Overview: (see full transcript below)

I am glad to be here not as a representative of a big investor, but as a representative of InvestNet. This project has ridden away of private initiative, private, proactive attitude to putting Bulgaria on the investment map, promoting Bulgaria’s advantages. I would say that from a project InvestNet is turning into a platform for exchange of ideas and active dialogue. It is a portal most of all, which gives a really quick snapshot to the person coming to Bulgaria for the first time, willing to learn more. There are all the microeconomic statistics, legal framework, tax framework, human resource framework. There is information on all key and promising industries. There are investment opportunities, service providers listing with more than 60 companies. There is also a section on European funding and tender opportunities. We translate the most up to date tender opportunities on the market. The existence of InvestNet is possible through the active contribution of many service providers and investors, AmCham, German Chamber, Austrian and Greek chambers, various associations, commercial attaches. We also have a section on success stories, which we want to actively promote. As mentioned by a few panelists, word of mouth is very important. We want InvestNet to be one more window into Bulgaria. We see it as a complementary platform to the state InvestBulgaria Agency, which has a lot of responsibilities and could utilize what the focus of InvestNet is. We have been planning today’s conference for a long time. It is only the beginning and we could utilize it in many ways. We have many ideas onward to continue this debate. 

One initiative for today was an express survey that we carried away among the InvestNet community. We sent 4 simple questions to 300 people, many of them are in the audience or on the panel. The first question was “Please, rate the current investment climate in Bulgaria”. 60% of the respondents have rated Bulgaria as an attractive destination. 20% have graded Bulgaria as non attractive. 12% have no answer and we have to think of how to convince those people in giving a positive answer. 

So you can see there is a lot of potential, but also a lot of homework needs to be done.

What the competitive advantages of Bulgaria are – low corporate taxes were mentioned, low wages, low cost of land, low cost of electricity and gas, educated and skilled labour force, very good foreign language skills, EU and NATO membership, opportunities to address niches not served in China or India, favorable strategic location, proximity to Asia and Middle East, treaties for avoidance of double taxation, stable and predictable business and political environment –this is both a recommendation and a perception, agreements on mutual protection and promotion of foreign investment with 60 countries, acquisition of land and property through a Bulgarian registered company with up to 100% foreign ownership, culture of ample natural and historic landmarks, tasty food and hospitality, outsourcing destination. 

And some of the weaknesses and barriers, mentioned by the panel – government red tape, insufficient law system, low attention on the part of the government to attract especially industrial investors, corruption, bureaucracy, administrative burden, low administrative capacity, low level of sustainability of policies, very few sourcing points, not enough publicity and advertisement, bad infrastructure, governments do not seem to follow a steady line of development, grey economy, clumsy and incompetent tax administration and administrative courts, not always clear provisions in the tax legislation. 

And let’s turn to the recommendations – personal reference and servicing to big and important investors, tax vacation and support for starting business, transparency and less corruption, recruitment of a highly trained and motivated team of professionals who will be responsible for attracting international investors, individual approach and tailor-made solutions towards each investor, decrease government role in the economy, improve administrative capacity, carry out a health care reform and education reform, simplify the ZUT and the bureaucracy, scrap all permission requirements that are not absolutely indispensable. Control regional and local decision makers, more clear incentives for the foreign investors, improve the infrastructure, reduce the administrative procedures, keep the low taxation level, abolish the exit taxes, in particular the withholding tax on dividend distribution. 

We at InvestNet believe that we are moderators and coordinators of the very active community of current and potential businesses in Bulgaria, associations and organizations that have shown great support for this initiative. We believe it is a clear sign of the private community reaching a hand to the government. One point which was not mentioned and it would be my last point is the Bulgarian commercial attaches. It is a big, unexplored opportunity for promoting Bulgaria. We believe there is huge potential for reaching out to them and for them reaching out to the Bulgarian community. 

Let’s continue working on improving Bulgaria as an investment destination.