy applica ons on the pla orm? Cyber threats are ever-changing. It is important for the measures to keep up with them. It is important for the SOCaaS provider to be flexible and allow for swi deployment of security applica ons. Upon the deployment, it is important that it is seamlessly updated and integrated into playbooks and repor ng.

EVOLVING WITH THE TIMES As the threat landscape to businesses has multiplied exponentially, there has never been a more important me to implement SOCaaS capability. To ensure the eﬃcacy of SOCaaS, It is crucial to empower business owners to understand and take charge of their cyber resilience. europeanbusinessmagazine.com 27

PORTUGAL FINTECH:

Capital raising of startups increased to €276M

tartups that run in the payments and transfers segment were the ones with the most capital raising opera ons. The “Portugal FinTech Report 2020” shows that the FinTech ecosystem has changed in the last 12 months and the rela onship with regulators has improved. Wri en By Beatriz Da Silva

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According to Portugal FinTech, the 30 Portuguese FinTechs that stood out in the country increased the amount of capital raised by around €66m in 12 months. The report shows that the top 30 technological innova on companies have raised, since 2017, around €276m, which compares with the capital raised un l last year, that

stood at €210m. However, this was not the only change in the na onal ecosystem of financial, insurance, cybersecurity, capital markets and even real estate technological innova on - although the report is called “Portugal FinTech Report 2020”, there are startups that run in another market segments other than finance,

hence why they are not truly FinTech (for example, a startup that runs in the insurance segment is known as InsurTech, while a startup that operates in regula on is called RegTech). In one year, the technological innova on ecosystem changed its configura on. As stated by the “Portugal FinTech Report 2019”, the top 30 FinTechs were almost equally distributed among the different market segments, which is not the case in this year's report. There is now a clear predominance of FinTechs that operate in the payments and transfers industry, 27% - against 10% a year ago -, followed by InsurTech (19% v 17% in 2019) and startups

that operate in blockchain and cryptocurrencies (13% v 10% in 2019). All other industries weigh less two digits in the ecosystem of the analysed FinTechs, which now includes a FinTech that operates in the real estate industry, a new feature that did not appear in the last year’s report. Another change was the increase of national companies who received funding. In 2019, about 46% of the FinTechs analysed had raised capital, rising to 60% this year. In Portugal, the loss of FinTechs based in Lisbon (the FinTech hub in the country) stands out, which now accounts for 54% of companies, against 62% last year. Porto remained with 19% of FinTechs, while Braga increased 6% in the last 12 months, from 10% to 16%.

Regula on remains a priority for FinTech There are aspects that have not changed between 2019 and 2020. Last year, FinTechs considered

regula on as one of the aspects to be improved. This year, 37% of FinTech s ll consider this to be the priority to improve. Despite this, the rela onship between FinTechs and national regulators seems to be improving as 53% of FinTechs considered that there was an improvement in access to na onal regulators, against 50% in the past; 49% considered that regula on had an impact in business development (29% in 2019), against 40% who considered that regula on had a nega ve impact (50% in 2019). FinTechs claim for a greater proximity to the Government. The vast majority of FinTechs (71%) believe that they need a be er rela onship with the public sector (60% in 2019), and only 16% consider that regulators act accordingly to the interests of startups (4% in 2019). Among the main obstacles to overcome, this year’s main challenge iden fied by FinTech was the sales cycle (42%), which in 2019 was iden fied as the second biggest hurdle to overcome. europeanbusinessmagazine.com 29

GLOBAL DEBT AT RISK OF "QUALITATIVE CHANGE"

lobal markets, spurred by policies, have emerged from the March panic during the spread of the COVID-19 pandemic. For now, all major economies, including Europe and the United States, are at the crossroads of a new direc on. Although the U.S. stock market experienced a certain degree of correc on in October and began to hover around high levels, it is s ll far from the all- me high it reached in early September. In the current stock market, the global market is s ll plagued by two factors, i.e., the recurring COVID-19 pandemic and a new round of s mulus

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policy changes. In fact, in the case of the second outbreak of the pandemic, there was no obvious fluctua on in the market, which meant that the capital market s mulated by the policy could hardly get rid of its dependence on the policy. This kind of policy risk that accumulates ceaselessly in the long run also implies the possibility of "qualita ve change". In the bond market, there have been signs of a pullback as the dollar index has been flooded with dollar liquidity. In the United States, investment-grade corporate bonds with maturities of more than 10

years underperformed short-term bonds last month and fell the most in August of all maturi es, according to Bloomberg Barclays Indices. In the options market, the cost of hedging against inflation of more than 2% over the next five years has more than doubled since February. In Asia, dollar-denominated corporate securities with maturities of more than 10 years performed worst in the two months to September. Some bond markets around the world have begun to signal long-term infla on risks, reflecting growing concern that a prolonged flood of liquidity might drive up future infla on, with the resul ng change in interest rates that could be poten ally disastrous for capital markets. Reports from international rating agencies have further heightened concerns about the future situa on. S&P Global warned that the second

wave of sovereign downgrades could come in the coming months as a result of the new wave of the pandemic, with some of the world's top economies likely to suffer credit downgrades or downgrade warnings. S&P has already downgraded the ra ngs or outlooks of nearly 60 countries this year. Some of the world's developed economies, including the European Union, Japan, the United Kingdom, and the United States, are also at risk from a new wave of the pandemic. S&P has revised its outlook for Japan

from posi ve to stable. Canada's rating was also downgraded to AA by Fitch. These changes suggest that while countries are expanding their fiscal deficits to cope with the pandemic, the long-term sovereign debt problem is worsening. In par cular, the size of the U.S. debt has ballooned to more than USD 20 trillion from about USD 13 trillion five years ago, and the na on's latest annual fiscal deficit has hit a record USD 3.1 trillion. The economic impact of COVID19 implies that the scale will inevitably

Founder of Anbound Think Tank in 1993, Chan Kung is now ANBOUND Chief Researcher. Chan Kung is one of China’s renowned experts in informaon analysis. Most of Chan Kung‘s outstanding academic research ac vi es are in economic informa on analysis, par cularly in the area of public policy. Wei Hongxu, graduated from the School of Mathema cs of Peking University with a Ph.D. in Economics from the University of Birmingham, UK in 2010 and is a researcher at Anbound Consul ng, an independent think tank with headquarters in Beijing.

be further expanded. In recent days, Randal Quarles, the Fed's Vice Chair for Supervision, said the Treasury market is so large that the Fed may have to stay involved to keep it func oning. Quarles also said that the Treasury market’s scale has grown so large that it may have outpaced the ability of the private sector to cope during periods of stress. This means there is an “open ques on” about whether there will be an indefinite need for the Fed to parcipate as a purchaser to support market func oning, a ques on that according to Quarles, has yet to arrive at an answer on. The Fed is also stressing that the future of the U.S. economy depends on another round of fiscal s mulus. The Federal Reserve and the U.S. government are likely to continue their massive easing policies in the face of rapidly ballooning U.S. government deficits. In Europe, the European Central Bank (ECB) has begun to note the threat posed by the build-up of corporate debt risks in the future and has stressed the ECB's policy role, hoping to allay market fears. For the financial market, although continuous easing policies are conducive to maintaining market stability, it also means that the capital market is increasingly dependent on policies, and it is diﬃcult for the capital market to form its own endogenous growth momentum. The con nued spread of the pandemic will further aggravate this "vicious circle". If capital markets are losing their func on, policymakers need to consider the possibility of a future qualita ve change in growing government and corporate debt that could cause markets to stall and the global economy to reboot. The only hope for governments and regulators is that the economy recovers its momentum before the crisis occurs. Final analysis conclusion: At present, the massive s mulus policies adopted by countries in response to the pandemic and economic recovery will con nue to strengthen in the short term, making the capital market increasingly dependent on policies. As emergency policies con nue to trend towards the long-term, the capital markets are facing the threat of losing their func on, raising the risk of a "qualita ve change" in the overall debt problem. europeanbusinessmagazine.com 31

Leadership in an uncertain world: WHY C-LEVELS NEED TO CONTINUALLY QUESTION

here have been few business contexts in living memory more challenging than the early moments of the pandemic. Keeping the wheels turning on a globalised economic system whilst borders are closing and national health regulations are confounding businesses, this is the archetypal VUCA environment. What do these kinds of changing new-world contexts, characterised by extreme Vola lity, Uncertainty, Complexity, and ambiguity (VUCA) mean for leadership and strategy? And what effect does this have on the role of skills and creden als? The compe ve world of business has, necessarily, always been an arms race. Leaders need to adapt and overcome obstacles, keeping pace with their compe tors as well as human development. Change is not new, says Marco Mances , former Research and Development Director at IMD Business School for 10 years. “What is diﬀerent is that the pace of change, the immediacy, the extent of impact and the number of factors to

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be taken into account have dras cally increased,” Mances explains.

What does this imply for execu ve managers? As a consequence of technological advancement, the business world has far higher complexity than it once did. Business leaders face uncertainty as a result of changing poli cal and regulatory contexts, vola lity as a consequence of flee ng commodi es prices and shifting markets, and ambiguity due to the emergence of unprecedented situa ons — Brexit, the pandemic, or the trade war between the US and China being recent examples. Mances argues that this should not lead to despair or the denouncement of norms in strategy and leadership: on the contrary, “strategic thinking becomes an impera ve […] Leadership becomes crucial.” Strategy must be far more frequently assessed in the VUCA environment. And it must be developed and evaluated by far more astute leaders who are

capable of “taking a though ul posi on and ar cula ng an agile strategy” in the face of complica ng factors. In a world that is increasingly diﬃcult to understand or predict, there is a second leadership func on that is also essenal, Mances says: the leader’s capacity to maximise the poten al of those under their charge. “Decreasing employees’ anxiety in the face of change by proving that challenges can become opportunities is going to be a cri cal enabler of peak performance and a compe ve advantage,” Mances insists.

Responding to the VUCA world with Vision, Understanding, Clarity, and Agility One way that leaders can prepare for VUCA environments is by heading oﬀ the factors at play, and by counteracting the quali es that make them challenging. According to Bob Johansen, a dis nguished fellow at the think tank Ins tute for the Future, effective VUCA

resources to disentangle the throng of data and find clarity. When faced with acute ambiguity, teams must have the agility to pivot on short no ce. While these strategies help execu ves to tackle VUCA situa ons, there is also considerable need to foster a learning mindset.

The need for lifelong learning

leaders harness vision, use understanding across the structure, create clarity for their team, and leverage agility to stay on point. Leaders with certainty of vision, of where they want the organisa on to be in the future, be er navigate vola lity through future-proof decision making. By understanding events from the perspective of all levels of the team or structure, collabora ng and viewing the problem from diﬀerent angles, leaders can counter uncertainty with mul -dimensional models. At IE Business School , Execu ve Educa on they make a point of teaching execu ves about these par cular skills; they typically use the Three Horizon approach to encourage execu ves to see their own businesses through the eyes of visionaries, the eyes of entrepreneurs and those of a manager having to deal with the short term issues. These different perspec ves o en generate relevant future scenarios for execu ves to develop specific strategies. Complexity can be tackled through deliberate eﬀort and commitment of

The emergence of the Vuca environment as the norm creates an impera ve for execu ves to con nually develop additional expertise. A recent McKinsey survey found that 87 percent of execu ve respondents either are experiencing skill gaps in their workforce as a result of changing market needs, or expect to experience them in less than five years. Nick van Dam is the Chief Learning Officer at IE University, Director for the IE Center for Corporate Learning Innova on, and a former CLO and HR Executive at McKinsey & Company. Over 30 years of business experience has led him to consider individual lifelong learning as one of the most crucial prac ces in the modern business environment. Van Dam and his colleagues believe that considerable changes need to be made to the business educa on model to align it more fully with trends in the real world. At IE University, students experience the Liquid Learning model which makes use of mul ple methodologies and platforms, virtual and physical, immersing students in a host of technologies and learning environments. Whether they a end in-person or remotely, IE students are exposed to the latest innovaons in ar ficial intelligence, analy cs, gamifica on, simulators, and communication technology, readying them at a me when these innova ons are just star ng to make their mark on the workplace. “Building a workforce of such lifelong learners is cri cal for organiza ons to respond to a changing business environment. To ensure they have the required skills and talent, companies must create a learning-for-all culture in which people are encouraged and

inspired to con nue learning new skills,” Van Dam and his colleagues write. Changes to the world demand new approaches to career planning as well. Technological developments and shi s in society stand to drama cally alter the workplace of the future. Learning must, therefore, align with these workplace needs. "While this mode of learning has long been in our future, the COVID-19 pandemic has made the transi on more urgent. It has shown us that universies must embrace ‘liquid modernity’ — so they can not only meet any crisis that arises, but also prepare students for varied careers over their long working lives," Van Dam explains. Not only will jobs be lost to automaon, Van Dam says, others will change as a consequence, and new jobs will emerge. Crucially, professionals need to be prepared to acquire skills outside their current wheelhouse. As ac ve lifespans increase, it might be quite ordinary for a person to work into their seven es, changing professional area repeatedly. What this means is that executives will need a drastic change of mindset. Due to the rapid and con nual change in working prac ces, it will no longer be about acquiring deep knowledge in one par cular field, followed by a career spent developing field-specific competencies. Van Dam suggests that changes to the future of work will mean that individuals need to have mul ple areas of deep knowledge over their lifeme, combined with a broad spectrum of competencies. Inevitably, this demands that we all become lifelong learners in order to constantly upgrade our skills and keep up with the adapta ons made in business: in fact, this will become a crucial success factor. At the same me, so skills, such as emo onal intelligence and communica on, will increasingly weigh on a professional’s value to teams and projects downstream in their career. As such, learning must reflect this trend. “The future of learning is liquid. It’s all about the richness of the experience: curricular and extracurricular, social and individual, global and local, […] cogni ve and emo onal,” Van Dam insists. europeanbusinessmagazine.com 33

The Business of Educa on:

HOW LEARNING IS MORE CORPORATE THAN EVER

ith the situa on surrounding the current pandemic, the substan al cost of university education is highlighted as protests continue over their decision to remain the full price despite much of the face to face academic curriculum going to an online system. More ques ons are being asked as to exactly where the money is going and how the perception of educaon is changing from an environment based on academia into a self-mo vated corporate environment. The unfortunate fact however, is that despite popular understanding, public higher educa on has been shi ing rapidly more corporate for a long me.

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As educa on develops and society has inherently become smarter due to the new innova ons and technologies made available, universi es have sought to grow in order to match such demand yet being purely government funded, they have been forced to find a way to cover these rising costs. This has meant great cost cutting measures, most of which have involved devaluing and depriving the student body through the reduc on of staďŹ&#x20AC; numbers, lowering yearly departmental budgets and commi ng to a strategy of massification which has seen a substan al rise in the number of students in a me when supplies are limited. Such is this despera on, that the University and College Admissions

Service reported a 3.5% increase in yearly admissions despite the current climate, whilst pres gious ins tu ons such as the University of Manchester saw their admissions acceptance rate soar from 42% to over 59% in just one year. This ini a ve has meant that they gain ÂŁ9250 in fees from every additional acceptance with a clear focus on using the students as consumers rather than scholars. In order to adopt this type of revenue progression, this has also meant the crea on of new posi ons of power in order to oversee the increased number of students and led to the money gained and also saved shi ing from a focus on educa on and achievement, to instead a culture of performance

targets, results and improved efficiency with more new hires than ever in departments being lifelong business or marke ng professionals, in direct contrast with the tradi onal structure. Policy advancement is also a factor outside the campus too with heavy strategic marke ng and promo onal campaigns being heavily funded despite the concerns. In the new year when applications are submitted, as well as on A-Level results day there is now a minefield of prime me television adverts, online banners/pop ups and even billboards li ered as ins tu on a er ins tu on competes to fill every available admission slot, knowing just one new student from every timeslot allows them to recoup the expenditure.

Such heavy corporate strategy has been seen in its American origins to result in a system that eats millions with the only returns being derisory graduation rates, crushing student debt crippling the next generation and o en even unappealing qualifica ons that have given no real education of value to the student and instead will just leave them with an expensive piece of paper they will never use. Such dangerous precedents are commonplace as a result of the con nued financial focuses of education and opens up the European con nent to the risk of some universi es becoming privately educating bodies who can set their own rates for admission and slowly destroy the sector, especially considering the impact it would have on a system where very few such organisa ons exist. This monetisation and categorisaon of students as customers is not even the main focus of how companies can profit from universities, in fact they do it through the opportuni es afforded to them by universi es financial frailty and the opportuni es this presents. Universi es no longer focus on research and development of individual fields or their expansions of campuses for their own learning and growth opportuni es but instead offer these as a way to allow businesses to profit from their clear advancements versus current knowledge. Companies now are a clearly ac ve part of the education system, with their wider integra on within learning meaning that they no longer need to fund their own research due to their abili es to form long term partnerships with ins tu ons that exchange knowledge for funding and backing via NDA agreements. Not only this, but the student customers are also a resource as educated employees who only further the service provided in return for the offering of basic salaries and even funding for master’s or doctorate degrees that specialise in using this educa onal opportunity to further the corporate knowledge that the business aims to gain. Ongoing opportunity has meant that while previously unimaginable, land on campus universi es and

local areas surrounding city ins tutions has become prime locations for hotels and other private enterprises to a empt to monopolise the ins tu on by being located on university land, a trend heavily featured with brands such as Costa Coffee and local convenience stores bringing o en premium pricing strategies in an a empt to mone se educa on and take every student penny possible. In some cases, there is old accommodaon blocks or car parks that become redeveloped as the desire to make profit overruns the natural focus, especially considering the increase in cases of brand-new centres of educa on cos ng mul millions, subsequently being sponsored or giving priority to private hire opportuni es and forcing student classes to relocate in the name of corporate greed. The scope of such, provides educa on with a new image of being a very profitable and exci ng venture for anyone who has the money and capital to provide a posi ve associaon, while allowing to outsource and re-establish the meaning of university educa on. Educa on is no longer focused on primarily providing a student educa on, but instead using this service in the most financially rewarding way possible even if it comes as a detriment to their core competency. The opportunity creates provides some incredible career development to those in certain fields, but for most they experience a rising number of fellow students alongside a decline in both the quality and availability of good teaching that is detrimental to their university experience. The corporate intent of universities is not purely self-mo vated, with the government funding being inadequate to allow them to provide everything they oﬀer and so they must rely on the acquisi on of student fee payers and contribu ng private funding to connue opera ons. Universi es are clearly now a business venture that needs corporate assistance to survive, and with no change on the horizon, there is no signs of this doing anything but evolving any time soon while increasing the threat of possible, eventual priva sa on. europeanbusinessmagazine.com 35

Covid 19 and the European Pharma Industry T he pharmaceutical industry is one of the European Union’s highest performing Technology sectors, with it consistently driving and advancing medical achievements. Through research, development and new medical breakthroughs, pharma has become such a key asset of the EU crea ng an es mated value of 220 billion Euros. However, this market has been severely hit by the austerity measures that the union has sought to employ since 2010, causing inabili es to further invest in na onal or con nental research at a me when compe on is growing from further developing na ons such as Brazil, China and India. In fact, migra on to these countries is happening as their markets show an 11% growth rate versus the 5% EU average, with Europe now only accoun ng for 17.7% of all new medical discoveries being brought to market. Covid 19 has proven to be the biggest challenge to the already struggling industry, so with the consequences of the outbreak, the reac on is crucial

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to ensure a constant supply of adequate pharmaceu cal treatments are available to European ci zens. In terms of response, Italy and France have been seen as the leading countries taking the quickest moves to react to the situation, with their health systems almost immediately taking current medications on the market for condi ons that they felt had a similar molecular structure such as HIV, Malaria and other an -viral drugs and tes ng their eﬀec veness. France pioneered this through the use of a trial on the drug Hydroxychloroquine that passed various studies and was subsequently praised as a treatment by American president Donald Trump. Other drug treatments involved the same protocol, only in diﬀerent samples with the World Health Organisaon choosing to conduct their own personal tes ng in Norway. The United Kingdom eventually led the way in trials with the strong research and development facili es na onwide, including a partnership

with pharmaceutical giant Astra Zeneca and Oxford University which among others was assisted by the poor governmental response to the ini al outbreak meaning a strong volunteer response. In June, the world’s first recognised coronavirus treatment was approved by both the Na onal Health Service and the Bri sh government through the use of Dexamethasone, which was believed to dispel the effec veness of the Hydroxychloroquine usage. Europe’s eventual strong response allowed it to amass an extensive list of countries such as France who were able to provide a quick logis cal supply of treatment to afflicted ci zens. Germany was ranked number one globally for treatment effec veness due to its strong health care system that relied on regional transporta on and administering policy whilst refusing to allow any medical equipment that may be of use from leaving its borders. More surprising countries also proved very effec ve in their methods, with Iceland having been already prepared for

the eventual influx with tes ng, drugs and quarantine set up before they even had confirmed cases and Turkey providing strict yet eﬃcient lockdown protocol for at risk groups such as over 65’s and under 20’s, alongside extensive availability of Hydroxychloroquine as a front-line treatment and Japanese drug Favipiravir as a secondary solu on. There were also some worrying logiscal issues in terms of actually achieving supplies of drugs, due to the way in which they are created. The European Commission discovered that 70-80% of all treatments were actually made using ac ve substances flown in from China, showing a lack of raw availability surrounding the a ainment of treatments with a need for a closer and more Eurocentric option. This need means that they are also more reliant on a newer supplier of product- Morocco. Morocco’s pharmaceutical industry did not exist ll just a er 1956 following its independence, however leader King Mohammed V dictated that in

order to sell within Morocco, major companies had to also have a producon base in the country which led to a slowly developing new infrastructure where technical ability and scienfic knowledge began to exist, turning the country into a modern-day leader in Africa’s con nental pharma market. With the drug supply having been disrupted due to Covid 19, a shortage has occurred as China has suﬀered great numbers of factory closures and the UK, India and Canada among many others has sought to put restric ons on further treatment sales to ensure their own self interests. The consequence of this is that Europe recognises its need for a regional supply that is much more accessible and in line with their own regulatory policies, something which carries great precedence going forward as the con nent looks to deal with both the current pandemic and the a ermath that will occur. As such, the supply chains are aﬀected, and this leads to the need of accelera on of near shoring to provide easier access that takes less of a focus on Asian supply. The loca on of Morocco makes it the perfect hub as a supply base for both Europe and Africa with it being centrally located on the p of one whilst only miles from the other. The na ons stable economy and recent investment also allow it to possess a modern transport system across land, air and sea, with its current trading deals in Europe making its routes of Covid supply provision already well established for its market. One of the more crucial elements is the high supply that is locally produced so that there is no reliance on other suppliers or any need to source from China. This creates the opportunity to be able to consistently produce treatment supplies at the low costs usually associated with African trade, whilst unilaterally using its strong rela onships across both con nents to grow and develop its exports. This is in no small part driven by the political environment, as the trade tensions are evident globally and whilst currently having no choice but to do business with China, Europe especially will take advantage of the EU’s 750 million Euro recovery

package aimed at focusing on new, reliable supply and invest that into a country such as Morocco, whose need is only strengthened by its posion as a tradi onal gateway to further investment in Africa as well as the US and EU free trade deals which are only becoming more comprehensive as a result of its modern and unbiased posi on. Egypt also stands to benefit as an alterna ve, having also been eﬀec ve in providing strong and las ng trade of current Corona virus treatments and supplies with a strong economy and global network of imports and exports. Despite this, Europe is not taking the best advantage of Morocco’s ability, with only Spain seeing Morocco as a strong and consistent trade partner in most of its needs. This is in part, as a result of its trade partnership with over a third of Spanish trade being linked to the na on, however in the current climate only France has reached out and secured a link for the provision of PPE, with other na ons not recognising the contribu on that is still to be made from the pharmaceutical environment that exists within the African na on. This kind of rela onship could develop in need due to the currently predicted second outbreak of the virus which could then see Morocco’s demand become so high that many of the European na ons are not able to get the treatments they need. The existence of such a successful pharmaceu cal industry shows how Europe will con nue to be at the forefront of medical research and development, especially in mes of crisis such as these, despite the challenges it might face. The ability to con nue to supply public led health response such as the German world leading reac on and the treatment and newly announced vaccine breakthrough in Britain is evidence of this, however it needs greater and more accessible supply which is now abundantly available in Morocco. Such speed, quality and education is paramount to the ability of the pharma industry to sustain itself, and should it take full advantage of its more accessible links then should only improve its response to the ongoing pandemic. europeanbusinessmagazine.com 37

MOROCCO: Building Back Be er

s countries around the world con nue to address the consequences of the COVID-19 pandemic, Morocco is a model of crisis management, increasing the daily tes ng rate from 2000 per day in April to 20,000 per day in June, reducing the key interest rate from 2.25% to 1.5% and providing 20bn dirhams for the recovery. Morocco has not spared any resources dealing with the pandemic, and is looking to the future, restar ng the economy and further advancing its state and society. Patricia Cullen reports. Improvements and progress have not just been made in response to the COVID-19 crisis however. They have been decades in the making, and over the past twenty years, Morocco has achieved significant social and economic progress due to large public investments, structural reforms, alongside measures to ensure macroeconomic stability. Highligh ng this monumental growth, Morocco jumped from 128th posi on 38 europeanbusinessmagazine.com

in 2010 to the 53rd spot in the World Bank’s Doing Business 2020 rankings. This posi ve transforma on across the business landscape has been credited to unprecedented, innovave structural reforms in the poli cal, social and economic environments. The Green Morocco Plan, the Industrial Accelera on Plan, the RAWAJ Plan for Trade Development and Distribu on, the Solar Plan and the Tourism Strategy are among the many policies that have been instrumental in this significant progress, and have been crucial to the industrial sectors historical growth. In OBG’s 2020 Morocco CEO Survey, 28% of respondents recognised that the industrial sector has huge poten al to drive further growth, followed by ICT and innova on at 24%, and agriculture at 10%. Renewables is another sector in Morocco that has huge opportunity, and the Na onal Energy Strategy 2009 aims to generate up to 52% of the country’s electricity needs from renewables

within 10 years’ time. Morocco is also set to be a global player in green energy and opportuni es for innovave, spirited companies abound. Key projects include the 580-MW Noor solar power plant, the 800-MW Noor Midelt hybrid plant and the 850-MW Boujdour wind farm. Though things are looking bright, there are challenges to overcome, and the combined eﬀect of a poor crop year and the implica ons of the confinement policy due to the COVID-19 pandemic in the secondary and terary sectors, has led to a downward revision of the growth rate. Travel restric ons and health concerns have cast doubt on the future of the country’s most dynamic industry, tourism. Morocco reacted quickly and closed its borders in mid-March to curb the spread of COVID-19, and while the county was applauded for its quick thinking, the tourism industry, which accounts for approximately 11% of Morocco’s GDP, took a par cularly hard hit.

On 19 May the Minister of Economy, Finance and Administrative Reform, Mohamed Benchaâboun, warned that the lockdown was costing the country US$101m a day and the HCP announced an anticipated 8.9% contrac on in GDP during the second quarter of 2020. Various percentages of contrac on from 5.2% to 1.7% have been given, as he warned that the emergency fund - which was established to deal with the crisis and had been allocated US$3.75bn - was insuﬃcient to meet the growing costs. Despite the challenging picture, this country is resilient, with an educated workforce and an innovative spirit. This crisis could present a chance for Morocco to remake its economy and will provide an incen ve for greater investment in health and educa on. The Minister of Industry, Trade, Investment & Digital Economy, Moulay Hafid Elalamy said that the post-COVID-19 situation will provide the Moroccan economy with ‘unimaginable opportuni es’. The government and regulatory authorities back these expectations and optimisms. And with good reason, as there are many plans already in place to revive the economy. While the current priority is to control the pandemic, Morocco has formulated a comprehensive ac on plan to help finance and support major projects within the framework of public-private partnerships, and strong ac on for economic and social recovery is forthcoming, with many relief measures already prepared. The financial recovery plan has a budget worth 11% of GDP, of which 4% will be provided through the Strategic Investment Fund. King Mohammed VI has formally ordered the transfer of MAD 15bn from the state budget, intended to increase investment and improve Morocco’s economy. The Strategic Investment Fund (also known as the Mohammed V Inv VI nves e tm men entt Fu Fund nd)) ai aims ms to ba back ck pro roduc ve se du sector sect cto ct orrs,, help elp fu el fund nd key pro rojje ject ject cts ts thro thro th rough roug ugh pr ug privat iv vat atee-pu public blic bl ic par artn tne errsh ship ips, s,

and will act as a facilitator, giving new energy to the investment dynamic in the Kingdom. Measures include the generaliza on of social security for all Moroccans, public sector reform and the introduc on of a resourceful plan to boost the economy. The total volume of investment expected under this project over the medium term is es mated to stand at approximately MAD 38bn, and will generate an added value of two addi onal percentage points of GDP per annum. There is also an ambitious plan for economic recovery and key structural reform in the social field, including the stepping up of public sector reform. The Ministry of Finance is currently working on an effective restructuring project for the public establishments and enterprises sector. The injec on of public funds, in the form of equity in key sectors of the Moroccan economy will also have a posi ve impact, by making the most of experse, financial resources and the ability to a ract ins tu onal investors and foreign donors. As part of the recovery package the King calls for a general national mobilization and the pooling together of skills and expertise. Alll of the Al hese se mea easu sure ress wi willll pro romo mote te inve inve in vest esttme ment, nt, sh nt shap hap apin ing an ing and d enh enha en hanc nciin ing ing the ca th the capa pabi bili ililitty y of th the na the na on onall eco ono nomy my. my

On August 6th, the authorities announced a plan to sustain the economic recovery and employment levels. The encouraging plan envisages the mobilization of approximately DRH 120bn, mainly in the form of credit guarantees to firms and funding for a newly -created ‘Fund for Strategic Investment’, which will finance investment projects (including PPPs) and sustain the capital of firms that needs equity injections to develop their business. Moroccan King Mohammed VI unveiled an ambi ous package of 11 na onal programs to be implemented in the coming three years. The measures are designed to generate 120,000 new jobs, directly or indirectly, over that period. Like all economies, the Moroccan economy will see significant consequences from the COVID-19 pandemic. However, the International Monetary Fund (IMF) es mates that Morocco’s GDP will increase by 4.5% next year. Moroccan expertise in a variety of sectors will contribute to a remarkable performance, and this agility and ability to recover, recreate and reinvent, characterises the Moroccan economic fabric. Coming into in to 2021, 1, Morroc occo co’s bus usin ines esss la land ndscape sc scap ape is ap is a rac raac ve aan nd nd mo morre e inv nvii ng th than han an eve v r.

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MOROCCOâ&#x20AC;&#x2122;S MOMENT: SUPPLY CHAINS REIMAGINED

n 2003, during the SARS epidemic, China accounted for only 4% of global output, but with increased globalisa on, dependence on China has also increased, bringing that figure up to 16% today. Post COVID19, will this reliance wane, and if so, where to look to now? The pandemic has uncovered many things, and the over-reliance of interna onal companies and governments on China is at the forefront. From cars to medicines, global corporaons with current or intended supply chain opera ons in the Asia Pacific are rethinking their routes, and with its reliable infrastructure, compe ve wages and skilled workforce, the

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world is watching Morocco, looking to include the country in its restructuring. China has long since played a dominant role in global manufacturing, but rising labour costs, the US-China trade war and, most recently COVID19, has led to a reassessment of the increasingly stretched global supply chains. Reeling from US-China trade pressures, supply channel tensions were already sky high at the start of this crisis. With a demand to bring supply chains and manufacturing closer to final desna on markets, Morocco is emerging as a key pharmaceutical manufacturing centre with easy access

to Western Europe. Currently, the na onal market is the second largest in Africa with a turnover of MAD 14.4bn. Post COVID-19, reloca on and multiplying suppliers in different countries will decrease dependency and ensure that na onal needs are met. Morocco boasts a very rigid and strict regulatory framework in line with European best prac ces, and consequently the Moroccan pharmaceucal sector is considered one of the best in the MENA region. However, to advance Moroccoâ&#x20AC;&#x2122;s a rac veness on the global stage even further, labour laws and legal frameworks that ensure con nual produc on together

with strict safety procedures must be granted, alongside further funding in R&D. The vulnerabilities of long supply chains have been highlighted by the pandemic and global companies that used to produce in China or import from the Asian giant are diversifying their suppliers. As of April 2020, the export value from China had fallen to a shocking low of $202bn - the largest drop in recent mes. Though the pandemic has brought this to the fore, rising produc on costs, together with increased rates applied as part of the US-China trade war, have seen businesses increasingly move their factories and plants out of China towards more compe ve markets. Morocco stands to benefit as European firms, hurt by COVID-19, seek alternative production bases and look to shorten their supply chains. This disrup on has amplified existing supply chain digitalization and diversification issues and emerging markets can reap the benefits. The COVID-19 lockdown measures imposed by governments around

the world to combat the virus have caused severe disrup on to supply chains as companies were forced to shut in March. Looking to the future, introducing incen ves for innova ve start-ups will help shape the future and encourage the growth of a true pharmaceu cal industry ecosystem in Morocco. The pharmaceu cal industry has long touted the strength of its global supply chain, but a double whammy of COVID-19 and geopoli cal standoďŹ&#x20AC;s have cast that network into doubt. As the pharma industry becomes increasingly globalised and demand grows for new product types with shorter life cycles such as biological and genomic medicine, supply chains need to become smarter. Morocco, an emerging player in the global pharmaceu cal market, with a strategic geographic loca on and EU regional trade agreements, serves as a gateway between Europe and Africa for companies looking to strengthen local supply chains and minimize future disrup ons. By bringing supply chains closer to home, EU companies

can gain more autonomy. Morocco can promote its stable poli cal system, reliable infrastructure and ample supply of educated labour to European manufacturers. The EU promised to remove Morocco from the tax haven grey list a er commending the reforms undertaken by the country to improve financial transparency and fight tax evasion. This promising step was taken a er Morocco showed willingness to comply with tax standards alongside the EU, and this will enable the relocaon of important ac vi es related to pharmaceu cal drug produc on. Morocco, which is widely regarded as an oasis of poli cal stability in its turbulent southern flank and a reliable trade partner of the EU, is the logical choice for European companies looking into ways to shorten their supply chains. There is no doubt that the pandemic has been a major stress for every country, but with great government incentives, resilience and inspired post COVID-19 strategies, Morocco is gaining strength and admira on entering 2021.

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MOROCCO: BRIDGING THE GAP

orocco, a North African country bordering the Atlantic Ocean and Mediterranean Sea, dis nguished by its Berber, Arabian and European cultural influences, has a thriving economic market, and enjoys the benefits of interna onal trade and global partnerships. Offering political stability, ins tu onal and macroeconomic dependability and a steady GDP growth rate of approximately 4.5% over the past 20 years, Morocco is one to watch. Reliable and effective, this innovave country can act both as a bridge,

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connecting Europe and Africa, and also as a profitable manufacturing hub in itself. Leveraging its geographic and cultural es with Africa, the Middle East and Europe, its world class infrastructure alongside the new Mohammed VI Tangier Tech City, Morocco’s manufacturing sector is booming. Morocco has had ins tu onal relaons with Europe since the 1960s, resul ng in the Advanced Status of 2008, upgrading the Euromed process and the Associa on agreement, among other mutually beneficial arrangements. Morocco’s well-developed opera ng environment, its

reintegra on into the African Union, and its strong presence in the Economic Community of West African States (ECOWAS) all play an important role. Furthermore, the Industrial Acceleration Plan promotes firms to extend opera ons across Africa, developing Morocco’s status as a gateway for interna onal investment in the con nent. The emergence of a middle class in the greater north west of Africa, with Morocco as economic catalyst, further supports companies to explore this new market, and has opened up opportunities for European companies to expand. There is an established history between Morocco and Europe, and King Mohammed VI has always been a Europe enthusiast. His PHD thesis in Law was dedicated to the relaonship between Morocco and the European Union, and he did an internship at the European Commission with Jacques Delors at the end of the eigh es. Since his arrival in the throne in 1999, he has pursued three economic sequences. Firstly, from 1999 to 2007, there was an infrastructure building sequence backed by public spending. The results were staggering. Morocco went from 100km of highway in 1999 to more than 2000km in 2020. Addi onally, the building of the largest African port, an $800m project, and the $4bn Tangier to Casablanca high-speed railway, are two of the most noteworthy recent projects completed. Major road, rail, airport and port infrastructure upgrades will continue in line with goals set out in the government’s long-term infrastructure strategy. These ongoing infrastructural improvements posi on Morocco as a strong link between Africa and Europe and intra-Europe trade. Secondly, from 2007 to 2012 a phase of rapid interna onaliza on through industry was launched. French carmaker Renault arrived in 2007, followed by PSA in 2015, and several hundred subcontractors from the automo ve industry have since

located in Morocco. This influx will help the country reach its stated goal of having the capacity to build 1 million vehicles a year by 2025, and Morocco will rank among the top 15 vehicle-producing countries in the world. Automobile shipments grew at an average annual rate of 39% from 2009 to 2018, resul ng in a jump from $224m to $3.9bn. Aeronau cs has also developed significantly. Strong growth in these higher-value-added exports, including cars, electrical machinery and aerospace parts, will enable Morocco to con nue to evolve as a manufacturing export hub into the future. While the world was coping with the financial crisis of 2008, Morocco started an ambi ous investment programme with regards to Africa. Con nent leaders from Morocco emerged in the financial sector, construction and services and Morocco became the first investor on the con nent in 2018. Integra on into EU supply chains has seen the kingdom move up the value chain from a tradi onal focus on lowskilled tex le exports to higher-tech industries. Morocco has been consistent in a rac ng an inward flow of foreign capital, specifically in banking, tourism and energy sectors. Thirdly, after the Arab Spring the focus was on correc ng the economic

and social problems created by the rapid growth of the previous sequences. Constitutional reforms in 2012 led to more stability, and Morocco used this advantage to reinforce its posi on as a bridge between Africa and Europe. The king launched a programme of decentralisa on and deconcentrarion in 2011 in order to create more territorial equilibrium and to develop remote regions. Also, the last sequence concentrates on environmental issues, investing heavily in solar and building the Noor Power Plant, the largest solar plant in the world. This area started to reap the rewards as Morocco became a net exporter of electricity to neighbouring Spain in 2019. These economic undertakings have already paid oďŹ&#x20AC;, with the IMF forecasting that real GDP growth will accelerate from an annual average of 3.1% in 2014 - 2018 to 3.8% un l 2023, outpacing the average annual growth in the MENA region of 2.7% over the period. Additionally, the current account deficit is expected to narrow from 4% of GDP in 2019 to 2.8% by 2023, thanks to rising exports of goods and services. Foreign direct investment (FDI) is central to Moroccoâ&#x20AC;&#x2122;s growth, and reforms have already boosted the a rac veness of inves ng in Morocco in recent

years, contributing to surging FDI inflows. Investment opportuni es in Morocco are particularly attractive in four sectors, namely export-orientated manufacturing, renewable energy, tourism and logis cs services. FDI grew at an average annual rate of 7.5% over the past decade to reach a record $3.6bn in 2018, making the country the fourth-largest recipient of FDI in Africa, according to the UN Conference on Trade and Development (UNCTAD). Morocco is one of a handful of countries that enjoy such an advanced partnership with the EU. Simultaneously, Morocco is firmly embedded within its con nent, and part of an African free trade area which oďŹ&#x20AC;ers an abundance of opportuni es for Africa and interna onal businesses. In essence, Morocco is a hub and a facilitator for all things European into Africa. The COVID-19 crisis has showed an over dependency on south Asian manufacturing for many European companies. Morocco is the best cost alterna ve to reshape regional and global value chains, allowing Europe to secure supply for its industry. Morocco is pivotal for the future of EU Africa rela ons, and the moment is now for Morocco, a bright spot for investment in the MENA region in 2021 and beyond.

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European Business Talks Exclusively to

Mr Mohammed BENCHAABOUN Minister of Economy and Finance about the rising global economic powerhouse that Morocco is becoming and their plans for the future.

Africa is home to seven of the world’s ten fastest growing economies and by 2050 the connent’s popula on is expected to overtake India’s and Chinas, doubling to 2 billion people. What can Morocco, the gateway to Africa, oﬀer to enrich the corporate landscape? Morocco enjoys an outstanding geographical posi on at the crossroads of the Arab world, the African con nent and Europe. This posi on naturally oﬀers our country the opportunity to serve as a gateway for European companies and investors seeking business opportuni es in Africa. In this regard, Moroccan authori es have deployed tremendous efforts 44 europeanbusinessmagazine.com

over the last few years to establish Morocco’s posi on as a regional economic and financial hub, through several sectoral and structural reforms aimed at enhancing the business environment and strengthening industrial and export infrastructure, with a major focus on diversifying trade and investment partners, including in Africa. Morocco has also developed a large network of bilateral agreements, comprising of 26 Bilateral Investment Trea es (BIT) and 20 double taxa on agreements with its African partners. These agreements aim to create a stable and conducive legal environment for the development of bilateral investments, in line with our strategy

to consolidate Morocco’s posi on as the second largest African investor on the con nent and the largest investor in western Africa. Likewise, as an ac ve member of the African Union, Morocco is part of the new African Con nental Free Trade Area (AfCFTA), which entered into force in May 2019. This free trade area, the world’s largest in terms of number of participating countries, will grant Morocco-based companies access to a market of 1.2 billion people and a gross domestic product (GDP) of $2.5 trillion, across all member States of the African Union. In this regard, Moroccan companies are well poised to seize the opportunity of increased intra-african trade

under the AfCFTA agreement, drawing on the support and wide-ranging regional experience of Moroccan banks operating in Africa and the resolute commitment of Moroccan authori es to pave the way for stronger economic and trade relaons with our African partners. Last but not least, it is worth menoning that our Casablanca Finance City, Africaâ&#x20AC;&#x2122;s leading financial center, is home to the Africa 50 fund, which is an infrastructure investment pla orm that contributes to Africa's growth by developing and inves ng in profitable projects. It serves as a catalyst for public capital while mobilizing private sector financing to meet increasing financing needs for infrastructure projects in our con nent. Morocco has chosen manufacturing as a strategic sector for its socio-economic development. Can you elaborate on these opportuni es and tell European Business Magazine readers why now is a good me to look to Morocco for business partnerships and development? Addionally, how can the countryâ&#x20AC;&#x2122;s impressive capacity for innovaon assist in the rapidly changing global market? Morocco has been engaged for several years in an accelerated process of industrializa on, reflec ng its firm desire to bring out new export sectors with higher technological content, to strengthen the country's attractiveness to foreign investments and to improve its posi oning in global value chains. By way of illustra on, the automo ve sector emerged as the leading exporting sector since 2014, with a share in total exports that doubled in less than ten years to reach 24%. Automobile produc on thus reached 402,000 units in 2018 against barely 10,000 vehicles in 2004, with a level of local integraon of over 50% and a market share of nearly 40% on the African con nent. The aeronau cs industry is also booming, with exports that have more than doubled since 2007 and a local integra on rate reaching 38% against 17% in 2014, exceeding the ini al target of 32% set for the 2020 horizon.

The implementation of the 20142020 Industrial Accelera on Plan was based on concrete measures, in parcular the establishment of ecosystems for a more integrated industry, which enabled the implementa on of several investment projects with posi ve results in terms of added value crea on and employment posi ons. With the outbreak of the COVID19 pandemic, the Moroccan industry has shown great capacity to cope with this new context and meet the pressing needs of the domes c market. Indeed, our manufacturers have mobilized quickly to meet Morocco's supply needs with sanitary and hygiene products, pharmaceuticals and foodstuffs. Several textile factories have also converted into manufacturing protective masks and textiles for medical use, and major automo ve and aeronau cal players have embarked on the manufacturing of respirators. For the future, we have already defined a new 2021-2023 industrial recovery strategy, which aims to confirm the industrial posi on of the Kingdom and to conquer new markets using public procurement as a catalyst. To this end, the new Plan aims to replace 34 billion DH of imports by local produc on, by targeting eight main sectors namely, textiles, transport, mechanical and

metallurgical industries, plas cs, electrical and electronics, agri-food, Para chemistry and leather. To do this, a first bank of 100 projects has already been set up in the various sectors men oned above, with support for Moroccan entrepreneurs in setting up their projects and securing their financing. A second axis of this strategy relates to improving the competitiveness of the Kingdom with the objective of becoming the most competitive global base for Europe. Finally, a third axis concerns the posi oning of the Kingdom as a carbon-free and circular industrial base, by mobilizing part of the Kingdom's renewable energies to meet energy needs of the industrial fabric at the best possible cost. Morocco has made substanal progress in the digital sector and digital technologies. With new technologies and working methods emerging as a result of the COVID-19 pandemic, what opportuni es will evolve in Morocco from this increased digi sa on? The era of digi za on and the digital transition of economies is now becoming urgent. With the COVID19 crisis, this transi on was accompanied, at the na onal level, by an acceleration in the use of digital

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technologies due, in particular, to the organiza onal transforma on of work with the mass deployment of teleworking and distance educa on. It has also forced the use of e-commerce which has emerged, in this context, as a vector for the growth of domes c and export trade transac ons. Moreover, under the influence of the pandemic, the dematerializa on of certain services has been widely deployed. The health crisis has indeed given a boost to digitaliza on eďŹ&#x20AC;orts, which will undoubtedly play a major role in post-COVID-19 Morocco. It will undoubtedly offer opportunities to s mulate the growth and compe veness of our economy while promoting its inclusion. This situa on has led Moroccan companies to completely rethink their organiza onal models, as 41% of them consider that the lockdown pushed them to adopt new technological and digital approaches to alleviate the impact of the crisis. The question of using digital and dematerialized services is an acute one. In this context, the digital transforma on is considered by the Government as a strategic lever for the improvement of public services. To this end, several public administrations have adopted digital tools to promote teleworking and have chosen to limit the physical exchange of documents and administrative letters. In order to support this dynamic, the Digital Development Agency launched, in June 2020, several digital ini a ves to promote and facilitate remote working within Moroccan administra ons. Despite its negative impact on the trade sector, the COVID-19 crisis has further revealed the potenal of e-commerce. Companies that have relied on this niche have been more resilient and able to cushion the downside shocks of the pandemic on their businesses. Moreover, the performance of contactless mobile payments in Morocco increased by 710% between the end of March and the end of May 2020, compared to the same period of the previous year, which indicates the poten al to be seized through an accelera on of the digitaliza on of domes c trade. 46 europeanbusinessmagazine.com

In addi on, public companies operating in the field of transport and logiscs have operated a shi in their processes in order to make the services provided to professionals and ci zens more efficient, by proceeding with the dematerializa on of documents and procedures. Moroccoâ&#x20AC;&#x2122;s virus management has been no ced and praised in Europe. Very early on the kingdom took the decision to close its borders and set up guidelines for supply, mobilising the industrial sector to fight the disease and revealing innova ve and engineering capabili es. Can you tell our readers a bit more about your methods and procedures, and how is Morocco placed for an economic recovery post Covid-19? Morocco was among the first countries to succeed in demonstrating exemplary proac vity in an cipa ng the risks and consequences of the Covid-19 pandemic. In response to this crisis, Morocco has placed the life of its ci zens at the forefront of priori es, by taking bold measures to stem the spread of the pandemic, and

by deploying unprecedented support mechanisms for the benefit of social classes whose vulnerability has been exacerbated by the crisis. In this context, and in accordance with His Majestyâ&#x20AC;&#x2122;s Instruc ons, a proac ve and mul dimensional response strategy has been put in place in order to limit the health, economic and social repercussions of this pandemic. Thus, a special solidarity fund was created, dedicated to the management of the COVID-19 pandemic. This fund has made it possible to raise more than $ 3 billion to date. Likewise, targeted support measures have been taken in favor of households and businesses to mi gate the impact of the lockdown and preserve the productive poten al of the economy. With the objec ve of suppor ng the gradual restart of the ac vity and creating the conditions for a vigorous economic recovery at the end of the COVID-19 crisis, we are working on the accelera on of the implementaon of our na onal economy recovery plan, through the mobiliza on of all available means in terms of financing, incen ve mechanisms and solidarity measures.

This plan, which will cover transversal measures as well as sector-specific measures, will be endowed with nearly 120 billion DH to support the economic recovery, including 45 billion DH allocated to the financing of investment projects by appealing to public private partnerships (PPP) and strengthening the capital of companies, especially small businesses, for the purposes of their development within the framework of the “Mohammed VI Investment Fund”. The remaining 75 billion DH will be granted in the form of State-guaranteed loans for the benefit of all business segments. The Government is also commi ed to deploying na onal preference in the field of public procurement to support the development of very small businesses, to accelerate the reforms required to improve the business environment, to upgrade the training and human capital development system to improve the training-job match and to accelerate the adop on of the amendment to the Law on payment terms and related decrees. For its part, the private sector has undertaken to preserve jobs by

maintaining a level greater than or equal to 80% of stable jobs, to allow undeclared workers to benefit from the social security system, to fight against informal prac ces, to reserve at least 50% of State-guaranteed loans to the reduc on of business-to-business debt, to encourage finished or intermediate products with strong local content, to understand the opportuni es oﬀered by digitaliza on, to further develop con nuing training and contribute to improving the training-job match, while ensuring compliance with the code of good corporate governance prac ces and health rules. Morocco has excep onally good es with European countries, but the partnership between the EU and Morocco could become even more robust through industrial cooperaon. Can you tell European Business Magazine readers more about how this can happen? The rela onship between the Kingdom of Morocco and the European Union showed a positive development as it is clearly demonstrated by the adop on of the Joint Poli cal Declara on, on June 27, 2019 for shared prosperity. This development

comes at a time when Morocco is trying to set up a new development model which opens up new opportuni es including in terms of industrial coopera on. In addi on, the COVID-19 pandemic has highlighted the need to adopt new paradigms to ensure the security, con nuity and fluidity of value chains. This pandemic has also shown the Kingdom's ability to respond eﬀectively to its domestic demand, and even supply other countries, for important products such as paramedical products. In this context, as a reliable and secure country, at the gateway to Europe, and a reservoir of compe veness, Morocco aims to play a leading role in the implementation of regional value chains at the Euro-Mediterranean level. Indeed, enhancing industrial coopera on between the EU and Morocco, in terms of integra on of Morocco into the perimeter of nearshoring of European industries, will allow a better diversifica on and security of supply to European markets. That’s why, we encourage European industrialists to pursue and accelerate their development in Morocco within the framework of new regional value chains, capitalizing on geographical proximity, reduced logis cs costs and the Kingdom's comparative advantages as well as the reduc on of the environmental footprint of the supply chain. Morocco has forged an internaonal reputa on as a reliable and credible partner. What can we expect to see from Morocco in 2021 and beyond? Far-reaching reforms have been implemented at the institutional, structural and sectoral level and have made it possible to diversify our economy, ensure sustained growth and consolidate macroeconomic stability. This progress has resulted in the maintenance of the confidence our country enjoys with interna onal institutions and foreign investors, despite an uncertain interna onal and regional environment. These reforms have enabled our country to achieve europeanbusinessmagazine.com 47

remarkable performances in terms of improving the business climate, as evidenced by the "Doing Business" ranking where Morocco has gained 76 places since 2009. Despite these positive results, our economy continues to face major challenges, including accelerating structural transforma on, strengthening poten al and inclusive growth, reducing youth unemployment, and reducing social and spa al dispari es. These challenges have been amplified by the advent of the crisis linked to the COVID-19 pandemic which has created new challenges in Morocco, as everywhere else in the world, for years to come. Our first concern in the coming years and of course from next year is the strengthening of the health care system and the generaliza on of social 48 europeanbusinessmagazine.com

protec on. This will take place through the rapid opera onaliza on of the Single Social Register which will, in the short term, be a strategic planning instrument in the field of social policies and will promote precise targe ng of public ac on in this area. Our ac on will also focus on enhancing the human capital of our youth in par cular. On this aspect, the realiza on, within the allo ed me, of the vision 2015-2030 for the reform of education and training should, alongside the implementa on of the employment strategy, ensure better integra on of young people and women in the labor market while improving the productivity of the economy. On the economic level, we are working with all stakeholders to enhance the competitiveness of our production

base and raise the level of poten al growth. To do this, we intend to step up sectoral and transversal reforms rela ng to the improvement of the business environment, the financial sector and economic governance and to iden fy a new genera on of reforms in the light of recommendaons resul ng from the work of the Special Commission on Morocco's development model. Finally, it is imperative for us to rebuild our macroeconomic buffers a er the COVID-19 crisis. In this regard, we intend to accelerate, parcularly in the area of public finances, the reforms (i) of taxa on by promoting tax fairness and better compliance with tax regula ons; (ii) of subsidies through the establishment of a targe ng system; and (iii) of the public sector, in par cular the op mizaon of public por olio management.

European Business Magazine talks to

Lamia Tazi

Secretary General of the Moroccan Federation of Pharma Industry and Innovation, about the Moroccan pharmaceutical industry, the impact of COVID-19, the new federation FMIP and accessibility to medicines.

The Moroccan pharmaceu cal industry went from 80% of the local market in the late 90s to less than 60% now. What, in your opinion, are the main factors that hinder the sustainable growth of this sector and what ac ons are needed to help boost and develop it? During the period to which you refer, there has been a regression in the share of manufactured drugs compared to those imported. In 2013, this phenomenon was par cularly exacerbated a er the price decree came into force. The la er clearly favours the imported drug by gran ng it an addi onal margin of 10%. The domesc pharmaceu cal industry has posed this problem to the government. When addressing the development of the Moroccan pharmaceu cal sector, several parameters must be evaluated. The Moroccan pharmaceu cal industry has experienced con nuous growth for more than three decades, some mes in double digits. In 2019, the turnover amounted to 1.5 billion Euros, represen ng 5% of the na onal

industrial GDP. The sector provides some 50,000 jobs in 49 pharmaceucal companies. Despite the current crisis of COVID-19, these jobs have been preserved, as well as the second position of our pharmaceutical industry in Africa, behind that of South Africa. In terms of investments, the Moroccan pharmaceu cal sector mobilizes significant budgets annually, both for the opening of new produc on units and for the maintenance and renova on of exis ng ones. These investments have enabled our industry to posi on itself in the therapeu c areas of the future such as biotherapies, which is sought-a er by pharmaceu cal players. Today, more than ever, local producon must be supported in order to ensure health autonomy. This must be done through a shortening of the product registration deadline, the establishment of a fast track for the essen al and/or innova ve products, the national preference for manufactured products, the extension of social security coverage and finally support for exports.

Morocco stands to benefit as European firms, hurt by COVID-19, look to shorten their supply chains, reduce their overreliance on China and bring manufacturing closer to home. The country could become the best pla orm south of the Mediterranean to build a prosperity hub based on co-investment between the north and the south. Can you elaborate on the opportunies that exist here? Can you tell European Business Magazine readers about Morocco's strengths in the global value chain? Where do the weaknesses exist, and how can they be handled? Morocco is well positioned to be the ideal partner of the old continent especially in industrial sectors with high added value such as the pharmaceu cal industry. Thanks to its poli cal stability, its geographical proximity to Europe and above all to the quality of its medicine produc on recognized European quality. europeanbusinessmagazine.com 49

Indeed, the COVID-19 pandemic has shown a great dependence of Europe towards Asian countries in terms of the pharmaceu cal industry, whether for finished products or API (Ac ve Pharmaceu cal ingredients). I believe that this pandemic represents an opportunity for both Europe and Morocco to put into prac ce a policy of co-loca on and co-investment advocated in recent years by several European officials. This policy can take the form of pharmaceu cal joint ventures whose produc on could be intended for both Europe and Africa. Morocco has several assets to make such coopera on eďŹ&#x20AC;ec ve. In terms of quality, Moroccan drugs are produced and registered in accordance with European regula ons. In terms of human resources, Morocco has the skills at all levels, including a new genera on of researchers and innovators, capable of making these pharmaceu cal projects a success. In terms of logis cs, Morocco has developed advanced and quality infrastructure in terms of highway, rail, port and airport networks. Morocco's financial sector, thanks to its African roots, also oďŹ&#x20AC;ers several advantages to investors. In terms of economic policies, the industrial and technological ci es created parcularly in the north of the country oďŹ&#x20AC;er a range of advantages and facili es for the establishment of leading Euro-Moroccan pharmaceu cal units. Furthermore, Morocco's commitment to the produc on of renewable energies represents a guarantee of compliance with interna onal environmental standards for European partners. The new federa on, the Moroccan Federa on of the Pharmaceu cal Industry (FMIP), aims to unite pharmaceu cal operators in Morocco and strengthen the na onal industrial fabric. What benefits will FMIP bring, and how will it support the Moroccan pharmaceu cal sector on the interna onal stage? The members of the Moroccan Associa on of the Pharmaceu cal Industry (AMIP) unanimously agreed about the crea on of the Moroccan 50 europeanbusinessmagazine.com

Federation of the Pharmaceutical Industry (FMIP) at the end of the Ordinary General Assembly of the associa on held on Tuesday, September 29th. This new federa on aims to bring together all the pharmaceu cal players in Morocco to strengthen the pharmaceu cal industrializa on. Whether its generic or mul na onals opera ng in Morocco via industrial sites, we all have a single goal which is to ensure Morocco's autonomy in the manufacture of drugs, and a quality and accessible product for the consumer. FMIP is created to support the various development ini a ves of the sector, especially in terms of industrial tools, Research and Development or innova on.

In your opinion, what are the legal and technical constraints to overcome in order to promote and encourage a stronger na onal pharmaceu cal industry? And what methods do you advise to create an adequate framework for this field of ac vity? From a legal perspective, the last two decades have seen several law reforms governing the pharmaceu cal sector; some of these reforms are posi ve and some are not. The entry into force of Law 17.04, the Pharmacy and Medicines Code, for example, has made it possible to open up the capital of pharmaceu cal companies to national or foreign investors other

units. There was huge pressure on the industrial teams, who have doubled their crea vity to maintain the delivery of medicines on me, along with safeguarding the health of employees and avoiding the formation of contamina on clusters. In terms of medical promo on, containment simply stopped medical representa ves from visi ng doctors and organizing scien fic events. This was an opportunity for our teams to imagine other forms of communication. In that respect, thanks to digital technology, we were able to maintain our medical and pharmaceu cal informa on eďŹ&#x20AC;orts through the organiza on of virtual congresses and webinar trainings. In brief, I think that the pandemic has had the merit of pushing pharmaceu cal players to make major transforma ons in their opera ons. This will posi vely impact the future of the sector. How would you qualify accessibility of medicines and the system of health insurance in Morocco? Is it possible to ensure the adequacy between the price of medicines, the level of citizens' income, accessibility to innova on and R&D and the capacity of the AMO?

than pharmacists. This is a major step forward and this legal framework can play a posi ve role in the Euro-Moroccan coopera on I men oned earlier. However, there are certainly challenges to be met at the regulatory level. One of these challenges is the long process of gran ng Marke ng Authorizations (MA) for new pharmaceutical specialties. I think that France's response to the impact of COVID-19 on its drug industry can serve as a model in this field. As a ma er of fact, one of the key measures recently taken by the French authori es to boost the French pharmaceutical industry is precisely to facilitate the registra on formali es for new drugs and to shorten the me to obtain the MA.

What impact has the COVID19 crisis had on the Moroccan pharmaceu cal industry, and what opportuni es have come about directly because of the pandemic? Did the crisis directly impact the sector's interna onal development strategy, par cularly in Africa? The COVID-19 pandemic has been a rich learning experience for the pharmaceu cal sector. It was necessary to react quickly through the ac vaon of business con nuity plans that respond both to the country's needs for drugs - especially those included in the COVID treatment protocol and to the impera ves of preven ng contamina on within the produc on

I believe that the project of generaliza on of social security coverage recently announced by His Majesty the King, will resolve this ques on of accessibility to medicines. The will to solve this problem by focusing on the sole parameter of prices and margins of medicines has proved to be fruitless, because the consump on of medicines per capita has not changed despite all the price cuts announced in recent years by the government. We have the weakest per capita drug consump on in the Maghreb region. It is only 35 Euros per inhabitant per year. This low consump on is essenally due to the fact that in Morocco two thirds of the popula on do not have reliable social security coverage. Consequently, the project of generalization of social security should contribute to better accessibility to medicines for ci zens, as well as promoting the development of the na onal pharmaceu cal sector. europeanbusinessmagazine.com 51

Morocco: A New Genera on of Civil Servants Paving the Way for Industry 2.0

ver the last decade a new genera on of civil servants has been working to improve the attractiveness of Morocco’s

industrial sector, especially in areas such as automotive, aeronautics, electronics and biotech. With youth on their side, many of them are in

their thirties or early forties, and they all have extensive experience in the private sector in Morocco or abroad.

Youssef El Bari, Secretary General Ac ng as the global coordinator of Morocco’s “industry team”, Youssef El Bari is the secretary general of the Ministry of Industry, trade, green and digital economy. Prior to this, a graduate from the prestigious French engineering school Polytechnique, El Bari was the director of industrial innova on in Phosphate Giant OCP. El Bari is laser-focused on execuon and deals with numerous challenges in the transforma on of the administra on, alongside coordinating the diﬀerent departments and interac ons with other ministries. A seasoned jogger who used to run long distance, El Bari is a rising star in the Moroccan administration. Renowned for his solu ons-oriented character and his constant search for common ground, he is also well known for being a tough nego ator. 52 europeanbusinessmagazine.com

Ali Seddiki, General Director of Industry Ali Seddiki, 35 years old, is one of the most esteemed actors of the Moroccan public industry. A graduate from HEC Paris, Ali started his career in a strategy consul ng firm based in Paris, and specialized in Aeronau cs, before joining the minister’s cabinet in 2014. He became director in charge of Aeronau cs, Rail, Naval and Renewable Energies and was project leader for the 1$ billion Boeing ecosystem in Morocco. He currently serves as General Director in charge of industry, and is in charge of developing the Moroccan industrial sector, which currently employs more than 800,000 people and generates $24 billion in exports. Seddiki’s scope of interven on encompasses regula on improvement, FDI development and industrial supply chain densifica on. Morocco’s industry is no longer a “boy’s club”: Following Morocco’s journey towards gender equality, the Kingdom’s industry is no longer a “boy’s club”, and two high profile female leaders are in charge of some of the most crucial sectors.

Afaf Saaidi, Director of Aeronau cs, Railway and Renewables Afaf Saaidi is an engineer and is currently preparing a PHD in Business. Saaidi accomplished most of her career in the public sector, and is the director overseeing the development of aeronau cs, railways and renewable energies. Prior to this, Saaidi was responsible for innova on, head of division for advanced technologies and head of division for industrial ecosystems.

Kenza El Alaoui, Director of Automo ve Kenza El Alaoui, 39 years old, is currently the director of automo ve industry in the ministry, the most dynamic sector when it comes to exports. Automo ve is also one of the most important sectors for employment, with more then 700 000 vehicles produced per year. El Alaoui, a graduate from Engineering School Ecole des Mines, spent a great deal of her career in French automo ve giants Peugeot and Renault, before being scouted by the ministry in April 2018.

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PIONEER CITIES CHART A COURSE TOWARDS A MORE ETHICAL AND RESPONSIBLE FUTURE

he World Economic Forum an n o unced on the 17th of November in the face of extraordinary challenges that 36 cities across 22 countries and six con nents have agreed to pioneer a new roadmap for safely adop ng new technology as part of the G20 Global Smart Ci es Alliance.

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Cities are facing urgent challenges from the COVID-19 pandemic and other major disruptions, which are expected to culminate in a budget crisis that could reach $1 trillion in the United States alone. They need data and innova on to become more resilient, responsive and eďŹ&#x192;cient. Yet there is no global framework for how

ci es should use these technologies, or the data they collect, in a way that protects the public interest. This is set to change with the launch of a new global policy roadmap by the G20 Global Smart Ci es Alliance, designed to give ci es the procedures, laws and regulations they need to use new technology responsibly. The

where the G20 Global Smart Ci es Alliance can help.” To kickstart adop on of the roadmap, the alliance has recruited a group of 36 “pioneer ci es” that will collaborate with global experts to enhance their city policies, in areas ranging from privacy protection and cyber security to be er services for disabled people and better broadband coverage. The pioneer ci es are launching their activities today at a global event broadcast by Smart City Expo World Congress, the world’s premier smart ci es event. “This ini a ve originated in Japan last year from our Centre for the Fourth Industrial Revolu on, a fact I’m very proud of,” said Koichi Akaishi, Vice Minister for Science, Technology and Innova on for the Cabinet Oﬃce of the Government of Japan. “I hope to see more ci es par cipa ng in the Alliance following the model set by these first pioneer ci es.”

Leaders of organiza ons par cipa ng in the programme:

secretariat of the alliance is hosted at the World Economic Forum. “This roadmap is not about theoretical ideas and pipe dreams, it is built on prac cal, real-world policies from leading ci es around the globe,” said Jeff Merritt, Head of the Internet of Things and Urban Transformaon, World Economic Forum. “City

governments are on the frontline of a global crisis and need to be able to act quickly and decisively to curtail this pandemic and set course for their economic recovery. Technology is an essen al tool in this fight but governments cannot risk falling into the usual traps related to privacy, security and vendor lock-in. That’s

Miguel Eiras Antunes, Global Smart Cities Leader, Deloitte Global, said “The transforma on from a tradi onal city to a ‘smart city’ does not just happen overnight. Success depends on the quality of the decisions that are made and the way those decisions are executed. Deloi e is commi ed to working closely together with the G20 Global Smart Ci es Alliance on Technology Governance to co-design policy frameworks that will empower governments to accelerate smart ci es ini a ves for sustainable developments.” “Being a pioneer city in the G20 Global Smart Ci es Alliance is an excellent opportunity for us to promote the innova ve work that is taking place in Leeds right now, but also facilitates the opening of doors where we can learn from other leading ci es around the world and implement best pracce in our city,” said Stephen Blackburn, Head of Smart Ci es, Leeds. London’s Chief Digital Oﬃcer, Theo Blackwell, said “We need to work together to realize the potential of data to solve city challenges by europeanbusinessmagazine.com 55

pu ng it in the hands of those who can make a diﬀerence. But we also need to do it in a way that is safe, ethical and responsible. London is proud to join this global ini a ve as a pioneer city to promote the adop on of ethical smart city policies.” Will Cavendish, Digital Services Leader at Arup said “COVID-19 has driven a step-change in the use of digital services in ci es, and many of these changes will only accelerate beyond the pandemic. The policies developed by the G20 Smart Ci es Alliance will be fundamental in ensuring that the enabling digital connecvity and data infrastructures, along with the rapidly-emerging technology-enabled services, are deployed in an inclusive, transparent and mutually beneficial manner.” “Technology and knowledge are two strategic assets to build inclusive, data-driven, and sustainable smart cities capable of tackling new and emerging challenges,” said Roberta Cocco, Deputy Mayor for Digital Transformation and Services to Citizens, Milan. “That is why Milan is joining the G20 Global Smart City Alliance, as this ini a ve will allow us to share best prac ces with innova ve ci es around the world. Today more than ever, in fact, we need to collaborate with each other to iden fy the most eﬀec ve tools to face global threats like COVID-19. It is only by joining our forces that we can beat this common enemy that is threatening the health, the economy, and the future of our ci zens.” Dr. Julia Glidden, Corporate Vice President, Worldwide Public Sector, Microso Corpora on, said “Accessibility and privacy policies are cri cal to making ci es more inclusive and transparent. Microso congratulates the Forum and G20 for creating model policies that aid ci es in serving all ci zens.” “We will adopt a transparent and par cipatory philosophy of local governance in the city of Istanbul,” said Ekrem İmamoğlu, Mayor of Istanbul. “Our aim is to empathize with all segments of society, and value the par cipa on of everyone, ensuring that the majority of the people are represented – not the few.” 56 europeanbusinessmagazine.com

Eduard Lysenko, Minister of the Moscow Government, Head of the Moscow Department of Informa on Technologies, said “Digitaliza on of urban infrastructure and en re spectrum of social services belongs to the Moscow Government’s prioritized policies. Moscow has developed and widely employs digital pla orms that increase the availability of electronic services and improve the quality of life and safety of its ci zens. Those platforms allowed by the way to promptly provide the Muscovites with the maximum level of protec on in the face of the global COVID-19 pandemic. Today we are ready to share experiences and coordinate eﬀorts within the pioneer city programme for the G20 Global Smart Ci es Alliance. We develop technologies not for the sake of technologies, but for the sake of people.” Gilvan Maximo, Secretary of Science, Technology and Innovation, Brazil, said “The G20 Global Smart Cities Alliance will provide us with a global

partnership to accelerate the adopon of technologies in a responsible manner and for the benefit of the ci zen, deba ng complex issues and seeking joint solutions. Therefore, Brasilia is eager to par cipate in this joint work.” “This opportunity to collaborate as a G20 Global Smart Cities Alliance pioneer city on a new roadmap for safely adopting new technology is very welcome indeed as we work to develop a Belfast Smart District and to weave digital innova on into every part of our economy,” said Alderman Frank McCoubrey, Lord Mayor of Belfast. “We’ll be exploiting new technologies and data to tackle city challenges in areas such as health and mobility to improve our ci zens’ quality of life – and we must ensure this is done ethically and in a way that priori zes transparency, privacy, equity and inclusion. Being part of the G20 Global Smart Ci es Alliance on Technology Governance means that each of the partner cities will

List of pioneer cities (in alphabetical order):

benefit from expert, tailored insights and policy tools and this collabora ve approach will allow us all to make progress in how we govern technology more swi ly and eﬀec vely, for the benefit of all our ci zens.” Dr. Frank Mentrup, Mayor of Karlsruhe, said “The G20 Global Smart Ci es Alliance oﬀers a unique opportunity to develop common ethical standards, foster digital sovereignty and therefore create and build a new resilient ‘trust infrastructure for ci es and ci zens’, as trust is going to become one of the most important and most vulnerable resources of our future.” We believe that technology is a key enabler that can transform our ci es in to smart ci es leading to delivery of improved services to ci zens and businesses”, said K.T. Rama Rao, Minister of Municipal Administra on and Urban Development, Industries and Informa on Technology, Electronics and Communication, Government of Telangana, India. “We are keen to collaborate with G20 cities in

• Apeldoorn, Netherlands • Barcelona, Spain • Belfast, United Kingdom • Bengaluru, India • Bilbao, Spain • Bogotá, Colombia • Brasilia, Brazil • Buenos Aires, Argen na • Cha anooga, USA • Cordoba, Argen na • Daegu, South Korea • Dubai, UAE • eThekwini (Durban), South Africa • Faridabad, India • Gaziantep, Turkey • Hamamatsu, Japan • Hyderabad, India • Indore, India • Istanbul, Turkey • Kaga, Japan • Kakogawa, Japan • Kampala, Uganda • Karlsruhe, Germany • Leeds, United Kingdom • Lisbon, Portugal • London, United Kingdom • Maebashi, Japan • Manila, Philippines • Medellín, Colombia • Melbourne, Australia • Mexico City, Mexico • Milan, Italy • Moscow, Russia • Newcastle, Australia • San José, USA • Toronto, Canada

formulating policy frameworks to improve quality of life of our ci zens using emerging technologies.” "Transforming our cities into smart cities is a great tool to improve people's life quality,” said Horacio Rodriguez Larreta, Mayor of Buenos Aires. “That is why we are commi ed to con nue incorpora ng technology, developing innova ve public policies, and to work together with the G20 ci es to build a modern and eﬃcient state that makes life easier for everyone who lives, works, studies or visits us in Buenos Aires." "The pandemic presents an opportunity to reshape our future, with renewed digital rights and tools that should allow access for all and people-centred government. Local and regional governments will need to lead this shi to ensure the applica on of technology promotes human rights through equitable public service provision; pu ng our communi es and planet first,” said Emilia Saiz, Secretary General of the United Ci es and Local Governments. “The G20 Smart Ci es Alliance is an important mechanism to help facilitate this transforma on, bringing together a cri cal network of partners to collec vely address and mi gate future crises" For more informa on on the new policy roadmap and the Pioneer Ci es Programme, go to globalsmartci esalliance.org.

About the Pioneers of Change Summit 2020 The World Economic Forum’s inaugural Pioneers of Change Summit will take place online on 16-20 November. The summit brings together more than 750 leaders from government, business and civil society from more than 90 countries. The summit takes place at a me when there is a rare, but narrow, window of opportunity to reflect, reimagine and reset the world. Key topics discussed include: digital business, sustainable production, infrastructure, health, new work models, financial innova on and fron er technologies. Members of the media wishing to par cipate are welcome to sign up at h p://wef.ch/mediaatpioneers. europeanbusinessmagazine.com 57

Would UK Businesses Gain In EU Reloca on?

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ill there be a deal between the UK and the EU? With less than seven weeks before the UK leaves the custom unions and single market, the nego a ons appear to struggle. As the meline for an agreement has repeatedly changed, the date for a European parliament vote on a deal is constantly pushed. Sources concede that Brussels may not be able to get the agreement ra fied un l 28 December. Three days before the end of the transi on period, it becomes essenal to ask whether Bri sh companies will survive leaving the single market. Indeed, according to the Bri sh Chambers of Commerce, over half of the companies have not taken any of the steps recommended by the UK government to prepare for Brexit. Many could argue that the failure to reach an early deal has also impacted their ability to plan for changes in the rela onship with the EU. Would UK businesses benefit in a continental reloca on to avoid Brexit challenges?

The loss of beneficial trade tariﬀs Michel Barnier has always been clear that avoiding a no-deal Brexit was the utmost priority of the negotiation. However, he also insists that a deal should not come at the cost

of safety and peace between trading partners. Unfortunately, as significant gaps remain to be addressed, Downing Street warns that it is “en rely possible that nego a ons will not succeed”. As days are numbered before the end of the transition period, businesses can’t afford to ignore the prospect of a no-deal. In the event the nego a ons are unsuccessful, the UK will have to apply tariffs and quotas to all goods coming from the EU. The EU will treat the UK as a third country, applying the relevant tariffs and quotas to British goods. The Confedera on of British Industry expects 90% of the UK’s good exports into the single market to be affected by tariffs. The bo om line, British exports would become more expensive to EU consumers, and therefore less a rac ve. Understandably, reloca ng inside the EU would secure trade tariffs and advantages.

Shipping processes How will goods travel between the UK and the EU? The UK government predicts long border queues and significant delays in the event of a no-deal. For lorry drivers, delays are only one of the many challenges they will face. Indeed, as France plans to establish immediate border controls a er Brexit, the government es mates that up to 85% of lorry drivers would not

have the necessary documentation for interna onal shipping. It becomes essen al for UK businesses to reach out to shipping partners who are prepared for the red tape challenges that could follow a no-deal.

A hos le environment Many entrepreneurs have already considered reloca ng inside the EU to escape the Brexit impact on their businesses. Many have considered or already made the move, with a preference for interna onal hubs that support SMEs such as Ireland, Cyprus and Germany. Sabine Harnau, the founder of From Scratch, explains, the lack of clarity about a Brexit deal combined with a post-referendum hos lity y forced her to relocate. She’s concerned about commi ng to long-term cross-border rela onships in a situa on where nobody knows what Brexit means. In conclusion, the UK is at risk of facing a deep Brexodus movement. Businesses that are the most likely to struggle in a no-deal Brexit have already been looking at relocation op ons to secure EU trading advantages, avoiding increased tariﬀs and complex shipping processes. But even a Brexit deal can’t erase the post-referendum hos lity that’s driving interna onal talents away.

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UNLOCKING THE POWER OF DATA-DRIVEN LINEAR TV FOR BUSINESS SUCCESS By Marlene Grimm, Head of Customer Success, Internaࢼonal at TVSquared

n this me of changing TV viewership habits, there is increased pressure on adver sers to be er understand consumers and reassess how to op mise available ad budgets. For the more innova ve businesses, data-driven linear is making its name as an invaluable tool that delivers reach where it will make a diﬀerence.

So, what is data-driven linear? Simply put, it’s an “advanced TV” solu on. Data-driven linear draws on various data sets – such as TV viewing behaviour data – to deliver digital-like intel for linear TV. Adversers are then able to op mise their linear TV buys against specific networks, channels, genres, programming, and manage ad crea ve and frequency, extending their reach to target par cular audience segments. Combine this understanding with always-on TV a ribu on and adver sers can discover more than simply whether or not an ad is driving response; they also gain insight into the audience that was reached, who responded, and what action they took. Even before COVID-19 the TV industry was evolving to adopt digital-like metrics to support adversers. But now, thanks to changing consumer behaviour, response and viewership habits have also shi ed, placing pressure on media owners to rethink how they sell inventory, while also encouraging businesses to reassess how they op mise their media spend on the adver ser side. 60 europeanbusinessmagazine.com

In this way, the global pandemic has only accelerated this advanced TV revolu on.

How can I use this revolu on for business success? For savvy adver sers, data-driven linear insights are the answer to precise connections with those audiences that drive a response, which in turn moves the needle on their business’ bo om line. This advanced TV soluon enables adver sers to reach precise audience segments and develop an audience-based ad buying strategy that brings together various data sets. Businesses are then empowered with the insights needed to op mise linear TV buys against specific programmes, genres, and channels. In addition, advertisers can idenfy the frequency in which specific households are being reached. Couple that with an understanding of the number of exposures an ad crea ve needs to generate the best possible response rate, and advertisers are able to iden fy their specific frequency range. With this data-driven insight funnelled into the business, it is easy to see exactly how many mes an ad should air before it reaches the point of diminishing returns. By using this approach, adver sers will be able to pinpoint the optimum communication frequency, reduce unnecessary ad waste, and recognise other areas of the campaign that could drive eﬃciencies.

Can I fine tune this to boost my business bo om line? Understanding the exact points of a campaign – from genre and network,

to crea ve length and frequency – that generate the best return-on-investment (ROI) is always going to be a main objec ve, but it’s important businesses understand that, to truly boost their bo om line, they need more than just access to these kind of insights. Always-on attribution is the key diﬀeren ator, a tool that constructs a long-term picture of a business’ audience – from who they are reaching to how they respond,

and even how these patterns will evolve over me. Always-on attribution also elevates a business’ understanding of whether or not an ad is driving response by identifying trends in op mal reach, frequency, and audience overlap. Businesses are then empowered to make ROI-posi ve optimisations to reach the audiences that matter most for their business goals.

TV creates valuable opportunities for businesses to reach and connect with consumers. But at a me when budgets are under pressure to perform – with accountability for every ad dollar so important – it’s vital the correct strategy is implemented. In today’s changing and uncertain landscape, an always-on strategy can make the diﬀerence between a successful campaign, and one that misses the mark.

Not only are data-driven linear insights vital for the op misa on of campaigns, but they are also invaluable to the marketers communica ng success back to the C-Suite team. Business leaders want to know whether their media investments are driving ROI – as well as if their campaigns are mee ng company KPIs – and data-driven insights, combined with an always-on strategy, is one way to unlock the power of TV for sustained business success. europeanbusinessmagazine.com 61

How Joe Biden wil

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ow that the presiden al race is all but over following the electoral college predictions in favour of now President-Elect Joe Biden, thoughts turn to how his role as number 46 will change the way America operates over the next four years. While Donald Trump made many efforts to change the landscape, his most pivotal ini a ve was to s mulate and revitalise the economy which, he claims is the most successful it has ever been despite the authoritarian and self-interest regime which moved away from the EU, seeing them as a foe not friend. Bidenâ&#x20AC;&#x2122;s rela onship with European business, while strained is expected to provide a much diďŹ&#x20AC;erent outlook.

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Many European leaders in fact feared that Trump would a second term and were vocally suppor ve of Joe Biden due to the percepon that under the current president the Trans-Atlan c rela onship was star ng to fade, while Biden as a lifelong Trans-Atlantic advocate already shares some strong links to various key figures across the connent such as German chancellor Angela Merkel, and therefore is considered to be possibly the best thing aside from an actual European in the white house. This presence means that in terms of being able to nego ate and do deals, there will be a mindset shi from the current hos lity into something that

is respec ul and will allow for a perfect environment to repair, renew and redefine the business rela onship and specifically the Trans-Atlanc agreement for years to come, provided that Europe actually want this to happen. When you consider the state of the global economy where the world is crushed by the constant fear due to the current coronavirus pandemic, the subsequent environmental destrucon and the fact that Donald Trump has almost single-handedly encouraged the reinvigora on of authoritarianism, there is no doubt that in order to preserve their future then they will have no choice but to work with any new American government.

The current situa on around trade will take much nego a on, mainly thanks to the way Trump treated the EU like an enemy and instead formulated plans and strategy around ideas at great opposi on to the current agreements, mostly through his stance of building stronger and more dangerous rela onships with combative nations such as China, North Korea and Russia while seeking to increase tariﬀs on EU imports such as metals and wines. The Biden administration also can’t directly change this overnight either. Due to the republican party a acks on free trade agreements, the party would be at threat of losing support should they directly realign themselves with

a con nent that also has a widening and outstanding trade deficit of over $170 million. He however, will be expected to over time reengage with the agreement especially with the openness that many EU leaders will need to have, a fact made a lot easier by the President-Elect already having committed to returning to the Paris Climate Agreement through execu ve ac on immediately following his inauguraon on January 20th. The US also has a great need for this relationship with their agreement with China slowly degrading even under Trump, especially considering they slowly become more of a threat to the na on which causes further losses in the business relationship. An added complica on is that China actually also has strong ties within Europe, where Germany is a key partner to the Asian na on and therefore specifically German companies will be more apprehensive of conduc ng further business with America due to the poli cal landscape possibly causing suppliers to refuse to work with companies who do show loyalty to their home na on. This is more significant as the American influence could cause further economic losses for China in countries such as Germany where they look to force Huawei and their 5g technology to be banned under suspicions that they are a secret vehicle for Chinese intelligence gathering. While s ll considered part of Europe geographically, the impending Brexit ini a ve means that the UK will only further suffer with the new president, with Biden’s Irish roots meaning that he could look to use Ireland as the bridge building nation rather than the traditional English route, which puts great risk of damage into the special UK-US rela onship. Pressure is being heavily placed on Boris Johnson to provide a viable mutual solu on to the ongoing exit talks, as exis ng tensions stemming from Johnson’s close rela onship to Trump and his rude language when talking about democrats such as former president Barack Obama. This presents a situa on where in 2021, the trade talks will be heavily skewed

towards working with the EU in a me of great Bri sh need to strike individual deals, unless Johnson can impress and show support for Biden and his plans in order to build the kind of rapport needed. The sheer volume of companies who operate on both sides of the Atlan c makes this a crucial part of the decisions taken to ensure that the economic outlook can remain posi ve. Despite all this positivity in regard to moving forward in prosperity with EU and creating a positive business environment, Biden faces many issues that must be fixed in order to proceed. Most of all, the tariﬀs and trades must be li ed from the previous administra on and he must navigate an agreement on the current $4bn that the continent is threatening to levy over fake subsidies believed to have been used on the aerospace industry for Boeing and Airbus. The damage from this is that for some smaller corporations, the supply chain will prove too expensive to profit from US goods and no longer be able to benefit from any current or prospec ve partnerships. There is also a growing cultural divide from some of the member states with may provide some hos lity to Biden, with Trump’s message not only resona ng with his own American people but his forceful personality also inspired the many an -establishment par es who due to legisla on such as free movement and the financial crisis, have found promise in a more self-focused a tude. Countries like Poland are ac vely despondent at the loss of such a booming presence that helped their own causes, and so see less merit in engaging with Joe Biden. Following in the footsteps of Donald Trump, Joe Biden is the kind of leader Europe and its business communi es need to prosper once again from their previous and current relationships. While there may exist las ng hos lies and there be a las ng me period before it is reinstated, countries like Germany and France suﬀered under Trump and so will look forward to the ability to regain a vital ally, especially in a worldwide pandemic where this support for their economies will be so important. europeanbusinessmagazine.com 63

Why the U.S needs EU Business now more than ever

he rela onship between the EU and America has existed since the birth of the na on over two hundred and forty years ago. However, since his inaugura on as the 45th President of the United States, Donald J. Trump has taken every measure possible in order to devalue and ultimately damage the lasting relaonship. In his personal opinion, he has been quoted to see more of a foe than a friend in his European counterparts, focusing on a policy of isola onism and individualism in a feeble a empt to establish American superiority again, which has caused much more harm than good, especially in terms of the business agreements he has tarnished. Despite this, now that he has all but been replaced by President-Elect Joe Biden, there is a need for him to re-stabilise the country and bring back prosperity. To do this, EU business is crucial to future prospects. Especially when considering the current pandemic and its eﬀects worldwide, America like all other na ons is struggling to maintain the economic standards expected- a fact considered to be a result of the ignorance and failure of the outgoing president to react or protect it, despite it being his main focus and the issue with which he believed would secure him his re-elec on. Such attitudes have overlooked one of the crucial ways in which the na on has s ll managed to survive, which is through Foreign Direct Investment, also known as FDI. This monetary contribu on is the investment shared between countries and is key to the maintenance of current stability, as the US and EU are in fact each other’s primary des na on for FDI with it making up 2.1% of American gross domes c product. State based affiliates of companies from the 27 EU member states

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is responsible for hundreds of billions of the imported and exported goods produced, with this figure not including the further billions spend in research and development while overall employing over 3 million US na onal workers where the average wage is o en higher than the American standard. The con nua on of this influx and co-opera on is of desperate need to keep the country afloat, with its corporations such as German auto giant BMW being a significant part of previous economic crisis with their $1bn investment in a new South Carolina based producon plant at a me when compensaon packages were necessary during President Obama’s administra on to save the ailing Automo ve industry. The need for EU business is also very much from a political standpoint. Donald Trump’s policies meant that under his direc on the United States ended its involvement in major worldwide co-opera on projects such as the World Health Organisa on and the Paris climate agreement, which are vital to ensure the country has the ability to influence the direc on of world health and climate change. America has such an important role in major developments that countries have complained, and the staﬀ list is largely made up of American born ci zens such as the world’s leading coronavirus expert, who would be forced to resign due to the only way to have employment is for your own country to be part of the agreement. In such moves to be more autonomous and create an almost dictatorial role for himself, Trump has taken the country away from the European con nent to align himself more with the enemy states such as Russia, China and North Korea who also avoid co-opera on. Biden now needs the EU interests to encourage or even force support so that he can consolidate both the country’s and

his own posi ons to ensure there is the ability to re-join or prevent the exit from the agreements so that he can keep them as a world power. This is more important s ll when considering that without access to the top Coronavirus knowledge, there is an increased threat to American health which also impacts the opera ons of the organisa ons and their employees within the country who will be less inclined to continue existing deals, especially if there was no joint interna onal alliance to help end the pandemic. These companies are also why such countries as France, who no longer see the US as a viable partner

anymore due to the previous administration’s tactics, continue to engage and therefore contribute to the na onal economy. A vital part of the need also comes down to protection and security, as the trade deals func on to provide supply and demand for weapons, people and even nuclear deterrents as strategic base placement from the US on European soil is down to the economic and financial es that allow America to have such an expansive presence throughout the world stage. This alongside the long-standing shared ideology and interests shows a clear need for a united front, more vital in the coming

months as with the country weakened and Joe Biden moving away from the more vola le na ons, there is a much bigger threat of a poten al show of strength in defiance of the new regime change and what will surely cause economic and control losses with the exit of Trump. America now exists in a state of needweakened by poor leadership and by the pandemic, it needs to put the past behind and move to prosper again from its supply chains. The economy could not survive without the con nued and developing existence of its automotive, manufacturing and oil industries, all of which are propped up by the business rela onship from

the EU and the investment they provide into the na on. Biden is in a posi on where he needs to legitimise America again to its friends and neighbours, where it condemns rather than supports the world’s most dangerous regimes which threaten its allies and can ensure the support to remain in its position as the ‘leader of the free world’. European trade and investment has been the backbone of business and poli cs across the lifespan of the na on, and at a me when the next four years could be the most crucial in its existence, America needs to restore this as a key part of it ongoing interna onal and domes c policy. europeanbusinessmagazine.com 65

The Clock is Tik Toking:

Why the use of apps like Tik Tok are necessary in modern business

ince its launch in September 2016, Tik Tok has taken the globe by storm. Its simplistic core concept of allowing users to update their profile by making a 15 second video supported by various music clips has become such a popular feature that it is now the most downloaded app in the world that isn’t Facebook owned. While this idea is based on entertaining the individual, it is businesses that are seeing the need to take advantage of such a trend in the modern market so that they can achieve long term success Based purely on metrics, its shows that over 1.5 billion people worldwide

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are active users of the application, with the majority of these being in the 18-34 market demographic. This group made up of ‘millennial’ and ‘gen z’ consumers is the largest and the main sector pertaining to growth across all markets, with their main objective being to constantly reinvent, improve and adapt what they use and how they live. This market is the vital component of any business strategy as they are always open to brand switching, lacking loyalty and o en needing no acquisi on costs, meaning that if a company is serious about reaching this audience then Tik Tok is a prime place to achieve this.

A key factor of this is that they are ‘active’ users, and therefore constantly aware of what they see as the app provides an immersive experience that o en provides heavy resonance through the personally selected content. The core components of video and audio in the app means any user is forced to dedicate themselves to purely focusing on what they watch, giving brands the perfect opportunity to portray a message they wish to deliver direct to a possible consumer, who takes it in and fully considers the presenta on as with the full horizontal posi oning used there is no room for other distrac ons.

Using Tik Tok also provides a clear perception that you are a modern company, with being part of the ‘it’ pla orm giving the impression that you understand how society works and how it is developing, with an obvious relatability to your intended audience. All the ac vity that takes place on the app is with the clear inten on of entertainment and providing value, so even if you aim to educate there is scope to portray this through entertaining and engaging content. Using these kinds of delivery is exactly what the people want and need to see, such as concepts around lip-syncing, dancing, jump

cuts, filters, edi ng effects and even by telling visual stories that resonate. U lisa on also offers clear new market strategies through new channels, such as through influencer marke ngCharli and Dixie D’Amelio have gone from children to worldwide stars through their u lisa on of the app, tapping into this market would make reach and poten al uptake so substan al with the right users behind a brand. If you aren’t on Tik Tok, you may actually be behind the general public with every big-name celebrity, sports star, teenager and even brand on the platform, but for specific markets there is actually still a significant deficit when comparing who does and who does not make use of this resource. There is an es mated 1 in 8 adults frequently ac ve, yet figures actually es mate that the app isn’t even considered as a possible strategy within most industries with 4-5% of companies having any interest, versus the vast majority of these same considered market leaders who invest into a passive site such as Facebook, that requires an o en alterna ve site to present the content. This indicates a clear first mover advantage for many who can be the first name in their field to reach the over 1.5 billion users and organically grow their brands. Tik Tok now even offers op misa on of their network for business customers who which to rather pay than make the necessary adjustments. They get companies involved via short form adver sements of 3-5 seconds, 60-second-long videos, u lising hashtags like they would expect to on Instagram or through branded effects where 2d, 3d and even AR versions of products can be added to videos. This is all backed up by an e-learning centre to educate less inclined professionals to produce successful launches and informed solu ons without the need to experiment with the app and s ll be able to go viral. The basics for any company who may consider Tik Tok: Be Authen c: The audience does not have the money to produce expensive produc ons, instead they use their

phones and so this same authen city should be used by the business to allow the user to relate and iden fy with the true brand ideals Utilise Trends: Viral videos are the essence of a successful Tik Tok user and how they gain a reputa on within the community. Whether it’s exci ng or daun ng, companies need to be unafraid to try them and ignore possible failure- it costs nothing if they do Follow the Rules: Part of professionalism is being able to look like you belong. Therefore proper forma ng such as the 15 second cut off and direct videos in a vertical, portrait style format must be adhered to No Hard Selling: Showcasing and providing buzz behind your brand is the key, it shouldn’t look or feel like as advert because then people move on. Companies have achieved great success through entertaining and then delivering the brand at the end when attention has peaked- brands such as these have been rewarded with incredible success Tik Tok can be an in mida ng platform due to its unique interface, constant rela on to the latest trends that have no possibility of control and its func on will o en not directly relate to a company’s objectives. While having been seen as a ‘flash in the pan’ like apps such as Vine that came before it, the social media giant has created unimaginable opportunity on a global scale at a me when everyone is living under unprecedented circumstances, causing growth like never before. Tik Tok is the headline social media app right now, with its presence felt in 150 countries and coun ng, through an hour of ac ve use per user a day. This is defining how we see user consump on and the ease to imagine and create content that transcends language and even often comprehension yet provides incredible results. Businesses who can understand and eﬀec vely u lise the app will not only gain an expansive knowledge of the current consumer landscape in crucial demographics, they will have all the tools to deliver over and over for a consumer that changes and evolves day by day. europeanbusinessmagazine.com 67

The Storming CBD Market in Europe CBD or Cannabidiol and is the second most prevalent of the ac ve ingredients to exist with Cannabis (Marijuana) and is a deriva ve of the Hemp plant, which serves as part of the family which also includes the Marijuana plant. While there are over a hundred extracts of the plant, CBD is medically proven to not cause the side eﬀect of becoming ‘high’ within its users, and therefore indicates that there is little to no risk of abuse or any health consequences through its usage. This relies on purchasing from safe suppliers such as Europe’s leading supplier Labocan, and because of this availability CBD is seeing an incredible drive in demand as it becomes one 68 europeanbusinessmagazine.com

of the fastest growing markets in the con nent. By Ma hew Meehan This rapid accelera on in the market has been driven across this year due to the ability of infusing the CBD into a wide range of product categories across mul ple sectors, from pharmaceu cals to cosme cs, nutraceu cals, sports therapy, medical treatments and more due to its perceived health benefits- such as high levels of Omega 3 and 6 which play a vital role in the crea on of inflamma on regula ng hormones, as well as organ func ons with the improved contrac on and relaxaon of the arteries. This has elevated the product to become synonymous with the need and usage of natural

and eﬀec ve care that takes away the exis ng s gma surrounding the current use of Marijuana, which exists as a well-documented drug seen in some loca ons as an illegal substance. However, adop on has been improved thanks to the ever-growing legalisaon and decriminaliza on eﬀorts of Marijuana where with it now no longer being necessary to sell it through a black market supply chain, there is now legal purchase and growth where the use of CBD products through respected brands such as Labocan is causing great expansion in the marketEurope itself is expected to see over 400% market growth over the next 4 years alone.

be confident in its usage whilst also seeing the market share globally skyrocket to €450 million which represents 31% of the current internaonal market, a figure only be ered by the United States who currently represent 40% of this industry. A crucial growth sector in this connua on will be the u lisa on of the health and wellness market where similar growth has also been experienced. As the need for new innovaon develops, the market is growing by 25% annually which is worth over $1 trillion in revenue, a powerful figure even before considering that CBD is considered to be one of the leading trends of innova on within the area thanks to its ability to comprehend a mul tude of diﬀerent applica ons in diﬀerent forms and so the maximisaon of this will be paramount towards cannabinoid’s growth as a legi mate and everyday ingredient. With unbelievable poten al, this means that the governments around Europe are now seeing the benefits of not just making it legal but actually looking at how to further embed its normalcy into culture and greatly expand its reach, mostly when considering the na onal income boost available through the taxa on of CBD products.

The slowly growing legal presence is causing the public opinion to also rise as favourability and accessibility ratings are also rising, so as the demand develops it is crucial that people are able to understand the differences in the products and which ones are the most effective for them, with the presence of the market leaders needed to lead from the front and provide trust, quality and eﬃciency. Specifically In the European market, growth is excep onal as even though the CBD product is marketed with a medical consumption focus, recreational use is legally permitted across the majority of the con nent which allows the current market to

Just one example is the state of California, where in 2018- their first legal year of opera ons, the state collected $345.2 million in pure tax revenue that not only makes it a valuable new facet of their economy, but also can be re-invested to fund societal re-educa on to con nue the ongoing trend that can only happen with the s gma decreased and the scope of adop on becoming almost universal. This need for change in the narra ve severely influences future implicaons, as with currently almost three quarters of usage being medical, successful promotion that increases obtainability while silencing public resistance means that within 8 to 10 years the adult usage sector will grow exponen ally, as the constant reclassifica on of the now socially accepted product results in it being seen as a ‘simple ingredient’. This hinges on the governmental ability to rely on prominent companies like Labocan

to provide clear quality assurance in all areas, from research and development (R+D) to cul va on and development to ensure that they abide by the food safety standards provided, which Labocan already do. Being such an innovative, health driven and disrup ve global industry which possesses such raw growth potential alongside the progressive and relaxed approach taken by the various European governments, the entrepreneurs and investors are now running into the market in order to fund the significant investment needed. These millions of euros now flooding the market consequently is crea ng prosperous environment where constant new start-up businesses exist as a result of such a domino eﬀect was always likely to cause. This however is not as good as it may seem, especially as it leads to an overcrowded market that suffers from poor regula on and inability to stabilise itself before the next wave of people look to capitalise on its growing success. These extensive numbers also make it impossible for the consumers to decide what they need and how to obtain it especially as in the eyes of the majority, the adop on of such products is merely a concept rather than a clear need. Because of this educa on is crucial to its future success, and the need for guidance is key. Luckily, companies such as Labocan exist who are such leaders in the European CBD market that they are crea ng posi ve ideals around its usage through its state of the art facili es which inspire confidence, its extensive product oﬀering which allows CBD to be u lised however the consumer needs it to be and through their help and support which includes personal support that gives direct advice in all areas such as Sales guidance, Legal frameworks and Order fulfilment support to businesses and buyers who still need informa ve assistance to learn and benefit from the product and the up and coming market. This kind of innova on and educa on from such modern and accessible companies is vital to ensuring that the poten al can be realised within the rapidly developing Cannabinoid market. europeanbusinessmagazine.com 69

SUBSTACK:

Independent Writing has Never Been so Easy

ournalism is witnessing the rise of a new business model — and the newsle er pla orm Substack is right in the center of it. Substack, an email list platform for writers, which recently celebrated its 3rd birthday, has quickly drawn a enon from the media industry for its simple promise: “making it easy to set

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up a subscrip on and collect payment from readers,““ which sounds extremely cap va ng for authors. What is more, Substack makes it easier than ever for writers to leave tradi onal publica ons behind and mone ze their own wri ng directly. “I think writers have always realized their own value; there just weren’t a lot of op ons in the

post-2008 recession for how to make good on it,” says Anne Helen Peterson, one of the top-writers at Substack. “But all of this feels very cyclical to me. The economy tanks, writers get laid oﬀ from their publica ons, writers go freelance, writers find success with scrappy publica ons, mainstream publica ons hire those writers, scrappy publica ons

die, mainstream publications get big, then the economy tanks again. So I’m trying to find something akin to stability, which is certainly a shared sen ment amongst the other journalists I know.” Substack was founded by developers Christopher Best, Jairaj Sethi, and journalist Hamish McKenzie back in 2017. Commenting on the very

beginning, McKenzie remembered that “put oﬀ by the social media algorithms that controlled news distribuon, they wanted a pla orm that would allow each client to build a “mini-media empire” around their mailing lists.” Basically, Substack allows anyone to launch a free newsle er, while also offering a premium tier, typically

star ng from $5 a month. The platform takes a 10 percent fee on subscrip on revenues, while 3 percent go to Stripe, which handles payments. Therefore, the writer receives the other 87 percent. To make the whole process as easy as possible, the pla orm also provides newsle er publishing tools, such as easy-to-use edi ng so ware that can handle the simultaneous publica on of stories and newsle ers for a payment solu on that makes subscriptions intuitive and manageable for both publisher and reader. Substack also shares features that allow stories to find large audiences outside the paywalls and design templates so that publishers can create beau ful reading experiences. The year 2020 has been extremely successful for Substack: since the start of the Covid-19 pandemic, the number of readers and ac ve writers on Substack has doubled. What is more, the pla orm has a racted some big names on its list: Rolling Stone’s Ma Taibbi, New York Magazine columnist Andrew Sullivan, and Buzzfeed’s Anne Helen Petersen have all recently quit high profile publishers to launch their own publica ons on Substack. Other notable hits on the platform include China expert Bill Bishop, the liberal poli cal writer Judd Legum, as well as journalist Luke O’Neil, who noted that he is expec ng to gross more than $100,000 annually for his newsle er ‘Hell World’. Commen ng on the numbers, McKenzie noted that “The top writers on Substack are making hundreds of thousands of dollars a year. And there’s a rapidly growing middle class, with writers and podcasters ne ng incomes that range from pocket money to high five figures. There are now well over 100,000 paying subscribers to Substack publica ons.” Speaking about the future, Best noted that Substack has entered into a new phase now, adding that “The first phase was to a ract writers with exis ng audiences to move to Substack. Now Substack wants to bring on new voices.“ Interestingly, one thing that Substack promises regarding the future is no ads, ever. “Any me you’re doing ads, it’s all about the lowest common denominator of engagement: clicks,” Best said. europeanbusinessmagazine.com 71

European Business Talks with with

Nick Morley EMEA Managing Director, Integral Ad Science (IAS)

Evolving the advertising industry to meet consumer behaviour Compe on for consumers’ a en on has been heightened by the pandemic. How can business leaders ensure their adversing teams are focused on ad campaigns that maximise engagement? Nick Morley: “To maximise adver sing success, business leaders should focus on the context in which their ad campaigns appear. While adver sers are aware of the opportuni es due to increased consumer engagement, brands are stepping up their brand safety measures during mes of social unrest and a pandemic climate. M ost businesses appreciate that context aﬀects how consumers view their brand, with IAS research showing that nearly three-quarters (70%) of UK consumers state that they are more likely to remember an ad when it appears next to contextually relevant content online. To hit the ultimate goal of the right ad, at the correct moment and in the best place, marke ng eﬀorts should also recognise and navigate the sen ment of context. Given that almost three-quarters of consumers (73%) state that the posi ve/nega ve feeling conveyed in an ar cle impacts their percep on of a brand who has adver sed alongside it, businesses need a technology partner to enable their brand to not just avoid unwanted associa ons, but also target investment towards suitable content. 72 europeanbusinessmagazine.com

With advanced technologies that blend semantic analysis and natural language processing, a brand can uncover exactly what the words on a webpage mean and how they relate to each other, in real- me and at scale. This allows business leaders to keep adver sing op ons open without pu ng their brand at risk. For example, in the current situaon, that could include dis nguishing nega ve content about coronavirus from stories with a positive sen ment, such as business survival or human kindness.”

Covid-19 has seen ad fraud skyrocket. How can business leaders op mise ads for performance by closely scru nising the supply chain? Nick Morley: “It almost goes without saying that problems with ad fraud pre-date today’s disruption. Long before the outbreak, ad fraud was predicted to become the second-greatest source of criminal revenue globally by 2025. But with budgets ghtening and adver sers under greater scru ny than ever, it’s even more important to keep a close watch

on ad fraud - from malicious apps, illegal bots and domain spoofing, to its many other forms. Staying ahead calls for an ‘always-on’ mindset. Business leaders should use tools that employ machine learning in order to constantly monitor abnormal traﬃc pa erns and spot the differences between human and bot behaviour. To make sure investment is constantly safe from fraudsters, business leaders need to ensure all of this insight comes from a verification technology partner that prioritises ongoing cross-industry collabora on and employs fraud detec on experts to understand the latest threats and spots signs of emerging ad fraud. These insights are paramount for both advertisers and publishers to ensure that they are transac ng only on genuine inventory.”

podcasts, or the explosion of viral TikTok videos that we hate to love. For business leaders, this presents both a challenge and an opportunity. There is greater potential to connect with highly recep ve audiences, but it’s also harder to keep track of the results that ads generate, or if they have a chance to make any impact at all. Ads must be seen and not just served to have an impact. But diﬀerent digital ad formats come with diﬀerent standards for evalua ng viewability — from sta c desktop display to mobile app video ads — and with more channels comes a greater variety of data. For example, at IAS, part of our viewability measurement also captures exposure me. This helps adver sers

evaluate engagement, based upon the theory that good content engages viewers for longer. To ensure business leaders can translate this data into business outcomes, it is paramount that the digital adversing industry keeps pace with the mul -channel consumer, and a vital part of that is accurate and easily digestible reporting. As well as ensuring access to cross-pla orm and cross device insight to gain a holistic picture of the context in which ads are appearing online, business leaders need tools that allow them to apply custom metrics aligned with their brand’s needs, whether that be unique brand safety requirements or custom viewability measurement.”

How can innova ve, up-to-date repor ng help business leaders crea vely connect with their target audience? Nick Morley: “Consumers were already feeding their digital media appetite with increasingly diverse content before Covid-19. Not only has consump on risen at an unprecedented rate, but also expanded across a wider range of channels; whether that’s the spike in video streaming services, record numbers listening to europeanbusinessmagazine.com 73

Why Influencer Marketing is so important in the modern world

n the modern age, people no longer retain control of the purchases they make. Whereas once the things you bought were down to either a specific need or simply personal preference, today’s buying habits are driven by a desire to belong, to fit in and relate with the friends or social group that matches your individual personality. As a consequence, studies show that these groups of friends, family, experts, media outlets and social media influencers provide us with the confidence that we are making the right choices as we conform to the perceived social norms. This influence is known as Influencer Marke ng, and with just about anyone now being able to work with major brands, this now number one form of online marke ng is crucial to companies compe ng in the marketplace. Influencer marke ng has grown substan ally year on year, with the trend growing to over $5 billion dollars on social media site Instagram alone. This relationship selling has become so powerful in the purchasing decisions

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that especially for the newer entrants into the market, they simply cannot ignore the sheer growth prospects on offer when their need for instant presence and credibility can essenally be solved overnight through the use of a recognised face in their space that legi mises them through simple posi ve associa on via their inbuilt customer base. But what makes this kind of marke ng so important is the fact that it solves multiple issues through organic traffic, thanks to the fact that they retain a loyal and o en fana cal group of poten al customers that is also extremely cost effec ve when considering the price of acquisi on. Three of the key considerations behind effective marketing strategy: Content creation, brand credibility and posi ve exposure to the target market, whilst difficult to balance from a corporate perspective are actually what makes influencers so successful in their own ventures. Such personal connec ons through often years of building trust from

their consistent posting and hard work makes the messages they send seem genuine and authen c in a way that is almost impossible to replicate by a brand or larger corpora on. From platforms such as YouTube, Twitch and Instagram, the ability to create such a unique kind of buzz from exciting content, which is both wanted and appreciated by these people needs to be almost the main focus for any company that wants to grow in this kind of environment. The opportunity available has never existed to take advantage of this, especially considering that in a rapidly developing world where 46% of marketing now takes place online, this number is likely only the beginning. The strong and unique content that can be created without expenditure, as through a simple sponsorship you are a ached to a chosen individual who through a simple promo onal adver sement subconsciously aligns the corporate objec ves with that of their own. Their content becomes a new form of adver sing that can then be used in outside ads, own personal content and even the companies own social media to form a much more comprehensive strategy. One example of this has been the American YouTuber Jimmy ‘Mr Beast’ Donaldson and browser extension site Honey, whose partnership has allowed the company to become a much bigger household name through sponsorship of selected videos. Due to its ability to heavily integrate itself into this market, it has gained a global reputa on and substan al increase in downloads that has now even began to diversify its content to capitalise its own growing internet audience. Despite this being a significant expenditure, with figures es mated to be around $10000 per video, the average business who may not have a good marke ng budget to spend on

such endeavours can instead benefit from the community of more common ‘micro’ influencers. These public personali es have a much smaller following of 10 to 200 thousand followers, and therefore are much more a ainable due to their prices of partnership being low or even simply for free product. There is no other form of strategy in current business that can oﬀer this kind of cost versus reward balance to businesses that would double or triple overnight from this kind of publicity. Influencers also rely on this kind of business rela onship and so represents a mutual need to be an eﬀecve partner, and reduces the possible risks involved. Pla orms such as YouTube have in the past revised their systems to limit the amounts their users receive and instead this revenue is as a result of influencer agreements and other adver sing-based contracts. There is however, a serious need for close considera on and assessment

before agreeing to such deals. There is significant risk in a partnership with the wrong influencer having the opposite effect and damaging the PR of the brand. Mostly consis ng of normal people who simply make money through content, they have to be heavily ve ed to ensure there is nothing controversial or offensive that would harm you, or even simply if they held different ideals to what you represent, then the current clients may no longer see a future with your company. The results and key performance indicators represent one of the most significant arguments as to why this is so important. Being so difficult to measure means that understanding what works and how to make communicaon more effec ve is a difficult task. Defining metrics is a key part of influencers, and when agreed is a sign of potential success with unique discount codes and tracking the clicks on a link being a substan al tool that

allows clear and concise feedback to maximise poten al returns. Attention online is so difficult to achieve in the current market, with anyone who dares to go online a acked from every angle by the same techniques industries have u lised for a long me. People feel safe with the comfort and reassurance of friendly and familiar guidance from the expert influencers that they regard as real people living real lives, an ideal they resonate much more closely with that a simple brand image. Tradi onal marketing is losing traction, and exciting delivery that caused a buzz or so called ‘viral’ attention is the key to true engagement within a society that regards personali es and reality TV star as their personal heroes. The current climate shows just how important presence is, and now businesses must adapt to stay relevant by matching the interests of their clients be er than their compe tors- Influencer Marketing is the key to this achievement. europeanbusinessmagazine.com 75

THE RISE OF GENERATION Z:

How They Are CHANGING BUSINESS in Incredible Ways

orn a er 1996 and comprising 33% of the world’s popula on, Genera on Z or ‘Gen Z’ will outgrow the millennial popula on even though most are barely even able to vote. Despite this fact, they are considered to be the most influenal genera on with a more ethically and racially diverse mindset alongside being the highest educated as around 72% look to graduate from university. Such a progressive mindset has led to the ability to not only own their diversity but also vocalise previously weaker opinions like being pro-immigration, environmentally conscious and being more open than ever to the acceptance of changes to the family and societal environment like LGBTQ+ rights and mixed-race households. Most of all, this openness has created an environment where the need for change and progression has allowed them to experience digital and technological advancements that have changed the modern culture into one where constant development is posioned as an integral life benefit. This new wave of tools, processes and forward thinking has revolu onised the business world in ways that previous generations could have barely dreamed of, and this is only going to accelerate into the future at incredible speed due to the impact that Gen Z is having. A main factor behind this is that they are the most extroverted genera on ever to have existed, where they are not afraid to be loud about what they believe in, proud to support their causes and driven to make sure their voices heard. Their crea ve, passionate, innovative and technologically

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focused mentality is harnessed in order to make a diﬀerence through how they work and achieve the lo y ambitions, which is why the overwhelming majority are now seeking to work in a freelance or ‘gig’ economy rather than commit to full me employment. This freedom and ability to adapt to any opportunity allows them to priori se cause over cash, while allowing even the quietest to have a vocal impact on society and has significantly affected this market with the 41% who choose this arrangement having created largescale opportunities for companies to change their internal structures and be er accommodate work in the more crea ve sectors of the industry. This same focus on self-achievement has been evidenced through the innova on that is driving the Genera on to become more entrepreneurial. Culturally focused, many people of past genera ons who come from a more ethnically diverse background have referenced to feeling like they are limited or held back in their employment, unable to speak out and actually be heard in a way to eﬀect lasting change. Therefore as Gen Z drives an influx that revitalises the tradional small business sector, the new age focus is also taking the activist approach by purposely competing against conglomerates who have lacked apparent morality, with these previously negatively biased races using their new power to flood the market and create their own individual opportunity through new ideas and crea ons. There is also the sense that this is almost a modern American dream for the immigrant popula on

who now have much higher ceilings with society’s lowering bias and ability to remotely work without risk of nega ve interac on. As with this and the majority of innova on developing, technology is the crucial factor that has allowed such change to exist. The limitless forms of communica on have not become a benefit any longer, as instead they are now a con nuously vital component of the way that this new age range lives their basic lives, with such na ve digitalisa on driving global expansion and continuing the march of more inclusion and integration from all markets. New discoveries such as the conceptualisa on of cryptocurrency like ‘Bitcoin’, complete social integraon to everyday processes and the ability to have complete remote control of every business opera on has

radicalised how people are able to work and achieve. Something especially important in the current climate where even those scep cal to adapt their methods have embraced the new ways of working that Gen Z are normalising, so that they can allow their businesses to survive and o en even grow exponen ally despite staďŹ&#x20AC; and customers not being able to patronise physical loca ons. Such forward momentum is only connuing to provide opportuni es that allows the new genera on to influence and adapt our understanding, with a refreshing focus on purpose being preferable to pay, meaning that as they are the largest sector companies must now adopt this same ethos too in order to stay compe ve with others who seek the best hires. These employees need to see impactful

companies who are making posi ve changes through their policies that also abide by diversity, charity and innovation quotas, meaning that a modern business must now aggressively and openly advocate for this. The biggest task therefore is to truly understand what it means to be part of Genera on Z. Internally, there is no place in their minds for a tradional 9-5 oďŹ&#x192;ce environment where long engagement over menial tasks is the norm. Instead, they have shorter a en on spans as a result of the sheer ease that informa on is now received and taken in, with speed and delivery of content being the primary focus alongside short yet incredibly producve bursts of crea vity be er fi ng their personali es- a key indicator as to why they also adopt the more freelance style of employment.

Externally, when trying to a ract this market there is no ability to waste their me by expec ng them to si through unnecessary or unengaging content, and so there must be a greater focus on actively engaging sources that they also find reputable such as influencers on social media platforms. Recommendations from friends, family and trust sources make up the main source of purchase information, with the trust and respect allowing them to believe in the research of others without the need to waste the me doing it themselves. Being the largest and most engaged consumer base when necessary, even if only for short bursts of a en on means that businesses must now work much smarter to connect with their audience. The overly produced marketing and those campaigns which try to mimic popular trends are rejected as fake and desperate in the Gen Z percep on, as instead the real and authen c approach must now connect through funny and original methods of using modern day interests. The u lisa on of real people versus models or airbrushed celebri es is a key insight, as is the obvious need to stay at the cu ng edge of technology with such newer creations like VR marketing slowly developing, this kind of constant innova on will be a crucial factor in becoming a modern brand in the eyes of these consumers. The world is evolving at unprecedented speeds, and this is mostly a ributed to the eďŹ&#x20AC;ect that genera ons such as Gen Z influence the world around them. You only need to look at people such as ac vist Greta Thunberg to see how age, authority and tradi on no longer constrains the vocal and unafraid leaders of tomorrow. In business, this dynamic youth development is ready to lead their genera on through future advancement with their core beliefs all crucial in the world to come, believing that jus ce and being real, authenc selves are the way forward. Corporate, tradi onal structures are no longer seen as targets, but instead seen as the past, with Genera on Z shaping the future to match their own individual narra ves of success. europeanbusinessmagazine.com 77

How the Union is stifling economic development and why Europe will never flourish under the EU

ith the UK’s impending exit from the European Union, there is more focus than ever on the state in which the current 28-member organisa on exists and what really are the benefits and drawback of being involved has, especially with other countries considering their future status. The EU’s main roots of concep on have always been based around the idea of providing more accessible free trade and a customs agreement focusing on improving the economic condi ons. However over me this ideal has changed into a reduc onist system where a single state mentality exists, with a governing bureaucracy that no longer serves the intended purpose, instead simply causing mass overregulation that devalues each nation’s own sovereignty and economic flexibility whilst taking away much of its perceived individual control. An economy cannot develop under these kinds of stringent condi ons. The EU itself has always been considered to be resistant to positive change that would actually allow for

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economic growth. Its founding was for the purpose of prosperity and free trade at a time when Europe was looking to come together a er years of war and conflict, creating common markets in industries such as coal and steel before leading to the first concept of an economic community known as the Treaty of Rome in 1957. Countries such as France, Italy and West Germany began this as a way to increase the amount of trade and build bridges, yet that kind of isola onism no longer exists in the modern day meaning that the need for such agreement is much lower, yet rather than understand this, the European Union instead has become an en ty governing with an aim on securing more power over its members with no ons to become one – there already exists a flag, anthem, five presidents and its own currency aimed at gaining financial control. Such structure causes great regulatory distress with issues like the overlooked tax structure limi ng business prospects. There is no encouragement towards business development, with the outdated system expec ng

increased contribu ons despite the constant decline in economic opportunity. The lack of progress is felt through the development restraints as while long established companies like Volvo con nue to thrive, there is no European innova on to provide alterna ves to Facebook, Amazon or Google due to the condi ons needed to support such ventures simply not exis ng in a European Union framework. Not only is this detrimental to the individual governments, but they are actually failing in their trading endeavours. Economies work oﬀ of the ability to increase trade as no country can be self-suﬃcient, and the global market has grown exponen ally with its u lisa on incredibly lucra ve, yet these opportunities are limited as the EU tries to enforce the maximisa on of trading within its own borders. This is a severe drawback when considering the poten al that may be possible for the states to revolu onise their exports at a me when the market clearly indicates that Europe has actually stopped growing in many major areas.

Some countries joined the Union with the explicit intention to adopt the Euro currency and provide financial stability by entering a market with promises of growth, lower unemployment through free movement and increased access to favourable trading partnerships that would lead to their own individual boom period. Instead the Euro has underperformed bi erly, instead of increasing the economic performance of such na ons it has simply become a divisive issue that causes debate and tension between na ons who did and did not adopt it as well as eroding the confidence of member states in the future both internally and also from global partners who sense instability they would suﬀer from. This loss of opportunity has also meant that the larger and greater contribu ng states have been le paying for the failures and mistakes made by na ons in financial distress such as Greece and Italy. Countries like the UK, France and Germany are responsible for providing large amounts of bailout funding for such southern European countries who have lost

mon ney and expected to be saved if they y were to go bust at the expense of othe er’s economic success. The financiaal crash of Greece was a prime example of this with the supe port package arranged considered faulty and poorly designed, especially as if they defaulted and became unable to make repayments, this would have adversely m daamaged the economies they were rely ying on due to a large increase in na onal debt, with Italy too large of aan economy and lacking enough financial stability to actually survive shou uld this happen. The ese causes continue to be furtherr weakened by the lack of actual enfo orcement that is possible, the EU has tried to make demands but due e to their needing to be a ratification by a majority, there is no scop pe to make widescale changes such h as they tried to do on the matter of austerity which would have actu ually been counterproductive due e to the struggling economies actu ually needing investment rather than enforced regula on. Even the commitments that were agreed to with 60% GDP levels of debt established as a benchmark are consistently breached by the likes of France and Germany, as such is their posion and Influence that there exists no real of way to effec vely punish them whilst they would have seen great economic damage had they followed the rules. The EU fails to provide effec ve governance when it expects economies of greater poten al to follow stricter rules and pay larger compensa on which limit its ability for success, all for the benefit of less able na ons. Such unequal contribu on is a crucial factor behind Brexit, the result of which brings many more quesons to the economic viability of the Union. The EU only survives based on individual contribu on and the UK’s economy is equivalent to that of 18 other member states, with this kind of extreme financial loss fracturing finances it only serves to show that those s ll trapped in this agreement will only suffer as they lose both money and trade opportunity should the current sanc ons be

enforced. There are also weakened economical protec ons with Britain as one of the largest proponents of a liberal free trade market leaving, it makes it much more possible to revert to a reduc onist, con nentally restricted trade policy that will contribute to the already expected job losses, an -federalism and unstable poli cal environment due to be created as other major EU powers look to take over Britain’s power posions. The UK is also America’s gateway and so the special rela onship may not translate over into the EU, causing even greater losses from one of the only non-EU trade agreements. Euroscep cs have been looking for a me to try and launch their own methods of escape, and poli cal pares in countries such as Poland and Italy are slowly gaining more power to leverage their own possible referendums and subsequent withdrawals, or as a minimum to change the group in a way that would undermine the principles and basic ideals that it intends to represent. If more and more ac on is taken, the economic outlook will be so unstable that member na ons could find themselves considered too risky to trade with and could result in serious depression like states, which would only fuel a greater power push from the EU as it reacts to keep control. The EU no longer has the same understood func on that it was founded to provide, with it serving now as a bureaucratic and isolationist body that seeks to use its own members to ensure personal success despite obvious detriment. The loss of the UK is a signal of how the promise of free trade and economic prosperity has been replaced with doubts and rebellion against overly controlling policy that causes more harm to a country than good. The longer the EU exists in its current form, and the longer it insists on trying to control and manage the trading and economical posi on of its members, the much lower opportuni es there will be to gain economic success. If prospect and hope is the vision for a na on, then they simply will not find it within the European Union. europeanbusinessmagazine.com 79

Lessons in leadership from the best in the business

Lloyd Salmons, co-founder, PepTalk

s we approach the end of the year, we can look back and put into context everything that has been thrown at us in 2020. Revenues have been hit, deals put on hold, career development has taken a back seat and the connection between worker, colleagues, management and clients disrupted to such an extent that we’re unlikely to ever go back to the world as it was in 2019. But that presents an opportunity for individuals in business - both management and employees - to create a more future-proofed and fluid structure that be er works for everyone. And as we stand on the precipice of a new year, a new vaccine and new hope for a be er 2021 some of the learnings from this pandemic will prove invaluable for every element of commerce in making tenta ve steps to ge ng back to what it does best. Because that’s what businesses do. They focus on the posi ves, learn from experience and look for solu ons. Nowhere is this more acute than in helping teams and staﬀ recover and catch-up from this year. Knowing what we know now, there are some key lessons in leadership businesses can deploy to make sure next year feels like the sunshine a er the rain: 80 europeanbusinessmagazine.com

Grasp the opportunity to build back be er

Empower the eﬃciency of employees

The last nine months has o en felt like we are 'living from work' rather than 'working from home' but there is no doubt that COVID has caused a shift in how and where people work for the long-term. It means that for both company founders and senior management and the staff they employ, finding me to separate work from personal life is cri cal. The lines will inevitably blur but eﬀort must be made to keep them separate. Things like a dedicated shut down me, ring fenced family days, dedicated me to exercise and just ge ng away from the screen are key. It’s a great chance to establish processes that can better balance work, mental health and family or personal life that should be grasped with both hands.

This year has underlined that people are unique as the spotlight has been placed on how individuals cope in a stressed situa on. Some have families to juggle, some work be er late at night or early in the morning, some can be more productive at home while others prefer to be in an oﬃce environment to work best. Whatever it is, businesses have been able to see down to an individual level how best people func on and moving forward there must be allowances for this to continue. Employees have been empowered to find answers to a complex work-life balance equa on and, in many cases, have come up with the right answer for their own circumstances. As a result, we’ve seen a trend for increasing produc vity and people more content with the set-up of day to day opera ons.

2021 won't be without challenge By all accounts we’re about to see anything from a double-dip recession to the worst depression since the second world war. Eitherway, the immediate outlook isn't great but it won't last forever and if history teaches us anything it’s that we can and do bounce back. Remember, if your business can survive this, it can survive anything.

Place a high stock on resilience & adaptability Understand that resilience & adaptability are important transferable skills. If you and your teams can flex at short notice to cope with spikes in demand or disrup on, that is hugely valuable. As an employer, place a great stock on these traits and encourage your employees to display them - even if they don't feel then can or have the ability to do so. The good news is, these traits are a ques on of nurture rather than nature and with the right guidance we can all learn to thrive, whatever is thrown our way.

Innovate to mo vate As people con nue to work remotely and the days of the all-in-oﬃce are behind us, founders need to look at innova ve ways to support the welfare, development and 'experience' of their teams to account for shi ing pa erns of work and communica on. While there is (hopefully) s ll a place for it, the days of relying on a team trip to the pub to keep up morale are over and have been replaced by innova ons enabling employees to tailor solu ons to their needs whether that be; mental health, financial planning, coping with pressure or just a shot in the arm to get up and go again. The very best - those that get to the top of their chosen career - do so on talent and work ethic. But this is based on a whole spectrum of other, so er skills like adaptability, problem solving, communica on, innova on and much more. These are the skills that we will all need to lean on if we are to make 2021 a year to remember for all the right reasons.

DONALD TRUMP:

The Successful President?

n 20th January 2017, Donald John Trump was inaugurated as the 45th President of the United States. Trump ignited his conserva ve base with his campaign trail talk of media bias and his promises to ‘build the wall’ and ‘drain the swamp’, leaving each and every one of his Republican opponents for the party nomina on behind. He was berated, cri cised and considered completely unqualified to be the leader of the free world, yet when the election came Hillary Clinton and her vast poli cal background did not compare to the raw passion and energy that Trump had given to the working class around the na on. 4 years later, we sit and watch as he desperately clings onto any power he can by contes ng one of the founding fathers key principles of democracy, while poli cal commentators deem him to have been a failure in his role. But let’s flip that. Forge ng all the non-sensical and wildly inaccurate tweets, his o en misleading speeches

and the nega ve, o en abusive rhetoric – lets focus on what truly dictates presidential success: the legacy he leaves on the na on. Was he actually successful in the key policy statements he made such as the economy? Was the media fair or did he actually have a case a er all? He faced immediate opposition from all corners, was that jus fied, or did it damage him before he even had the chance to sit in the Oval Oﬃce? Clearly there is significant need to see what he achieved, and how successful he truly was from a purely operaonal perspec ve. Despite all, Donald Trump was undoubtably a success for the Republican agenda. By his own hand, he in only four years was able to completely revolu onise the social judiciary by appoin ng 3 supreme court judges, such as recent nominee Amy Coney Barra , which for the first me in nearly 80 years makes the bench strongly conserva ve due to its current 6-3 majority. 220 other federal

judges were also appointed across the country which with the American legisla ve branch being 1/3rd of government allows the conserva ve intent to be strengthened na onwide for years to come. The 1% are stronger under Trump, unsurprisingly, considering he himself belongs to this group, however this also comes as a result of his business acumen with the change of the tax codes causing corpora on tax to drop from 35% to 21%. Such prospect of economic prosperity has been signalled due to the ability to reinvest this money into the business and ensure the future of the workforce that has seen steadily growing unemployment before this work via the Trump administra on. Not all of his achievements have had personal benefit either, it can be considered direct and pragma c that he has taken steps to lower minimum sentences and provide early release programmes for drug felons, especially those concerned with marijuana which europeanbusinessmagazine.com 81

has slowly become wider legalised during his presidency, as well as his work on the world stage with his successful infiltra on of ISIS caliphates in the Syrian compounds where American soldiers were able to locate and assassinate leader Abu Bakr Al-Baghdadi in late October 2019. By all accounts, this demonstrates a clear no on of Donald Trumpâ&#x20AC;&#x2122;s successes as a leader, despite the popular opinion. It illustrates that whether he is right or inevitably wrong, that he is unafraid to take the necessary ini a ve to make hard decisions and take action when the situation needs it. He has evidenced clear ability on the interna onal stage to rip up any trade deals he finds to be unfair, even refusing to make concessions for the global trade ini a ves as the only things he will sign are those that favour U.S interests, whilst taking a protec onist stance when they donâ&#x20AC;&#x2122;t. In such cases as the European Union, he rejects the idea of group trading with a preference to negotiate with individual na ons due to their common dissenon and lack of common interests, language or even need to work together because it does not fit the kinds of partnership he feels is appropriate for the country. It is easy to berate him for such choices, but such a bold stance is brave, courageous and safeguards the interests of his workers who may have not got a good deal for themselves financially had there been an unbalanced agreement. To understand the success, you simply have to look past the image and reputation he has been given and appreciate what actually should matter to the vo ng public, the fact that the country is focusing on its own benefit- he is the leader of the United States. No one else. Such is this fact that he has created new interna onal rela onships with other similarly discredited leaders such as Vladimir Putin and Kim Jong Un. The ability to reach out and befriend such notorious poli cians through friendship and to achieve posi ve nego a ons has allowed there to be a set of circumstances where co-existence and even peaceful solu ons to major global problems are on the cusp of being agreed. Despite the similaries of them all understanding each 82 europeanbusinessmagazine.com

other due to possessing the same na onalist self-mission, Trump is an experienced businessman as well as a current poli cian. He has dealt with unsavoury figures for a long time; therefore his experience and skillset allow him to do what is needed for the benefit of the country. There is s ll the outstanding ques on of how much image should relate to the idea of success. There is no doubt that on a personal level he is almost repulsive with his rude, arrogant, manipula ve, sexist and philandering personality not being appropriate for the level of public oďŹ&#x192;ce he currently holds. He is instantly so easy to dislike that it remains en rely conceivable that had one of his opponents for the nomination won instead, that they would be lauded and publicly beloved for the same kind of achievements. There is some evidence to suggest that such a strong and loyal voter base is the reason as to why the 2020 elec on was the highest turnout ever, as he brought out of the shadows a

working-class audience in the rural areas who were cold and dismissive of poli cs, yet who suddenly gained hope that someone held their same values and would lead them into a brighter future. The minority of these voters who became protestors and grasp to great levels of idiocrasy in order to overturn their own cons tu onal amendments may not be the leaders of tomorrow, however the passion and dedica on you see is a testament to how successful Trump truly was at ge ng his message out to the people who needed it most. Such percep on has centred around the ideals of the media, which have long been a target of the Trump machine. While difficult to completely comprehend, there has been some forms of mistreatment levied against the president during his me in office with the way in which his achievements have always been put into second place behind his negave presenta on. Now bias is always a media certainty: as while muddled

in self-pity, Donald Trump is correct when he explains that the media twist or misrepresent his words to fit their personal narra ve. Unfortunately, that’s not anything new or personal towards the president as every American news outlet from NBC to CBS to FOX, each one takes its place on the political spectrum based on its aﬃlia ons whether down to the owner, the state or the commentators it wishes to employ. His vic misation or ‘fake news’ angle is in fact how every person in the world would be represented, only Donald Trump is such a polarising figure that his personality and his ac ons, from the constant slandering to the unethical public interac ons make it hard to focus on his incredible accomplishments considering the entertainment value he otherwise provides. Barack Obama was greatly hated by republican members and broadcasters, however he treated them respec ully and with maturity and therefore received a fair and professional treatment that

reflected more onto policy. He never a acked his opponent’s deceased son as a war criminal or used the news to fuel an ongoing vende a against one of the largest establishments in the modern world, especially at the extent of the nation’s personal health as Trump did in the early stages of Coronavirus where he suggested it could even possibly be a form of drama zaon as a ploy against his leadership. To this point, it is very easy to focus on this as support for Donald Trump as a failed President. Division in the na on is now at a point wider than ever, and it is hard to imagine that without being a more moderate Democrat, Joe Biden would ever have been able to win the elec on. This is a Trump causa on, down to his insistence to push his base to widen the gap and a ack the media for his own benefit to ensure that if as he claims it’s never his fault, then the only solu on is that it is all a false narra ve to a ack him. But this is mildly intelligent. He has forgotten that the media took him from his reality as a child handed the keys to his father’s fortune and created this image of a self-made real estate mogul who became a media personality almost overnight. And the sudden change actually speaks to the Republican party who hate how the media is current and mostly progressive by seeking truth and constant development, conservative Chrisans are scared of the danger they face when their personal lives are steeped in tradi on and never devia ng from what their bible tells them. On elec on day with their dismissive approach to media polling, they turn up in large numbers to vote as if they didn’t previously exist and create a scenario that skews the votes more in the Presidents favour. This support allows him into a situaon whereby being staunch believers, they buy into his theories that big tech is against him despite their early support when he first considered a poli cal career, and they are why the deep state conspiracy is now so prevalent as Donald Trump himself manipulates this theory in his last-ditch a empts to keep his grip on power. The reality of ‘deep state’ is that rather than being a conspiracy, simply put it is the only hurdle he can’t physically

get past, as its real form is the two separate branches of governmental power that keep him from autonomous control. The democrat’s control over the house of representa ves and their legacy following 8 years in power means that the administra on he took over has more control than he cares to admit, and such is his tenacity that rather than admit his defeats, he turns a perpetually gridlocked system into the opportunity to campaign for greater power and possibly the ability to act alone without approval. Abrasive, tough but it is difficult to argue that Donald Trump hasn’t been successful. At every step of his journey he has been the charisma c and ground-breaking leader America has yearned for, only due to his rural and unappreciated support and outspoken if not occasionally ridiculous temperament does the country discredit a man who literally walked out of his own New York oﬃce and into the Oval with very li le opposi on from anyone. Perhaps the biggest success he will achieve is the las ng impact he will have on American poli cs. He might have contributed to tax improvement, unemployment and interna onal relaons, but crucially he has exposed the American system for what it truly is, cracked and broken. Donald Trump was never the problem; he was just the mirror that embodies how America truly looks. The racism, self-interest, tax evasion and all his other endeavours are examples of real problems being ignored every single day, so finally after 4 years America must wake up and see what they truly represent as a nation to themselves and the en re world. Joe Biden is the new President because America didn’t like what it saw, yet unless they confront the xenophobia, growing class/ ideological divide and finally solve the clear political inadequacies nothing will ever change. Trump may just go down as one of the most memorable Presidents in history, si ng in an unimaginable position next to Abraham Lincoln, Thomas Jeﬀerson and others. His greatest success will not have been his public service but the legacy he is des ned to leave behind, the catalyst for an America that truly needs some way to become great again. europeanbusinessmagazine.com 83

With the USD in decline, how else can investors hedge risk? The US dollar has long been the benchmark for a stable currency. It has long worked as a defensive asset and aﬃrmed “cash is king”. But in 2020, the US Federal Reserve took unprecedented measures to provide monetary support to the population, “printing dollars.” In a few months, the global dollar supply has soared by about 20%. And although inflation in the US is still very low, Citibank predicts the dollar will devalue by the same 20% in 2021, and the dollar index has already dropped to a three-year low. If the king is no longer the dollar, then who? By Victor Argonov, senior analyst at EXANTE

Euro and other world currencies. The same problem, only so er Despite Ci bank’s forecasts, inflaon in the US is s ll below 2% per annum, and the Fed has leverage to maintain the dollar rate even in the face of expanded supply. According to “dollar op mists”, cash is s ll the king, and if someone encroaches on the domina on of the American 84 europeanbusinessmagazine.com

dollar, then it is some other cash - the euro, the British pound, the Japanese yen, etc. the DXY dollar index, which reflects the dynamics of the American currency against the euro, pound, yen, franc, as well as the Canadian dollar and the Swedish krona. Before the COVID-19 pandemic, the dollar index was in the range of 96-100, and at the peak of the crisis

in March soared to 103. Most investors, selling securities and other assets, preferred to transfer capital in the US dollar, rather than in euros or other currencies. Even knowing that the Fed was flooding the market with liquidity, they trusted this currency more in the old fashioned way. But since May the situa on has changed. The dollar index began to decline and already (December 4) rolled back

like a signal from the establishment to a mass of investors: “The dollar is bad, buy bitcoin!” This was a very apt statement when you consider that Bitcoin has been known as an excellent defensive asset against currency risks since 2018. While its hedging role against stock market crashes is s ll controversial, it has helped buyers more than once against na onal currency crashes. The crises in Turkey, Argen na, Venezuela and a number of other countries have shown that the collapse of the na onal currency is causing a surge in interest in cryptocurrencies. And if now the me has come for the dollar’s instability, then cryptocurrencies can come to the rescue here too.

Index funds. In theory, the dollar is perfectly hedged, but in prac ce they themselves o en collapse

below 91 - the mark at which it was previously in 2018. This means that storing capital in a basket of other currencies can mi gate the possible deprecia on of the dollar. Since mid-February, the euro has grown by 11% against the dollar, the yen - by 8%, and the yuan by almost 7%. However, this is only a half measure. Mutual exchange rates and the dollar index reflect only the change in their purchasing power rela ve to each other. However, they do not say anything about their absolute purchasing power. For example, if one day all world currencies depreciate by half, but do it synchronously, this will not aﬀect the euro / dollar rate or DXY at all. However, at the same me, ci zens will see their por olios half, at least temporarily.

Cryptocurrencies. Algorithmic protec on against infla on and long-term growth, but its own risks Of all the assets of the cryptocurrency, perhaps the best showed itself

against the backdrop of the COVID crisis. Although in February-March they collapsed even deeper than stock indices, their recovery turned out to be much faster, and since October, the dynamics of cryptocurrencies has almost completely ceased to depend on the whims of stock markets. A er the spring recovery, many investors believed in cryptocurrencies as a defensive asset, and during the pre-election drawdown of the indices they did not dump them “for the company.” The rate of bitcoin (BTC) and many other coins began to rise, regardless of whether stock indices are declining or rising. At the same time, other factors began to work in favor of cryptocurrencies: their acceptance into the account of the popular payment system PayPal, the expecta on of new measures to support the popula on by Biden, etc. In November, Ci bank’s forecasts of the threat of dollar devalua on by 20 % and, at the same me, the growth of the bitcoin rate above $ 300K. Both predic ons were made by a reputable financial ins tu on and sounded

In the modern world, a par cularly rapid flow of capital goes between the stock market and the dollar. Major stock indices such as the S&P 500 (stocks of the top 500 US companies) usually move against the dollar. When people sell stocks, the dollar goes up and vice versa. Buying funds that track indices (for example, SPY, the price of which is propor onal to the S&P 500 or DIA, the price of which is propor onal to the Dow Jones), on average, allows not only insuring against inflation, but also ge ng a good income above it. Since the 1950s, the S&P 500 has grown at an average rate of 8% per year. For this reason, it is wise for any investor to have stocks and especially index funds in their por olio. But like cryptocurrencies, they are not a panacea. Thus, like cryptocurrencies, index funds insure an investor against currency risks in the long-term horizons, but in the medium-term they can fail. Therefore, as in many other cases, the best solu on is to diversify: store part of the capital in tradi onal currencies (dollar, euro, yuan, franc, etc.), part in cryptocurrencies (BTC, ETH, etc.), part in stocks and index funds (SPY, DIA, selected successful stocks from different industries). europeanbusinessmagazine.com 85

Leveling the field: how the rule of law and a free press are crucial in international business

xpanding a business into new international markets can be a complex challenge as companies grapple with differing regulations, wildly varying cultural norms, and must o en communicate and market in mulple languages. S ll, the rewards are legion – a much larger consumer popula on, exposure to new and innovave products and a diversifica on of overall risk as a firm moves away from a single market. The world is a large, dynamic place and massive growth (especially in the global middle class) is expected in Asia, the Middle East and Africa in the next decade. What businesses quickly discover, however, is that much of what companies take for granted in the U.S. or UK as far as legal protections and transparency are weakened or en rely absent in the countries into which they might want to bring their business. How do companies determine where they can safely manufacture their products or source their goods? What tools are available to help judge this risk? Every year, a plethora of global rankings are published by various organiza ons to help explain the rela ve risks and ease of inves ng in a given country. An alphabet soup of organiza ons from the OECD to WIPO as well as bodies such as the World Bank and companies like A.T. Kearney compile lists to rack and stack the various na onal markets. But there are other indices that are crucial to interna onal business leaders and are usually overlooked as quants focus on comparing easily-iden fiable sta scs such as consumer spending habits or labor costs. The overlooked

86 europeanbusinessmagazine.com

concerns of the rule of law w and press freedom, however, determine the true cost and risk of an interna onal investment, and a close examina on of these will help companies to steer clear of serious pi alls before commi ng me, energy and personnel to a new market.

The importance of a free press to business In the last few years, the concept of a ‘free press’ has had a rough ride, especially in the United States, as poli cal fac ons point fingers at what they see as par san repor ng, and other (unprofessional, unchecked) social media-based organiza on have started to dominate how many people get their news. However, professional inves ga ve journalism is a crucial, irreplaceable ally to business investors. A free professional press is one of the most important tools to ensure transparency in a market. A great example of this is the exposure of Wirecard in Germany (and the Philippines) by intrepid Financial Times reporters. Despite both the firm’s auditor (EY) and the German government’s own watchdog failing to detect any problems, the FT reporters con nued to dig into an apparent disconnect in Wirecard’s accounts and eventually exposed a billion dollar fraud which led to the firm’s collapse. In the absence of a free press, this fraud would not have been discovered. When you are working with foreign partners, the free press is a strong and cri cal ally on checking any sort of flagrant fraud and company shenanigans.

This important role in the press - monitoring governments and businesses for misconduct - is why the Reporters Without Borders (RSF) ‘World Press Freedom Index’ is a key component in assessing a foreign market and understanding what checks and balances poten al future business partners from these countries may face. The U.S. is ranked 45th and the UK 35th out of 180 countries, neither of which are par cularly impressive, but at least give a baseline from which to start a compara ve survey. Interested in doing business in Russia? Their ranking is 149th out of 180. China? 177th out of 180. Companies must think twice before engaging in business here, as a firm enters these countries without the helpful assistance of a free, inquisi ve press to help iden fy and bring down fraud, bad prac ces, gra and other major concerns for businesses opera ng in the country. This is especially crucial for foreign businesses who are

entering the market – everyone else who operates locally and is part of the system may already know through experience and word of mouth which companies are actually reliable and which are shell companies to support the money-laundering ac vi es of the local elite. In the absence of a free press, a foreign company is on its own and opera ng at a significant disadvantage.

Corrup on flourishes in the absence of scru ny Not surprisingly, the rankings of Transparency Interna onal’s Corrupon Percep ons Index generally track along the same lines. Although they use diﬀerent methodologies to establishing their rankings, corrup on generally thrives in a country with limited or no press freedoms. The reasons for this are fairly obvious – with no inves ga ve repor ng or shaming in the press, oﬃcials and agencies are able to

engage in corrupt ac vi es with impunity. Even countries that a empt to ‘root out’ corrup on with death sentences and criminal investigations have limited effectiveness. China, for example, embarked on a major anti-corruption campaign in 2012 that included the inves ga on of several poli cal figures and could even carry the death penalty, but they s ll rank 80th out of 198 countries. The United Kingdom is ranked 12th in the most recent Index, the Unites States is ranked 23rd, and Russia is…137th. Denmark is number one. Their ranking in press freedom? 3rd a er Norway and Finland. The connection between a free press and corrup on is strong. The rule of law is another crucial ally for foreign businesses But one other ranking is crucial for businesses looking to expand into the interna onal market. Although businesses may not want to turn to the law for assistance over an issue

(contract dispute, violation of a non-disclosure agreement, intellectual property protec ons) at least it is a reliable op on in the U.S. and the UK for companies that find themselves in a bind over certain business issues. America and the United Kingdom are compara vely li gious socie es, and companies from these markets o en think in terms of legal solu ons (or resolu ons) when facing a business problem. But what if there is no reliable legal system to turn to at all? Or what if the local legal system is subject to corrup on or even governmental manipula on in favor of the ‘home team’ when a company is opera ng overseas? This is a substan al concern when working in the interna onal arena, and they have a ranking for this issue as well – the World Jus ce Project’s Rule of Law Index. The rule of law is defined briefly as a legal system which is just, accountable, accessible and fosters an open government. The U.S. is ranked 21st europeanbusinessmagazine.com 87

Comparison of indices

200 180 160 140 120 100

Press Freedom Rule of Law Corruption

80 60 40 20 0

USA

and the UK is ranked 13th out of 128 countries. Russia and China come in at 94th and 88th respec vely. Once again, the number one country is Denmark. The chart above shows the rela onship between these indices. For the sake of comparison, Brazil (BRA) and the Netherlands (NLD) have been added to the mix. The connection between the relative strength of press freedom and the rule of law with corrup on is striking. The absence of a strong rule of law and professional free press clearly create condi ons in which corrup on will thrive. For business leaders, the key concern is risk – if they invest in a country with a weak rule of law and no press freedom (which has its own ESG concerns for stockholders) they are highly likely to face corrup on concerns. The U.S. Department of Jusce and the Security and Exchange Commission are very aware of this and focus the majority of their Foreign Corrupt Practices Act investiga ons into countries such as China, Brazil and Russia. Historical prosecuon sta s cs for the UK Bribery Act are similar, with an addi onal focus on the Middle East and Africa. Additionally, a company needs to weigh its legal concerns very carefully before inves ng in countries at the bo om end of the scales, as their ability to dispute business conflicts in court are drama cally weakened. Crucial intellectual property is at risk 88 europeanbusinessmagazine.com

RUS

CHN

DEN

(as many have discovered to their dismay y in China) and a company’s ability to rely on outside sources (such as the press) to vet and inves gate poten al partners or upcoming regulatory change drops for every point on the scale. The smart (and safe) money is to locate key business components in countries where these issues are absent. International business is risky enough without the added burden of a corrup on concern or loss of key technology. Chasing cost savings may look wise in the short term, but paying extra to work in a country free of corrup on, with a robust professional press and strong legal system is the clear winner in the longterm. The playing field is substan ally more level for foreign businesses that invest in countries such as the Netherlands or Denmark. There is a price to pay in higher wages for local staff and potential corporate taxaon, but one will be able to compete on fair terms, keep abreast of developments and revela ons thanks to a free press and avoid the risk that the company will be pulled into a corrupon scandal such as Brazil’s infamous ‘car wash’. Beyond the obvious concerns of opera ng in these countries, there are secondary impacts that are important to consider – a loca on with a strong rule of law allows a business to (properly) influence the government and help avoid regulatory

BRA

NLD

changes that may impact the company’s ability to compete on the local market. In the event of cybercrime or other related malfeasance, a foreign company can approach the local law authori es with confidence instead of trepida on. With a free press, companies can expect scruny of their ac ons, but also those of their suppliers and competitors as well as the government. Building a produc on facility in a country that has a miserable press freedom score and major corrup on concerns will also invite stakeholder scrutiny from an ESG perspec ve. Inves ng in a country where these issues do not exist allows businesses to generally sidestep concerns over social and governance concerns. In the end, choosing where to do business is a numbers-based decision, but all too often, the number crunching does not look to secondary costs that come from ‘running to the bo om’ on these issues. A company is far be er oﬀ paying a bit more to play on the level playing field that comes from a site that has press freedoms, posi ve rule of law and less corrupon. The advantages far outweigh the price of admission. Kirk Samson is the owner of Samson Atlantic LLC, a Chicago-based international business consulting company focused on market research and political risk assessment. Mr. Samson is a former U.S. diplomat and international law advisor.

How to Build up Partnerships

(Lothar Stadler, December 2020)

othing stays as it was – global business changes, fast innovaons are emerging, and new developments in digital solutions help us to work diﬀerently. Today’s search for business partners is diﬀerent – no traveling, no physical meetings, no personal checks. Different approaches to build up rela ons can make it possible to reach our goals in this changed world.

Check your business strategy before star ng to search for partners In the current global situa on companies suﬀer from uncertain es and some may suﬀer from lower customer demand. Business leaders have basically two possibili es: downsizing or finding new markets. This is the main reason why many companies look

outside their home country’s markets for growth opportuni es. Entering new markets bring a lot of opportuni es, but also a lot of challenges. Many obstacles must be overcome to achieve success in a new market environment. Before star ng your partner search, always check your general business strategy. Does your products and services fit the new market? What compe ve se ngs do you find there? What value can you add to your new customers? Define your go-to-market strategy and set up a me frame for your new venture. Focus on your company first. Before companies set out to find partners in distant countries, they should take the time to solidify their business fundamentals such as strategy, oﬀerings and resources. This will help build the business case and pla orm they need to mone ze eﬀec vely in new markets.

Currently we see that data and analy cs aﬀect business prac ces most in sales and marke ng func ons. The energy, high-tech and healthcare industries are par cularly concerned. Involving data and analy cs before entering new markets may also lead to reconfigura on of opera ng models or even core business func ons from product development to marketing (Go lieb, Riifai, 2017). Even when businesses are facing high demand, like the healthcare industry at the moment, it makes sense to deeply dive into your business strategy and define the priori es for new partners. "For all the markets we are entering or where we already serve customers, we have employees from these regions inside the company, with local knowledge and language. This is essenal for our partnerships.” says Edwin Kleiber, Managing Direcor at Amex, a distributor of medical and laboratory equipment, who currently responds europeanbusinessmagazine.com 89

to the needs of interna onal developing agencies and humanitarian aid organiza ons. When a team is truly na ve to a region, you gain invaluable insights into local markets and customs. Check your possibili es of human resources and see in which fields local partners can add value. Before entering a market and long before searching for a partner, it is important to analyze the value that you want to bring to your customers in the new markets. In literature, an array of concepts has been developed addressing the ques on of how value is created for customers and which components and characteris cs of value are important. Three main concepts of customer value can be found: while economic and early marke ng literature mainly focused on value-in-exchange, more recent developments focused on rela onship value and value-in-use (Kleinaltenkamp, 2015). This brings up the real situation in which a customer uses a product. Marke ng and sales arguments become more relevant when they refer to specific customer situa ons. Adding value for customers with products and services through appropriate value crea on concepts becomes even more important in remote mes. Your eﬀorts can mul ply when you meet the needs of your customers with the right arguments, whether it is a physical product, a so ware as a service, or a pure service. Some recent approaches have turned towards a more customer focused view of value crea on processes and try to mo vate customers to par cipate in joint value crea on processes. This also needs partners, especially in distant markets, to interact with future customers.

Defining partner roles It is important to have a clear understanding of the business strategy before starting to define partner roles. This makes it possible to derive the right roles for any new partners. Depending on what type of product or service you oﬀer and whether you serve a market directly or indirectly, 90 europeanbusinessmagazine.com

these factors define the roles of a future partner. Figure 1 shows a selec on of the most common channel partners. Companies may want to sell products directly to customers. In this case they may work with channels like personal selling, agents, retail oﬃces or marke ng partners. Typical indirect commercializing works with dealers, licensing and service partners. E-commerce has a rising importance and can be organized through direct or indirect channel roles. A survey among workshop participants at CIS2020 – Asia’s largest experiential conference in corporate innova on – shows a representa ve picture of the current situa on (figure 2). More than 60% of business leaders and innovators are currently looking for marke ng-, e-commerce- and agent-partners. Those are partner roles which do not need big investments, but create big opportuni es and facilitate progress even with fewer resources. As remote work is currently on our agenda, marke ng partners can help in distant markets before, during and a er the sales process. Finding marke ng partners is probably easier than finding suitable dealers or service loca ons. Choosing a marke ng partner can also be possible remotely, and you might see the results immediately. When it comes to industrial products, many companies still rely on tradional channels for commercializing.

For many of those businesses, personal customer interac on is a high priority, even with customers in distant countries. Many companies therefore rely on local partners like agents or representatives, who on the one hand inform about news and on the other hand represent the respec ve company’s interests in that market. "The current pandemic has made local partners in distant countries more important for manufacturers", means Wolfgang Willig, Managing Partner of Al Mazroui Infra from the United Arab Emirates. AM Infra serves wellknown companies from the Western hemisphere with its trade services and local support in the infrastructure and transport sector in the Gulf region. He confirms: “Agent ac vi es have increased over the last year - also due to travel restric ons - because more local exper se is needed”. From a commercial perspec ve, the Internet has significantly transformed the retailing landscape. Demand for new technologies led to a shift to e-commerce channels in many sectors. The increasing prevalence of e-commerce has also given rise to a novel e-commerce channel - the marketplace - in which manufacturers sell their products directly to consumers. Globally, more than 50% of e-commerce sales were made through online marketplaces in 2019 (Merton, 2020). It is forecasted to grow drama cally over the next 5 years, as more companies adopt marketplaces

as the best platform to promote online sales. With the rise of the world’s marketplace top league like Amazon (global), PayPay Mall (Japan), eBay (global), Mercado Libre (South America), AliExpress (global), Rakuten (global) or Taobao (China), manufacturers, retailers and online traders need to decide whether to introduce the marketplace channel in addi on to their exis ng channels. The high degree of shi to e-commerce led a large number of businesses to interact with their customers via different channels. Mul -channel commercializing aims to create additional customer convenience with mul ple touchpoints such as online and brick-and-mortar stores. Companies may sell their products via e-commerce, look for an agent in a specific country and have a marke ng partner for a region at the same me. Managing mul ple channels is becoming increasingly complex, but customer demand is driving mul -channel strategies. Today, multi-channel commercializing is moving towards an omni-channel model in which the integration of various pla orms shapes the service interface and creates a seamless experience for consumers (Thaichon, Phau, Weaven, 2020). The way companies are using the mul -channel trend is one of the hottest business topics these days. The choice of product and service oﬀerings per channel, new strategies in pricing, how to measure sales performance, and even the eﬀect of spillovers from online pla orms are quesons that go hand in hand with the mul -channel trend. The use of mul ple channels can also change a structure of a company, including the role of the sales force, and may also lead to risk of cannibaliza on and potential conflicts in resource allocation (Yingchen Yan, Ruiqing Zhao, Zhibing Liu, 2018). Coordina on and control of mul -channel roles is essen al for business success in the future. With the appearance of new channels, companies o en need to consider how to introduce a new channel with which partner. Defining the right channel role is crucial before star ng to search for a new partner.

Partner search Classical personal selling is s ll the most used channel today. Millions of companies have their own sales staﬀ who try to convince customers to buy their products or services. Par cularly in the B2B market, personal selling is s ll the most important channel role. Take the example of industrial goods, which often require a high level of explana on. Here, sales can hardly be realized without specialists travelling to customers. Many countries have been keeping tourists out during the pandemic, and travel for business people has become extremely complicated due to permits and enforced quaran ne days when entering a country. Entry into China is currently practically impossible for regular business trips (Brown Forrest, 2020). Agents typically can help in this situa on as proximity to customers is an important asset. Personal conversa on is s ll the most eﬀec ve tool to convince people of one’s ideas. Long-standing contact networks of local agents are of course helpful and even more so, when travel restricons are in place. Trading companies and marke ng partners can also help in such situa ons. Depending on the targeted market, it makes sense to look for a partner that fits into local business prac ces. For

Europe and its regional diﬀerences it might be useful to have a marke ng, agent or distribu on partner in each country. In the Middle East, where business has strong es to ruling families, it can be helpful to have someone, who has long-term business connec ons and even poli cal contacts. In South East Asia, even among ASEAN countries, it is s ll diﬃcult to ship products to another country for repair and return it repaired. In such a case you probably have to look for a local service partner. In Japan and Singapore traditional trading firms dominate the market. These can help foreign manufacturers to access the market. If we know who we need, we can talk about how we find them. Classic matchmaking organizations are chambers of commerce, commercial department of embassies, national representa ons, industrial, business and trade associations. Try to find influencers in a new market. Par cipate at conferences to meet poten al partners. If you want to sell an elevator, for example, speak to architects, property managers or construction companies. Even ask future customers for help with searching for local partners and check how other companies and competitors work in that market. Probably you can get recommenda ons from your personal network, like business partners or social media

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contacts, when you speak about your projects and future markets. Accelerators can help start-ups in matchmaking and business expansion in new regions. For example: RISE with its accelerator program works alongside startups and helps navigate a Southeast Asian expansion. Hong Kong's largest start-up community WHub can serve as a gateway to China, and PlugandPlay connects the best technology start-ups with the world’s largest corpora ons. Finding the right partner requires experience, contacts and knowledge for cultural diﬀerences.

Building partner networks virtually Today’s search for business partners is different – no traveling, no physical mee ngs, no personal checks - but the tasks stay the same. We recommend to speak to people, who know the market or know someone, who can help you on-site in the market. Personal recommendations offer a solid founda on for establishing new rela ons. Keep in mind that everybody is in the same situa on in this pandemic and that customers find it just as difficult to get to know new suppliers. Nevertheless, a good synergy of adver sing ini a ves, social media appearances and sales efforts also helps in virtual acquisi ons. Michael Kreilmeier, Managing Director of Mission Embedded, a system integrator for safety-cri cal applicaons in the transport and medical sector, states that "the more complex a product is, the newer a product is and the further away the customer is, the more trust needs to be built up. A personal touch always helps. If this is missing, the hurdles for new business are very high, but not impossible". In mes of completely remote work, local contacts help. Established agents and local representa ves report that their network of contacts is especially helpful now and that they benefit from their long-standing rela onships. Not only businesses rely on close and long-standing rela onships but also universities. Partnerships between universi es have had a high priority 92 europeanbusinessmagazine.com

for decades. They shape en re genera ons, make a valuable contribuon to research and promote cultural exchange. Universi es have always been at the forefront of technological or social progress, and they switched to virtual formats very early in the pandemic. Virtual formats have also changed working prac ces in partner networks. "Virtually you o en get quite far nowadays, some mes the last steps require a physical meeting. Real personal me is be er used today, because it is no longer taken for granted", says Barbara Stö nger, Dean of the Executive Academy at the Vienna University of Economics and Business Administra on. In the past you might have travelled for three days, today you might only have one hour for the same topic in a single video call. Human factors in partnerships cannot be replaced, but a lot of preparatory work in projects is possible with virtual tools. Therefore, we will look more closely at how digital tools can help in partner networks later.

Remunera on framework Once you have found the right partner, the next step is to discuss remunera on for the rendered services. A clear defini on of a remunera on framework and the incen ve system is essen al for the success of a partnership. Finding an appropriate soluon for individual situa ons makes the difference. Figure 3 shows six core elements of a well-func oning remunera on framework. Every company has diﬀerent types of partners - from small businesses up to big businesses. Each partner may have a diﬀerent relevance to the company. Partners can be classified by status, and represent certain importance to the company, certain rights and obliga ons, and organiza onal hierarchy. Partners may also have different roles or development stages in a business network. Typical status are silver, gold and pla num partnership. Certain rights, incen ves, discounts and community advantages can be linked to a status.

For any partnership it is necessary to set the rates of remunera on. If you are looking for an agent, it is essen al to set commission rates, if you have a distributor, it is important to consider discounts, and if you are looking for marke ng partners, they will probably receive a fixed amount per month, quarter or year, or you can find a formula that depends on business success. Price levels o en are essen al for company strategies. Depending on the market and regulation, you can introduce recommended guiding prices. Keep compensation formulas simple, because payment procedures might get quite complex when it comes to invoicing, partial payments and credit notes. Incen ves of course are very important and give the possibility to ac vely manage your partners. Incen ves can vary from typical discounts for bigger orders, oﬀerings for addi onal services, addi onal gi s or a higher status, if certain targets are reached. Nowadays, customer service is a must for every product or service.

Companies may offer special customer services to their partners. They may also seek partners who multiply services to their customers and offer train-the-trainer programs. Local service partners that understand local customs and speak the respec ve needed language become increasingly popular. During the pandemic, both capital goods manufacturers and manufacturers of complex plants became aware of the importance of local service partners. In the past, technicians could simply get on a plane and solve problems on site within a very short me and get plants running again. Today there are travel restric ons, quaranne regula ons of 10 days on arrival and 10 days on return. This drives up service response mes, repair mes and associated costs. Local partners, who can communicate with specialists from manufacturers remotely or via VR- or AR-applica ons, are valuable today and new technologies for servicing are becoming reality. And finally, new partners need help in their startup-phase. This can be simple things like free samples or starter kits and may lead to increased support of new partners with favorable payment arrangements, addi onal training, and greater a en on to technical service. “Each partner may not be able to support as much as needed, due to budget or me constraints. Laying out your concerns before working together helps”, means Natchaya Sukkaew from Yara Interna onal in Thailand.

Agreement principles Figure 4 shows the typical agreement principles that need to be brought into balance. Any partnership must have a defined starting point. It is also recommended to define a certain dura on of an agreement. Openends in agreements can lead to diﬃcul es in termina on, for example if partners invest for the longer term and then demand compensa on. In partner agreements one of the main points to clarify are the du es of both sides. This is the time to precisely specify what you expect from a partner and define who does what. Almost ridiculously seeming

ques ons such as ‘who is responsible for which marke ng ac vi es’ and ‘who pays for them’, or ‘who bears the transla on costs’, make sense to be clarified before the signing of a partner agreement. Rates of commission and discounts, a fixed fee or a performance bonus are typical elements of such agreements. They all need a calcula on basis. Is it the contract value or is it the value without taxes, and which currency is used for calcula on? These are sensive issues, as the nature of the base can cause high varia ons in money. When it comes to payment, an important issue is to specify the time of the payment. For example, an agent's commission usually arises, when a customer contract is signed, but the commission cannot be due un l the contract is in force and the full commission should only be paid, when a customer has paid their bills. Each market has its own characteriscs and this is the me to talk about special es. We recommend formula ng a standard agreement suitable for general purposes and to deal with the special es at the end, as they can vary from country to country. Businesses can evolve and an agreement should also provide room for future developments. It may be that you wish to change partners or that you will have other sales challenges in the future, so it is a good idea to facilitate such developments. A partner, who is no longer performing, can severely block your business development. Termina ng a partnership is not easy, some mes painful, but somemes also necessary. Find out, whether a new partner is right for you and simply try it out. We do not recommend signing large agreements at the very beginning of a partnership. Try to start a first project together. You will see how well the rela onship works as soon as the first diﬃculty comes up. Even though we are talking about agreements here, lawyers can help with compliance to regula ons and laws. Nevertheless, it is the business people, who should define the principles of the partner rela onship. Finding an equilibrium between partners europeanbusinessmagazine.com 93

might be a secret to establish longme partnerships. The big aim should always be to find the right balance, on the one hand by le ng the partner work independently and on the other hand by monitoring their ac vi es.

Managing new partners The right managing of new partners could be the final touch to a successful partnership. In any organiza on, a good onboarding program helps with all other subsequent steps. In mes of remote work, digital tools, hands-on prac ces, fast ac on, professional organiza on and good communica on is also needed for managing partners. Today’s popular digital tools all work on cloud based systems and they are available anywhere and any me, which highly facilitates relaonship management of partners. By using communication tools like Slack, Google Chat, Microso teams, etc., teams are brought together in communication channels related to projects, topics or teams. Everyone in a channel sees the same messages and stays on the same page. Bringing even 94 europeanbusinessmagazine.com

external partners into such communica on channels can make work faster, collabora on more efficient and bridge global distances. “As so ware plays a more and more cri cal role in the performance of every organiza on, we share a vision of reduced complexity, increased power and flexibility, and ultimately a greater degree of alignment and organizational agility.“, said Stewart Butterfield, Slack CEO and Co-Founder, when announcing an agreement on 1 December 2020, under which Salesforce will acquire Slack. Online collabora on tools for managing projects and personal tasks help in mes of remote work. By also integra ng partners, teams can work more efficiently. Popular collaboraon tools like Trello, Monday, Basecamp, Gira, Miro, Freehand, Confluence or Jamboard all have their own specialty and strengths. One aspect that they all have in common: they intend to enable teams to organize and priori ze projects in a flexible, effec ve and crea ve way, from anywhere in the world, irrespec ve of whether you commute on a bus or spend your work day at the beach.

Customer rela onship management tools are powerful pla orm tools to help marke ng, sales, e-commerce, customer service and IT teams to keep the customer in focus. Managing partners with a CRM so ware can help a lot to be er work together with a view on your customers. We even recommend opening a corporate CRM account for external partners. In this way, partners can report directly into your CRM system and you do not receive single Excel- sheets or E-mails with sales or customer informa on anymore. The data will be directly fed into your system from your local partner and you can immediately see the results. Set targets with your partners that appear challenging. With the use of CRM so ware you can easily monitor and control target achievement. When you search for partners, you can ask for a certain number of leads and opportuni es per week or month. If you formulate targets and prepare your people well for achieving them, they will do it and be happy with new modes of working. “B2B commerce of the future will shi very strongly to online channels - not least because of Covid-19. Partner models are moving further from isolated channels towards a 360° view of the customer. Modern CRM systems oﬀer a holis c pla orm for data management and enable the development of automated and personalized solutions.”, says Christina Neumüller, Salesforce Consultant at Salesfive in Munich. With all the sophis cated so ware solutions and futuristic tools, the people who make the projects work must not be forget. As new partners arrive in organiza ons, the need for training in opera onal processes and digital tools also increases. Be aware that not all people are familiar with digitals tools or sophis cated applications. Frequent training sessions also help to include those, who need more time to learn working with these new tools. Powerful partnerships can grow, when you show flexibility in serving new partners. Mo vate people to share informa on to build up trust and enable deliberate learning with channel partners (Keeling, Cos, Ruyter, 2020; Lostakova, Pecinova, 2014).

AUTHOR Dr. Lothar Stadler, 44, is an entrepreneur from Austria and provides services in global sales and business innova on for technology-driven customers. He is a former sales execu ve from the machinery and transport industry, mentor for start-ups and lecturer. Lothar.stadler@explorvent.com www.explorvent.com

CONCLUSION This ar cle is supposed to give you an idea on how to find multipliers for your commercializing eﬀorts. The search for the right partner is characterized by choosing the right channel roles and an op mal incen ve system. The current pandemic has made it even more important to add value for customers with the right partners. B2B business is s ll strongly dominated by the role of personal selling. Local agents with a well-established network of contacts can help even more nowadays. The high degree of shi ing to e-commerce makes a good coordina on of mul -channel commercializing essen al in the future. We defined some of the core elements of a remunera on framework and typical agreement principles, which should be brought into balance for a successful partnership. Virtual

formats have also changed working prac ces in partner networks. By using communica on and collaboraon tools, work can be done more efficiently. Customer relationship data management will enable automa za on and will become a key success factor in the future to keep the customer in focus. Powerful partnerships rely on mutual trust. Remember, most great things in history happened in cooperation - the right partnerships can be a great founda on for future success.

SOURCES Brown Forrest (2020): No tourists allowed: These places are s ll keeping travelers out during the pandemic, CNN, 14 November 2020. Debbie Isobel Keeling, David Cox, Ko de Ruyter (2020): Deliberate

learning as a strategic mechanism in enabling channel partner sales performance, Industrial Marke ng Management, Volume 90, p113123. Go lieb Josh, Riifai Khaled (2017): Fueling growth through data mone za on, McKinsey Global Survey,. Hana Lostakova, Zuzana Pecinova(2014): The Role of Partnership and Flexibility in Strengthening Customer Rela onships in the B2B Market, Procedia - Social and Behavioral Sciences, Volume 150, p563-575. Kleinaltenkamp Michael (2015): Value crea on and customer eﬀort – the impact of customer value concepts, in: The Nordic School, Service Marketing and Management for the future, Cers, Hanken School of Economics, Helsinki, p.283-294. Merton Kate (2020): the world’s top online Marketplaces 2020, webtrader, 18 february 2020. Thaichon Park, Phau Ian, Weaven Scott (2020): Moving from mul-channel to Omni-channel retailing: Special issue introduction, Journal of Retailing and Consumer Services, available online on ScienceDirect, 16 september 2020. Yingchen Yan, Ruiqing Zhao, Zhibing Liu (2018): Strategic introduc on of the marketplace channel under spillovers from online to offline sales, European Journal of Operaonal Research, Volume 267, Issue 1, 16 May 2018, Pages 65-77. europeanbusinessmagazine.com 95

Why now is the time to

s we emerge from the coronavirus-induced economic lockdown, it is vital to consider what comes next for business. In the UK, the Office for Budget Responsibility estimates that government’s life-saving interventions to prop up the country through the crisis could cost over £100bn. Meanwhile, the European Union has predicted that a recession of “historic propor ons” will happen this year. What this means is that fiat currencies linked to sovereign governments are going to become very expensive. Someone has to pay for the mountain of debt being racked up by governments, and that will potentially mean higher taxes, or higher infla on which erodes the value of wages and savings. Larger companies may be able to raise capital through tradi onal measures, but it is going to become more expensive. And what about pubs, independent restaurants, and local football clubs? These places are o en cornerstones for communi es, and they are likely to be hammered by a recession. They cannot issue equity on the stock market -- it is prohibi vely expensive. 96 europeanbusinessmagazine.com

As the economy reopens, what role could crypto play in helping these businesses access capital and get back on their feet? Perhaps now is the me to normalise a prac ce called tokenisa on. Many will already be aware of cryptocurrencies like Bitcoin and Ethereum. These digital coins are gradually becoming more accepted around the world, and the current crisis is likely to accelerate their wider adop on -especially as many may fear physical coins and paper money could transmit the coronavirus. Poli cians from the US to China are discussing creating digital equivalents to their currencies, as they are easier and cheaper to distribute, and prevent fraud. Meanwhile, regulators are becoming more understanding and accep ng of crypto, as technology provides more robust protec on and oversight. Even leading financial institutions, from Fidelity to Goldman Sachs, are taking cryptocurrency seriously. Cryptocurrencies are effectively tokens that represent a store of value and can be exchanged. But while a cryptocurrency is traded publicly,

crypto tokens can be created privately, and for specific purposes. Tokenisa on is the process of taking an asset, and dividing ownership of the asset into several cryptographic tokens. Much like a share certificate or loan note represents that the holder owns equity in a company or a stake of a debt, so too can tokens represent frac onal ownership of an asset. The difference is that it is a much cheaper and more eﬃcient process than tradi onal share ownership. Selling shares in a business o en requires dealing with an investment bank and financial ins tu ons, as well as paying for a registrar to handle and distribute share cer ficates. It is a high-cost and complex process. In contrast, because crypto token exchanges are recorded onto a blockchain, it is more decentralised, democratised, and low-cost. After the Covid-19 crisis, private ins tuons looking to liquidate their assets should consider issuing tokens as a cheaper and more direct approach to raising capital. This is not uncharted territory. The beer chain BrewDog has raised

millions of pounds by selling shares directly to customers through its “Equity for Punks” scheme, while crowdfunding websites like Crowdcube and Seedrs have transformed how businesses can raise capital from everyday investors, by largely digi sing the process of issuing shares. Tokenisa on offers similar benefits, enabling that local pub or restaurant to sell token-based frac onal ownership to loyal customers. These tokens can offer other bonuses, such as a discount or a share of profits. And unlike crowdfunding-based equity, these tokens are inherently tradeable, thanks to being recorded on a blockchain; they don’t need to be listed on a stock market, the tokens are tradeable in and of themselves. Of course, if you’re a small business owner, the idea of becoming a blockchain expert in order to issue tokens will seem daun ng. But you won’t have to. In addi on to liquidity (i.e. the ability to buy and sell) being offered via crypto-issuing pla orms, big tech is also limbering up to offer infrastructure solu ons for the rapid issuance of tokens via a recognised currency that is automa cally incorrup ble. Facebook is the leading household name here. Libra, its cryptocurrency, will enable the social media giant to connect its communica on solu ons with ecommerce, and it may eventually lead to the crea on of infrastructure for companies to issue tokens via

Libra. Imagine paying for your friend’s pint with Libra coin over WhatsApp or Instagram. But Apple, Google, or even Japan’s Rakuten could also pull out in front. The la er already has “Super Points”, a cashback-based loyalty scheme that can be used to pay for goods on other ecommerce platforms, and even in branches of McDonalds. These points could be tokenised, which leads to all sorts of possibili es. For instance, if they could be exchanged with Libra, you then have a poten ally cheaper

alterna ve to tradi onal forex markets and en rely new ways to generate wealth. The underlying point is that, while it is easy to fret over how businesses will cope with the economic repercussions of the pandemic, it’s also possible to be excited by the solu ons that will emerge. Now may be the time for crypto coins like Libra to become mainstream, and tokenisa on could become a crucial way for communies to support their local businesses in the coming years.

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everal years ago, the CEO of Deutschebank stated in an interview that he thought AI would replace up to half of its staﬀ. The predic on sent shockwaves through the industry and made a lot of employees feel uncomfortable about the longevity of their roles. The bank soon fired him and replaced him with somebody else, so he won’t be responsible for the organiza on’s sweeping changes. But it did reveal just how much hype there is in financial circles about the promise of AI. Other people have joined the fray, calling for the end many rou ne jobs in the banking industry. Ci group execuves believe they will say goodbye to around a third of workers. Japanese financial group Mizuho says that it is looking to replace more than 19,000 by the end of the present decade. But whether the digital transformaon in banking will bear fruit remains to be seen. Currently, there’s a problem right at the core of AI research. The people at the forefront of the movement know that the technology is very good when it has an objec ve func on something to op mize - but it isn’t so good in other situa ons. So, for example, it can maximize the probability that an image shows a cat. S ll, it can’t engage very well in regular conversa on - the sort of thing you need for healthy client rela onships.

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Artificial intelligence is also a long way from becoming what you might call “general intelligence.” The so ware is good at performing cogni ve tasks, but it has no subjec ve experience of them. It doesn’t know what it is doing - it just goes through the mo ons. This fact of the ma er means that some of the more outlandish predic ons probably won’t come true. What we seem to be looking at is something that will allow so ware to perform a subset of cognitive tasks. However, it is doubtful we will see programs with subjective agency any time soon. When you tell them what to do, they’ll do it well. But they won’t be running their own companies just yet. That’s very futuris c. AI, however, is a wishy-washy concept. Unlike the tech revolu ons of the last decade - like the cloud - you can’t easily pin it down. AI doesn’t just do one thing - it is a solu on for a whole bunch of tasks. The banking sector, therefore, is going to have to figure out how to deploy it sensibly. For now, it won’t replace people. Instead, it’ll be more like a tool that makes them more valuable. It is, in a sense, a form of cogni ve assistance, just like machines are assistance for manual labor. Robots can’t do all the work themselves, but they can dramatically increase the

output per worker. The same may now be coming to the banking industry. You’ll s ll need oﬃcers to process business banking customers manually, but AI could speed up aspects of the process, like credit checking. The banking sector needs to be careful not to set unrealis c expecta ons of AI. The people at the forefront of the field are more than willing to point out that the science isn’t done yet. They can replicate some aspects of intelligence, but they can’t fabricate it wholesale. Researchers s ll need to make fundamental breakthroughs to usher in that exci ng and giddy new world. To call AI in banking pure hype, though, is taking it too far. There are n umerous examples of AI in banking already, and the technology only connues to improve.

Biometrics For Added Security We first saw biometrics in banking in the film Blade Runner. But advances in technology and AI have made it to make it a reality. And it’s already been done. Bri sh bank Natwest, for instance, now allows customers to open accounts with a selfie. It then stores their data securely, linking their biological profile to their financial informa on. The security benefits of AI could be quite extraordinary. It might sound unsafe, but it is actually a massive improvement over the current system of using government-mandated IDs like passports and driving licenses. Biometric forms of iden fica on are much more challenging to forge and, generally, safer than their paperbacked rivals.

Investment Trading Currently, bankers rely on seasoned traders’ quick wits to make investment decisions in the equity markets on behalf of their clients. Movements, however, are often so fast-paced and unpredictable, that many traders struggle to equal the market, let alone beat it.

Banks and other financial institutions, therefore, are wondering whether there is a way to use the data-crunching abili es of AI to make be er split-second decisions. Ar ficial intelligence could theore cally evaluate firms based on publicly available data, establish fair value, and then conduct trades based on those insights. By using data be er than any human could, it might be be er at determining value - at least in the short-term.

(consistent with fraud), it can put a block on it, protec ng money un l the owner confirms that it made the transac ons.

Be er KYD Checks The Patriot Act introduced a bunch of new security requirements for online transactions. But ensuring that all these are being met is diﬃcult, even

for experienced banking professionals. The idea now is to use AI to check a range of data, from a customer’s social security to their social media, to determine whether fraud or money laundering is taking place. The technology should reduce the amount of me that it takes to assess an applicant. And that might bring banking fees down and make the process more eﬃcient.

Fraud Protec on Banking fraud is currently a massive issue for the banking sector. Every day, thousands of people lose money from their accounts because of fraudsters usually opera ng over the internet. AI tech, however, oﬀers a poten al solu on. Because AI can connect the dots between vast troves of customer informa on, it can o en spot potenally fraudulent ac vity quickly. Fraudsters trying to access accounts from an unknown IP or loca on, for instance, could trigger a denial of service. Similarly, if an AI suddenly detects unusual account activity europeanbusinessmagazine.com 99

The Covid Virus is Stimulating the Evolution of Business

By Michael Marshall, PhD

t seems obvious to most people that business of all types, are changing, adap ng and evolving in response to the Covid Virus and its’ eﬀects on business. Observing this is continual daily everywhere. Discussing this with business owners, management, staﬀ and employees of all types of business and companies, confirm that business management, attitudes, operations, strategies, human resources, communications and marketing, revenue generating parts of the business is changing quickly and evolving. Restaurants are now focusing more on the ‘take-out’, ‘pick-up’ and catering side of the business. Enhancements and changes for more sanita on of the restaurants, employees, food prepara on and food packaging for ‘take out’/’pickup’ are all advancing and evolving.

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Social distancing and wearing masks are now part of daily life and work. Some cultures are struggling with this since they are not used to this. USA is struggling with this with 35-45% seeming to object to this. Retail stores having same issues with customers and evolving as well with these things. Stores are controlling and managing this but this is a challenge. The stores are now focusing more with their online websites and selling online with home delivery. Inventory levels are declining in the stores forcing customers to shop online via the internet. There is an increase demand for home delivery services and logis cs. This is crea ng new jobs. Clothing stores have declining sales because many people are working out of their house now and do not need to buy so much oﬃce business clothing.

Auto sales are declining since people are not driving as much so they do not need new autos as much and same for auto repairs and new res sales. Computer sales are increasing, and auto sales and auto repairs are declining since many people are now working out of their homes instead of driving into the office and workplace through traffic daily. There is an increase in unemployment in some jobs and business sectors and an increase in others especially logiscs, warehousing, truck drivers and home delivery drivers. Some businesses cannot stay in business with the Covid Virus situa on. Restaurant Buffets where food is put out on tables in the open, for all that you can eat and serve yourself, is not able to meet the sanita on and social distancing requirements and needs. These businesses are closing or changing to provide only ‘take out’, ‘carry out’, ‘catering’.

The air quality is increasing and getting better because of less people driving to work every day. Less travel and less autos on the road mean a decrease in gas demand so gas prices are decreasing. Companies are now having many of their office staff and management work from their own house remotely. This is a major a tude change, management change and operations change. Video conferencing being u lized far more now instead of traveling to customers and mee ng in an oﬃce. Companies are finding that they are actually more productive with this and there are substantial cost savings with not having to support company offices. They can now utilize the space for other things that can help the business to grow. Companies also are finding that many highly talented people who previously they could not hire due to reloca on was not acceptable or desirable, now can a ract more of these highly talented people since they can work remotely. When in person mee ngs are needed and required , video conferencing technology is u lized or such meetings are held to a minimum and staﬀ travel by airplane to a major airport selected as the central point to meet, and local business conference and mee ng rooms are rented for the day for such. The airlines business has decreased significantly with some es mate being 50-60% decrease because business travel has decreased so much as well as personal travel decreasing. For social distancing airlines cannot pack people into the airplanes, elbow to elbow so close anymore. More people are staying home to entertain or entertaining outside of house on the lawn or grass. This is causing a big demand on lawn chairs to sit on outside. Since there are more people working from their home now, there is a big demand for home improvement products to repair the house or update and remodel. In the USA, house building products and wood lumber is in such high demand that prices

have increased significantly causing new housing and new buildings cost to increase. Home furniture and home décor stores are busy with sales increasing since people are at home more and see the need for such. There is a high demand for higher level air quality equipment for all businesses and companies. Cleaning supplies and sanitation supplies for higher level sanitation requirements are in high demand. Personal hygiene protec on products such as masks and medical gowns are in high demand. With company factories, they are reorganizing the facili es to provide more social distancing. Some companies, businesses, products and services are increasing sales while others declining. Due to the Covid Virus students from many schools, grade schools, elementary schools levels are now learning from home online with a computer and teachers are learning how to do this. A lot of new computers are being sold with the increase of demand and need. Parents are learning how to help their children to learn and how to help mo vate them as well. This is a very big challenge for the parents and the students. Same for college and universities. Online classes are taking the place of classrooms and teachers are learning how to teach online and students are learning how to learn online and mo vate themselves.

It is so important and cri cal for businesses and companies to crea vely adjust and make bold changes and improvements for ‘growing the business’ and ‘staying profitable in business’ with the current Covid Virus situa on and challenges. Even now, many businesses and companies are re-evalua ng their products, services and their capabili es to expand their products and services into things in high demand. All businesses need to be doing the same thing. This is progressively helping these businesses and companies to grow significantly, both in sales and profits. There are a lot more changes with businesses and consumers happening right now and I have only men oned just a few in this ar cle to help open up your eyes to it, to help you be more aware and thinking about it more. Once you are more aware of this, you will automa cally and naturally start seeing it more. This may even take over much of your thinking and observing. Businesses are evolving and changing due to the Covid Virus. Consumer behaviors, needs and a tudes are changing and evolving. There will be a lot more changes to come and all will evolve. Many of the business changes will most likely progress even though the Covid Virus will eventually get managed be er and have inocula ons / vaccina ons for it. Do not expect all of the business changes to go back to the way things were before Covid. europeanbusinessmagazine.com 101

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Articles inside

Ai In Banking Hype Or Revolu on

Why Now Is The Time To Tokenize The World

How To Build Up Partnerships - Remotely

Lessons In Leadership From The Best In The Business Lloyd Salmons, Co-Founder, Peptalk

European Business Talks With With Nick Morley

How The Union Is S fl ing Economic Development And Why Europe Will Never Flourish Under The Eu

Leveling The Field: How The Rule Of Law And A Free Press Are Crucial In Interna onal Business

Substack: Independent Wri ng Has Never Been So Easy

The Storming Cbd Market In Europe

The Clock Is Tik Toking Why The Use Of Apps Like Tik Tok Are Necessary In Modern Business

How Joe Biden Will Aff ect European Business

Unlocking The Power Of Data-Driven Linear Tv For Business Success

Morocco: A New Genera on Of Civil Servants Paving The Way For Industry 2.0

Would Uk Businesses Gain In Eu Reloca on

European Business Magazine Talks To Lamia Tazi

European Business Talks Exclusively To Mr Mohammed Benchaaboun

Morocco Bridging The Gap

Morocco s Moment: Supply Chains Reimagined

Morocco Building Back Be er