site.btaGerman Chamber Member Companies Attracted by Low Taxes, Cheap Labour, Stability, Challenged by Corruption, Justice System, Opaque Public Procurement in Bulgaria
NW 08:10:02 05-05-2018
LG1854NW.104 08:10
104 ECONOMY - BULGARIA - GERMANY - BUSINESS CLIMATE POLL
German Chamber Member Companies Attracted by
Low Taxes, Cheap Labour, Stability, Challenged by Corruption,
Justice System, Opaque Public Procurement in Bulgaria
Sofia, May 5 (BTA) - The members of the German-Bulgarian Chamber of Industry and Commerce (DBIHK) single out the tax burden and tax framework, this country's EU membership, labour costs, access to subsidies and political and social stability as Bulgaria's advantages as a destination for doing business.
The conclusion is based on the results of an annual business climate survey conducted by the Chamber and presented by DBIHK Managing Director Mitko Vassilev at a BTA-hosted news conference on Friday.
Among the challenges of operating in Bulgaria, the companies listed the shortage of skilled personnel, corruption, the justice system, non-transparent public procurement, the education reform, low productivity and infrastructure development.
The survey was conducted between February 1 and March 1, 2018 among 108 DBIHK member companies and over 1,700 companies of Central and Eastern Europe (CEE).
Fifty-eight per cent of respondents assess the overall economic situation in Bulgaria as satisfactory and only 9 per cent as bad. "In general, the poll found that there is more light than shadows in bilateral relations," Vassilev commented.
Fifty per cent of those polled expect Bulgarian economic development to remain unchanged compared to last year. Asked the same question at company level, 63 per cent said the situation will improve and only 2 per cent fear a deterioration. Forty-nine per cent of the companies expect an increase of export turnovers in 2018 from 2017, and 48 per cent believe they will be able to create more jobs. Forty-seven per cent do not intend to change their investment expenditures this year, while 46 per cent said they will invest more.
As many as 52 per cent of the companies are very pleased with Bulgaria's EU membership, and none are very displeased, which places this country above the average CEE level. Bulgarian companies are rather pleased with access to public or EU subsidies, and just 2 per cent are very pleased, which, too, is above the CEE average.
Forty-eight per cent of the companies said they want the introduction of the euro. Assessments of the public administration are slightly above the CEE average, but 17 per cent said they were very displeased and none said they were very pleased.
Legal certainty is assessed below the CEE average: the largest proportion of respondents are very displeased. Combating corruption and crime ranks Bulgaria far below the CEE average, with 44 per cent of the companies saying they are very displeased. In terms of public procurement transparency, this country placed last but one (ahead of Slovakia), with 33 per cent very displeased and none very pleased. Assessments of political and social stability are just above the average: 18 per cent very displeased and 1 per cent very pleased.
"Bulgaria is doing well and even outperforms the rest in terms of tax burden and tax framework," Vassilev said, adding that there is room for improvement in infrastructure, where companies rate the country below the CEE average.
Labour costs rank Bulgaria second after Albania, the DBIHK Managing Director said, adding that this attracts foreign investors but puts off local people. In this indicator, Bulgaria ranks last within the EU.
Regarding the quality of general education, the business gives Bulgaria rather low marks and ranks it at the bottom of the CEE table, and assessments of vocational education are similar. In terms of the availability of specialist labour, Bulgaria is rated below the CEE average.
Fewer companies said they would invest in Bulgaria again: 88 per cent would do so and 12 per cent would not, compared to 90 per cent and 10 per cent, respectively, in 2017.
Asked whether the Bulgarian Presidency of the EU Council will have a catalyzing effect on the national economy, 44 per cent agreed, 44 per cent disagreed, and 12 per cent didn't know.
Germany's Federal Ministry for Economic Affairs and Energy reports that Bulgarian-German trade reached a new record for 2017 of nearly 7,500 million euro, or 12 per cent more than the previous year, Vassilev said. Bulgaria's exports to Germany grew by some 20 per cent, while Germany's exports to Bulgaria advanced by just 6 per cent, he said, noting that this ranks Germany as Bulgaria's largest trading partner.
According to the Bulgarian National Bank, the inflow of German investments in Bulgaria approximated 130 million euro in 2017, the DBIHK Managing Director said. German interests own between 10 and 100 per cent in some 1,400 companies in Bulgaria.
Between 1996 and 2017, the stock of German investments in Bulgaria totalled 3,300 million euro. The inflow peaked in 2008 at 783 million euro. The investment outflow exceeded the inflow in 2011 and 2014. German companies invest mainly in Bulgaria's manufacturing industry, energy, construction, trade, the IT sector and aircraft maintenance. German investors had created over 55,000 jobs by 2016. VI/LG
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LG1854NW.104 08:10
104 ECONOMY - BULGARIA - GERMANY - BUSINESS CLIMATE POLL
German Chamber Member Companies Attracted by
Low Taxes, Cheap Labour, Stability, Challenged by Corruption,
Justice System, Opaque Public Procurement in Bulgaria
Sofia, May 5 (BTA) - The members of the German-Bulgarian Chamber of Industry and Commerce (DBIHK) single out the tax burden and tax framework, this country's EU membership, labour costs, access to subsidies and political and social stability as Bulgaria's advantages as a destination for doing business.
The conclusion is based on the results of an annual business climate survey conducted by the Chamber and presented by DBIHK Managing Director Mitko Vassilev at a BTA-hosted news conference on Friday.
Among the challenges of operating in Bulgaria, the companies listed the shortage of skilled personnel, corruption, the justice system, non-transparent public procurement, the education reform, low productivity and infrastructure development.
The survey was conducted between February 1 and March 1, 2018 among 108 DBIHK member companies and over 1,700 companies of Central and Eastern Europe (CEE).
Fifty-eight per cent of respondents assess the overall economic situation in Bulgaria as satisfactory and only 9 per cent as bad. "In general, the poll found that there is more light than shadows in bilateral relations," Vassilev commented.
Fifty per cent of those polled expect Bulgarian economic development to remain unchanged compared to last year. Asked the same question at company level, 63 per cent said the situation will improve and only 2 per cent fear a deterioration. Forty-nine per cent of the companies expect an increase of export turnovers in 2018 from 2017, and 48 per cent believe they will be able to create more jobs. Forty-seven per cent do not intend to change their investment expenditures this year, while 46 per cent said they will invest more.
As many as 52 per cent of the companies are very pleased with Bulgaria's EU membership, and none are very displeased, which places this country above the average CEE level. Bulgarian companies are rather pleased with access to public or EU subsidies, and just 2 per cent are very pleased, which, too, is above the CEE average.
Forty-eight per cent of the companies said they want the introduction of the euro. Assessments of the public administration are slightly above the CEE average, but 17 per cent said they were very displeased and none said they were very pleased.
Legal certainty is assessed below the CEE average: the largest proportion of respondents are very displeased. Combating corruption and crime ranks Bulgaria far below the CEE average, with 44 per cent of the companies saying they are very displeased. In terms of public procurement transparency, this country placed last but one (ahead of Slovakia), with 33 per cent very displeased and none very pleased. Assessments of political and social stability are just above the average: 18 per cent very displeased and 1 per cent very pleased.
"Bulgaria is doing well and even outperforms the rest in terms of tax burden and tax framework," Vassilev said, adding that there is room for improvement in infrastructure, where companies rate the country below the CEE average.
Labour costs rank Bulgaria second after Albania, the DBIHK Managing Director said, adding that this attracts foreign investors but puts off local people. In this indicator, Bulgaria ranks last within the EU.
Regarding the quality of general education, the business gives Bulgaria rather low marks and ranks it at the bottom of the CEE table, and assessments of vocational education are similar. In terms of the availability of specialist labour, Bulgaria is rated below the CEE average.
Fewer companies said they would invest in Bulgaria again: 88 per cent would do so and 12 per cent would not, compared to 90 per cent and 10 per cent, respectively, in 2017.
Asked whether the Bulgarian Presidency of the EU Council will have a catalyzing effect on the national economy, 44 per cent agreed, 44 per cent disagreed, and 12 per cent didn't know.
Germany's Federal Ministry for Economic Affairs and Energy reports that Bulgarian-German trade reached a new record for 2017 of nearly 7,500 million euro, or 12 per cent more than the previous year, Vassilev said. Bulgaria's exports to Germany grew by some 20 per cent, while Germany's exports to Bulgaria advanced by just 6 per cent, he said, noting that this ranks Germany as Bulgaria's largest trading partner.
According to the Bulgarian National Bank, the inflow of German investments in Bulgaria approximated 130 million euro in 2017, the DBIHK Managing Director said. German interests own between 10 and 100 per cent in some 1,400 companies in Bulgaria.
Between 1996 and 2017, the stock of German investments in Bulgaria totalled 3,300 million euro. The inflow peaked in 2008 at 783 million euro. The investment outflow exceeded the inflow in 2011 and 2014. German companies invest mainly in Bulgaria's manufacturing industry, energy, construction, trade, the IT sector and aircraft maintenance. German investors had created over 55,000 jobs by 2016. VI/LG
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