InvestBulgaria Agency

November 2013  InvestBulgaria Agency issue 2 (2), year 1  Economic News - Business, Investments, Trade  Analysis of Sector  Investment Opportunities of Municipality Monthly  Interview Electronic Publication  Chamber of Commerce in  Macroeconomic Indicators  Upcoming Events

INVESTBULGARIA AGENCY

To meet the needs of investors and to maintain good business environment are key priorities of the Bulgarian government

Anna Yaneva

Deputy Minister of Economy and Energy

In the period 2005 - 2009 she was elected Deputy Minister in charge of "Economics" in the Ministry of Economy, Energy and Tourism.

She was Secretary General of the Committee on the Use of Atomic Energy for Peaceful Purposes and Member of Parliament in the 41st National Assembly.

From 2009 to 2012 she was a member of the standing committee on "Economy, Energy and Tourism."

She graduated from the Commercial High School in and Master in "Management and organization of Material-technical supply" in the Higher Institute of Economics "Karl Marx."

Our efforts are aimed at maintaining macroeconomic and financial stability and reducing the administrative burden on businesses. One of our main priorities is the promotion of sectors with high added value for improving the competitiveness of the Bulgarian economy. The package of incentives, which we offer investors, is competitive in regional aspect. The focus of our work will continue to be on attracting investments - conducting proactive investment marketing. Our strategy to attract investors is based on clear priorities in terms of target countries and target industries, of which Bulgaria seeks to attract strategic investors. Target determination linked to program implementation is a prerequisite for good results. Along with this we also work for optimization of administrative services, improvement the coordination of IBA

InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 Tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320, e-mail: [email protected], http://www.investbg.government.bg

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with other institutions and local authorities to improve the quality of the investment service. Successful model for investors encouraging requires central administration and regional structures and local authorities to work together to provide quality and timely service for each investment project. For large investment projects coordination and competent assistance in all stages of the investment process is of particular importance. What deserves special attention is that investors, which have received a certificate under the Law on Investment Promotion, now expand their presence in Bulgaria, as some of them have already issued a second and even third certificate. Such investors are Lufthansa Technik Sofia Ltd., Knauf Bulgaria Ltd., Cement Jsc., Trakya Glass Bulgaria EAD, SOK Jsc. and Witte Automotive Bulgaria Ltd. This means that companies appreciate the business conditions and incentives that the Law on Investment Promotion provides.

Annual Awards “Investor of the Year” 2013 InvestBulgaria Agency (IBA) organized for the eighth time the annual awards "Investor of the Year" 2013. The aim of the event is to honor the most significant investment projects carried out in Bulgaria in 2013. Specially appointed committee will review all nominations and determine the companies that will be awarded at a ceremony in January 2014.

page 2 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

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EVENTS ORGANIZED BY IBA IN OCTOBER InvestBulgaria Agency met the business in Veliko Tarnovo On October 31st, 2013 a round table organized by InvestBulgaria Agency was held in Veliko Tarnovo. The event brought together current and potential investors in the region, representatives of municipalities, regional centers, business and media. At the beginning of the meeting IBA’s large-scale project that promotes Bulgaria as an investment destination abroad, was presented. The new CEO of the Agency Svetoslav Mladenov discussed with representatives of the business, state and local government plans to attract more investors and create new jobs in the city of Veliko Tarnovo and the region. He presented the Agency's work and stressed that it is important to maintain an ongoing dialogue with stakeholders. They are supposed to work effectively in order to be supported and facilitated by the government. Important issues related to approaches to attract new investors in the North Central Region were concerned in the course of the discussion. The district administration noted that interest in investing in the region comes mainly from Bulgarian investors, rather than foreign ones, which is worrying. The general opinion of those present was that holding more frequent meetings would help promote the region's potential and attract more investors. The agency presented its project to prepare an investment catalog aimed at informing potential investors of the business climate in different regions of Bulgaria. Thus, IBA urged those present to assist with providing additional information for making the end material complete. Mr. Mladenov thanked the Municipality of Veliko Tarnovo and expressed the willingness of the Agency to work actively with the Bulgarian municipalities in order to make Bulgaria an attractive investment destination. Round table hosted by InvestBulgaria Agency was held on Bulgarian economic forum 2013 Round table, hosted by Mr. Svetoslav Mladenov, Executive Director of InvestBulgaria Agency (IBA), focused on ‘Investment Promotion: Overcoming Legal, Non-legal and Administrative Barriers Facing the Business’ was held on 14 November 2013. The panel was part of the Bulgarian economic forum: “Let’s talk about economy growth generators”. Representatives of different institutions from Southeast Europe took part in the round table: Mr. Milos Jovanovic, Director, Montenegrin Investment Promotion Agency (MIPA), Mr. Hristian Ilievski, Deputy Director of Agency for Foreign Investments and Export Promotion of the Republic of , Ms. Edit Gyenge, Adviser to Minister Dan Sova, responsible for Department for Infrastructure Projects and Foreign Investments, Romania, Mr. Tibor Nemet, Head of Trade Department, Embassy

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of Hungary, Ms. Stefka Slavova, Alternate Director for Poland, Bulgaria and Albania. Board of Directors, EBRD). Mr. Plamen Dilkov, CEO, PVB Power Bulgaria. Mr. Svetoslav Mladenov has outlined the barriers facing business and the actions needed to be undertaken in order to overcome obstacles. The policy of attracting and promoting long-term investments, as well as the ways for creating more favorable business climate were discussed during the panel. Mr. Mladenov shared with the audience that IBA organizes regular meetings with business, state and municipalities representatives, where strategies for attracting new investments and facilitation of easier administrative procedures are discussed. Mr. Mladenov expressed his expectations and hopes for further close cooperation between promotion agencies in the region.

page 4 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

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MEDIA FOR INVESTBULGARIA AGENCY

Svetoslav Mladenov: InvestBulgaria Agency is the universal PR for Bulgaria „InvestBulgaria Agency (IBA) is the universal PR for Bulgaria”, Mr. Svetoslav Mladenov, IBA’s executive director in Bulgaria On Air ‘s show Investbook said. IBA is working with the government quite well, added Mr. Mladenov. He explained that the IBA has received a few big projects from the Ministry of Economy and Energy, which will be included in the investment catalogue, expected to be issued soon. The catalogue will consist of comprehensive information on the investment climate in Bulgaria and possibilities for investments in different sectors of Bulgaria’s economy. bgonair.bg, photo: bgonair.bg, 31.10.2013.

Investors are not afraid of refugee wave and political instability Investors are not interested in problems with refugee wave. When they decide to invest, economic stability, country’s territorial organization and presence of experts in different sectors are the things that matter. It is not expected refugee wave to reflect on investments in Bulgaria because our country is getting international support to solve the problem. This is what Svetoslav Mladenov, InvestBulgaria Agency’s CEO said, cited by Focus Agency. Refugee wave has encompassed not only Bulgaria but also other European countries. Thus the matter has to be inspected both from its exterior and interior side. Externally we get serious support from the EU and from other countries. They help us financially and also give us practical advice how to deal with a matter of such scale that Bulgaria is getting familiar with for the first time in recent years. In his opinion all this is assessed by investors in terms of support that the country gets and in terms of its membership in the EU and the fact that it has a stable currency board. That is to say that both financial and economic stability is sufficient argument for investors to continue to look ahead, Mladenov added. At the moment the biggest investors in Bulgaria are the , Austria, , UK and . Investors’ interest from Russia, Ukraine, and has appeared in last months, the Agency’s CEO says. In an interview with Trud, he states that investors are not worried by political instability in the country. ‘In the last three months there has been increased investment interest. Out of 163 projects registered in the agency, 48 have been examined in the last three months. On the other hand, it is a global process. Investors are tired of traditional markets in Europe. Bulgaria together with several other Balkan countries are distinguished with the fact that here things are in a process of development. Investors see opportunities for realization of profits, explains he. No radical changes in the Law on Investment Promotion are envisaged. It has proved that attracts investments, Mladenov points out. His comment is a response of announced by Vice-president Daniela Bobeva removal of part page 5 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

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of the alleviations for large investors, as the state cannot afford it. Mladenov has not explained which alleviation namely will be dropped. He said that at the moment a review is being made in order to find out which of these the state can really do. Mladenov also announced that mayors are also thought of being engaged with attraction of capitals. This is necessary as the Agency’s employees cannot handle by themselves. In addition IBA does not have representatives abroad. The Agency is working on six investment projects - automobile and . Until the end of the year we hope that we will have results with all six projects, Mladenov concluded. Source: Dnevnik, http://www.dnevnik.bg, photograph: Yulia Lazarova, 11.11.2013

InvestBulgaria Agency is working for facilitation of procedure for issuing of certificates InvestBulgaria Agency’s CEO Svetoslav Mladenov announced during Bulgarian economic forum that the agency is working on mitigation of procedures for issuing of several certificates, connected with initial documentation that has to be prepared by investors. Twelve forms that have to be filled in when an enterprise is registered are united into a single paper. In that way investors save time and registration procedure is considerably shortened, Mladenov said. The agency has started an information campaign aimed at informing investors of ongoing events in Bulgaria’s economy and up-to-date legal changes. The reason is that big part of investors comes to Bulgaria with negative attitude. They believe that conditions for doing business in the country are hampered largely by the economic indicators, administrative rules and chaotic situation, Mladenov explained. BGNES, www.vesti.bg, 14.11.2013

Svetoslav Mladenov to meet investors in USA, 19-22 November 2013 InvestBulgaria Agency’s CEO Svetoslav Mladenov will take part in a Bulgarian delegation led by the Minister of Economy and Energy Dragomir Stoynev, departing to the United States for a visit in Washington D.C. from November 19th to November 22nd. BEH’s CEO Boyan Boev, CEO of Nuclear Regulatory Agency Lachezar Kostov and NPP Kozloduy’s CEO Ivan Genov also joined the delegation. Within the working visit development and prospects for deepening of bilateral trade and economic relations between Bulgaria and the US will be discussed. The delegation will have high-level meetings with representatives of American administration at the State Department and the Department of Commerce. A workshop aimed at presenting favorable microeconomic conditions in Bulgaria and the country’s advantages as an investment destination will be organized with representative of 15 corporations. All of them are members of the based in Washington D.C. Business Council for International Understanding – BCIU. mi.government.bg, 18.11.2013

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Svetoslav Mladenov: Businessmen is USA still know little of Bulgaria American investors want to hear now that Bulgaria is economically stable, well-positioned in the EU, with prospects, Svetoslav Mladenov said. From the meeting with American companies, members of Business Council for International Understanding in the US, InvestBulgaria Agency’s CEO Svetoslav Mladenov got the impression that Americans know little of Bulgaria and of business conditions in the country. They were even quite impressed by facts that both minister of the economy Dragomir Stoynev and Svetoslav Mladenov shared with them. This is what impressed me the most, provided that there always have been ways to inform business in the States on chances for investment in Bulgaria, Svetoslav Mladenov said before Focus. Asked what did he tell Americans for Bulgaria and what is the most important thing that American business has to know about our country, Svetoslav Mladenov pointed out that in his opinion American investors and businessmen wanted to hear that Bulgaria is stable at present. They wanted to be sure that our country is economically stable, well positioned in the EU and that it has prospects for development. „These are the things that I think they became certain of via facts that we presented. These are membership in NATO and The EU, stable currency board, stable and good to a greater extent fiscal policy, as well as good conditions for investment, IBA’s CEO summed up. Svetoslav Mladenov is in the United States as part of a delegation led by minister of the economy and energy Dragomir Stoynev. http://www.komentator.bg, 21.11.2013 Svetoslav Mladenov: American business wants stability in order to invest in Bulgaria Washington. American business wants security in order to invest in Bulgaria. This is what InvestBulgaria Agency’s CEO Svetoslav Mladenov said in an interview with Focus Agency, after a meeting with representatives of 15 corporations, members of Business Council for International Understanding in USA. Representatives of American business are interested whether Bulgaria is economically stable now, if it is well positioned in the EU and whether it has prospects for development. ‘We acknowledged them with Bulgaria’s membership in the EU and NATO, with our stable currency board, with our good and stable fiscal policy and with good investment conditions that we offer as a country. All these are related to measures that have been improved or developed in our country such as a 10% flat tax, 0% corporate tax, increased investment in training of people so that human resources can be distributed more evenly geographically’, Svetoslav Mladenov added. He also said that after the meeting with representative and members of Business Council for International Understanding in the US, it became clear that big part of American companies are not well informed of investment possibilities in Bulgaria. www.focus-news.net, photo: AFP, 21.11.2013

page 7 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

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ECONOMIC NEWS - BUSINESS, INVESTMENTS, TRADE

ECONOMIC INDICATORS Investment is research for biotechnological Foreign Direct Investments pharmaceuticals goes over USD 10 million For the last five years more than USD 10 million has been invested in wide range of clinical research for biotechnological drugs in the country. They are direct investments in Bulgarian healthcare. This was pointed out by Doctor Krasimira Chemishanska, general manager of Amgen for Bulgaria at a scientific conference on Innovations in biotechnologies-medicine of the future. She pointed out that at present four out of every five new pharmaceuticals in a process of development are biotechnological. Source: BNB

Their share is expected to increase seriously in future.

At the moment about 20% of all pharmaceuticals worldwide are BNB exchange rates produced by the methods of biotechnology, as they insure chances for more efficient treatment of more than 350 million patients in the world. More than 300 of them are in clinical use, approved by regulatory agencies. About 900 are the new molecules that are in a different stage of clinical research. investor.bg, 31.10.2013

Swiss giant opens sensors plant in Sofia Swiss electric giant LEM opened a new BGN 3 million high-tech factory in the Bulgarian capital Sofia. The investment in the enterprise is to the Source: BNB amount of nearly BGN 3.2 million (CHF 2 million). The factory is located in Sofia’s neighborhood Nadezhda at an area of 4 500 square meters. Main Interest Rate The factory in Sofia will produce converters and sensors that are built 0.02% - 01.11.2013 into key security technical solutions such as elevators, electrical systems and others. Initially the plant will employ 40 people, which will increase to 80 after 6 months. The number of employees is scheduled to increase to 400 by 2018. Decision to come to Bulgaria was exceptionally important for us, LEM Group’s CEO François Gabella said. Among factors for the choice of the country he pointed out political and economic stability, high qualification and exclusive motivation of workforce. Source: BNB capital.bg, standartnews.com, 01.11.2013

South Stream Gas Pipeline to fetch Bulgaria EUR 2.8 B Unemployment Rate 11.2% - October 2013 by 2043 Bulgaria expects revenues of EUR 2.8 B from the South Stream gas pipeline in the period 2013-2043, according to Economy and Energy Minister Dragomir Stoynev. Speaking after a meeting with Gazprom CEO Alexei Miller and Russian Energy Minister Alexander Novak, he assured that Bulgarian citizens carried no financial risk for the implementation of the South Stream gas pipeline.

"We are not required to provide bank guarantees. This is a good step Source: NSI which will help us lead the country out of the crisis," Stoynev stated. page 8 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

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BAI Stock Exchange-Sofia "A large part of the work will be carried out by Bulgarian companies, Monthly Turnover 11.2012-11.2013 which will generate employment. There will be work for Bulgarian companies which are in a difficult situation. The annual interest rate is 4.25%. The repayment period for the loan of the Bulgarian Energy Holding (BEH) will be 22 years," he said. novinite.com, 01.11.2013

Bulgarian confectionary maker Prestige 96 opens a new factory Source: BSE-Sofia Leading pastry manufacturer Prestige 96 moved the production of all its products into a brand new plant in Veliko Tarnovo. Since the BGREIT: 01.11.2013 – 29.11.2013 beginning of 2013 the confectionery manufacturer has been producing all of its product range in a new 28 400 square meter modern factory. The investment in construction of the plant and implementation of quality control equipment is of a total value of BGN 30 M. Other BGN 20 million is planned for investment. „Bulgarian market is of importance to Prestige 96 and the company will continue to develop itself”, said the enterprise CEO Anastassios Panayotopoulos at the Source: Investor.bg official opening ceremony. The plant is one of the best not only in Bulgaria, but in Eastern Europe. We are proud to be based in Veliko BG40: 01.11.2013 – 29.11.2013 Tarnovo namely, the CEO added. The factory was officially inaugurated on Thursday. “We intend to continue investing in new and powerful production technology in order to expand our product range”, pointed out the chief executive. novinite.com, 01.11.2013

Bulgarian brewer Zagorka plans to invest over EUR

4.0 mln in 2014 Source: Investor.bg

Bulgarian beer maker Zagorka, part of Dutch group Heineken, plans to invest over EUR 4.0 million in its brewery in Stara Zagora, in the SOFIX: 01.11.2013 – 29.11.2013 southeast of the country, in 2014, said Nikolay Mladenov, CEO in an interview. In October Zagorka opened in Stara Zagora a BGN 2.0 million warehouse. The 3,000- square meters facility is the first of its kind for the whole Heineken group. “We have more green initiatives that we plan to develop connected with green logistics, green office," Mladenov said. "Coming up are major upgrades in the brewery, where we plan to once again go green.”

seenews.com, 04.10.2013 Source: Investor.bg

11 new enterprises are being developed in Trakia economic zone Trakia economic zone turns out to be one of Bulgaria’s biggest economic projects. It is being constructed at an area of 10 700 000 square meters in the region of and unites good experience of industrial-commercial zone Marica, industrial zone , industrial-commercial zone Kuklen and potential features of park Education and high-tech-Plovdiv, industrial zone and high-tech center Trakia and agro center Kaloyanovo. In the next 10 year TEZ is expected to attract additional investment to the amount of EUR 750 million. In that way 30 000 jobs are to be created. Lots with a total area of 7 450 thousand square meters have development

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plans and infrastructure in the six zones. “We greatly depend on small Selected Decisions of the and medium Bulgarian investors rather than on foreign companies”, Government engineer Panchev stresses. At present eleven projects are being of the Republic of Bulgaria for the period 30.10-20.11.2013 developed in Trakia economic zone. Part of them is at a stage of planning 20.11.2013 while others are before completion. Intensive negotiations are being  InvestBulgaria Agency has new lead with three new investors for projects assessed at about EUR 300 organizational rules to optimize the million. They show great interest in zones Kuklen and Rakovski, doctor administration of the two structures engineer Nikola Dobrev added.  Government bill will be coordinated with BORKOR Stroitelstvo.info, 04.11.2013  Adopted report on the implementation of the measures in Increase in investments in metallurgical industry the National Reform Programme  Ratification is proposed for MoU with Production of metallurgical industry is realized successfully in foreign U.S. for technical assistance markets and forms a major share of 16% in the total volume of goods  Bulgarian position on the meeting of exported from Bulgaria. Despite the economic crisis the industry for Ministers responsible for EU production of basic metals in Bulgaria can boast on growing turnover and Cohesion Policy is approved 13.11.2013 investment in the sector. The profit per employee in the sector has  Bulgaria and Romania strengthen increased almost three times in the last years. In comparison to other cooperation in the field of sectors of industry, metallurgy is distinguished with the information technology and regional highest labor productivity, where growth was almost double. Share of development added value also doubled. Deputy Minister of Economy and Energy Anna  Minister Papazov will head the Bulgarian delegation to the session of Yaneva stressed on these issues during celebration of the 50th the Assembly of the International anniversary of the "Day of Metallurgist”. In her words the anniversary Maritime Organization celebration itself is a significant fact in the history of an industry, even  Approved results of a meeting of EU more so when it is successful. ministers responsible for trade  Industrial Minerals BG" gets mi.government.bg, 06.11.2013 concession for extraction of non- metallic minerals Freight train corridor from Prague to Sofia and  A legal framework for the introduction of complex becomes operational administrative services Bulgaria became part of European Rail Freight Corridor 7, which began  Minister Stoynev will participate in operating on Friday at 12 o’clock. This was announced by National the forthcoming session of the WTO  A working group to attract and Railway Infrastructure Company’s press center. The route of Freight Rail promote investment intentions in corridor 7 passes along the axis: Prague-Vienna/ Bratislava-Budapest- tourism Bucharest-Constanta-Vidin-Sofia-Thessaloniki-Athens. 06.11.2013 The seven European countries: Czech Republic, Slovakia, Austria,  A working group for the preparation of the Bulgarian host of the 16th Hungary, Romania, Bulgaria and Greece with their infrastructure annual meeting of the Board of managers and a single authority for distribution of capacity founded the Governors of the Bank corridor that connects Central and South Eastern Europe. It serves as a  A new protected area for the tie to Asia via Black sea and Aegean Sea ports that offers good, reliable conservation of wild birds service based on the harmonized technical and procedural conditions.  Bulgaria and Qatar will develop cooperation in the field of sport standartnews.com, 11.11.2013  Agreement between Bulgaria and Germany for the mutual provision of Sicom, Italy has invested EUR 4.5 million in a plant property ownership has been proposed for ratification New industrial factory was officially opened in Industrial park Ruse.  New ordinance regulates the Major shareholder in Balcantsink JSC is Italian company Sicom. The requirements for separate collection investment is to the amount of EUR 4.5 million and will create new 30 and recycling of electrical and work places. Galvanizing and manufacturing of metal products will be electronic equipment performed in the plant. Mayor of Ruse Plamen Stoilov, deputy regional  Approved measures taken by the Minister of Economy and Energy for manager Milena Hinkova and the stakeholders Maria Manchini and stabilization of VMZ JSC Giuseppe Fortuna attended the event.  EU finance ministers will seek stroitelstvo.info, 11.11.2013 page 10 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

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Preferences for companies hiring new personnel agreement with the European The companies, which create new jobs in regions with unemployment Parliament on the draft budget for 2014  Government has proposed changes to at least 25% higher than the average for the country will be allowed to the Forest Act to better protect the retain up to 100 per cent of the corporation tax. This is stipulated to be interests of Bulgarian citizens and part of the changes in the Corporate Income Tax Act, announced by business Deputy Minister of Finance Liudmila Petkova. Ms. Petkova explained 30.10.2013  expanded the number and size of that at least 50% of work places which companies create, should be in protected areas for the conservation of manufacturing activities and minimum 30% of the personnel must have natural habitats and wild fauna and flora permanent address in the municipality with high unemployment. 16  Bulgaria develop cooperation in the field more new municipalities are included in the list of regions with high of youth and sports with Slovakia and rate of unemployment. Thus their total number is 160. Ukraine  Strategy for Development of National standartnews.com, 12.11.2013 Statistical System in Bulgaria aims to produce and distribute quality Premier Plamen Oresharski opened the 15th Bulgarian information  From January 1, 2014 the minimum economic forum wage became BGN 340 Sofia is the venue of the 15th Bulgarian economic forum. This edition  Bulgaria and Ukraine will intensify their focuses on “Considering generators of economic growth”. Prime cooperation in investment promotion  Additional funds for tobacco growers Minister Oresharski officially opened the forum in Sheraton. and producers of fruit and vegetables to The major goal of the government is creating conditions for economic be given development through restoring macroeconomic and fiscal activity.  Budget 2014 to stimulate economic Measures for cutting contraband channels are also envisaged, added growth in the medium term 2014 Mr. Oresharski. The forum has brought together 500 experts, the  Pensions in 2014 will be updated under the Swiss rule delegation from Serbia being the largest.  Interagency Working Group will bnr.bg, 14.11.2013 coordinate consideration of the investment project Destination Solvay Sodi will invest new BGN 55 mln Plant for production of soda ash in Devnya Solvay Sodi, part of the Belgian group Solvay will invest BGN 55 million in a new facility that is to considerably decrease the company’s expenditures and will have big environmental effect. The new distillation column will reduce steam consumption greatly. The investment has been approved a few weeks ago and is expected to be completed until 2015. This was announced during the presentation on the occasion of Solvay’s 150th anniversary. The project is part of the measures taken by the Belgian group for savings and optimization of their production in Europe in a time of slowdown of major markets and expectation of a new player in the sector in the next years. capital.bg, 14.11.2013 Bulgaria’s GDP in 2014 up by 1.6%, IMF foresees The International Monetary Fund /IMF/ expects a GDP growth of 1.6 percent for Bulgaria for the next year and inflation of 1.8 percent. According to the IMF there are risks for the economic recovery of the state, but the governmental forecast of a 1.8 percent growth can be reached and depends mainly on reforms in healthcare and retirement System. The IMF assesses highly the governmental measures for improvement of business environment. Fund experts don’t have any concerns about the intentions of the government to increase public debt at the end of 2013 and the beginning of 2014. bnr.bg, 15.11.2013 page 11 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

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Standard Profil – Bulgaria will double the Minister Stoynev: Bulgaria seeks US capacity and staff energy investor Bulgarian Stara Zagora-based company Standard Profil won a major project that includes the construction of Bulgaria can attract U.S. investments in energy sector. the full range of rubber seals for the new model of This will probably be discussed at the meeting of the Opel – Astra, company CEO Petar Angelov announced Minister of Economy and Energy Dragomir Stoynev for the economic portal of Stara Zagora. As one of the with U.S. companies General Electric and leading companies in production of rubber seals in Westinghouse, which are planned within the minister's Europe, Standard Profil has won the trust of giant visit to the U.S. Daimler and will also equip some of its SMART models. These two long-term contracts will double the capacity "We have to ensure the stability of the energy system and staff of the Bulgarian firm. in the long term, we need to look for decades ahead. "We are completing a new production hall of 700 This means we have to have a very clear analysis of square meters and next year we will build another new what capacity will be required in Bulgaria after 20 factory of an area of 5,000 square meters” Angelov years and will have to focus our efforts to diversify said. The total investment to build the new facilities energy supplies ," Stoynev said in the National Security and equipment was approximately BGN 2 million. The Council at the White House. company's staff in present is 1,000 people. standartnews.com, 18.11.2013 standartnews.com, 22.11.2013

page 12 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

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INVESTMENT PROJECTS IN A PROCESS OF REALIZATION

ABB Bulgaria Bulgarian subsidiary of Swedish-Swiss concern ABB

ABB, a company that produces equipment for electrical grid and industry will invest about USD 23 million in a new factory in Bulgaria. The new factory will be the fourth one of ABB in Bulgaria. It will be located on the region of Plovdiv and will insure products for low and medium voltage. The enterprise will create 600 new jobs that will add to the number of present employees of ABB Bulgaria. Thus, their number will reach 1800 people. Production base will be constructed on an area of about 15000 square meters. Its launch is planned for the end of 2013. It’s the second huge investment of ABB in the region of Plovdiv. The first capacity was built in 2009 and at present employs more than 700 people.

BHTC – Behr-Hella Thermocontrol SPLTD between German companies Behr and Hella

The company will complete a new for Bulgaria investment in a plant for production of devices for servicing and management of air-conditioning installations for cars and trucks of renowned world famous car producers- Mercedes, Audi, BMV, Lamborghini, and Bentley. The future factory will be located in the economic zone Sofia- Bozhurishte at an area of more than 75 000 square meters. Built- up area is expected to reach 22 000 square meters. It’s the first project of the company in Eastern Europe. Planned investment is to the amount of BGN 42.5 million. Thus, 350 jobs will be created. The project is certified as Class A in April 2013. The factory is expected to be ready towards the first half of 2014.

WITTE Automotive SPLTD, Ruse part of WITTE Automotive Group, Germany

During the present year the company, which has been producing locking systems for cars since 2010 in Ruse began expansion of its manufacturing capacities via construction of a production workshop with an area of 8000 square meters. BGN 7.5 million will be invested in the first stage of the project. As a result more than 270 jobs will be created. In February 2013 the company was awarded with a certificate for investment class A for this project. The new factory is expected to be opened in the end of 2014.

page 13 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

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Partner for investors in Bulgaria National Company Industrial Zones (NCIZ) is a 100 % state-owned company specialized in industrial park development, management of industrial zones and innovation centers and provision of additional services for investors. The company encourages investments in sectors with high added value and develops industrial zones in line with the latest international standards. The advantageous terms on which it offers industrial terrains and the competitive investment environment in the country form an outstanding opportunity for foreign investors seeking to expand their business.

A total of 8 projects: • 6 584 500 m² total area • 842 580 m² built-up area • 225 500 m² open warehouses Three developed industrial zones: • Ruse • Vidin • Svilengrad Five zones on early stages of development: • Sofia – Bozhurishte Economic Zone • • Karlovo • Telish (Pleven) • Varna West

Ruse Free Zone Total area: 370 235 m² Location: • 800 m to the East of Danube Bridge connecting • Bulgaria and Romania • Right next to the port of Ruse – the biggest river port in Bulgaria • Junction of two Pan-European Transport Corridors Infrastructure: • Well-developed roads • Electricity and gasification • Water and sewerage • Telecommunications

page 14 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

Issue 2 (2)/ November 2013 InvestBulgaria Agency

Vidin Free Zone Industrial & Logistics Park – Burgas Total area: 308 627 m² Total area of the park: 238 000 m² Location: Location: • On the bank of the Danube river next to Danube • The second-biggest city on the Bulgarian Black bridge II (Vidin-Calafat), a freight port and a ship Sea Coast terminal • 10 km to Burgas Airport • Located on two borders – land with Serbia and • 4 km to Burgas harbour river with Romania • 2 km to a -bound highway • Junction of Pan-European Transport Corridors Infrastructure: Infrastructure: • Electricity • Well-developed road network • Water and sewerage • Electricity • Telecommunications • Water and sewerage Svilengrad Free Zone Industrial Zone Karlovo Total area: 70 000 m² Total area: 580 000 m² Location: Location: • 2 km to the border with Greece • In the geographical center of Bulgaria • 50 m to railway connections with Turkey and Greece Full access to: • Access to the Pan-European transport corridor • International road connecting Europe with Turkey • Railway network Infrastructure: • Water and sewage • Well-developed road network • Electricity • Electricity • Telecommunication networks • Water and sewerage • Coverage by all wireless providers Sofia-Bozhurishte Economic Zone Industrial Zone Telish - Pleven region Total area: 2 550 000 m² Total area: 2 036 638 m² • Advanced manufacturing facilities Location: • High-tech industry base • In immediate proximity to the main road Sofia- • State-of-the-art administrative buildings Varna • Comprehensive transport and logistics center • On the main road Sofia-Ruse Infrastructure: Location: • International road • Immediate proximity to major international • Railway network roads and EU transport corridors • Electricity supply • Distance to Sofia City Center – 15 km • Water and sewerage • To Sofia Airport – 23 km • Telecommunication network • Direct connection with the railway network Industrial Zone Varna – West Infrastructure: Total area: 399 000 m² • Well-developed road network Location: • Electricity • Near the largest Black Sea city in Bulgaria • Gasification • 35 km to Varna • Water and sewerage • 28 km to • Telecommunications • 18 km to Varna – West port • 11 km to a highway bound to Black Sea Infrastructure: • Proximity to gas, electricity, optics, and all transportation networks www.industrialzones.bg • [email protected] • 1, Angel Kanchev Str., 1000 Sofia, Bulgaria Tel.: +359 2 8 902 902 • Tel./Fax: +359 2 9 871 684

page 15 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

Issue 2 (2)/ November 2013 InvestBulgaria Agency

ANALYSIS OF SECTOR "CHEMICAL INDUSTRY" Sector "Chemical Industry" Number of companies, number of employees in the sector Top companies in the sector by number of employees „Manufacture of chemical products (NACE20)“ 2008-2011 Number of employees Company 15000 14885 13713 12836 12758 1100 2010 2011 2012 13500 Manufacture of refined petroleum products (NACE 19.2) 12000 900 Lukoil Neftochim Burgas JSC 2 024 1 827 1 770 10500 Prista Oil Holding SPJSC - Sofia 336 289 258 9000 700 7500 Polysan JSC - Rousse 110 140 154

6000 500 Manufacture of chemical products (NACE 20) 4500 527 477 485 507 Neochim JSC - Dimitrovgrad 1179 1265 1352 3000 300 Dunarit JSC - Rousse 577 554 677 1500 Agropolychim JSC - Devnya 662 670 669 0 100 2008 2009 2010 2011 Solvay Sodi JSC - Devnya 572 508 509 Number of employees Number of companies Orgachim JSC - Rousse 467 439 455 Manufacture of pharmaceuticals and medicinal products (NACE 21) Number of companies, number of employees in the sector „Manufacture of Sopharma JSC - Sofia 1 826 1 871 1 987 rubber and plastic products (NACE 22)“ - 2008-2011 Biovet JSC - Peshtera 1 636 1 667 1 858 Balkanpharma JSC 677 802 1 084 30000 2000 26105 23755 Balkanpharma Razgrad JSC 323 349 421 27000 21292 21834 1900 24000 Balkanpharma Troyan JSC 313 320 370 1800 21000 Manufacture of rubber and plastic products (KID 22) 18000 1700 15000 1600 Standard Profile Bulgaria SPJSC -

12000 1500 Stara Zagora 538 667 1 270 9000 1497 1600 1505 1515 1400 Plastchim T JSC - Tervel 773 822 932 6000 3000 1300 Gotmar SPLTD - Saedinenie (Pd) 944 848 895 0 1200 Assenova Krepost JSC - Asenovgrad 652 697 721 2008 2009 2010 2011 Vidachim JSC - Vidin 658 629 630

Number of employees Number of companies Assets of the companies in the sector - 2008-2011, BGN mln Top companies in the sector by sales income

Assets DMA Sales (BGN mln)

3500 Company 2986 2010 2011 2012 3000 2793 2753 2725 Manufacture of refined petroleum products (NACE 19.2) 2500 Lukoil Neftochim Burgas JSC 5 462 6 738 8 220 1899 1942 2000 1812 1820 Polysan JSC - Rousse 57 134 183 1463 1398 1392 1500 1316 Prista Oil Holding SPJSC - Sofia 180 155 125

1000 812 820 791 810 Manufacture of chemical products (NACE 20) Agropolychim JSC - Devnya 306 439 479 500 Solvay Sodi JSC - Devnya 301 344 393

0 Neochim JSC - Dimitrovgrad 160 284 252

2011 2009 2010 2008 2009 2010 2011 2008 Astra Bioplant SPLTD - Slivo pole 67 106 183 Manufacture of chemical products (NACE 20) Manufacture of rubber and plastic products (NACE 22) Dunarit JSC - Rousse 45 33 68 Manufacture of pharmaceuticals and medicinal products (NACE 21) Net sales - 2008-2011 BGN mln Sopharma JSC - Sofia 212 231 214 Balkanpharma Dupnitsa JSC 89 166 202 3000 Biovet JSC - Peshtera 128 125 179 Servier Bulgaria SPLTD - Sofia 43 46 47 2500 2307 2318 Balkanpharma Troyan JSC 32 31 44 1955 2000 1764 1839 Manufacture of rubber and plastic products (NACE 22) 1570 1609 1459 Plastchim T JSC - Tervel 75 111 114 1500 Gotmar SPLTD - Saedinenie - Pd 100 98 108

1000 Hamberger Bulgaria SPLTD - Sevlievo 45 53 63 Vidachim JSC - Vidin 53 61 59 500 Standard Profile Bulgaria SPJSC 27 50 61

0 The data for the sector Manufacture of refined petro-products (NACE

19.2) and the sector "Manufacture of medical materials and our

2010 2008 2009 2010 2011 2008 2009 2011 Manufacture of chemical products (NACE 20) Manufacture of rubber and plastic products (NACE 22) products (NACE 21) is confidential.

page 16 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

Issue 2 (2)/ November 2013 InvestBulgaria Agency

Chemical industry in Bulgaria traditionally develops in the following Authors: Hristo Etropolski sub-sectors: and Nikola Manzelov, sectorial experts – Chemistry, products of • Petrochemistry mineral resources, mining • Organic and non-organic chemical products and fertilizers and quarrying, energy, • Pharmaceutical industry utilities • Perfumery, cosmetics and household chemistry • Paints and varnishes • Plastic and rubber products

After the crisis of 2008 – 2009, export of enterprises in the chemical industry has registered stable growth in the last several years, which is evident from statistical data for the period 2009 -2012: Hristo Etropolski EUR mln Export 2009 2010 2011 2012 Chemicals substances and products* 899.5 1239.4 1616.0 1723.8 Petroleum products ** 1190.8 1661.1 2225.6 2928.3 Total chemical industry sector Export EUR mln 2090.3 2900.5 3841.6 4652.1 share in total exports 17.9% 18.6 18.9% 22.4% Sources: * NSI, ** BNB

Or in total export of chemical products and oil products in 2012 reached 22, 4% of Bulgaria’s total exports.

To a greater extent these results can be explained by the fact that most companies of the sector, both enterprises with foreign participation and those that are fully Bulgarian, implement active marketing policy and successively complete their investment program for modernization, reconstruction and often expansion of production capacities. Leading enterprises in the sector-short list Revenues in Number of Subsector / Enterprises Products BGN employees million.* Petroleum products Lukoil Neftochim Burgas JSC Petroleum products - fuels, - Burgas (part of LUKoil) bitumen, vacuum residue, 8220,2 1825 LPG, polypropylene Polysan JSC - Ruse Petroleum products, 183,3 154 waterproofing materials

Prista Oil Holding SPJSC - Sofia Motor and industrial oils 125,4 258

Astra Bioplant SPLTD - Slivo Bio diesel, vegetable oils 183,2 124 pole

page 17 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

Issue 2 (2)/ November 2013 InvestBulgaria Agency

Chemical products Agropolychim JSC - Devnya Mineral fertilizers 479,2 669

Solvay Sodi JSC - Devnya Soda ash-light and heavy, 393,2 509 (part of Solvay Group) baking soda

Neochim JSC - Dimitrovgrad Mineral fertilizers 252,5 1352

Agria JSC – Plovdiv Preparations for plant 59,4 207 protection

Orgachim JSC - Rousse Paints and varnishes 84,0 455

Air Liquide Bulgaria SPLTD, Pirdop (part of Air Liquide) Industrial gases 37,0 91

Drugs and medical products

Sopharma JSC - Sofia Drugs and medical products 214,4 1987

Balkanpharma Dupnitsa JSC - Dupnitsa (part of Actavis Drugs and medical products 201,7 987 Group) Veterinary medical Biovet JSC - Peshtera products, medical products 179,2 1858 for human use

Cosmetics, household chemistry Ficosota Synthes Ltd - Detergents, cleaning and 101,2 474 (for 2011) Shumen polishing preparations (for 2011)

Perfumes and cosmetic Aroma JSC - Sofia products 27,2 261

Perfumes Lavena JSC - Shumen 8,6 92

Rubber and plastic products Plastic foils and flexible Plastchim T JSC - Tervel packaging 114,5 932

Gotmar SPLTD - Saedinenie - Plastic packages 107.9 895 Pd Standard Profile Bulgaria Rubber sealants for SPJSC - Stara Zagora 61,2 1270 (subsidiary of Standard Profil Otomotiv) Polymer foils and packages Megaport Ltd - Varna 47,7 612

Polymer packages and Assenova krepost JSC - materials 47,3 721 Asenovgrad

* Source: Bulgarian Enterprises Information System /BEIS/

page 18 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

Issue 2 (2)/ November 2013 InvestBulgaria Agency

INVESTMENT OPPORTUNITIES OF MUNICIPALITY

Varna Municipality Area: 237,5 sq. km. Mayor: Ivan Portnih Tel: +359 52 /820-280 e-mail: [email protected] Web site: http://www.varna.bg

Varna Municipality Population Total for Varna Municipality 2010 2011 2012 Population (number) 330 001 343 643 343 602 Birth rate, (number) 554 401 -42 Mechanical growth - total (number) 274 -65 1 Working-age population, number 217 854 225 682 225 145 Leading companies by sales Company 2010 2011 2012 income (BGN thousand) Naftex Petrol SPLTD 1 083 733 1 342 477 1 352 280 Energo-Pro Sales JSC 730 748 794 743 844 754 Energo-Pro Grid JSC 225 926 295 831 398 905 Oktopod Invest Holding SPJSC 183 766 216 147 186 281 Navigation Maritime Bulgare (Navibulgar) JSC 304 946 273 813 194 943 Leading companies by profit Company 2010 2011 2012 (BGN thousand) Energo-Pro Grid JSC -183 8 815 11 649 Navigation Maritime Bulgare (Navibulgar) JSC -2 152 -5 100 7 676 Agro - Svetozar Dichevski ST 11 197 12 024 7 479 Comfort LTD 13 955 15 288 7 256 Melrose Resources Bulgaria SPLTD -4 744 8 332 7 019 Projects carried out in the  Building of high-tech park - Varna Varna Municipality (Projects  Creating investment center within the medical university implemented in the  Completion of technology transfer office municipality of Varna, in the area of public functions)

Varna is the third largest city in Bulgaria, covering an area of 205 sq. km. Its location on the northern coast of the Black Sea and rich natural resources make it one of the most famous resorts in Europe and the largest in the Black Sea region. At the same time it is on the crossroads between the Middle East and Western Europe. Varna will plan 205 projects with an estimated value of their realization of BGN 1.1 billion for the next 7 years. Varna municipality will rely on EU funding amounting to 49% of the total to provide financial resources, about 7% of the state budget, 9% own financing and 14% of other investment funds. Involvement of private investors in the implementation of the plan is planned to reach about 21% of its total value. According to the integrated plan for urban regeneration and development of the city during the programming period 2014-2020, Varna will be developed as a major national center for growth. (Source: Capital Daily)

page 19 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

Issue 2 (2)/ November 2013 InvestBulgaria Agency

Varna Province Area 3818 sq. km. Population Total for 2009 2010 2011 Population (number) 465 465 465 100 474 344 Natural increase - from 1000, ‰ 0.5 -1.1 -1.5 Economic Total for Varna Province 2009 2010 2011 indicators and Employees under labor contracts (number) 164 943 150 670 149 361 labor market Average annual salary of employees under labor contracts (BGN) 7 159 7 533 8 144 Economic activity rate - 15-64 years (%) 67.3 66.3 64.1 Employment rate - 15-64 years (%) 64.4 60.8 57.5 Unemployment rate (%) 4.3 8.2 10.3 Registered unemployed as to 31.12. (number) 16 179 16 243 17 379

GDP (BGN mln) 4463.8 4464.191 4873.94 GDP per capita (BGN) 9613 9595 10270 Foreign direct investment in non-financial enterprises, as at 31.12. 1 640.3 1 531.5 1 500.6 (EUR mln)

Cost of acquisition of long-term tangible assets (BGN million)1) 1 402.4 1 119.6 1 091.1 Turnover (BGN mln) * 13 170.6 13 865.8 14 880.0 Produced output (BGN mln) * 7 648.8 7 691.1 8 354.6 Value added at factor cost (BGN mln) * 2 527.8 2 524.9 2 697.5 1) Incl. purchase of land * Data are calculated by the methodology of Structural Business Statistics Source: NSI

page 20 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

Issue 2 (2)/ November 2013 InvestBulgaria Agency

INTERVIEW

Interview with Mr. Serg Shcmit CEO of Italcementi Group Bulgaria Italcementi Group is one of world’s leaders in cement industry and the biggest producer of cement in Bulgaria. You entered Bulgarian market in 1998 through the purchase of Devnya Cement. How much have you invested in Bulgaria so far? Italcementi Group is presented in Bulgaria through its subsidiaries Devnya Cement, Vulkan Cement, Lyulyaka Materials and Devnya Limestone (a joint- venture with Solvay Sodi JSC). Thus, your country is a key market for future development and investment. In the last ten years the company has invested more than BGN 400 million in Bulgaria, which makes it one of the biggest foreign investors in the country. This includes acquisition of existing production capacities, as well as considerable investment in modernization of factories, aimed at increase of productivity and quality standards. Besides, the company invests in improvement of working conditions in order to guarantee that all facilities are designed, maintained and exploited in a way that minimizes health risks and keeps employees and workers safe at all levels of the organization. This means that Italcementi Group has made one of the most colossal industrial investments in Bulgaria for the last decades and is one of the biggest investors in Bulgaria. Are you content with conditions for business development in our country? My personal impressions for investment climate in Bulgaria are exceptionally positive. I believe that this country has a big potential for growth and development not only in our sector but in others as well. As a whole, Bulgaria is distinguished with financial and political stability. It has key geopolitical location with its access to the Black sea. The country represents a peculiar crossroad between Europe and Asia, which is extremely important for our company. Devnya Cement is the second largest current investment of Italcementi in Europe. As far as I am concerned, until now this is the most essential project as it is one of the biggest investments made in Bulgaria in the last 25 years. It also confirms Italcementi’s certainty in the future of Bulgarian economy and development of infrastructure. Moreover, strategic location of the plant, situated next to Port Varna-West, opens doors before Devnya Cement to turn into one of the most important exporters for countries in the Black sea basin and neighboring countries. The project is assessed to a total of about BGN 325 million. In April 2013 we were awarded with an Investor Class A certificate on the matter. What obstacles have you met in you activity so far? Do you get support from the state and what are your recommendations in order to do business easier here? From the start of the project in 2012 state institutions (Government, Ministry of Economy and Energy, Ministry of Regional Development, Varna’s regional administration, etc.), as well as local authorities (, RIEW-Varna and so on) have been quite pro-active in support of our project. We got priceless cooperation by InvestBulgaria Agency, too. The latter facilitated and speeded up bureaucratic procedures on receiving the Investor Class A certificate. In my opinion, fields where the state has to focus are speeding up of bureaucratic procedures for projects introducing the best existing technologies, such with most innovative processes and systems for safety and environmental

page 21 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

Issue 2 (2)/ November 2013 InvestBulgaria Agency

protection. It has to insure conditions of equality to all participants on the market. This is the only way to guarantee loyalty of competitiveness. Last year construction of a new production line for manufacture of clinker and cement that utilizes the so called dry method was started. It will replace the old technology under the wet method. Would you like to tell us more about the facility? When do you expect to launch the new production capacity? For us the investment is an extremely important step ahead that is to introduce the latest, most innovative technologies in production of cement in Bulgaria. Moreover, by replacing the wet method of production of clinker with the dry one, Devnya cement will accomplish striking results as far as environmental protection and safe working conditions are concerned. These are to fall in line with the latest adopted European norms in the field. This makes me and the rest of the employees in Italcementi Group extremely proud. The new facility Picture 1: Location of the new production facilities in will have huge effect on local, regional Devnya Cement (marked in blue) and national level. It will let the company continue responding to requirements for demand of cement on the domestic market in support of the growing need for infrastructure projects, roads, bridges, as well as big diversity of residential and non- residential constructional activity. We expect that the new production facility will be launched by the end of 2014. What do you think of local specialists? Is there shortage of qualified employees in your sector? I believe that there are lots of experts in Bulgaria, not only in our sector but also in the other industries. I am sure that workforce in the country is plenty and has quite high potential. People are qualified and can easily be trained to perceive working standards and requirements of a multinational company like ours. I firmly believe that human capital is the sole competitive advantage that distinguishes the company and determines its success. Italcementi‘s major priority is development of personal skills and competencies of each employee and improvement of management for accomplishment of higher results for the company as a whole. Our efforts are directed to development of our employees’ potential, improvement of their skills and enrichment of their experience and knowledge. We strive to improve working conditions and raise living standard for them and their families.

page 22 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

Issue 2 (2)/ November 2013 InvestBulgaria Agency

AMERICAN CHAMBER OF COMMERCE IN BULGARIA

American Chamber of Commerce in Bulgaria 1766 Sofia, Bulgaria Mladost 4 Area, Business Park Sofia, Building 2, floor 6, Tel: (359 2) 9742 743, 9742 744, 9742 745; Fax: (359 2) 9742 741 e-mail: [email protected] Web: http://www.amcham.bg

American Chamber of Commerce in Bulgaria Fosters a AmCham Committees are driven by the active Strong Business Community in Bulgaria involvement and mutual cooperation between members for developing new ideas, sharing experiences The American Chamber of Commerce in Bulgaria and, ultimately, achieving common goals. (www.amcham.bg) is a leading business organization AmCham Tax Committee is engaged in promoting a uniting over 300 American, Bulgarian and international modern tax framework based on best international companies operating in the country. The Chamber was practices, facilitating the correct and transparent established in December 1994. implementation of the tax legislative system, and The American Chamber of Commerce’s mission is to enhancing stability and predictability in the tax strengthen the economic relations between U.S. and system to support the positive development and Bulgarian commercial enterprises within the framework growth of the Bulgarian economy. of the U.S. - European transatlantic economic relations, The Human Resources Committee provides a as well as to further improve the business climate in platform for HR professionals and consultants from Bulgaria. multi-national and local companies to discuss relevant sector specific issues and legislative AmCham Bulgaria is an affiliate of the U.S. Chamber of changes, and share knowledge about the latest Commerce and a member of the European Council of trends in the HR sector. American Chambers of Commerce (AmChams in The mission of the Corporate Social Responsibility Europe). Committee is to encourage and facilitate For 19 years now, AmCham has been the network of the responsible business practices among AmCham leaders of the American, Bulgarian and international members and to support them to improve the business community. Through the meetings we arrange quality and effectiveness of their CSR programs and and the publications we produce, we keep our members actions. abreast of legislative changes, offer advice on economic Public Procurement and EU Funding Advisory matters and provide information of newfound business Committee. Promotes a transparent and modern opportunities within Bulgaria and abroad. We lobby on public procurement framework based on best behalf of our membership and advocate for their European and other international practices, legitimate interests. Our members continued interest in facilitates the correct and transparent the organization serves as a testament to the Chamber’s implementation of the Bulgarian public role as the ideal venue for lobbying and networking procurement law. opportunities. Quality Management Working Group fosters the importance of quality control and standards for AmCham Committees organizational management improvement and AmCham fosters special Committees whose scope of successful business. activity includes tackling issues which directly or Energy & Mineral Resources Committee monitors indirectly affect the operations of our member legislative and policy developments in the energy companies, as well as developing positions that sector in Bulgaria and the implementation of the AmCham as an organization can then take further to key European legislation with the ultimate goal to be decision makers. useful and influential on the policy dialogue with the government and the development of a sustainable and efficient energy strategy.

page 23 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

Issue 2 (2)/ November 2013 InvestBulgaria Agency

Publicity Our monthly AmCham Bulgaria Magazine provides in- depth coverage of a variety of themed issues, hot business topics, economic analyses and coverage of the chamber’s activities. We distribute 2,500 copies to members, Bulgarian government and key contacts in Bulgaria and abroad. AmCham Bulgaria Yearbook The AmCham Yearbook is up-to-date and sophisticated business guide. It is a valuable reference guide for both AmCham members meet regularly throughout the year current members and potential members with an active discussing the relevant issues of the day with influential interest in the Bulgarian market. governmental officials, MPs, key figures within the AmCham Daily News private sector. Every morning AmCham members receive a summary of Due to our good relations with the U.S. Embassy, we the local news highlighting recent developments in the have been successful in representing U.S. business world of business, politics and international relations. interests within Bulgaria. AmCham Bulgaria Website Our Members On www.amcham.bg you can find detailed information The good corporate reputation is one of the most about the American Chamber of Commerce – activities, important criteria for membership. AmCham Bulgaria list of members, upcoming events and announcements, brings together reputable companies and organizations reports, Chamber’s committees, media coverage and from all economic sectors. The Chamber unites law and archive of past events. consultancy firms, advertising and PR agencies, non- profit and educational organizations, engineering and Visit Europe tourism guide bi-monthly construction firms, chemical and pharmaceutical AmCham-s of Bulgaria, Croatia, Czech Republic, manufacturers and distributors and financial Hungary, Romania, and Slovenia have agreed to institutions. The AmCham community also includes cooperate in development of a monthly online regional companies from within the transportation & logistics tourism guide Visit Central and Southeastern sector, consumer goods manufacturers and distributors, Europe where AmCham Bulgaria members can put service providers, travel agencies, IT companies as well forward their services to the regional AmCham as industrial and office equipment suppliers. All these members through the AmCham network. business interests, both American and Bulgarian, share a common sense of community and a determination to help improve US - Bulgarian economic relations.

page 24 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

Issue 2 (2)/ November 2013 InvestBulgaria Agency

MACROECONOMIC INDICATORS

Foreign Direct Investments in Bulgaria EUR mln Net cash flow - annual data Year 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 903.4 980 1850.5 2735.9 3152.1 6221.6 9051.8 6727.8 2436.9 1151.2 1330.2 1480.5 Net cash flow – quarterly data 2013 2013'Q1 2013'Q2 2013'Q3 2013'Q4 Quarter 476.4 211.6 166.4 Net cash flow – monthly data 2013 I II III IV V VI VII VIII IX X XI XII Month 97.8 192.7 185.9 -94.2 129.5 176.3 118.8 43.8 3.8 Source: BNB

Main economic indicators EU-Bulgaria-USA European Union Bulgaria USA GDP (purchasing power parity) $ mln 15 970 000 [2012] 105 500 [2012] 15 940 000 [2012] GDP - real growth rate % -0.3 [2012] 0.8 [2012] 2.2 [2012] GDP - per capita (PPP) $ thousand 35.1 [2012] 14.5 [2012] 50.7 [2012] Industrial production growth rate % -1.6 [2012] 1.2 [2012] 3.2 [2012] Labor force Mln 230 [2012] 2.585 [2012] 155 [2012] Unemployment rate % 10.3 [2012] 11.1 [2012] 8.1 [2012] Budget surplus (+) or deficit (-) % of GDP n.d. -0.5 [2012] -6.9 [2012] Public debt % of GDP n.d. 16.2 [2012] 72.5 [2012] Inflation rate (consumer prices) % 2.6 [2012] 3 [2012] 2.1 [2012] Current account balance $ mln -34 490 [2011] 542.8 [2012] -487 200 [2012] Export $ mln 2 170 000 [2011] 26 820 [2012] 1 564 000 [2012] Import $ mln 2 397 000 [2011] 31 500 [2012] 2 299 000 [2012] Reserves of foreign exchange and gold $ mln 863 800 [2011] 20 500 [2012] 150 200 [2012] Debt - external $ mln 15 500 000 [12m 2012] 50 540 [12m 2012] 15 930 000 [12m 2012] Stock of direct foreign investment - at home $ mln n.d. 52 990 [12m 2012] 2 723 000 [12m 2012] Stock of direct foreign investment - abroad $ mln n.d. 1 923 [12m 2012] 4 507 000 [12m 2012] Source: CIA /www.cia.gov

page 25 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg

Issue 2 (2)/ November 2013 InvestBulgaria Agency

UPCOMING EVENTS

December Bulgaria InvestBulgaria Agency (BIA) will publish in the first 2013 half of December Investment Catalogue of Bulgaria The aim is to gather investment projects to be brought to the attention of Bulgarian and foreign investors. The catalogue will be a printed edition and will be available on the website of the Agency. It will be distributed by the IBA and other government institutions.

3 British Academy The Economist’s innovation Awards 2013 December of Film and 2013 Television Arts, London

5 China, BEIJING China Summit 2013 December Sofitel Wanda, BEIJING 2013

10 Sofia, Nordic Business Forum December Bulgaria “Boosting partnership between the Nordic business 2013 and the Bulgarian state administration: The Nordic model experience”

10-11 Amsterdam, Smart Investing in a Low Growth World December The Netherlands 2013

16-18 Poland, Sopot 8th Energy Forum (2013) December 2013

January Bulgaria InvestBulgaria Agency (IBA) organized for the eighth 2014 time the annual awards Investor of the Year 2013 The aim of the event is to acknowledge the most important investment projects implemented in Bulgaria in 2013.

page 26 of 26 InvestBulgaria Agency (IBA), 31 Aksakov Str., Sofia 1000 tel.: (+359 2) 985-5500, Fax: (+359 2) 980-1320 e-mail: [email protected], http://www.investbg.government.bg