BULGARIAN ECONOMIC TOP NEWS DIGEST
WEEKLY REPORT ( 19 - 26 MARCH 2010 )
Sections/headline briefs:
MACROECONOMY:
· Hong Kong may boost up Bulgarian wine sector
· Russia wants 80% of NPP Belene
· Six candidates vie for Bulgaria's Belene project consultant
- Bulgaria to up VAT to 22% for 1 year
- Bad credits in Bulgaria reach record high level
· Bulgaria to become a destination for dental tourism
· Bulgaria world's 71st "Most networked economy"
· Bulgaria labor costs register wide growth variations
INVESTMENTS:
· Bulgaria and Qatar sign MoU setting up $ 500 M investment joint venture
· 4energy Invest to invest EUR 15 M in bio coal production
· Fraport vows to complete new terminals at two sea airports by 2013
· Ryanair nears Plovdiv airport
· Carrefour plans to open new 10-12 Bulgarian stores by 2012
· Ernst&Young: FDI frontier
COMPANIES:
· Honda opens new complex in Sofia
· US software giant VMware expands business in Bulgaria
· Joint interstate company to develop Qatar investment projects in Bulgaria
· Colin's casual wear brand storms Bulgaria retail market
· Bulgarian capital hosts IT security conference
- 500 firms partake in Bulgaria's largest construction expo
· Billa Bulgaria to roll out 20 supermarkets in 2010
THE CRISIS:
· Bulgaria starts overcoming crisis in April
· Bulgaria said to need nearly decade to recover from crisis
- During the crisis bulgarians are buying double online
· Bulgaria insurance markets reflect financial crisis
MACROECONOMY:
Hong Kong may boost up Bulgarian wine sector
Bulgarian wine producers can avoid the negative impact of the crisis and even significantly expand their business, if they make use of the opportunities in Hong Kong. This was announced last week during a business seminar in Sofia, by the Special Representative of the Chinese province for the European Union in charge of trade and economic issues Mary Chow. According to her, by June 2008 Hong Kong has removed all duties, taxes and administrative barriers to imports of wine and they have grown by 122% to USD632 million in 2009. "This is the second biggest market in the world in terms of volume of wine sales after New York. Besides, using Hong Kong as an entry door to China, Bulgarian companies can benefit from the many advantages of entering this huge market," Miss Chow explained. Another plus for wine businesses is that the region itself is not growing vines and has no local production, which in turn makes it neutral to trade and promotion of alcoholic beverages. Hong Kong also organizes a series of festivals and fairs dedicated to wine where producers can present their products. A curious detail is that the organizers of these events provide tangible incentives to participants, provided in the form of three free nights at hotels. Apart from wine, Bulgarian companies can benefit from the recent measures of the Hong Kong government to revive the economy. The main part of them, in the words of Miss Chow, has been associated with investments in the construction of large infrastructure projects, which may use the services of Bulgarian companies, too. For example is given the construction of a new cultural centre near the coast at a total area of 14 hectares, the reconstruction of the old international airport terminal that will be transformed into a a docking platform for ocean liners, the construction of the 50-kilometre long bridge to Macau and the high-speed railway route to Guangzhou. Other sectors that are being considered a priority by local authorities and may be of interest to foreign firms are innovations, information technologies, healthcare sector and environment. According to data of Winchell Cheung of the Trade Development Council of Hong Kong in 2009 the exports to Bulgaria reached USD38 million while imports were worth USD23 million dollars. Compared to the previous year, though this represents a decline of 43.7% and 26.5 percent, respectively. However, according to Mr. Cheung, at the beginning of 2010 the trade between the two countries is growing again and the positive trend is expected to further strengthen by the end of the year. "We are here to show how Bulgarian companies can benefit from the fact that Hong Kong is already out of the crisis," he said.
Russia wants 80% of NPP Belene
Russia wants eighty percent of Bulgaria's NPP Belene. "The Russian party will hold eighty percent of the capital of the Bulgarian-Russian joint venture," said Timur Bavlakov, CEO of Russia's Atomstroyexport that has been contracted to build the power plant. However, this contradicts an earlier agreement between Bulgaria's energy minister Traycho Traykov and his Russian counterpart Sergey Shmatko, according to which Bulgaria and Russia will hold equal shares in the future company. When established the company will start building the power plant with a Russian loan and thus the Bulgarian state will not appear as a debtor. According to Mr. Bavlakov, over the next two years Atomstroyexport will finance the construction of NPP Belene with own funds.
Six candidates vie for Bulgaria's Belene project consultant
Six candidates have submitted documents to bid in the tender opened by the Bulgarian Energy Holding for a consultant to help it decide how to proceed and attract new investors for the planned Belene nuclear power plant.The names of the companies were not disclosed by the holding.This is the first phase in the tender, which was opened by BEH on February 19. The shortlisted candidates will be invited to submit offers in the second part of the procedure.The project's consultant will be obliged to develop its economic model and proceed to the selection of investors, the update of the financial model, etc.Bulgaria's new centre-right government, which has put the 2,000 megawatt Belene under review due to rising costs, came up with the idea to hire a new consultant after German utility RWE walked out of the project due to funding problems and Sofia decided to redesign it in the next year to attract new investors.Meanwhile it emerged that Bulgaria's contract with Russia's Atomstroyexport, commissioned to build the planned Belene nuclear plant, will probably be extended by three months.Russia proposed last month to extend EUR 2 B of funding to Bulgaria for the construction of the stalled project until Sofia finds a strategic investor, even without corporate or state guarantees.The extension of the contract with Atomstroyexport will give opportunity to Bulgaria to delay its reply to Russia's offer, which was initially expected by the end of this month.Bulgaria's Economy and Energy Minister Traicho Traikov made it clear on Thursday that Russia's offer for funding will not be enough and that the country will angle for a European investor.“There are many potential strategic investors. Those, with whom the government has already held talks, are fewer. Now it remains to be seen which of them will submit bids,” the minister said.He explained that the agreement with Atomstroyexport will be put to a legal and financial review before a decision for its extension is taken.During their recent visit to Sofia, Russian Energy Minister Sergei Shmatko and Sergei Kiriyenko, head of the Rosatom state nuclear corporation, which controls Atomstroyexport, announced that Rosatom was ready to extend a loan and become a shareholder in Belene plant.According to Bulgarian Energy and Economy Minister Traicho Traikov in exchange for the offer the Russian side can hold no more than 15-20% of the plant, while the remainder of the loan will be paid through electricity sales. Russia however is expected to insist that it hold at least a 50% stake in Belene nuclear plant.The Bulgarian government has abandoned plans to cut its shares from 51% to 20-30% and will aim to keep a 50% stake in the multi-billion nuclear project, which has stalled over lack of funding.RWE's departure from Bulgaria's new Belene nuclear plant put extra pressure on government to find new shareholders while it redefines the scope of investment it needs.Belene's reactors are to be of the Russian VVER-1000 class, while the Western companies are providing instrumentation and control systems.State power utility NEK has a majority stake in the plant.
Bulgaria to up VAT to 22% for 1 year
Value Added Tax (VAT) will be increased to 22% for 1 year, according to the last draft of the cabinet's anti-crisis measures, the labor unions economic expert, Mika Zaikova, informed.Zaikova reported the news Monday speaking for the Bulgarian National Radio (BNR), voicing her surprise from the move, which had never been discussed before.The increase will bring an additional BGN 540 M to the State budget.On Tuesday, the National Council for Three-Way Partnership will discuss the last version of the anti-crisis package. Zaikova further informs the measures are 39, of which 20 come from the proposals of the labor unions and the employers. These measures further include wage reductions if there aren't any layoffs.Prices of electricity, heating and gas are not going up, the expert says, adding the cabinet wants to privatize the Sofia Heating Utility “Toplofikatsia” and the National Palace of Culture in the capital.VAT was introduced in Bulgaria in 1994 at 22% and was reduced down to 20% 10 years later. Business experts have long insisted VAT is further lowered with another 2% in other to stimulate consumers.
Bad credits in Bulgaria reach record high level
In February, bad credits in Bulgaria reached a record-high level, they account for 12.22 percent of the total amount lent out. The bad and re-structured loans gross 4.73 billion leva by February 28, as within a month alone they have swollen by 5.79 percent (or 259 million leva: bad and re-structured housing loans score 11.64percent; consumer loans, 13.58 percent; corporate loans, 11.85 percent. The banks’ credit portfolio has shrunk by 205 million leva in February down to 49.75 billion leva, according to data provided by the Bulgarian National Bank.
Bulgaria to become a destination for dental tourism
Bulgarian dentists are to move their cabinets to the beach. Bulgaria is going to become a destination for dental tourism and during the summer vacation Bulgarian dentists will polish the smile of foreign visitors. Dental tourism has become a hit in the last two years, shows a research made by "Eurodental". Holidaymakers combine rest and treatment provoked not just by the bargain prices but also by the quality dental and tourist service, experts assure. Bulgarian dentists are high-qualified professionals, who work in modern and well-equipped clinics, dental medics are positive. Zlatani Pyasatsi (Golden Sands) Black Sea resort will be the venue of a conference dedicated to dental tourism in Bulgaria and the main topic of the discussions will be how to attract foreign patients. The conference is organized by the Association of Dental Dealers in Bulgaria in partnership with Fernet-Bulgaria, the Bulgarian Association on health tourism and the Council of investors in tourism.
Bulgaria world's 71st "Most networked economy"
Bulgaria ranks seventy-first in the list of the world's "most networked" economies, according to the the latest survey by the World Economic Forum (WEF), released on Thursday.Bulgaria is preceded by Turkey and Egypt and comes ahead of Sri Lanka and Macedonia.Sweden, Singapore and Denmark top the ranking.According to the 2009-2010 study, a good network enables economic progress, and top countries were seeing their information and communication technology (ICT) acting as catalysts for sustainable growth.The three leading countries all built their capacity on a "long-standing focus placed by governments and private sector alike on education, innovation and ICT access and diffusion," CPA WEF economist Irene Mia said, as cited by DPA.ICT would help increase development and competitiveness, the WEF said.Switzerland occupied the fourth position, moving up a notch, while the United States was ranked fifth, falling two spots from last year's list.Hong Kong moved up four spots to place eighth, but Iceland dropped out of the top 10.Finland, Canada, the Netherlands and Norway closed the top rankings.In total, 133 countries were reviewed in the study.
Bulgaria labor costs register wide growth variations
Bulgaria National Statistics Institute (NSI) has published labor cost data, showing that hourly costs rose on average by 7,2% year on year.Preliminary data for the final quarter of 2009 reveal that the highest growth rate - 25,1% - was in the construction sector. Other areas showing high levels of increase included administrative and support service activities (20,9%) and arts, entertainment and recreation (18.4%).The lowest rises were in the information and communication fields (0,7%) and human health and social work activities (2,4%).Certain sectors registered a decrease in labor costs year on year. Public administration and defense fell by 14%, and professional, scientific and technical activities saw a decrease of 4,3%.Within the structure of total labor costs, wages and salaries rose by 8,9% compared with the previous year, and associated, non-wage costs rose by 0,2%.The growth rate of the wages and salaries component ranged from -15,4% in public administration to +27,0% in the construction sector.
INVESTMENTS:
Bulgaria and Qatar sign MoU setting up $ 500 M investment joint venture
Bulgaria's Economy, Energy and Tourism Minister Traicho Traikov and Qatar's Business and Trade Minister Fahd bin Jassim bin Muhammad Al-Thani Tuesday signed a Memorandum on the establishment of an investment joint venture between the two States, Traikov's Ministry said in a press release. The Bulgarian shareholder in the company will be the National Company Industrial Zones, and the Qatari partner will be the Qatar Investment Authority. Traikov and Fahd discussed specific opportunities for investment in Bulgarian infrastructure projects. Bulgarian Prime Minister Boyko Borissov told a news conference in Doha that the company will handle 500 million US dollars investments. "The company will carry out feasibility studies, select the best projects and finance them, the PM said. It will focus on projects in agriculture, tourism and construction.Under an agreement signed Tuesday between the two countries' transport ministries, Qatar Airways will launch a service to Sofia in October. "The arrival of a carrier of such scale will bring in extra revenues to Sofia Airport," said Borissov. Agreements have been drafted between the defence ministries of Bulgaria and Qatar on the training of Qatari servicemen in Bulgaria.Traikov also conferred with the Chairman of the Board of the Qatar National Hotels Comapny Board Chairman, Sheikh Nawaf bin Jassim bin Jabor Al-Thani, Traikov's Ministry said in a press release on Tuesday. The two agreed thaat the Sheikh will visit Bulgaria to get familiar on site with the opportunities for investment in the country's hospitality industry.Last year Qatar invested over 30,000 million dollars abroad and is ready to invest the same amount this year, too.On the second day of their official visit, the Bulgarian delegation toured the Ras Laffan liquefied natural gas facility. This country is interested in the facility in connection with the opportunities for LNG import from Qatar after completion of the gas interconnectors with the neighbouring countries, work on which is in progress.On March 24 Borissov will pay an official visit to Kuwait, where he will confer with the Kuwaiti Prime Minister, Sheikh Nasser Al-Mohammad Al-Ahmad Al-Sabah, as well as with the Emir of Kuwait, Sheikh Sabah IV Al-Ahmad Al-Jaber Al-Sabah. Talks are also scheduled with the Speaker of the National Assembly of Kuwait, Jassem Al-Kharafi.
4energy Invest to invest EUR 15 M in bio coal production
Belgian renewable energy company 4energy Invest intends to invest EUR 15mn in the construction of a plant for bio-coal production out of timber. The unit will be located in the southern town of Kardzhali. The company expects to acquire a land plot in the next months and may launch construction by the end of the year. The plant will start operations by end-2011.
Fraport vows to complete new terminals at two sea airports by 2013
Fraport Twin Star Airport Management vows to complete the construction of the new terminals at the two Black Sea airports in Varna and Burgas by 2013, CEO Dirk Schusdziara informs. The company is currently working on the design phase. The company does not plan investment cuts this year and will work on all its projects. Fraport is to invest EUR 29mn and EUR 36mn in the construction of the facilities in Varna and Burgas, respectively. The initial plan was to launch the facilities until 2011. The company operates the two sea airports under a 35-year concession contract. Schusdziara expects the passenger traffic at the airport in Varna to remain unchanged at 1.2mn this year.
Ryanair nears Plovdiv airport
Budget air carrier Ryanair is contemplating starting a direct link with Bulgaria's second-largest city, Plovdiv. In April 2010, company representatives are scheduled to arrive to make a final decision on the matter, according to Doichin Angelov, director of Plovdiv airport, according to a media statement on March 24 2010.The Ryanair delegation is expected to arrive in Bulgaria on April 6 and will remain in the country until April 15."They will meet with the Transport Minister Alexander Tsvetkov and subsequently will travel to Plovdiv, where we are to finalise our potential agreement with them," Angelov said in the statement.Ryanair has been showing interest in Bulgaria for several years. But as airport taxes are poised to become three times cheaper than those at Sofia as of April 1, the reality for the line to be launched becomes ever more real.A forum between the Plovdiv municipal administration and the Bulgarian-Catalan chamber of commerce BGCAT was held in Plovdiv on March 23.Meanwhile, Sofia Airport said that Danish budget carrier Cimber Sterling will link Copenhagen and Sofia and flights will be conducted biweekly, on Thursdays and Sundays, Dnevnik reported. Currently there is no direct flight to the Danish capital. The flights will start on March 28.Bulgaria Air used to fly Copenhagen, but the service was withdrawn in 2006.
Carrefour plans to open new 10-12 Bulgarian stores by 2012
French retailer Carrefour plans to add ten to 12 stores to its Bulgarian network over the next three years, said Laurent Bendavid, the chief executive office of the company’s local branch. At present, the chain comprises one store in Bourgas, on the southern Black Sea coast, and plans to cut the ribbon on its first Sofia unit on April 21, which will be housed by The Mall shopping complex under construction on the busy Tsarigradsko Shosse boulevard. The bulk of Carrefour’s Bulgarian outlets are still under development. Carrefour also plans to open self-service cash desks at its Bulgarian stores, Bendavid said. The automated terminals will enable customers to scan and pay for goods. Slovenian retailer Mercator is also considering opening self-serve cash registers at its local shops. The chain opened its first Bulgarian hypermarket in Stara Zagora last year. The Mall retail complex sprawls on an area of 66,000 square metres, which will accommodate 185 shops. It will feature a cinema hall, a bowling hall, crèches, eateries, etc. An underground road will take cars from western Sofia neighbourhood to the shopping centre. Pedestrians will be able to enter the complex from an aboveground passage over Tsarigradsko Shosse, according to plans.
Ernst&Young: FDI frontier
Publication: www.sofiaecho.com
Foreign direct investment (FDI), fuelled by readily- and cheaply-available credit, was one of the cornerstones of Bulgaria’s economic boom before the current downturn. The substantial decrease of the cash flows from abroad hit Bulgaria and the rest of South Eastern Europe belatedly, but worse than economies further to the west, yet the investor outlook for the country and region remains optimistic, a survey by Ernst&Young said.
The consultancy firm presented its survey covering what it calls South Central Europe (SCE) – Romania, Bulgaria, Croatia, Serbia, Albania, Bosnia and Herzegovina, Kosovo, Macedonia, Moldova and Montenegro – in Sofia on March 18. The survey is based on interviews with 203 investors in a region with a population of 57.8 million and a gross domestic product of $621 billion in 2008, just double that of Greece.It was that scope for growth that attracted foreign investors, who started 1239 projects in the region in the five years ending in 2008, a quarter of the total number for the former communist bloc plus Turkey over that period of time.In 2009, when the global downturn finally reached Bulgaria, the number of projects in the country halved, according to Fabrice Reynaud, senior manager of Ernst&Young international location advisory services."The crisis was difficult for SCE and Bulgaria because of the refuge effect played by big Western European countries, but what is interesting is that when we surveyed international investors a few months ago, they are again very confident about SCE as a market with more growth potential than elsewhere in Europe," Reynaud told The Sofia Echo in an interview.Even though Western European companies, who make up about half of the investors in SCE, took refuge in their own region – a fact accounting for the much smaller, between zero and 10 per cent, according to preliminary data, decline in FDI in Western Europe – the law of diminishing returns made them look out towards SCE as an area with potential for much higher growth.Despite years of investment, the region still remained much of a frontier, Reynaud said. "It’s like the gold rush, where the frontier is moving and for the betterment of every country. My analysis would be that it depends in which business you are," he said.Basic manufacturing and logistics was continuously moving eastward, but SCE was a better place for hi-tech manufacturing, research and development or call centres than its eastern neighbours."Today it is difficult to have your accounting shared services centre in Moldova or Kyiv, but Sofia, Belgrade and Bucharest, for some years, are in the list of cities and countries that are [being] investigated," Reynaud said.Shared services centres, which group a company’s functions in one area – like accounting, IT or human resources – in one location, are one possible area where Bulgaria could do more to attract investors."Sofia has good assets: the labour pool, language capacity, moderate labour costs, the stability of macroeconomic indicators and a comfortable unemployment rate. Its difficulties stem from the image of corruption and questions about infrastructure, including office space," Reynaud said."When you make it objective, there are more good points than areas to improve, but you have to package it and today I am not quite sure that the package is there, with a bow on top."Nevertheless, Bulgaria scored the highest mark in the survey, with 54 per cent of investors interviewed saying that they were confident that Bulgaria’s attractiveness would improve over the next three years. "It is the catching up effect. You still have a sleeping beauty who is not as much on the map as Romania," according to Reynaud.The country’s best bet was to offer the quality found in more developed Central European countries like the Czech Republic, coupled with the dynamism of a country like Romania. "When you manage to combine the two, that would be a nice card to play," Reynaud said.To achieve that, Bulgaria had to do away with its image of corruption, which could put off investors even before they make a shortlist of potential locations, especially when the companies in question are unfamiliar with Eastern Europe."Today they are still a bit reluctant to go to Bulgaria because of this perception. This is an issue for Bulgaria and it requires a good communication campaign to tell investors that the Government is aware of the issues and is working to eradicate them," Reynaud said. Ernst&Young will present its global attractiveness survey and Europe’s place in the world at an investment conference in La Baule on June 2-4.
COMPANIES:
Honda opens new complex in Sofia
Bultrako, the local dealership of US automaker Honda, last week cut the ribbon on a new trade and service centre in Sofia. The complex spans 1,500 square metres and comprises showrooms for cars and motorcycles, a car parts and accessories store and a service centre. The project has stomached around EUR 1.5 million. The complex, which uses its own water source, will be equipped with its own rooftop photovoltaic (PV) solar system. In Sofia, Honda has two more car and motorcycle trade centres as well as one motorcycle shop. By the end of the year, Honda centres will spring up in Varna and Stara Zagora.
US software giant VMware expands business in Bulgaria
VMware has expanded its business in Sofia with the opening of a new office for an estimated 400 employees. Currently the company employs 200 Bulgarian IT specialists developing the infrastructure platform of its virtualization systems. VMware is yet to officially announce the number of job openings in Bulgaria, but informs a large number of interviews are ongoing.The company is looking for Software Developers in Automation, C/C++ Software Engineers, Java Front-End and Back-End Software Engineers, Quality Assurance Engineer - Automation, and Managers.In addition to the new office, VMware has made investments in the expansion of their data center in Sofia. The company stepped in Bulgaria in 2007, after purchasing the Bulgarian branch of the company Sciant.
Joint interstate company to develop Qatar investment projects in Bulgaria
On the first day of the official visit here by Bulgarian Prime Minister Boyko Borissov, Bulgaria and Qatar signed a memorandum of cooperation between the two countries' economy ministries and an agreement on avoidance of double taxation.The two accords were signed in the presence of the Bulgarian government leader and his counterpart, Sheikh Hamad Bin Jassim Bin Jabr Al-Thani.The signing of the two documents restores the good traditions that have existed between the two countries, said Prime Minister Borissov. He said that he had had a very fruitful meeting with his counterpart. Sheikh Hamad Bin Jassim Bin Jabr Al-Thani announced that the sides have agreed to establish an interstate company to work on investments in Bulgaria. In turn, Borissov noted that the relevant ministers will continue the work on this company which should shortly prepare two to five projects in the field of agriculture, energy, tourism, infrastructure and training.An intergovernmental commission has been endorsed which should hold its first meeting in the coming days.Taking a question, the Prime Minister of Qatar said concrete sums had not been discussed but that his country is ready to invest at mutual benefit. In 2009 alone Qatar invested 30,000 million dollars abroad, he noted, adding that the same amount is expected to be invested abroad in 2010.As to the possibilities of importing liqueified gas from Qatar, Sheikh Hamad Bin Jassim Bin Jabr Al-Thani said his country does indeed have such a terminal in Italy which still has capacity. They are considering another terminal but that requires plenty of technical and financial analyses which are currently under way. Bulagria is one of the countries on the list for this project, but everything depends on who the end user is and what quantities of gas that user will use.Borissov expressed hope that Sofia-Doha direct flights will soon become a reality, while his Qatar counterpart stated that that country will open an embassy in Bulgaria by the end of the year.Diplomatic relations between Bulgaria and Qatar were established on October, 16 1990. In early 2009, the Bulgarian government decided to open a Bulgarian embassy in Doha, and in the summer of the same year the President decreed the appointment of an ambassador to Qatar.Sheikh Hamad Bin Jassim Bin Jabr Al-Thani and his wife, Sheikha Mozah bint Nasser Al Missned, had been instrumental in the 2007 release of five Bulgarian medics with life sentences from Libyan prison.On November 1, 2007, during his visit to Qatar, President Georgi Purvanov conferred the highest Bulgarian state order, The Balkan Range with ribbon, to the Emir for his exceptional contribution.A number of agreements were signed during Purvanov's visit, including an intergovernmental accord on reciprocal promotion and protection of investment, a cultural agreement, a memorandum of understanding in the area of sports between the two countries' Olympic Committees, a memorandum of understanding between the Bulgarian Chamber of Commerce and Industry and the Qatar Chamber of Industry.The Emir and his wife made an official visit to Bulgaria on April 14, 2009. This was the first visit of the head of state of Qatar to Bulgaria. The two sides signed agreements for aerial communications, and economic and technological cooperation.According to 2008 figures, trade between Bulgaria and Qatar stood at over 2.4 million dollars, up by 25.4 per cent from 2007.Bulgarian exports rose 22.8 per cent, consisting mainly of piping and fixtures, lift trucks, sheet iron, kitchen sinks. Bulgaria imports ethylene polymers and automobiles.
Colin's casual wear brand storms Bulgaria retail market
The casual wear brand label Colin's enters officially the Bulgarian retail market with its first own store at the newly opened mall “Serdika Center” in Sofia.The store will be located on 300 square meters while the company plans to open 8 news stores in the country in the next 2 years. The investment is estimated at USD 2 M and it will provide 100 new jobs.Currently Colin's has 2 franchises in the Black Sea capital Varna and the Danube city of Ruse.The very first Colin's store opened in 1983 in Istanbul. The company now has 480 stores in 40 countries around the globe and factories in Aksaray, Istanbul and Egypt. It makes 22 million jeans per year.
Bulgarian capital hosts IT security conference
An international conference on IT security is taking place in the Bulgarian capital Sofia on Wednesday.The aim of the forum entitled IDC IT Security Roadshow 2010 is to discuss practices for coping with theft of loss of corporate and personal data.The topics on the agenda of the conference include overcoming complex threats and multilayer security strategies for sustainable organization.The speakers at the forum feature US special agent Joe Scargill; Vodafone Group Services Network Security Manager, Marco Ermini; Alexander Ognyanov, head of Bulgaria’s National Health Insurance Fund. The opening address is by Parvan Rusinov, Bulgaria’s Deputy Minister of Transport, IT and Communications.
500 firms partake in Bulgaria's largest construction expo
About 500 companies are participating in the 2010 edition of Bulgaria’s largest construction expo “Stroiko”.Some 12% of those are taking part in it for the very first time. Stroiko is opening formally on Wednesday, and will last until March 30, taking place in the National Palace of Culture in Sofia.The organizers of the expo have pointed out that while the event will generate little turnover and economic profit they have chosen to hold it with hopes that the downturn in Bulgaria’s construction sector will not get any worse.The major focus of even is spending management, according to its top organizer Vasil Hadzhiyankov, as cited by the Pari Daily. Some of the new products to be presented at Stroiko 2010 are mobile camping lodges and mobile baths.Hadzhiyankov has stressed the fact that the number of participants is roughly the same as last year while was the goal of the organizers of Stroiko.He explained it was hard to figure out the precise number of participants because of the various forms of cooperation between construction firms.
Billa Bulgaria to roll out 20 supermarkets in 2010
Billa Bulgaria plans to open 20 new supermarkets in the country this year, the company announced.The thirteenth outlet of the company in the capital Sofia, which will be located at Vladimir Vazov boulevard, will be inaugurated at the end of March and will spread over 800 square meters.Billa, which is owned by German concern REWE Group, currently operates 65 outlets in Bulgaria, of which 12 in Sofia, five in Rousse, four in Burgas.Capitalising on the rising demand for discounted products, Rewe recently launched it's first Penny Markt discount store in Bulgaria.Total investment into the country over the 2010-2014 period is reported to be as much as EUR 250 M.Bulgaria, Russia and Ukraine drove overseas sales growth at German retail giant Rewe in 2009, the company announced a few days ago.
THE CRISIS:
Bulgaria starts overcoming crisis in April
Bulgaria s economic recovery will start in April 2010, according to Tsvetan Simeonov, Chair of the Bulgarian Chamber of Commerce and Industry. Bulgaria s economy has seen harder times. If the GERB party lives up to its campaign promises not to increase taxes, to reduce the administration we are not going to be in the situation of some of the neighboring states, Simeonov told Pro.bg TV apparently referring to the situation in Greece. Simeonov has slammed the Borisov Cabinet for its policy to delay payments it owed to private companies, and to pay immediately only to those who give up 10% of the state debt to them. The Bulgarian Chamber of Commerce and Industry, together with the major trade unions, have insisted that the government publish a schedule of paying out the money it owes to private businesses that executed public procurement orders. This would allow the firms to apply for credits, Simeonov said. In his words, when drafting the 2010 budget, the government did not take into account the possible drop in the level of revenue which occurred in the first months of the year. The BCCI favors strongly the idea of the Finance Minister, Simeon Djankov, that state employees should pay their health insurance on their own because this will improve the equality in the labor market.
Bulgaria said to need nearly decade to recover from crisis
It would take an extended period for Bulgaria to recover from the crisis, provided that its annual economic growth strengthens, a local expert claims.“Bulgaria will start to crawl out of the crisis in about seven or eight years and only on the condition that it begins to record a stable economic growth of 3-4% per year,” Boyan Durankev, lecturer at the University of National and World Economy, told BGNES news agency.Asked about the anti-crisis measures that the government plans to undertake, Durankev said the average taxpayers will have to carry the biggest burden, while the richest people will not be even stinged.“The planned increase in the value added tax by 2 percentage points to 22 percent will increase the end prices of all products and services by an average of 7-10%,” he said.“Some 80% of the Bulgarian population will have to carry the burden of the crisis, while those 15% who own yachts, aeroplanes, big cars and expensive properties, will even laugh at the new luxury tax.”According to the expert the results from the measures are not clear yet.“Everything is chaotic. We haven not hit the bottom yet and when we do I am afraid that we may not only see a repeat of the Greek crisis in Bulgaria, but even a worse scenario of it.”According to Durankev the government should focus its efforts on the introduction of a progressive tax, which is to replace the flat tax rate, and fill in the leakages in the state and municipal budgets.Bulgaria's new center-right government plans to introduce a new tax on luxury goods, increase the value added tax to 22 percent and cut public servants wages in a bid to help fight the economic crisis and keep down the fiscal deficit.It is part of a package of new measures, which also include floating minority stakes in state-owned companies and a possible bond issue.The government is expected to agree with the trade unions and the union of employers this week a final package of nearly 50 steps to combat the crisis.The government focused its austerity measures on the wealthy, after its plans to raise the healthcare tax and cut benefits to civil servants triggered protests.
During the crisis bulgarians are buying double online
According Aukro.bg the Bulgarians are buying more and more online in Internet with double increase of purchases in the last year. In February alone the visitors of the e-commerce site Aukro.bg were more than 1 million and users are increased with 140%. At the moment the registered buyers and sellers are 200,000. In spite the decrease in consumer markets because of the crisis the online average everyday sales are also doubled. The main reason according to data is the less prices which is the most important for every third Bulgarian.
Bulgaria insurance markets reflect financial crisis
A Bulgaria Insurance Report has concluded that the country's industry is facing a difficult period in both the life and non-life sectors.The report, published by Business Monitor International (BMI) warns that the Bulgarian insurance market is crowded, and predicts some rationalization by companies over the coming year.The market has also been directly affected by the onset of the global and regional economic difficulties, according to the report.In terms of gross written premiums for the first half of 2009, the three largest non-life companies were: Bulstrad (Vienna Insurance Group), DZI General insurance and Lev Insurance, with market shares of 15,6%, 14% and 11,2%, respectively.In the same period of 2009, leaders in the life segment were Allianz Bulgaria Life, DZI and UNIQA Life, with market shares of 21%, 16,1% and 10,9%.Analysis of the different types of insurance traded showed that, the largest non-life lines in 2008 were motor insurance, compulsory motor third party liability (CMTPL) and fire and diverse risks. These accounted for 43%, 26% and 14% of total non-life premiums.Bulgarian operators DZI, Lev Insurance and Armeec increased their market shares within the fire insurance segment to 14,1%, 11,0% and 10,4%.By analyzing figures to date, the BMI report has forecast total premiums for 2009 of BGN 1,718 M, a figure that includes non-life premiums of BGN 1,491 M and life premiums of BGN 229 M.The report further projects that in 2014, the corresponding figures will be BGN 3,086 M, BGN 2,322 M and BGN 764 M respectively.The BMI report noted that, although there were some negative trends for most of 2009, Bulgaria’s insurance business sector generally proved more stable than many neighboring countries.