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FCC Chairman expects adjustments in Europe to improve competitiveness of economies and businesses

15/06/2010

FCC Chairman expects adjustments in Europe to improve competitiveness of economies and businesses

Baldomero Falcones, Chairman and CEO of FCC, of which Esther Koplowitz is the principal shareholder, believes that the adjustments implemented by the various European governments will enhance the competitiveness of both their economies and companies. According to Mr Falcones, the devaluation of the euro and the rationalisation of the welfare state are provoking change in Europe.

During his presentation at the Menéndez Pelayo International University (UIMP) in Santander, entitled "Spain's economy over the last three decades. From the consolidation of democracy to the current crisis. Evolution and projections", Mr Falcones classified the Spanish government's austerity measures as "positive" and "on the right track for restoring the economy's competitiveness and employment".

Mr Falcones expressed his conviction that the government's adjustments would set the stage for a new phase of growth. Nonetheless, he warned that Spain would have to work harder than other European Union countries, although he predicted that it would benefit from the recovery of other European economies, which purchase close to 70% of our exports."

During his presentation, at an event sponsored by the Spanish Financial Journalists Association (APIE), Mr Falcones emphasized that the Spanish economy must recover its competitiveness. To that end, he advocated undertaking "structural reforms that reduce costs", citing specifically the labour market, the financial system, energy costs, public expenditure and market unity. He maintained that those reforms should be accompanied by measures to promote productive investment in education and training, infrastructure, and innovation.

In defining what he called "a strong infrastructure policy", Mr Falcones referred to efficient distribution of public funds, inclusion of private initiative, and restoration of Spain's credibility to improve access to global financial markets.

FCC leadership and business model
Mr Falcones noted investment in infrastructure as a "vital element for improving the economy's productivity". He expressed his opinion that it should be "efficient investment" which improves Spain's productive structure in the medium and long term, creates sustainable jobs, and enhances social cohesion.

FCC's Chairman stated that world economic growth requires sustainable development programmes in infrastructure, services and energy resources, which are industries where FCC "is a leader, with a diversified business model, a broad global presence, and a focus on improving efficiency".

In this vein, he noted that more than 50% of the group's EBITDA comes from recurring activities unrelated to construction, and 44% of revenues are obtained outside Spain, adding that the company expects to increase the latter percentage to 60% by 2013.

In closing, Mr Falcones stated that: "FCC has challenged itself to do as much, if not more, with fewer resources, so as to emerge from the crisis in a stronger position". Accordingly, the company has undertaken business process re-engineering and new plans for procurement management, talent attraction and retention, and results-based management, among others.