Peter Cserfalvi, Chairman of the Bulgarian-Hungarian Chamber of Commerce

 

Dear Mr. Cserfalvi,

1. What are your main tasks as a Chairman of the Bulgarian-Hungarian Chamber of Commerce?
In addition to managing the Chamber, my tasks include answering the requests of the members and representing their interest at various forums. A significant part of my activity is linked to interaction with the Hungarian Embassy.

2. In your opinion, what makes Bulgaria attractive for investors and for Hungarian investors in particular?
The relative geographical vicinity is the most important factor for investors. We should not forget about the lively activity of the Bulgarian minority in Hungary. Many of them are engaged in some form of bilateral business. The similar size of, primarily, lower middle market companies in the two countries (as these are the typical partners) makes them natural partners. And last but not least, the cheap operating environment, mostly the low taxes, which has the biggest direct impact on the profitability, is attractive for investors.

3. What are the five positive things you would tell a potential foreign investor in Bulgaria?
Bulgaria’s EU membership and all its advantages are the most important thing. In the short run, the currency board is an important factor for exchange rate stability, but it has its shortcomings, mostly when it comes to adjustment issues. Low income taxes referred to above come next. As a banker, I have to mention the good financial intermediary system as a positive factor as well. The generally well-qualified workforce is also a paramount issue.

4. What are the most interesting sectors for Hungarian companies to invest in Bulgaria?
The above-mentioned lower middle market orientation services are interesting sectors for Hungarian companies. Agricultural production has huge potential, as well as logistics. Infrastructural construction may be interesting – although longer term expectations failed to materialize thus far and entering this market requires enormous investments.

5. What are your recommendations for the improvement of the investment climate in Bulgaria?
Bureaucracy is always a problem – not only for businesses but also at a personal level. The legal system also needs improvement, just to mention one thing, in the area of insolvency legislation. The investment priorities of the Government should be more straightforward as well. And the most important thing: a significantly better infrastructure (mainly roads and railways) is needed.

6. Do you think the Bulgarian government provides enough support to companies and specifically to foreign companies?
A redefinition of priorities at government level as mentioned above is needed. Clear goals must be set in order to attract investments in sectors with higher added value. Bulgaria should learn from the experience of other CEE countries, which is sometimes not really good, in relation to becoming the tail of the global supply chain – to mention here automotive industry. Taxes are ok, production costs are ok, financial institutions are ok, but the context needs improvement.

7. Finally, from your personal experience, what is your opinion about the relations between Hungary and Bulgaria?
The official relations, including business relations, are very good. Hungary is one of the top ten investors in Bulgaria. This is primarily due to the two big banks, DSK and MKB Unionbank. Although the crisis hit both countries seriously and this dropped back the interest from Hungary’s side in business, this interest has started to revive. Cultural relations between the two countries could be also improved. Tourism also attracts an increasing number of visitors to Bulgaria, this marvelous country.