issue 162 september 2015

Analysis: The Lost Tourists Fuel Prices Play

Member News: Ernst & Young: FDI into Europe Hits a New Record UniCredit Hosts Transformations Expo

The Migrant Crisis

American ChamberC hamber of CommerceC ommerce in

BusinessB usiness Park Sofia, Mladost 4 Area, Building 2, Floor 6, 1766 Sofia Tel.:Te l .: (3(3595 9 2) 99742742 747433 FFax:ax: (3(3595 9 2) 99742742 747411 homepage:h omepag e: www.amcwww.amcham.bgh am.bg e e-mail:-mail: [email protected] cham @a mch am.bg

editorial

Dear Reader,

Wouldn’t it be great if we could devote this first post-vacation issue of the year to the departing summer, to our oncoming fall work and the expecta- tions of a positive business balance for your companies? For better or worse, though, we live in the European Union, which is facing one of its largest public crises after the Second World War: the Refugee Wave (read Boyko Vassilev’s opinion on Page 8 and a historical review by Reuters on Page 4).

Tens of thousands of refugees from conflict zones in Africa and Middle East have come knocking at the doors of the EU, looking for salvation, shelter and a better future. For the first time in decades the Union has no common solution for such a serious issue. Immigrant quotas that the European Commission has tried to request have been met with disagree- ment from member countries. The better-off Eastern Europeans have no desire to accept refugees, while the poorer ones – like Bulgaria – at least officially do not object, but have no means to do much. Just this year Italy and Greece have seen some 430,000 migrants from Syria, Eritrea, Iraq, Afghanistan, Somalia, Gambia, Nigeria, among other countries. The majority plan to continue north; however, an initially welcoming Germany and well-wishing Scandinavians cannot accept the entire refugee flow – and is this the solution anyway?

Perhaps it is time for the EU to revive the so-called humanitarian passport of the United Nations, known from the 1950s and 1960s. This used to be a blue document with the UN’s logo on the cover, photo and information about its holders inside, which allowed thousands to move around the world after wars, crises and political repressions.

Nowadays we can have a EU humanitarian passport with all the requisite data including biometrics, but most importantly with the EU country that will be considered a refugee’s host, his or her new homeland. This will allow for easier and safer transportation across the continent (by train or plane, not by foot or via

the dangerous, deadly trucks); it will limit fraud and help reuniting families. It will make the refugees feel AmCham Bulgaria Magazine September 2015 accepted, it will give them the sense that they are safe and welcome. It will enhance their integration into the EU societies.

Some among you may object that this is an undemocratic measure, a group labeling of sorts. Is it more democratic to leave downtrodden and forlorn victims of war and misfortune to wander around like scared animals? Or line up against the barbed wire on yet another border? What if the more impatient countries in the EU get fed up with the unrelenting crisis and start large-scale deportation operations?

page Think about it. 1

Sincerely,

Milen Marchev Editor-in-Chief contents

AmCham Bulgaria Magazine is a primary forum for political and economic analyses, news, viewpoints as well as for the presentation of new business opportunities. The articles in the AmCham Bulgaria Magazine express the opinions of the authors and do not necessarily reflect the position of the American Chamber of Commerce in Bulgaria. Publisher Writers: American Chamber of Commerce in Bulgaria Boyko Vassilev, Marina Tzvetkova, Business Park Sofia, Mladost 4 Area Mina Georgieva, Panayot Angarev, Building 2, Floor 6, Sofia 1766, Bulgaria Yuliana Boncheva Tel.: +359 (2) 9742 743 Fax: +359 (2) 9742 741 Advertising e-mail: [email protected] AmCham Bulgaria: www.amcham.bg Nadejda Vakareeva, [email protected]

Editor-in-Chief AmCham Bulgaria Magazine: Milen Marchev Milen Marchev, [email protected]

Deputy Editor-in-Chief The AmCham Bulgaria Magazine reaches a broad audi- Christopher Karadjov ence of AmCham members, leading US, Bulgarian and international companies, US and Bulgarian decision-mak- Senior Editor: ers, all AmChams around the world. Irina Bacheva Subscription is free of charge. If you would like to sub- scribe to AmCham Bulgaria publications, please contact ISSN 1312-935X the AmCham Bulgaria office.

2 AmCham Bulgaria Magazine September 2015 September Magazine AmCham Bulgaria amcham bulgaria

Board of Directors of the American Chamber of Commerce in Bulgaria President Ms. Krassimira Chemishanska Amgen Bulgaria Vice President Mr. Alex Nestor Individual Member Contents Treasurer Ms. Petya Dimitrova Eurobank Bulgaria Members Mr. Plamen Zhechev Cisco Systems Bulgaria cover story Mr. David Butts CMS Cameron McKenna EOOD Ms. Diana Pazaitova Fama Consulting The Migration Debate ...... 4 Mr. George Brashnarov Nemetscheck Bulgaria Mr. Peter Lithgow Individual Member By Anne Hammerstad, REUTERS Mr. Sergey Koynov Forton International Mr. Solomon Passy Atlantic Club Bulgaria EXODUS: The Refugee Crisis Sets Mr. Venislav Yotov AIG Europe Limited (Bulgaria Branch) Ex-Officio Member Ms. Maria Galindo Senior Commercial Officer, Difficult Questions for Europe and Bulgaria ...... 8 U.S. Embassy Executive Director Mr. Valentin Georgiev By Boyko Vassilev

3M Bulgaria EOOD . AA KRES EOOD . Abbott Products EOOD . AbbVie EOOD . Actavis Bulgaria EAD . analysis Adecco Bulgaria ltd. . ADM Bulgaria Trading EOOD . Advance International Transport EOOD . AES Corporation . AFA OOD . AGORA-IN Ltd. . AIG Europe Limited (Bulgaria Branch) . AIMS Human Capital . AD . Seaside Woes of Season 2015: ALD Automotive OOD . All Channels Communication . Alliance One Tobacco Bulgaria . Allied Pickfords Bulgaria . Alpha Bank Bulgaria . America for Bulgaria Foundation . American College of Sofia . American English Academy . American Research Center in Sofia . American University in Bulgaria (AUBG) . Amgen Bulgaria EOOD . Amway Dubious Cleanliness Romania Marketing Srl. . Anglo-American School of Sofia . AON Bulgaria . APOLO Ltd. . Architect Nikolay Mihaylov Galabov . Arexim Engineering . Ashtrom International Ltd. . ASSESS Ltd. . Association Srednogorie and Closed Beaches ...... 12 Copper Industrial Cluster . Astra Zeneca Bulgaria EOOD . AT Engineering 2000 Ltd. . Atlantic Club Bulgaria . Atos IT Solutions and Services EOOD . Attica Media Bulgaria Ltd. . August Research . Aurubis Bulgaria AD . By Marina Tsvetkova Auto Bavaria Ltd. . Auxionize . AVON Cosmetics Bulgaria . AW-Tronics LLC . Axway Bulgaria EOOD . Baker Tilly Bulgaria . Balkan Star Automotive EOOD . Ballistic Cell Ltd. . Baxter Bulgaria EOOD . BG Radio . BICA International Ltd. . BMG Ltd. . BMW Vertiebs GmbH - Branch Bulgaria . BNP Paribas S.A. - Sofia Branch Will Cheap Oil Stumble Bulgarian Plans . Bojinov & Bojinov . BOYANOV & Co. . Braykov's Legal Office . British American Tobacco Bulgaria . Brown- Forman Bulgaria Ltd. . bTV Media Group . Bulgarian American Enterprise Fund . Bulgarian Charities Aid Foundation (BCAF) . Bulgarian Executive Search Association . Bulgarian Property Developments EOOD . Bulgarian-American for Domestic Production? ...... 16 Commission for Educational Exchange Fulbright . Bulgarian-American Credit Bank . BulPros Consulting JSC . Bulstrad Life Vienna Insurance Group . Business Intellect Ltd. . Business Park Sofia EOOD . C3i Europe EOOD . CAD By Investor.bg R&D Centre Progress Ltd. . Carat Bulgaria . Castello Precast OOD . Center for the Study of Democracy . CEZ Bulgaria EAD . Chaos Software ltd. . Cheque Dejeuner Bulgaria Ltd. . Cisco Systems Bulgaria . Citibank Europe Plc, Bulgaria Branch . CMS Cameron McKenna LLP - Bulgaria Branch . Coca-Cola Enterprises Services Bulgaria EOOD new members ...... 17 . Coca-Cola HBC Bulgaria AD . Coface Bulgaria Credit Management Services EOOD . COLLIERS International Bulgaria . Comverse Bulgaria . Congress Engineering Ltd. . Construction Management Group . Contitrans M Ltd. . ContourGlobal Maritsa East 3 AD . Curtis / Balkan Ltd. . DA TRAVEL . Dalkia Bulgaria EAD . Danailov, Auxionize Drenski, Nedelchev & Co. . Delchev & Partners Law Firm . Deloitte Bulgaria EOOD . denkstatt Bulgaria OOD . Deutsche Bank AG . Devin AD . DHL Express Bulgaria Ltd. . Diamed Ltd. . Dimitrov, Petrov & Co. . Djingov, Bojinov & Bojinov Gouginski, Kyutchukov, & Velichkov . Dobrev & Lyutskanov Law Firm . Dr. I.S. Greenberg Medical Center . Drujba Glassworks SA . Dundee Precious Metals Inc. . DuPont Pioneer . EcoPack Bulgaria AD . Edenred Bulgaria DA TRAVEL . Ekoterm Proekt EAD . Ekotoi - Service Ltd. . Ekzotika EOOD . EL-A-Project Ltd. . Electron Progress EAD . Eli Lilly and Company . Eltrak Bulgaria Ltd. . EMC Computer Systems Austria GmbH . Emerson Process Management . EnergoService AD . Engineeringservice Sofia Ltd. . Enterprise Communications Group OOD . Garitage Investment Management EOOD EOS Matrix Ltd. . EPAM Systems Bulgaria . EQE Control OOD . Ernst & Young Bulgaria EOOD . ESRI Bulgaria Ltd. . Etap Adress . Eurobank Bulgaria . Eurohold Bulgaria . European Bank for Reconstruction and Development Holzindustrie Schweighofer EOOD (EBRD) . European Trade Center EOOD . Evrika Commerce Ltd. . EVS Translations Bulgaria . Expat Capital . Experian Bulgaria EAD . FairPlay International . Fama Consulting OOD . Flying Cargo Bulgaria Ltd. - Licensee Siemens Healthcare of FedEx . Force Delta Ltd. . Forton AD . Foundation Glob@l Libraries - Bulgaria . GAEA - Green Alternative Energy Assets EAD . Galardo Real Estate . Garitage Investment Management EOOD . Gasstroymontaj Jsc . General Electric International . Georgiev, Todorov & Co. . Geostroy AD . Geotechmin OOD . Geotrading AD Sterling Serviced Office Group . Gi Group . GIFTA . Grand Hotel Sofia . GSK . GTC Bulgaria . Harley-Davidson Sofia . Helios Power Jsc . Hewlett-Packard Bulgaria Ltd. . Hilton Sofia . Holzindustrie Schweighofer EOOD . Honeywell EOOD The National Network for Children . Hydroenergy Company JSC (HEC) . IBM Bulgaria . ICAP Bulgaria JSC . IDC Bulgaria . Ideal Standard - Vidima AD . Incotex Group Ltd. . Industrial Holding Bulgaria . INFORMA . InterConsult Bulgaria Ltd. . Interdean Relocation Services . Interlang Ltd. . Intertek BA . Intracom Bulgaria EAD . Investbank JSC . member news Investor BG AD . IP Consulting Ltd. . Japan Tobacco International Bulgaria . Jobs.bg EOOD . JobTiger Ltd. . Johnson & Johnson Bulgaria EOOD . Junior Achievement Bulgaria . Kalamaris Group . AD . Telus International urope Kamenitza AD . Katilin Popov Enforcement Officers . Kempinski Hotel Grand Arena . Kempinski Hotel Marinela Sofia . Kinstellar Sofia Branch . KPMG Bulgaria OOD . LANDMARK Property Management AD . Lexim Sofia Co. Ltd. . Lindner Immobilien Management EOOD . Lirex BG Ltd. . M3 Communications Group, Inc. AmCham Bulgaria Magazine September 2015 Invests €40,000 to Renovate the Hill+Knowlton Strategies Associate . Maria Vranovska, MD, MBA . Mars Incorporated Bulgaria EOOD . Marsh LLC. . MBL| Part of the CBRE Affiliate Network . Megatron EAD . Mellon Bulgaria EAD . Merck Sharp & Dohme Louis Braille School ...... 19 Bulgaria . MetLife Europe Ltd. - Bulgaria Branch . Microsoft Bulgaria . Miltech Ltd. . Minstroy Holding Jsc . Mobiltel EAD . Monbat Plc. . Mondelez Bulgaria AD . Moten Sport . Moto-Pfohe Ltd. . Mr. Alex Nestor . Mr. David Hampson . Mr. Jean Talmon . Mr. Nikolay Ouzounov . Ms. Anelia Tatarova . Ms. Gergana Valova Cruise Agency CONTITRANS M Ltd. . Ms. Kalinka Kovatcheva . Ms. Margarita Radeva, CPA . Municipal Bank Plc . Musala Soft AD . NDB Ltd. . Nemetschek Bulgaria . NEXTDOOR Ltd. . Novacon Bulgaria Ltd. . Novotel Sofia . Nu Boyana Film Studios . On Bulgaria Ltd. . Oracle East Central Europe Limited - Branch Bulgaria . Orak Group Europe Ltd. . Orbit Ltd. Presents Azamara Club Cruises® ...... 20 . Panchim Ltd. . PANDA - IP Ltd. . Pedersen & Partners . Penev LLP . Penkov, Markov & Partners . Pfizer Luxembourg SARL Branch Bulgaria . Philip Morris Bulgaria EOOD . Philips Bulgaria Ltd. . PPD Bulgaria EOOD . Premier Luxury Mountain Resort . Premier Tours Ltd. . Prestige 96 AD . Provident Financial Bulgaria Western Europe Overtakes China and Ltd. . PSG Payroll Services Ltd. . PwC Bulgaria . Quintiles Bulgaria Ltd. . Radisson Blu Grand Hotel . Raiffeisen Investment Bulgaria EOOD . Red Devil Catering Plc . Regus Bulgaria Ltd. . Renault Nissan Bulgaria SRL page North America as #1 Investment Destination . Right Rental Ltd. . RSM BX Ltd. . S&T Bulgaria EOOD . Sanofi - Aventis Bulgaria EOOD . Sb Accounting 3 and Consulting . Schenker EOOD . Schneider Electric Bulgaria . SECTRON . Sensata Technologies Bulgaria with FDI Projects at Record High ...... 21 EOOD . Shell Bulgaria EAD . Sherita M Ltd. . Siemens EOOD . Siemens Healthcare . SIENIT Holding . Silver Ridge Power . Sitel Bulgaria EOOD . Sodexo Pass Bulgaria EOOD . Sofia Hotel Balkan . Sofita Translation Agency . Sogelife Bulgaria IJSC . Sopharma AD . Sopharma Trading JSC . Sportal.bg JSC . Stanton Chase International Bulgaria . Stefan Dimitrov, Norman Realestate Co. Ltd. . Sterling Serviced Office Group . Sunfoods Walltopia Welcomes New Minority Bulgaria EOOD - Development Licensee of McDonald’s in Bulgaria . Sutherland Global Services Bulgaria EOOD . Synchron-S OOD . Tavex EOOD . TBI Bank EAD . TechnoLogica EAD . Telelink EAD . TELUS International Investors in the Company ...... 23 Europe . The Coca-Cola Company Bulgaria . The National Network for Children . Tishman Management Company EOOD . Titan Zlatna Panega Cement . TMF Services EOOD . Tocheva & Mandazhieva Law Office . UniCredit Bulbank . UniCredit Leasing EAD . Unimasters Logistics Plc . Unique Estates . United Bulgarian Bank . UniCredit Studio Hosts Sofia Transformations Videolux Holding / Technopolis . VISA Europe . Visteon Electronics Bulgaria . VIVACOM . VMware Bulgaria EOOD . VSK Kentavar - IZ Dinamika EOOD . VUZF University Higher School of Insurance and Finance . Walltopia Expo and Brings to Life History of Sofia City...... 24 Ltd. . Welcome to Bulgaria . Westinghouse Energy Systems Bulgaria Branch . World Courier Bulgaria Ltd. . World Transport Overseas Bulgaria Ltd. . WorleyParsons Nuclear Services JSC . Wrigley Bulgaria EOOD . Xerox Bulgaria Ltd. . Xogito BG Ltd. . Yastrebets Hotel Wellness & SPA . Yatoto . Zlatina Ruseva-Savova, LL.M., MBA . Zobele Bulgaria EOOD . cover story The Migration Debate Lessons for dealing with today’s migrant crisis from the last one By Anne Hammerstad, REUTERS

Migrants arriving from Hungary are seen in Nickelsdorf, Austria, 10 September 2015. The Austrian railway company Osterreichische Bundesbahnen (OBB) temporar- ily ceased to operate trains between Budapest and Vienna due to overburden. Migrants arriving to Austria will be transported from the Austro-Hungarian border to Vienna by buses and trains allocated for this purpose.

We have been here before. Hundreds Mediterranean in dinghies, fishing crisis in host states such as Malaysia, of thousands of people fleeing in rick- boats and even steel-hulled ships, and Thailand and Indonesia — before gov- ety boats, many of whom perish at sea struggling through southern and east- ernments overcame their urge to pass as regional governments avoid search ern Europe on foot, bicycles, buses and the buck and look away. and rescue efforts in fear of their “pull trains. They follow the same migration factor.” Conditions at arrival made routes as asylum seekers from other Overcome it, though, they did. During unwelcoming in order to deter others nasty parts of the world, as well as eco- an 18-month period beginning in from attempting the journey. Still people nomic migrants from sub-Saharan January 1979, the world, led by the continue to come. Africa. According to the UN Refugee United States, resettled 450,000 Agency, UNHCR, Syrian refugees Indochinese refugees. By the late In the two decades following the United account for 53 percent of the nearly 1990s, one million had begun new lives States’ withdrawal from Vietnam in 400,000 illegal arrivals by sea to Europe in the United States, 400,000 of whom 4 1975, three million people fled the com- so far in 2015. were boat people. Large numbers of munist regimes of Vietnam, Cambodia refugees went to France, Canada, and Laos. More than one million were The Indochinese refugee crisis was Australia, and other countries as part of boat people. resolved in great part through resettle- the resettlement agreement dubbed ment, agreed to and executed by a “Open shores for open doors.” A different sea and a different time, but broad coalition of countries. Like today, the Indochinese refugee crisis has les- it took media attention on the countless There are many modern-day examples sons to offer for today’s Syrian exodus. tragedies at sea — coupled with seri- of large-scale refugee resettlement. AmCham Bulgaria Magazine September 2015 September Magazine AmCham Bulgaria Refugees are crossing the ous political backlash and humanitarian Hungarians fleeing after the 1956 upris- cover story

ing, and Kosovo-Albanians “ethnically cleansed” during the 1999 Kosovo war, benefitted from swift, organized reset- tlement of a significant proportion of the refugees in order to alleviate the humanitarian and security concerns of countries of first asylum. Between April and June 1999, NATO airlifted 86,783 Kosovo Albanians to 30 different coun- tries, mostly in Europe and North America.

But times have changed. Faced with rising and unpredictable numbers of asylum seekers arriving directly at their door, most governments in the rich world have come to view resettlement as an avoidable burden rather than a Migrants in Hungary walking in direction of the Austrian border with their wishful final destination – useful tool of refugee protection. Germany. cant proportion of Syrian refugees Syrians arrived with some savings with Only a tiny fraction of the world’s refu- would alleviate the chaotic scenes which to pay rent and an education that gees today are resettled, while vast played out across Europe. It would help could, with luck, win them a job. Others refugee populations languish for years stabilize and support Turkey, Lebanon had the option of getting food and and decades in refugee camps, such and Jordan, all creaking under the health care in a refugee camp. as the Dadaab settlements for Somali pressure of the refugee influx. And it refugees in Kenya, and Zaatari, home would reaffirm the principle, established But the war is now in its fifth year. to around 80,000 Syrian refugees in after the horrible failings of World War There are many more refugees, they Jordan. Two, that all states have a joint respon- are less welcome in their host states, sibility to provide refuge for people flee- those refugees who had savings have There are some good arguments ing war and persecution. depleted them, and there is less against resettlement. The ideal is, of humanitarian aid available per refugee course, that refugees should one day There are today over four million Syrian in need. The UN has received 37 per- return to their home countries. Until refugees worldwide. Over 90 percent cent of the funds needed for the 2015 that day, it could be argued that they have gone no further than just across humanitarian program for Syria’s dis- are best looked after close to their own the border. Turkey hosts 1.9 million placed: money that goes to run refugee country, due to cultural and social affin- refugees, Lebanon 1.1 million — a camps, and to provide food or food ities, for cost reasons, and because quarter of the country’s population — vouchers, health care and education proximity would make them better able and Jordan is home to 630,000 both within the camps and to the many to judge when it is safe to repatriate. Syrians. more who have settled in urban areas such as Jordan’s capital, Amman. Sometimes, though, large-scale reset- Until this year, because it was locally UNHCR’s budget is 10 percent lower tlement is necessary. There is no end in contained, it was possible for the rest of than last year, leaving the High sight to the Syrian conflict. The reset- the world to pay little attention to the Commissioner for Refugees, Antonio tlement of a relatively small, but signifi- unfolding refugee crisis. Most fleeing Guterres, to declare that “we are AmCham Bulgaria Magazine September 2015

page 5 cover story

broke.” result, are transformed from refugees ary further afield. to “illegal immigrants.” Refugees themselves, having used up For such a resettlement program to their savings, are getting into crippling Studies of Vietnamese refugees reset- work, it will take serious negotiations debt. Their rent and costs of living in tled in the United States show that between the frontline states and a Syria’s neighboring states have those who had experienced traumatic broad coalition of resettlement states. increased dramatically in the past year. and dangerous journeys by boat found The Syrian refugee crisis is not a A recent study by UNHCR showed that it harder to integrate into their new, European problem. The United States, 70 percent of Syrian refugees in “normal” lives than those who had ben- Canada, Australia and other members Lebanon are now living far below the efited from the Orderly Departure of the rich world need to step up. The poverty line. Program. For everyone’s sake, then, Gulf States need to wake up to their Syrian refugees need safe and legal moral obligation. As needs have risen, the humanitarian ways to travel to countries where they system has not been able to cope. The can restart their lives and educate their Germany has in recent days become a World Food Programme just announced children. shining beacon of hope and decency to 229,000 refugees in Jordan that they for Syrian refugees. The governments would no longer receive food vouchers We need a comprehensive resettle- of the UK, France, Australia and a due to funding cuts. At least 700,000 ment program for Syrian refugees in smattering of other countries suggest Syrian refugee children are going with- Turkey, Lebanon, Jordan, Egypt and they will take in somewhat larger refu- out an education, according to Iraq. Not for all of Syria’s four million gee quotas. This is a step in the right UNHCR. refugees, but as a safety valve both for direction, but unilateral and piecemeal host countries and refugees, coupled announcements will not do the trick. But there is no safe and legal way for a with stronger economic and political We need a giant show of global solidar- Syrian refugee to travel to Europe — or support to the states at the frontline of ity and concerted action. It has been to any other part of the world, for that this humanitarian disaster. You cannot done before. The recent groundswell of matter. They have to resort to the peril- cut food rations in Jordan and wonder sympathy for Syria’s displaced means ous aid of people smugglers and, as a why people are leaving to seek sanctu- it can be done again.

6

German Chancellor Angela Merkel (C) has a selfie taken with a refugee during a visit to a refugee reception centre in Berlin, Germany, 10 September 2015. Germany can deal with the arrival of hundreds of thousands of refugees without cutting social welfare benefits or raise taxes, Vice Chancellor Sigmar Gabriel said on 10 September, during a debate in parliament on next year`s budget. Germany expects 800,000 asylum seekers this year, four times more than last year and more than AmCham Bulgaria Magazine September 2015 September Magazine AmCham Bulgaria any other country in the European Union, which is split on how to deal with the biggest refugee crisis since World War II.

cover story EXODUS The Refugee Crisis Sets Difficult Questions for Europe and Bulgaria By Boyko Vassilev

Martin Schulz (L), the President of the European Parliament, speaks with Commission President Jean-Claude Juncker (R) before the latter delivered his first State of the Union address to the European Parliament in Strasbourg, France, 09 September 2015. The European Union was set 09 September to launch a fresh effort to tackle its migration crisis, including a controversial scheme to redistribute refugees among member states.

“Mr. Cameron, summer is over! Now deal with the biggest which everybody likes and everybody strives for. crisis facing Europe since World War II!” … And which today is bursting under the force of its own That is how The Sun summarized the situation about the attractiveness. Its internal moral feeling cannot stand the European refugee crisis. If we have to say it even more sight of the dead Syrian child on a Greek beach, the suffo- directly, in the summer of 2015 it emerged that Fortress cated people in the truck to Austria and the drowned Europe was about to fall. It is something like the Biblical migrants in the sea near Lampedusa. That is too much of a 8 Exodus, several catastrophes into one: a moral, political burden for the European public opinion – especially for the and demographic one. German one, which has just cured the wounds of the big wars. Europe is tormented by thoughts: Is it worthy of its The moral crisis hits United Europe right into the heart. After own claims? And it is quite unclear if it is going to stand that World War II, Western Europe – and later Central Europe – burden. united to stop the wars and sufferings on the Old Continent. And if the United States is the new Rome of the imperial Because, purely politically, the situation does not look sta- order, then Europe had to be the new Athens of wisdom, ble. The right-wing populists were strong enough even AmCham Bulgaria Magazine September 2015 September Magazine AmCham Bulgaria abstention from force, values and human rights. A utopia before the refugee crisis. A month of tension at the cover story

Hungarian borders and railway stations – and Hungary’s Juncker, to come up with a new plan. The previous one Prime Minister Viktor Orban turned into a spokesman of envisaged the allocation of 40,000 immigrants in the EU those who had no problem speaking aloud before: countries on a quota basis – and was rejected by many countries, including Spain, which agreed to 32,000 only. “The supply of immigrants is endless Now the question is about 160,000 refugees – and that is a goal, not a reality. Juncker also suggests special European and if the European Union does not protect its borders, mil- forces and assignment of “secure countries” the refugees lions will come; there is no end to this. There is a threat that from which will be returned home. one day the Europeans will become a minority on their own continent.” A deeper analysis raises the question of what the West did wrong in the Middle East. Russian President Vladimir Putin Orban wants to tighten border control. According to him it is has a ready answer: of course, the United States is to not Europe but Germany that has a problem. Because most blame. It has always tried to impose “foreign models” on the refugees want to go there. Arab states. Quite many opponents of the West are con- vinced of that and the thought is turning into something like But it is Germany and the strong leadership of Angela an axiom of anti-Americanism. Merkel that are the only political hope at present. Merkel, together with the French President Francois Hollande, But let us ask a few questions. The United States was right- called on the EU for measures, solidarity and actions. A fully criticized for waging the second war in Iraq, which master of balance, the German chancellor does not admit a toppled Saddam Hussein from power. Yes, that unleashed a compromise with the European values but she does not series of other events but not a refugee wave to Europe. expect the European institutions to break down either. She The refugees set off for Europe after the civil war in Syria, says, “If Europe does not cope with the immigrants, it is not where the United States chose not to interfere. And also, the Europe we wanted.” when we hear the statement that dictators are to be pre- ferred to jihadists and that the Middle East was better off How is Merkel thinking? It is clear that the so-called Dublin with Saddam and the old Assad than with Islamic State, we Regulation, which provides for the first countries of entry to have to ask ourselves: Wasn’t it the dictators who created bear the burden, does not work: out of 350,000 refugees Islamic State? In a region of turbulence and revolutions that had entered Europe by the beginning of September, there are neither clear-cut culprits, nor clear-cut recipes. Greece had taken 218,000 and Italy, 114,000. All those people cannot stay there. America should know it is going to be criticized in any case – when it does interfere (Bush) and when it does not inter- But it is also clear that not all refugees can get to Germany. fere (Obama). But it is on it, jointly with the European Union, By the beginning of September the German borders had that the responsibility lies to pacify Syria and ensure that at been reached by 413,000 refugees, less than a third of least part of the refugees return home. whom were from Syria. Until the end of the year Berlin is expected to review 800,000 asylum applications and that In this cocktail, big and small states have equally big prob- hides risks even for the powerful German economy with its lems. Bulgaria makes no exception. In 2013-14 several famed social services. More than 6 billion Euro is said to be thousand refugees brought needed for that. Consequently, the burden has to be split equally. Great Britain’s readiness to accept 4,000 refugees structural problems was one of the first steps in that direction. to the light: poor conditions in the accommodation centers, Europe, and its tacit leader Merkel, have not surrendered to a land border hard to protect, not properly settled issues AmCham Bulgaria Magazine September 2015 the crisis. But the demographic dimensions of the problem with Turkey, danger of extremism and populism, inefficient cannot be ignored. It has been less than five years since the social services. In other words, the refugees were like time Thilo Sarrazin wrote “Germany Does Away with Itself”, torches lighting up the dusty closet of unfinished reforms. and Merkel herself has announced By September 2015 Bulgaria had given a refugee status to the end of the multicultural model 12,800 people out of a total of 17,000 people detained on Bulgarian territory; for the whole year 2014 the number was used until recently as an ideological matrix for integration of 12,700. The trend towards an increase is clear. Nevertheless, the European Muslims. It has been less than a year since in the summer of 2015 Bulgaria seemed to remain in the page 9 Charlie Hebdo and the gloomy prophesies of writer Michel background: the big drama unfolded along the lines of the Houellebecq about “Muslim” France. Today Muslims in Greek islands – – Serbia – Hungary – Austria – Germany are more than 5 percent, in France, up to 10 per- Germany. But that is only apparently so. There are at least cent. In 2010 they were 6 percent in the whole of Europe; three issues that need to be urgently solved. the forecast for 2030 is 8 percent. Firstly, Bulgaria’s share for reception of refugees was Measures are needed and they should be long-term ones. 1.25%. Until recently that meant the accommodation of As for now the German-French initiative has encouraged 800 people, which the Bulgarian institutions (and espe- the President of the European Commission, Jean-Claude cially several MEPs) viewed reluctantly. But according to cover story

A car with Bulgarian license plates full with 17 Syrian migrants was detained near the Bulgarian city of . The Driver – Iranian citizen was arrested for human trafficking. Juncker’s new plan, Bulgaria will have to receive another abandoned truck in Austria revealed Bulgarian participation 1,500 refugees. How will a country that could hardly man- in the illegal trafficking in human beings to the heart of age to accommodate 800 and had problems handling sev- Europe. In other words, the Bulgaria mafia is here and liv- eral thousand passing refugees cope with all that? Nobody ing. Nurtured by the embargo against former Yugoslavia, it knows. Bulgaria has its own Muslim population and quite a lost influence with Bulgaria’s European integration but toady large diaspora in the Middle East but for now it miracu- it is raising its head. The refugee wave is a huge resource lously stands outside the main interest of Islamic State. for it; it will help few become rich but put many in the terrible But there is always a risk and it should not be underesti- situation of being strangers in their own country. That is mated. something that a Bulgaria facing depopulation, a demo- graphic crisis and migration of its own population will not be Secondly, Bulgaria’s desire to become member of the able to stand. Schengen area can be foiled not by its own problems but because of the world around. Paradoxically, that may not be To recapitulate, the moral, political and demographic crises such a big catastrophe: if Sofia joins Schengen, the refugee facing Europe to a great extent are Bulgarian problems too. flow may increase, rather than decrease; They demoralize the public and prevent the economy from 10 growing. What can be done? The oldest cliché is that once in the Schengen area, Chinese hieroglyph for crisis, which is said to have the double meaning of opportunity. it will be much easier for every refugee to reach the cher- ished Germany. Therefore a compromise is likely to be But that is the relief of the strong. They know that everyone reached – partial entry in Schengen, for instance by air only. can do fine with a crisp tailwind but only heading into at That will be an attempt to have the best of both worlds. storm will reveal the good captain. Both Bulgaria and Europe need worthy skippers right now in the middle of the AmCham Bulgaria Magazine September 2015 September Magazine AmCham Bulgaria Thirdly, the shameful episode with the dead people in the gale.

analysis

In search of lost tourists… Seaside Woes of Season 2015: Dubious Cleanliness and Closed Beaches By Marina Tsvetkova

The beaches of Lozenets, , Tsarevo and , the central and eastern beaches of , the southern beach of Kiten, and are the ones with levels of contamination above the best standards according the official data of the Regional Inspection of Environment and Waters of . “Swimming is on your own responsibility. This year alone the number of holiday- most generous lovers of the Bulgarian There is a risk of infections,” reads the makers has dropped about 20 percent, seaside, decreased at least 20 percent. startling warning to visitors on some of she said. These are sad statistics, given the best-known beaches in Hawaii, that the sector generates 12 percent of Tasty and cheap including the famed Waikiki. For a few the gross domestic product and the gov- is not enough days in August some of the most ernment even had plans to raise the dreamed-about spots on the planet share to 20 percent by 2020. However The problem of contamination of the remained deserted. The reason was the the trend is just the opposite. Bulgarian seaside has been looming spillage of nearly 2,000 tonnes of waste- large for years. The construction boom water along the Pacific coast. Sewage. As a matter of fact there are more indi- and the tourist influx are the main rea- 12 Not sharks and jellyfish. Contamination. cations that the crisis in Bulgarian tour- sons for the doubtful cleanliness of the The warning could be read on signs and ism is aggravating. In the first half of water and beaches around several heard delivered by lifeguards using 2015 only 50 percent of the visitors to resorts. loudspeakers… Bulgaria’s resorts were citizens of EU member states, statistics show. Visitors The contamination of the beach in The fact that breaches of the rules and from Germany dropped 13 percent, Lozenets is a classic example of private contamination of the seawater affect Romanians, nearly 50 percent. Tourists investment initiative outstripping the con- tourism was admitted even by Bulgaria’s from Russia and Ukraine, which are struction of infrastructure. At the height of AmCham Bulgaria Magazine September 2015 September Magazine AmCham Bulgaria Minister of Tourism Nikolina Angelkova. traditionally the largest group and the the season it emerged that the water on analysis

by the concessionaire of the northern beach in Primorsko, who saw huge piles of the mysterious substance.

The cleanest beaches to the south are , the village of Chernomorets – South, the central beach of , camping site, the southern beach of Pomorie, the beach of Kraymorie and the beaches of . The popular beach of Koral has not been examined, most probably because it is not guarded this year.

At the opposite pole are the central beaches of Lozenets, Ahtopol, Tsarevo and Chernomorets, the central and east- ern beaches of Pomorie, the southern beach of Kiten, Primorsko, , Minister of Tourism Nikolina Angelkova presented a new online register for Bulgarian tourist attractions Sozopol, the camping sites of Zlatna early in September. For different reasons - Ukraine, Russian workers holidays policy, financial crisis in Ribka and Gradina, as well as some of Bulgaria and contamination scandal, the tourists to Bulgarian seaside this summer were almost 20% less the beaches of , show the than in 2014. official data of the Regional Inspection Lozenets’s central beach and the former Regional Health Inspection published of Environment and Water of Burgas. camping site of Nestinarka had the high- the indicators of 48 beaches along the est concentrations of E-coli and intestinal southern coast. The samples were taken Ofitserski Beach in Varna is an exception enterococci. The data were published on in late July and early August. Analyses to the general rule – it is among the con- the website of the Regional Health are made regularly every two weeks taminated ones; in the middle of July the Inspection of Burgas. Following a micro- and the results are ready in three days. concentration of E-coli in the water there biological analysis of the water, a tempo- Additional inspections are made in case exceeded more than twice the admissible rary ban was issued on swimming in the of alert. As could be expected, the norms (500 units per cubic centimeter of sea. The samples showed that the val- established quantity of bacteria causing water). The beach was never closed, ues of coliforms exceeded the admissible gastro-intestinal infections is higher because follow-up analyses did not show levels. Coliforms are bacteria like E-coli around the larger seaside towns and deviation from the norm. and other such bacteria that can cause resorts. acute gastro-intestinal infections. Contamination with fecal water was At the end of August, a mysterious con- found in the region of the Kabakum Regarding the Lozenets case, Minister of tamination startled holiday-makers on North beach, next to Chayka residential Environment and Water Ivelina Vasileva the beach in Primorsko after the sea district, following a signal. The source of said there was a need for modernization waves cast ashore white wax-like balls the contamination was a pipeline pass- and expansion of the wastewater treat- that were greasy to the touch. The prob- ing between the International House of ment plant, which was built many years lem was first reported to the inspection Journalists and private properties. ago. For the purpose the municipality and the local water-supply and sewerage AmCham Bulgaria Magazine September 2015 company have to prepare a plan. It Interesting facts about the turned out that untreated water had been The Black Sea is about four times larger than Bulgaria and makes up 1/853rd of the discharged from the plant, i.e. more total area of all seas and oceans on the planet. Its maximum depth is 2,245 meters, efforts are needed for its proper opera- and its average depth is 1,271 meters. The water catchment area spreads over some tion, Vasileva said. 2,500,000 square kilometers and includes rivers on two continents: Europe and Asia. The treatment plant was built 30 years ago with a capacity to service 3,000 The Black Sea is a typical internal sea. To the west, its shores reach the Balkan people, while today it has to service more page Peninsula; to the north, it is bounded by the Russian Plain; to the east, the Caucasus 13 than 10,000 tourists. and the Colchis Lowland; to the south, the Anatolian Peninsula.

Comparative data show that the seawa- The coastline is 4,090 kilometers long. The Black Sea is part of the large interconti- ter by Bulgaria’s northern coast of the nental Mediterranean Sea. The Bosphorus Strait, which is up to 50 meters deep, Black Sea is much cleaner that on the connects it to the Sea of Marmara, and the Strait of the Dardanelles connects that southern one. That is known by tourists, sea to the Mediterranean. To the north, the Strait of Kerch connects it to the Sea of so every investment in a treatment plant Azov, which can be seen as a shallow and large bay of the Black Sea. The Black Sea is a reason for optimism among the is the most isolated sea from the world ocean. affected towns and villages. Burgas analysis

Minister of Environment and Water Ivelina Vasileva during the official opening ceremony of the new water supply and purifying system in . For the case of Lozenets contamination she said there was a need for modernization and expansion of the wastewater treatment plant in the seaside town, because it was planned for 3000 citizens and during summer season the tourists in Lozenets are more than 10000.

The institutions actually conduct spe- The Black Sea basin has undergone many changes. The climate of the Black-Sea cialized water tests and have already coast is characterized by mild winters and relatively hot summers with many established improvement of the water sunny days. To a great extent the climate above the sea itself is formed by the quality in the regions where treatment atmospheric transport. While all oceans and most seas have almost one and the plants operate. The plants are designed same salinity, which is quite high (35 percent), the salinity of the Black Sea is to treat wastewater from industrial facili- twice lower (18 percent). That is related to the hydrological peculiarities of the ties and households. Once processed, Black Sea, more specifically the formation of its water mass, its structure and the water is discharged into the sea dynamics. without causing pollution. The new facil- ities and technologies have to guaran- The low and high tides in the Black Sea are insignificant and are registered with tee a healthy environment for people instrumental observations. As a result of the vertical distribution of salinity and tem- and preservation of the biodiversity, perature, the water mass in the Black Sea has a specific structure, split into two which is a wealth for Bulgaria. layers: an upper layer containing oxygen (from its surface to a depth of 200 meters) and a lower one (below 200 meters), where oxygen is replaced by hydrogen sulfide. Treatment plants The stratification of the water mass has an impact on all other hydrological indicators vs. wastewater of the vertical stratification of the plankton and benthos. There is no other sea on the earth with such stratification of the water mass. Some 300 million Leva has been invest- ed in facilities to clean the seawater in Some 70 percent of the total amount of waste discharged into the Black Sea comes the summer of 2015. Two treatment from the six Black Sea countries (Bulgaria, Georgia, Russia, Romania, Turkey and plants have been opened in Varna and 14 Ukraine). Some of this waste and the rest 30 percent flow into the Black Sea through Pomorie, which makes the water safer the Danube River. Given the lack of large currents, the insufficient circulation of the for swimming for nearly 420,000 tourists water and the large quantities of doubtful nutrients flowing into it, the environmental and residents of the towns. Large-scale status of the Black Sea is getting worse and worse. reconstructions of the treatment plants near Nesebar and will be finished Taking into account the worsening environmental health of the Black Sea, in April soon. The investment amounts to 95.8 1992 the six Black Sea countries signed in Bucharest a convention on the protection million Leva. The facilities will service of the Black Sea against pollution, which is a legal and diplomatic platform for joint Sunny Beach, Nesebar, Sveti Vlas,

AmCham Bulgaria Magazine September 2015 September Magazine AmCham Bulgaria actions. , Ravda, Kableshkovo, Aheloy analysis

cleanliness of the seawater. Because if Cleanliness of seawater near that is not done according to the European standards, the groundwater Nesebar will be guaranteed carries the waste into the sea. Statistics of the Ministry of Regional Development The project for expansion and modernization of the wastewater treatment plant in and Public Works show that of 209 Ravda is almost completed. The discharge facility carrying the treated water 2.5 beaches along the Bulgarian Black-Sea kilometers into the sea was finished at the end of June. When the project is over, the coast, 95 have not been granted con- capacity of Ravda’s treatment plant will reach 222,000 people and will treat an addi- cessions on. The check-up of more than tional amount of 9 million cubic meters of wastewater. The cleanliness of the seawa- 100 concession-holders in August ter in the resort villages of Aheloy, Ravda and Nesebar will be guaranteed. showed mass breaches of the rules, including the rules for free access to the and Tankovo, which means some some 110 million Leva. That means that beach, provision of medical care and 150,000 tourists in summer and 30,000 more than 550 million Leva has been lifeguards. A total of 56 concession- local residents. A 73 million Leva waste- invested for the past 10 years in making holders were fined and there are grounds water treatment plant in Sozopol is also the seaside cleaner. The total value for termination of several contracts for to be opened soon. It will solve the very invested in 50 projects for environmen- repeat breaches. More than 1.5 million serious pollution problem in Sozopol tal preservation at the Bulgarian seaside Leva is the amount of fines collected Bay. Currently the wastewater of in the sectors of water, waste and biodi- this year but concession-holders and Sozopol, Chernomorets and versity stands at 713 million Leva. those renting beaches prefer paying the is discharged directly into the sea, con- fines to changing the management of taminating both the beaches and the Waste treatment is also related to the beaches. many shellfish farms in the area.

The total value of the projects under the new Environment Operational Program is 2.5 billion Leva until 2020. A part of the money will be used for construction of new and expansion of existing treat- ment plants at the seaside. A total of nine treatment plants have been financed under the Environment Operational Program 2007-2013. Four of them have been built or reconstructed already: Varna-Akatsiite, Pomorie, and Ruen. The project for modernization and expansion of ’ treatment plant is under way. The deep-water discharge facility is worth 48 million Leva and has been built already. The treatment plants of Nesebar and are also under construction. Three new treatment facilities are planned in the region of Burgas: in AmCham Bulgaria Magazine September 2015 Banevo, Vetren and Mineralni Bani, as well as in the district of Gorno Ezerovo. The treatment plant in Sozopol, which residents and holiday-makers have been waiting for years, is almost fin- ished too. More than 400 million Leva is the value of the page 15 nine treatment plants in the region of the Black Sea. These include three projects performed under the ISPA pre-accession program before 2007: the water cycle of Varna and and the wastewater treatment facility of Meden Rudnik district in Burgas. The ISPA projects amount to analysis Will Cheap Oil Stumble Bulgarian Plans for Domestic Production?

In Bulgaria the lower oil prices will affect mainly the price of the natural gas but they can also shrink the VAT revenues

For weeks now oil prices in world mar- kets are aiming at a new bottom. The analysts say that the markets are oversupplied and demand lowers. At the same time the economy of one of the biggest energy consumers – Japan, shrank in the second quarter. A slowdown is seen also in China, the world second biggest economy, which inevitably will affect the global econo- my. The economist Lachezar Bogdanov The very first months of the year commented that it's more difficult to showed that the Ministry experts are One by one, major energy companies transport natural gas and there is cer- wrong in their forecast for the situation freeze new projects because of the tain economic logic in developing new on oil markets. The oil price was cor- restless oil market. In Bulgaria the explorations. Their scope is large and rected in the spring review of the bud- plans for exploration of the natural gas currently the major companies choose get – to 61,5 dollars per barrel average and oil in the deep waters of Black the projects that make greatest eco- for the year. The expectations of the Sea in the Khan Asparuh block were nomic sense. He says that the explo- analysts at the U.S. Department of also postponed. The consortium ration of natural gas and oil won't stop Energy though are that the European between Total, OMV and Repsol can- but the costs are being analyzed very crude oil will be traded at just over 54 celed its contracts for some of its carefully. dollars per barrel average in 2015. activities in the promising block, taking into account the changes in the legis- In Bulgaria the effect of the lower oil If there is a great discrepancy between lation from one side, and the time- prices will be felt mainly in the price of the forecast and the actual oil price, the consuming geological exploration from natural gas. The formula of its calcula- revenues from VAT and excise duty set another. tion is such that the oil price affects it in the budget will be lower, says too albeit a delay of 9 months. Stanchev. Therefore he expects new Now the exploration of the field is According to the economist Krasen correction of the fuel prices in the expected to start as soon as 2016 Stanchev the impact will be mainly fis- autumn review of the state budget. instead of late 2015. The consortium cal and trade and export will feel some asked for the delay so it can make new relief. Lachezar Bogdanov though doesn't evaluation and wait for the situation to expect serious problems for the budget settle down. He reminded that the Law on the State because of the difference between the 16 Budget was based on a long-term forecasts and the real oil prices. He Since then though the prices of the forecast for an oil price of about 92 cited that the latest budget data show energy resources have fallen even dollars per barrel for 2015. Currently, VAT revenue growth which is behind more. According to the company however, the Brent crude, used in the the budget surplus in recent months. though after the first delay the project calculations of the Ministry of Finances, is back on track and currently the drill- is traded at 49-50 dollars per barrel “Partially this is due to the higher value ship is being chosen. The exploration (as of August 21) in global markets of the dollar, partially – to the estimat- is planned to start between March and which is close to the crisis levels of ed tight costs in the budget”, adds AmCham Bulgaria Magazine September 2015 September Magazine AmCham Bulgaria May 2016. 2008. Bogdanov. new members

Auxionize is an e-pro- We are DA TRAVEL, more than 10 years on curemet system offering market, mainly focus on corporate travel an alternative to the traditional procurement process. The company management - IATA full accredit agent. We was founded by two of the most successful Bulgarian entrepreneurs offer full and complex services to corporate clients: air tickets – Ivaylo Penchev a serial entrepreneur and co-founder of Walltopia (negotiated corporate fares), hotel accommodation, transfers, – the world's leading climbing walls manufacturer and Peter Mitev a rent-a-car, event management in Bulgaria, registration for con- co-founder of Chaos Group – the creator of one of the most success- gresses, incentives trip and holidays. Our main focus is 100% ful products for 3D visualization, V-Ray. 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Our team is comprised of Partners is a company specialized in investment man- with substantial experience in the IP field, which is complemented agement for own accounts and for third party by an array of associates having earned their degrees in the United investors, on project level. The company has experience and Kingdom and United States. The firm has selectively built a team of focuses on investments in the real estate sector, agricultural / food experienced consultants – scientific, linguistic, and investigative – production, and education. The company's portfolio includes proj- AmCham Bulgaria Magazine September 2015 to deliver the highest quality legal counseling in every sphere of our ects for managed residential communities and office parks, com- practice. This enables objectivity in every case and familiarity with mercial areas, educational and sports centers. the needs of our clients from every part of the globe. As a part of Bojinov&Bojinov‘s social responsibility program, we utilize our pro- Garitage Investment Management EOOD partners with some of the fessional experience to actively work with state institutions and most established architectural studios in Bulgaria, and worldwide, international organizations. Together we conduct and participate in to integrate the styles diversity and modern trends in materials and round tables, seminars, and professional workshops to enhance technologies to successfully implement its investment projects. the role of IP law in society. The company’s innovative approach in The company sustains high quality of operations by partnering page the spheres of IP and corporate law combined with strong legal 17 traditions and ethics passed through three family generations, deliv- with experienced contractors using integrated systems and cer- ers entrepreneurial thinking both to and on behalf of our clients. tificate management processes.

Contacts: Contacts: Bojidar Bojinov Atanas Garov Manager Managing Partner Tel.: +359 2 986 2974 Tel.: +359 2 904 6686 http://www.ptmbojinov.com Address: Sofia Park, Build. 16B, 3rd Floor Address: 38, Alabin Str., 1000 Sofia 1766 Sofia new members

Holzindustrie Schweighofer EOOD is a Sterling Serviced Office subsidiary company of Holzindustrie Group was the first Schweighofer Romania and part of the Serviced Office provider Schweighofer Group. The core business of in Bulgaria opening in 2004, offering premium, flexible & tailored Holzindustrie Schweighofer EOOD is trading serviced office solutions in 3 locations: of coniferous logs. For more than four centuries, the Schweighofer  Sofia, at 2a Saborna Street - in the heart of the city in one of the family has been closely associated with the wood processing most beautiful office buildings, an architectural monument built industry. The result of the development of the past 12 years: in 1929 and modernised on the inside. meanwhile 5 modern technology woodworking factories were  Sofia, at Serdika Offices – is our brand new centre with 137 established in Romania. At present Schweighofer employs 2,800 workstations in 26 offices, various Meeting Rooms, Club Lounge people in 3 sawmills (Sebes, Radauti, Reci - starting Q3/2015) Room, Café and spectacular views of Sofia and and 2 panels factories (Siret, Comanesti). Holzindustrie Mountain from the top floor Schweighofer is the market leader in wood industry – with a wide  Istanbul, at Astoria, Tower A, Floors 8/9/10 – in the heart of city’s range of high quality products, exported to more than 70 countries business district all over the world. Sterling services and facilities include fully Furnished and Equipped Schweighofer Group is active in the following business sectors: Offices, Project Offices, Virtual Office & Business Base, Meeting,  Saw mills and further processing (Holzindustrie Schweighofer) Conference & Training rooms, Event Planning and Venues, Video  Energy - cogenerated heat and power plants for production of Conferencing, IT/Telecom, Business Support, Reception and green electricity Welcoming, Club Lounge Room & Café area. Monthly fees are  Wood trading inclusive of substantial amount of services.  Production of high quality viscose pulp  Forestry Sterling is also a member of Alliance Business Centers Network  Real estate with over 650 partner locations worldwide.  Hotel Contacts: Contacts: Giles Blanchard Jurgen Bergner Managing Director CEO Tel.: +359 2 9264 111 Address: 128, G.S. Str., Fl. 5 Address: 2A, Saborna Str. Sofia 1000 Sofia Inquire: +359 2 9264 111; [email protected] For over 166 years, our innova- www.sterlingoffice.com tions have been advancing human health Siemens Healthcare is a pioneer when it comes to provid- The National Network for Children is an ing medical technologies that help deliver a better quality of alliance of 127 member-organizations healthcare. Siemens Healthcare develops innovations that sup- from all over Bulgaria, which work with port better patient outcomes with greater efficiencies, giving pro- children and families in four major direc- viders the confidence they need to meet the challenges of a tions: health, education, families and chil- changing healthcare landscape. As a global leader in medical dren in institutions, as well as children’s and juvenile justice. The imaging, we have a keen understanding of the entire patient care mission of the organization is to strengthen and facilitate the coop- continuum—from prevention and early detection to diagnosis and eration among similar non-for-profit organizations and all inter- treatment. ested parties in the best interest and wellbeing of children in Bulgaria. In 2014 the member-organizations of the National Siemens Healthcare strives to be a trusted partner in a changing Network for Children worked and helped 94 141 children through- landscape. Our aim is to support our customers at all levels and out the country. They also supported 6 792 families and trained 3 along the entire continuum of care to meet the new challenges 134 experts from different professional groups that work with chil- and achieve a successful transition to next-generation health- dren and families. There are a thousand people that work in the care. National Network for Children and more than a thousand volun- teers help us on regular bases. Today, we’re one of the world’s largest suppliers of technology to the healthcare industry. All supported by a comprehensive portfo- Contacts: lio of clinical consulting, training, and services tailored to custom- George Bogdanov 18 ers’ needs. Executive Director Tel.: +359 2 444 43 80 Contacts: Address: 58 Vitosha Blvd., 4th fl. Todor Vodenicharov 1463 Sofia CEO Tel.: +359 2 8115 394 Address: 2, Kukush Str. 1309 Sofia AmCham Bulgaria Magazine September 2015 September Magazine AmCham Bulgaria member news Telus International urope Invests €40,000 to Renovate the Louis Braille School

As part of the Telus Days of Giving in Sofia, more than 500 TELUS International Europe volunteers invested their time and energy, along with a company investment of €40,000, to renovate the Louis Braille School for the visually impaired children. TELUS International Europe, a leading outsourcing company, aims to improve the environment and conditions in which children live and learn.

Telus team members around the world volunteer to worthy causes in their local communities, bringing to life TELUS’ “we give where we live” philosophy. Telus Days of Giving are a global initia- tive that takes place in every location Levon Hampartzoumian, UniCredit Bulbank and Xavier Marcenac, Telus International Europe. Telus International operates. TELUS International Europe was honored with grams of the company,” said Elka we have more than 500 volunteers; the special “Engage” award, from the Belokapova, director of the school. Telus International team members, and Bulgarian Business Leaders Forum, for their friends and families,” said Xavier the Telus Days of Giving event in 2014. "We express our gratitude to the 500 Marcenac, President of Telus volunteers and Telus International International Europe. The initiative is taking place at the Louis Europe employees. The declared inten- Braille School for the third consecutive tion of Telus International Europe to “We expect significant growth of the year. With this year’s planned activities, continue to organize the Telus Day of company and I hope next year we will Telus International Europe and the vol- Giving in Bulgaria in the coming years have twice as many volunteers attend unteers fulfill the promise made three will meet the full support of the Bulgarian the Telus Days of Giving. I am really years ago to the school management to government. We are convinced that the proud to be part of this amazing team help them to improve the conditions number of the socially responsible com- and to know that, together we are giving where the children live and study. panies that will undertake such noble back to the community in which we live,” initiatives in our country will continuously Mr. Marcenac added. "We are extremely happy and grateful increase in the future," said Mr. Totyu to Telus International and all the volun- Mladenov, Counselor to the Cabinet of The TELUS International Europe invest- AmCham Bulgaria Magazine September 2015 teers for the support. Our school rarely the Prime Minister of the Republic of ment this year is focused on finalizing receives an investment of such scale Bulgaria. the refurbishment which started three and we can’t believe we have finally years ago at the first TELUS Day of accomplished what we’d dreamt of for Other friends and partners to the com- Giving. The school dormitory has been years. Our school is one of the few in pany and the school tool part in the ini- entirely refurbished, the lighting in the Bulgaria where children with disabili- tiative Krasimira Velichkova, Director of dormitory and school building has been ties can get education and I can hap- the Bulgarian Donors Forum and Mr. changed, the furniture has been pily say that the conditions, atmo- Lazar Zhivankin, chairman of the asso- replaced, the school yard was cleaned sphere and quality of teaching and ciation of parents of visually impaired and the green areas maintained. The page 19 learning in the school have been sig- children. special sensory garden was brought nificantly improved after the Telus back to life and now the children can Days of Giving. Telus International “Every year, thousands of Telus employ- continue to explore the surrounding Europe remains our friend and we will ees participate in volunteer activities in nature. This year, the investment of be very happy and proud if some day connection with a special day for our time, money and energy are concen- our students can be part of the com- company; the Telus Days of Giving. trated on refurbishing the school library, pany and have the chance to bring Telus team members around the world the corridors and the dormitory, planting back to the community through the join forces to contribute to a better life new trees, and preparing the school for corporate social responsibility pro- for those who are most in need. Today, the start of the new school year. member news

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Western Europe Overtakes China and North America as #1 Investment Destination with FDI Projects at Record High EY European attractiveness survey

US$305b invested into the region, 36% year-on-year increase UK, Germany and France remain the preferred destinations for foreign direct investment (FDI) within Europe, while Turkey enters the Top 10.

More than half (59%) of investors into the region believe Europe’s attractiveness will improve in the next three years

FDI into Europe hits a new record with US$305b attracted into the region in 2014, translating to a 36% year-on-year growth, despite global growth slowdown. Last year alone, 43 European countries – including Russia and Turkey – drew 4,341 projects reaching a 10% growth over 2013 and created 185,583 jobs (+12%).

According to 808 decision-makers polled for EY’s 13th European attractiveness survey, Western Europe attracted 50% of investments worldwide in 2014, up from 45% last year, overtaking China as the most attractive investment des- The capability to restore economic growth, competitive edge, tination, which saw a 6% decline in projects to 38%. An the ability to nurture new-age companies and commercialize increase in North American investment, up from 31% to 39%, ideas for changing the lives of millions are a few reasons why placed it in second place and saw China pushed down to European cities attract FDI, with London at the number one third place. position, followed by Paris and Berlin. The top 10 includes three in Germany – Berlin, Frankfurt and Munich – as well as Marc Lhermitte, EY’s Head of International Location Advisory two cities in Spain – Barcelona and Madrid. Services and author of the report says: Central and Eastern Europe, Russia and Turkey account for “The improvement in Europe’s relative attractiveness stems more than half (52%) of Europe’s total jobs created by FDI – at not just from economic stabilization and recovery in Europe, 96,087 jobs – outpacing Western Europe. Slovakia is a new but also from the greater uncertainty about the emerging mar- entrant into the top 10 countries by FDI jobs creation at the kets and their ability to continue delivering the growth rates ninth position, replacing Serbia. The top 10 also include the achieved over the past decade. Lower energy prices, a weaker UK, Russia, Poland, France, Germany, Romania, Spain, AmCham Bulgaria Magazine September 2015 euro and quantitative easing have all added impetus to Turkey and Ireland. Europe’s investment appeal and resulted in almost 200 thou- sand new jobs created across the continent which is a very encouraging figure as employment is one of the key drivers of economic growth.” Country and city ranking: Who is winning the European attractiveness race? page 21 More than half (52%) of FDI projects and 30% of jobs created by investments into Europe were captured by the top three destinations: the UK, Germany and France.

The UK is still the number one destination in terms of FDI proj- ects and jobs. Turkey is a new entrant into the top 10 countries by FDI projects at the ninth position, replacing Finland. The remaining positions are taken by Spain, Belgium, Netherlands, Poland, Russia and Ireland. member news

Key sectors for FDI in Europe

An economic recovery, a depreciating euro and falling energy prices have all helped revive the appeal of manufacturing in Europe. Taken together, they underpin a 20% surge in FDI manufacturing projects and jobs. Logistics operations, also blue collar, rose 27%, driven by this industrial resurgence and a boom in e-commerce.

Services had a mixed year: software projects (27% increase), financial intermediation (37% increase) and back-office opera- tions (15% increase) all grow strongly while business services (24% decrease) and research and development (1% decrease) slide.

Projects go west, jobs go east

Central and Eastern Europe (CEE) incl. Russia and Turkey outperform their western neighbors in the number of jobs cre- ated by FDI. Therefore if the number of new jobs in Western Europe is 89 486, those in CEE are 96 087. Poland and Turkey retain the appetite of investors and generate high levels of new jobs. Poland ranks third with 15,485 jobs, and Turkey is eighth with 8175 jobs. Romania is progressing impressively with 77%, creating 10 892 new jobs. The largest jump however makes Macedonia with 233 % increase in jobs created. They are 5688 in 2014. Bulgaria ranks just after the A bumpy road ahead? first ten – 12th place with 5688 new jobs. However, the need for reforms and better infrastructure is crucial in attracting The survey reveals 59% of investors are confident about investor interest. Europe’s prospects in the upcoming three years, but only 32% of executives have plans to establish or expand operations in The biggest investors Europe over the next year, while 64% do not have any plans.

Although, European companies account for half (51%) of FDI Investors suggest that to make the best of Europe’s economic projects into Europe itself and US multinationals a full quarter resurgence and further improve the investment climate, policy- (25%), Chinese companies passed Japanese companies to makers should continue to remove impediments to business become the fifth-largest FDI investors into Europe in 2014. efficiency – such as excess bureaucracy and slow growth, With 210 projects, up by almost 40% from a year ago, Chinese which are still seen as major obstacles. investment into Europe shows the effect of the Chinese Government promoting outward investment as a means to Foreign investors see bureaucracy (20%) and slow economic acquire technology, brands and resources overseas to boost growth (17%) as the biggest flaws in Europe’s attractiveness, domestic high-value manufacturing and services. overshadowing the geopolitical uncertainty at Europe’s fron- tiers (11%) and big deficits (11%). European countries need to further enhance labor market flexibility, simplify regulations and foster business-friendly environments.

Lhermitte says: “Current debates across Europe are likely to influence the region’s attractiveness for investors. Any poten- tial change in the UK’s relationship with the EU and key events – elections and reforms – in major European econo- mies could affect the attractiveness rankings going forward. In particular, those countries – France, Spain, Italy and more – that have the potential to raise their investment appeal 22 could contribute to an even more interesting Europe in the next couple of years.”

Pascal Macioce, EY’s EMEIA Deputy Managing Partner, says: “A stable business environment, research and innovation capacity and its market are Europe’s top investment attrac- tions. Investors believe the digital, health care and energy transformations will drive Europe’s renaissance, once again AmCham Bulgaria Magazine September 2015 September Magazine AmCham Bulgaria becoming the most desired investment destination.” member news Walltopia Welcomes New Minority Investors in the Company

Walltopia concept design of indoor climbing wall for the near future. Founded in 1998, the company is now one of the world's foremost manufacturers of artificial

climbing structures, operating on 6 continents through offices in the USA, UK, Canada, Germany, Russia and Asia Pacific and exporting to 50 countries around the AmCham Bulgaria Magazine September 2015 globe. The Head office is located in Sofia, Bulgaria. Innovation has always been, and continues to be, our driving force and we not only offer the largest and most complete range of climbing wall surfaces available in the world today but also deliver complete solutions for customers' facilities and businesses from project design to wall assembly, route setting and staff training.

Walltopia, the world’s leading manufac- from the CEE region, focused on iden- Walltopia, BlackPeak Capital and the turer in the climbing wall industry with tifying and partnering with dynamic China–CEE Fund aims to support the more than 1,300 projects in 50 coun- businesses, have acquired a minority company’s impressive growth and inno- tries has joined forces with BlackPeak share in Walltopia Ltd. This is the first vative amusement products. In 2012, Capital and the China–CEE Fund. investment of the China-CEE Fund in Walltopia has expanded its portfolio of page 23 Bulgaria and one of the six investments products and services towards the larg- BlackPeak Capital, a co-investment completed by BlackPeak Capital since er amusement and active entertain- growth equity fund focused on invest- its launch in 2014. ment market. The investment will also ing in high-growth Bulgarian companies increase capacity and support the glob- with leadership positions on the global “We are happy to welcome partners al roll-out of Funtopia, an amusement and domestic markets, together with who share our passion for the product concept for indoor climbing for kids, the China–CEE Fund, a fund estab- and who can drive value beyond which has already been launched suc- lished by China Exim Bank in partner- money” said Ivaylo Penchev, CEO of cessfully in Bulgaria, the U.S., Canada, ship with other institutional investors Walltopia. The partnership between and Israel. member news UniCredit Studio Hosts Sofia Transformations Expo and Brings to Life History of Sofia City Board and Chief Executive Officer of UniCredit Bulbank, Levon Hampartzoumian – a copy of an advertisement supplement in the Times newspaper dated 1925. On the last page, one finds a photograph of the building of the Bulgarian National Bank, which back then was accommodat- ed in the building where UniCredit Studio is currently housed.

Sofia Transformations presents a different face of the capital city that few of us remember. The pictures take the visitors on a journey through the old main streets: Rakovski Str., Targovska Str., Lege Str. Knyaz Dondukov Blvd. The pictures show buildings beyond time that have become the capital’s symbols. The exhibition dis- plays the transformations through the years of symbolic sites such as the National Theatre, the Military Club, Sofia University, Lion’s Bridge, Sveta Nedelya Church, Ariana Lake, the Bulgarian National Bank etc.

The black and white photographs tell sto- ries of fortune and misfortune, glamour and ruin. The exhibition takes the visitors Levon Hampartzoumian, UniCredit Bulbank and Yordanka Fandakova, Mayor of Sofia. 130 years back in time, a period during The gallery for modern art, UniCredit Fandakova. which the capital of Bulgaria changed a Studio, hosts Sofia Transformations, an lot. exhibition with photographs of Bulgaria’s “I hope that all citizens and visitors of Sofia capital city from the end of XIX and the will be able to feel the spirit of old Sofia as For many years, Victor Mihaylov has been first half of XX century. The exhibition is at the same time we attempt to make our collecting the photographs taken by a realized in partnership with the creator of city a better place for living” Yordanka large number of photographers, publish- the website Stara Sofia (www.stara-sofia. Fandakova said to the guests at the open- ers and explorers. The priceless images com), Victor Mihaylov, and is under the ing ceremony. She received a present were captured for greeting cards, publica- auspices of the Mayor of Sofia, Yordanka from the Chairman of the Management tions or were made by amateurs.

24 AmCham Bulgaria Magazine September 2015 September Magazine AmCham Bulgaria Archive photo of the commercial street near the mosque downtown Sofia. Ariana lake. RIGHT TIME, RIGHT PLACE, RIGHT NOW

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