Studies Eastern European Markets
Eastern European Markets


2009

Pekka Lehtonen, Arseniy Svynarenko
Structural development and change of the Finnish food processing industry 1995 - 2005 and challenges to make FDI´s to Russian and Ukrainian markets

Study in brief

This study has been made for the target in mind to encourage Finnish food processing companies to establish their economic activities in Russia and Ukraine. The growth potential in Finland has been fully utilized. Moreover, the direct export has attained its limits. Common agriculture policy (CAP) in EU will in the long run push Finland´s farms to specialize, grow and also move into multi business entrepreneurs.

Food processing industry has its place to process the raw material in that chain. The scale of food processing companies is limited by the supply of Finnish raw material. Because international food processing companies grow by consolidation and green field investment especially in former socialist countries, Finnish companies have to follow the suit or being consolidated.

Finnish evidence shows right strategic development in our neighboring countries. However, Ukraine, Belorussia and Caucasian countries are the areas where Finnish technology and knowledge transfer should be directed to, either by own resources or in partnership with European big food processing companies. The food processing companies should imitate the pattern of Finnish technology industry which employs an equal number of employees abroad as in Finland.

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