GE aims to increase its procurement for CEE SMEs
Budapest, Warsaw, October 3. 2017 - General Electric (GE) aims to buy more products and services from Central-Eastern European SMEs. The company has more than 6,500 suppliers in the region and its procurement value exceeds 1.7billion USD, which it hopes to double by 2020 through extending its SME supplier base, fostering the development of regional suppliers and transferring its know-how on digital distributive technologies to its suppliers - stated the company at a regional supply chain conference in Warsaw and Elblag on 3 and 4 October, opened by Tadeus Koscinski Undersecretary of State, Ministry of Development, Poland.
More than 150 suppliers from Central and Eastern Europe and representatives of Hungarian, Polish, Croatian, Czech, Romanian, Serbian and Slovenian government organisations, investment agencies and export banks participated in the CEE Supply Chain Dialogue conference, initiated by GE and co-hosted by the American Chamber of Commerce. The objective of the event was to explore opportunities to better connect SMEs in CEE to the global economy via GE’s supply chain, hence to further increase the competitiveness of the CEE region.
“Central and Eastern Europe has experienced unprecedented growth in the past 20 years. The source of that growth has been competitive labour costs, robust internal consumption and foreign direct investments. However, being efficient in pure technology absorption is not going to maintain economic growth in the long run, and the increase in productivity is getting closer to the boundaries of technology” - said Peter Stracar, President and CEO, GE CEE. “Further growth needs different drivers and the real challenge will be how we support the transition of CEE into an innovation based region. Increased and stronger cross-border collaboration will drive the growth of our SME suppliers in CEE” - he added.
GE buys directly from over 30,000 suppliers from multiple locations around the world and the value of such transactions amounts to 70 billion USD globally. Out of Europe, GE sources $9B annually, with approximately $1.7B of that spend coming from CEE with over 6,500 suppliers. “Key to GE’s performance is the support and growth of its supply base. We believe there is a real opportunity to expand our spend in CEE providing for substantive growth for our suppliers and the opportunity to better support our plants in Europe” - said Melissa Twiningdavis, GE Europe Vice President Supply Chain. “We need to extend our supplier eco-system to the next level and we wish to create future-safe, strong SMEs by sharing our know-how, especially on disruptive technologies, and by developing stronger export capabilities” - she added.
The CEE Supply Chain Conference is linked to the strategic cooperation agreement GE in CEE signed in January with the Polish Ministry of Economic Development, amongst others focusing on the development of SMEs in Poland and on the recently signed memorandum of understanding with the Hungarian government on the promotion of SMEs. Just out of Hungary, GE has an export volume of $3B, mainly sourced from local SMEs. In Poland, the company has an annual sourcing volume of $400M.
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GE in Hungary
GE has been successfully operating in Hungary since 1989, and is not only the biggest US investor, but also one of the largest Hungarian companies running 11 factories, four research & development centres and two business service centres in 11 cities, employing more than 10,000 people. GE is the biggest exporter in the country, exporting 99% of its total production to foreign markets. Today nine out of GE’s global businesses are active here. GE provides innovative and advanced healthcare, oil and gas, aviation, lighting, power and digital products, services and solutions across Hungary. At the end of 2012 GE signed a strategic partnership agreement with the Hungarian Government.
GE in Poland
GE entered the Polish market in 1992. It currently employs 7,300 people in the industrial sector. The GE Group in Poland owns, among other things, three plants specializing in the manufacture of electric products (in Kłodzko, Łódź and Bielsko-Biała), two facilities of GE Aviation (Dzierżoniów and Bielsko-Biała) and three plants of GE Power (a turbine manufacturing plant and foundry in Elbląg and a generator manufacturing plant in Wrocław). The EDC (Engineering Design Centre) has also been operating in Warsaw for 16 years. It was founded as a partnership between GE and the Institute of Aviation. Since 1992 the company has invested USD 670 million in Poland and its annual expenditure on research and development is approximately USD 100 million.