PROGRESS REPORT 1998
SERVICE METROPOLIS IN A MODERN INDUSTRIAL REGION

ADVANCED SERVICES FOR COMPANIES IN THE BASQUE AUTONOMOUS COMMUNITY

One of the characteristics of the evolution of the productive fabric is, apart from its ability to adapt, the tendency towards growing specialisation. Companies tend to externalise an increasing number of functions, and advanced services facilitate this process, thereby contributing to the renovation, modernisation and interdependence of the local economy.

Advanced services give greater strength to the local business foundations, thanks to the fact that they serve as agents for the innovation and dispersion of new techniques and knowledge. Subsequently, the importance of this kind of service to the business fabric of Metropolitan Bilbao and the Basque Autonomous Community as a whole is highly important. This means that the lending of these services constitutes one of the leading factors in defining a dynamic and attractive metropolitan area (together, among others, with the level and quality of the infrastructures and the qualification of human resources).

The rate of growth in this sector has been, since 1985 and until 1997, higher than the figures registered for both the Basque economy as a whole and in comparison to those registered for the same sector in the rest of Spain. The explanation for this difference has to be sought at the outset since, while company services in the Basque Autonomous Community represented 2% of the GNP in 1985, the Spanish figure for the same item was 4.5%. This said, by 1994, this figure was virtually the same: 5.6% in Spain and 5.3% in the Basque Autonomous Community. By 1996, the participation in wealth was already 7.2% in the Basque Autonomous Community.

During the period 1985-1996, the professional and business services sector saw the number of employees grow by more than 44,000 workers in the Basque Autonomous Community, meaning that this is the sector to have experienced the highest increase. The strongest growth took place during the period 1994-1996, with the creation of 15,700 jobs, largely due to the legalisation in 1994 of Temporary Agencies, which were responsible for 98% of the growth in question.

In comparison to other European countries, job occupation figures, for both the Basque and Spanish sectors in general, lag a fair distance behind countries like Holland, Denmark or Great Britain, where employees in the business services sector stands at more than 15% of the occupied population.

Foreign presence drops to 5% with respect to the smallest establishments, rising to 14% in the case of companies with more than 5 workers. But this depends on the kind of activity carried out, engineers for example, are set aside from average figures for the sector, in view of the fact that they invoice a quarter of their services abroad, a percentage which rises to 67% in the case of the leading Basque engineering companies.

The growing demand from the Basque industry for this kind of service is starting to be met by companies in the Basque Autonomous Community itself, rather than by the services previously imported from the rest of Spain. Nevertheless, it should be pointed out that there is still a great deal of space for the sector to continue developing in the future.

Development of the advanced services market in Metropolitan Bilbao, like in the rest of the Basque Autonomous Community, contributes highly effectively to its economic revitalisation and to enriching its productive fabric, guaranteeing its competitiveness in the face of the processes that are developing on an international level. This development is backed by a series of highly qualified human resources, especially as far as new technologies and knowledge development are concerned.
 

XXX

XXX

XXX

*The importance of technological innovation with respect to development of the traditional industry of the metropolis

The Strategic Plan for the Revitalisation of Metropolitan Bilbao affirms that the dissemination and promotion of new technologies as regards key areas of the productive processes favours a rise in productivity, while contributing to an improvement in the competitive position of companies.

Despite the fact that most Basque companies recognise the importance of technological planning and the commitment to certain lines of research, only 40% can actually confirm that they have drawn up and implemented a steady technological plan.

XXX


*The euro can contribute to increasing the financial centrality of Metropolitan Bilbao

The Economic and Monetary Union (EMU) phenomenon now taking place will serve as an accelerator with regard to two tendencies, which have in fact already been set in motion. The first of the two is the process of dualism between world and national financial centres; and the second is the process which is taking place in many countries regarding the carrying out of financial activity in one single centre. Based on these tendencies, we find ourselves faced with a third group of markets with a promising future, i.e. local financial markets, which will survive thanks to the search for their own niche and specialisation in particular financial products.

In 1998, the Bilbao Stock Exchange negotiated over 8.8 billion pesetas, thereby beating a new record of trade. These results earned it a market share of 16.8%, thereby ensuring its second position on the Spanish stock market, behind that of Madrid, and closely followed by that of Barcelona.

XXX


*The need to promote the local fair and congress services

The Bilbao International Trade Fair, which remodelled its Congress Centre during 1998, equipping it with the latest in technological advances, has to promote its role as a congress centre, combining this factor with the increased offer brought about with the inauguration and setting in motion of the Euskalduna Congress and Music Centre.

During last year, the important policy of internationalisation carried out by this asset in Metropolitan Bilbao, was rewarded with an increase of 31% in the number of foreigners who attended the events organised. Once again, it was the biennial Machine Tool and Ferroforma Fairs that were the most important and most internationally famous.

XXX


*The importance of making the most of new technologies for the development of trade

Electronics permit suppliers to increase their competitiveness thanks to the fact that they bring the customers closer. Many companies therefore employ electronic technology to offer a better before and after-sales service, thereby increasing the amount of information they can provide on their products and allowing them to deal with customer demands immediately. The customer benefits from a better, higher-quality service.

The application of new technologies will permit a streamlining of the business sector, overcoming borders until reaching the global market. Moreover, the modernisation of this sector will make it easier to co-exist with the chain stores, the expansion of which must be carefully planned in order to minimise their impact on small and medium-sized traders.

XXX


*The need to coordinate initiatives to encourage the creation of companies

Evolution towards an advanced industrial society puts the accent on knowledge and its management as the keys to progress. Excellent management takes on outstanding importance in an increasingly global market, which is characterised by growing competition. Hence, companies in Metropolitan Bilbao must make the most of innovation and product quality such as basic strategies in order to increase their competitiveness.

The promotion of business initiatives on the left bank of the estuary takes on particular importance in view of the situation of relative decline presently being experienced in this area, and especially as a way of market rehabilitation for the cast-offs of industrial restructuration - the long-term unemployed. Coordination of the initiatives adopted by the different administrative levels with competence in the subject is therefore essential.


*The opinion of Metropolitan Bilbao as an advanced services metropolis in a modern industrial region

The population is beginning to accept the image of Metropolitan Bilbao as an advanced services metropolis, especially as far as the most dynamic segments of the society are concerned. This therefore means that the youngest and higher education holders are mainly opting for an economy of advanced services rather than traditional industry.

Even though, like in 1997, technology is considered to be a priority in comparison with culture when promoting economic development, growing importance is being placed on the latter as the driving power behind the revitalisation process, undoubtedly due to the influence of the "Guggenheim Effect".

The progress of citizens in the metropolitan area as regards the knowledge and handling of new technologies can first of all be seen in the evolution of the number of PC users in the home, and secondly, in the Internaut collectivity. In this sense, 38% of those polled have a computer at home, while only a few are connected to the Internet (8%).

XXX

Back to Index

*METROPOLITAN BILBAO