Let­ter from the ed­i­tor

Top 100 See - - Editorial - Nevena Krasteva Ed­i­tor-in-chief

Ever since SeeNews started pub­lish­ing its SEE TOP 100 rank­ing of the big­gest com­pa­nies in the re­gion eight years ago, the win­ner has been an oil and gas com­pany. Not so any longer.

Ro­ma­nian car maker Da­cia, a unit of France's Re­nault, over­took OMV Petrom as the top com­pany in the re­gion, and this break­through is symp­to­matic of the changes tak­ing place in the in­dus­trial land­scape of South­east Europe. The tra­di­tional heavy­weights – the oil and gas and elec­tric­ity com­pa­nies – are slowly but steadily los­ing ground, though they still dom­i­nate the rank­ing and in all like­li­hood will con­tinue to do so for quite some time. Their bot­tom­lines are neg­a­tively im­pacted by low oil prices on global mar­kets – a wel­come fac­tor for most other sec­tors – reg­u­la­tory volatil­ity, and, in­creas­ingly of­ten, un­favourable weather con­di­tions.

The man­u­fac­tur­ers of cars and car parts in the mean­time have been speed­ing up the SEE TOP 100 track, their growth fu­elled by the quick re­cov­ery of their large ex­port mar­kets. They have been mak­ing the best of the re­gion's com­pet­i­tive ad­van­tages - cheap labour costs, low taxes, strate­gic lo­ca­tion, and im­prov­ing in­fra­struc­ture, of­ten draw­ing on past ex­per­tise in the lo­cal industry. The prospects be­fore them seem up­beat as eco­nomic growth in the re­gion ac­cel­er­ates, consumer spend­ing in­creases and per­sonal in­comes rise.

An­other industry poised for growth as it is tied to consumer spend­ing more closely than any other is whole­sale and re­tail. IT and agri­cul­ture, largely ab­sent from the list of the top com­pa­nies in the re­gion, have been at­tract­ing in­creas­ing for­eign in­vestor in­ter­est lately, which is bound sooner or later to place them among the ranks of the big busi­nesses.

For­eign own­er­ship re­mains a cru­cial fac­tor for the per­for­mance of the com­pa­nies in South­east Europe, help­ing them avoid many of the pit­falls on the lo­cal scene such as lim­ited lend­ing or po­lit­i­cal med­dling, while giv­ing them ac­cess to big mar­kets. How­ever, to un­lock the re­gion's po­ten­tial for growth the gov­ern­ments should ad­dress the long over­due struc­tural re­forms, tackle cor­rup­tion and grey econ­omy and try to make the over­all busi­ness environment more pre­dictable. The lo­cal busi­nesses for their part should fi­nally ac­knowl­edge the im­por­tance of in­no­va­tion for com­pet­i­tive­ness.

This, in a nut­shell, is the essence of this year's edi­tion of SEE TOP 100. To get the de­tails, apart from the flag­ship rank­ing of the largest non-fi­nan­cial com­pa­nies by to­tal rev­enue and the rank­ings of the big­gest banks and in­sur­ers, read the in­ter­views with the chart-top­pers and key mar­ket play­ers, as well as the analy­ses of some of the most vi­brant sec­tors con­trib­uted by industry ex­perts.

We are also bring­ing to you the per­spec­tive on South­east Europe of the big in­ter­na­tional lenders in an in­ter­view with To­masz Telma, IFC re­gional di­rec­tor for Europe and Cen­tral Asia, on the chal­lenges facing the re­gion. We take this topic fur­ther with Tom Rogers, se­nior ad­vi­sor to the EY Euro­zone Eco­nomic Fore­cast, and our part­ners from Euromon­i­tor. To get a broader per­spec­tive, we of­fer you a sur­vey by me­dia an­a­lyt­ics com­pany Per­cep­tica mon­i­tor­ing sen­ti­ment across the re­gion towards de­vel­op­ments in Greece and a pos­si­ble Grexit. An anal­y­sis by Raif­feisen In­vest­ment on the M&A mar­ket out­lines the main trends and iden­ti­fies the hottest sec­tors for in­vestors.

We have again in­cluded a spe­cial chap­ter on in­no­va­tions in this year's edi­tion of SEE TOP 100, fea­tur­ing, among oth­ers, in­ter­views with Siemens Bulgaria CEO Bo­ryana Manolova on the Industry 4.0 con­cept, and Michael Paier, IBM gen­eral man­ager South­east Europe on the risks to IT se­cu­rity for the busi­ness.

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