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AIM 2018 Preview: Flanders Investment & Trade

Flanders is the Dutch speaking northern region of Belgium and is considered the gateway to Europe. Given its strategic location within 500 kilometers of major European capitals like London, Amsterdam, Frankfurt, and Paris, businesses in Flanders have immediate access to the European market. CID recently sat down with Flanders Investment & Trade to discuss what AIM participants can expect to hear about the exciting opportunities to invest in Flanders’ agricultural and energy spaces, among others.

CID: What primary message about investing in Flanders will you bring to the conference? FIT: Flanders Investment & Trade (FIT) is a proud winner of the 2016 & 2017 AIM Award, which recognizes the best investment promotion agencies from around the world. In 2017 Flanders was able to attract 215 new projects at a value of EUR 2.08 billion. These investments created 5377 new jobs. Flanders is the 3rd most globalized country in the world. Its central geographic location means Europe’s main markets can be reached in less than 24 hours and 60% of Europe’s purchasing power lies within 500 km. Flanders offers a cutting-edge infrastructure in the heart of Europe. The workforce is known for its knowledge of multiple languages. Last but not least, operating in Flanders means being close to Europe’s institutions. Companies with or deciding to set up their activities or headquarters in Flanders can reap the rewards of:

CID: Why is Flanders an attractive region for agricultural investment in Europe? FIT: Home to businesses in all areas of agriculture, Flanders happens to be the biggest R&D hub in Europe when it comes to plant biotechnology. The region, a global leader in intensive farming, is responsible for 75% of Belgian agriculture and features income per hectare that is significantly higher than the EU average. Agriculture, food, and supportive bio industries are extremely big in the region, which boasts diverse companies from startup all the way to mature global firm.

The food industry is the largest employer in Flanders. Dairy farming is among the largest agricultural subsectors in the region. CID: How does Flanders foster innovation in agriculture? FIT: It’s not just the presence of agricultural companies in the region that is important – the presence of supportive scientific research and innovation is also key to the thriving agribusiness industry in Flanders. With the growing trend towards a biobased, circular economy, Flanders is poised to provide the greatest benefits and reap the greatest rewards. Its focus on the production and processing of renewable resources, agricultural research, and innovation in agricultural technologies and sciences makes the region an ideal place for any industry that touches agribusiness.

Flanders offers several incentives that are particularly relevant to research-intensive industries like ag-biotech. Examples include:

  • innovation income deduction – up to 85% of a firm’s net earnings from innovation is tax exempt;

  • investment deduction for R&D – 13.5% of acquisition value/qualifying asset or 20.5% of the depreciated amount;

  • exemption of payment of 80% – of the personal income withholding tax of researchers in certain scientific fields

CID: How can firms benefit from Flanders’ biomass industry?

FIT: Flanders ensures cost-competitive biomass feedstock and is an ideal business fit for biobased companies. The region offers great access to diverse feedstock resources, is home to four promising biomass value chains, and excels at generating second and even third-generation feedstocks.

To give just a few examples, Flanders is home to:

  • A strongly developed agro-food sector – producing valuable resources, such as sugar beets and corn for industrial biotechnology.

  • An interconnected fruit and vegetable agribusiness – ideal for the local valorization of side streams from food, feed, or industrial products.

  • A pioneering green biotechnology – for the development of high-yielding crops as well as second and even third-generation feedstocks.

  • A world-leading recycling hub – translating into a vast amount of organic waste as feedstock for the biobased industry.

Through know-how in novel biomass generation processes – from gasification and fermentation to chemical conversion and biorefining – four promising biomass value chains stand out in Flanders:

  • The production of fine chemicals from sugars, starch, etc.;

  • The development of second-generation sugars;

  • The use of lignin-rich resources for the production of materials and chemicals with high added value;

  • The conversion of carbonaceous (waste) gases into chemicals

VITO, the Flemish Institute for Technological Research, is a major partner of the biobased industry through its focus on, among other things, the development of innovative, biobased molecules from biomass and other novel feedstocks – such as wood (lignin), algae, insects, and CO2. What makes VITO unique in this domain is its integration of separation techniques into chemical, microbial, enzymatic, and (bio)electrochemical processes.

CID: Can investors rely on the continuity of Flanders’ incentives for renewable energy investments? Why?

FIT: Flanders has a system of ‘green certificates’ to promote energy generation from renewable sources. Put in place by VREG, the regulator of the electricity and gas market in Flanders, the system is two-pronged:

  • On one hand, producers of electricity from renewable energy sources can receive green certificates, which they may sell;

  • On the other hand, power suppliers must submit a specific number of green certificates to avoid a fine.

Flanders has all the ingredients to take clean technology and renewable energy to the next level: from a government-driven commitment to sustainability, over innovative energy companies, to pioneering research centers and knowledge platforms that aim to bring about a clean energy economy.

Flanders is home to various cluster organizations that support the energy industry in the region by offering companies a myriad of innovation and research possibilities.

To zoom in on just three of these organizations:

  • Flux50 – As Flanders’ spearhead cluster for energy, Flux50 facilitates collaboration between energy, IT, and building companies. The aim is to enhance the competitiveness of Flanders’ smart energy industry in its transition toward low carbon systems. In doing so, Flux50 is a membership organization that unites relevant industry, academic and government players, providing them with project support, networking opportunities, and a platform for knowledge sharing.

  • Smart Grids Flanders – This knowledge platform unites businesses, universities, and research institutions to enable the smart grids and smart energy meters of tomorrow.

  • EnergyVille – Bringing together the expertise of research centers VITO (energy technology development) and imec (nanotech) as well as Leuven University, EnergyVille is the go-to center of expertise for sustainable energy, intelligent energy systems, energy-efficient buildings, etc.

CID: What are the most important trends in investment in Flanders?

FIT: We see a growing interest in the access to smart financing. Combined with unique tax incentives, this offers a superb platform for succesful investments. In recent years, Flanders has become a pioneering circular economy. The region is one of Europe’s leading recycling hubs.

Investors are eager to take advantage of employment subsidies and renumeration advantages. At the same time, more and more companies are becoming aware of the available support for transformation, R & D, growth, and green investments.

To learn more about investing in Flanders, visit Flanders Investment & Trade at AIM 2018, stand AIM H1b.

There is still time to register to attend AIM 2018!

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