Bulgaria

December 2008

ECONOMIC GROWTH - The Bulgarian economy is forecasted to contract 1.2 % in 2009 and 0.3 % in 2010.

EURO ADOPTION - Bulgarian economy has been assessed to be in the weakest state across Central and Eastern Europe. The fears of economic shock have lead to active discussion about adoption of euro. The debate has not gone unnoticed by the European Commission which has denied the possibility of such alternative.

CORRUPTION - Bulgaria loses 220 M EUR and another 340 M EUR are under question as a result of the decision of the European Commission not to unfreeze the aid for the country because of fraud and corruption. The decision has raised voices about premature acceptance of both Bulgaria and Romania to the EU.

TELECOMMUNICATION - Ericsson announced the opening of its new logistics centre. Ericsson's Central Order Desk will cover 11 countries from South-Eastern Europe by processing 65% of all orders to the company and coordinating 100% of all complaints.

PC - The PC market has continued to grow strongly in Q3/2008 as the number of units sold jumped 72.6% and sales revenue 44.6% higher y-o-y.

RETAIL - Central Mall Pleven, the first commercial and recreation centre in Pleven, was opened after a 12.5 M EUR construction works were finished. The mall is reported to have 95% of its floor space rented out.

FOOD INDUSTRY - Kraft Foods moves chocolate production from Romania to Bulgaria despite having invested 30 M EUR into the Romanian plant.


October 2008

ECONOMY - According to EBRD analysis, Bulgaria is one of the countries in Eastern Europe whose economy will avoid a recession and the devaluation of its currency.

ELECTRONICS - 2be, a Bulgarian consumer electronics retailer, announced that it will open 13 shops in neighboring Macedonia.

ALTERNATIVE ENERGY - About 500 M EUR is estimated to be invested into wind farms in northeastern Bulgaria by the end of 2009, Velizar Kiryakov, chairperson of the association of eco energy producers, has said. Another 51 M EUR will be spent on solar power generation.

REAL ESTATE - Real estate company Willbrook Management International will by 2009 build a 40 M EUR housing complex in Varna, which will also be Bulgaria's first green project.


August 2008

BUSINESS ENVIRONMENT - Bulgaria advanced 24 positions to 44th in Forbes' third annual ranking of Best Countries for Business.

INFLATION - Inflation rose to 10-year high of 15.3% in June.

INDUSTRIAL ZONES - 100 industrial zones are planned to be build under Bulgaria's export strategy for the 2008-2013 period. The effort will be backed with a disbursement of 51 M EUR annually. The ministry estimates the average cost per industrial zone at around 3 M EUR.

ICT - The value of computer and telecom hardware supplies rose 17% on the year to 269 M$ in Q1/2008.

ENERGY - Karnobat will construct a 150 M EUR wind and solar energy park by end of 2008.

RECYCLING - Varna-based company Mega Group said it would invest some 100 M EUR over the next couple of years to a plant for recycling of oil and petroleum waste.

AUTOMOTIVE - Bulgaria reported the second-fastest growth rate in terms of new passenger car registrations in 1H/2008. Bulgaria's y-o-y growth rate of 20.5% was beaten only by Lithuania's 36.2%. Slovakia was tucked into third place with 19.3%.

RETAIL - Metro Cash&Carry, the German retail chain, has started construction works on a second outlet. The new hypermarket will be the company's 11th in Bulgaria. The outlet, with a price tag of around 40 M EUR, will have 10 000 m2, including 7 500 m2 of retail space and will stock over 60 000 items. The company said it has also bought a site for a new outlet in Sofia, where it already has two stores.

MEDIA - Central European Media Enterprises announced that it had invested 110 M EUR to acquire 80% of two Bulgarian TV stations.

ENERGY - AES Geo Energy plans to build a 201MW wind farm. The investor will first install 51 wind turbines with a combined capacity of 156MW. Another 15 turbines will be added during the second phase of the project. The facility should be operational by 2010.


May 2008

ECONOMIC DEVELOPMENT - Eurostat found Bulgaria to be the cheapest country in the West Balkans and in the EU. The research draws on 2006 statistical data provided by the National Statistical Institute. Bulgaria's prices are on a par with those in Serbia and Macedonia. Romania, Montenegro and Albania came up with an index that is 10 points higher than in Bulgaria.

RETAIL - IKEA plans to build three hypermarkets in Bulgaria. They are to be opened between 2009 and 2011. In its first move toward entry in Bulgaria, in early 2008 it bought a land plot in Sofia.

RETAIL - French travel and high street retailer Lagardere Service is planning direct entry into Bulgaria. Plans are to open the first Lagardere-branded shops this year.

OIL - LUKoil, the Russian oil company, bought from Petrol, Bulgarian fuel retailer, a chain of 75 gas stations and the fuel depot used for servicing the stations for 237 M EUR.

CONSTRUCTION MATERIALS - The Bulgarian company Devnia Cement is to shortly launch the construction of a 250 M EUR plant, the company said in a statement. The new plant will have an annual capacity of three million tons a year and is slated to start operations in early 2010. In addition, the new factory will have a special rigid household waste-burning facility. To cure cement, the plant needs to burn about 200 000 tons of waste.

TECHNOLOGY - US diversified holdings company ITT announced plans to invest $400 million in Bulgaria, mostly in the construction of new production facilities. According to sources familiar with ITT plans, the US company will eye Bulgarian army modernization projects, namely the deployment of tactical communication-information systems for the general staff, ground, air and naval forces.

CORRUPTION - Bulgaria and Romania are on the rack in the European Union over their alleged failure to fight corruption and implement judicial reforms. Bulgaria faces further complaints over its record in dealing with rampant organised crime.


March 2008

ECONOMIC DEVELOPMENT - FDI in Bulgaria soared last year 30% to EUR 5.7 bln. The share of FDI as a percentage of the GDP rose from 17.4% in 2006 to 19.9% last year. In December 2007 alone, FDI flows were up 11.5% on the year to EUR 556 mln, whereas in Q4/2007 it grew by 13.9% y-o-y to EUR 1.57 bln. Venture capital formed 59.3% of overall FDI. Revenues from the sale of real estate to foreigners soared to EUR 1.7 bln last year (EUR 1.15 bln in 2006). FDI covered 92.1% of the current account gap last year, down from 110.9% in 2006. The high deficit, 20.5% of GDP at the end of 2007, makes Bulgaria vulnerable to a hard landing should the global credit crunch curtail FDI flow. The Finance Minister Plamen Oresharski, however, assured that Bulgaria is not in danger of financial crunch as the budget includes solid fiscal reserves and a strong surplus.

LOGISTICS - Japan will lend Bulgaria EUR 238 mln for the construction of two terminals handling container ships in its Black Sea ports of Bourgas and Varna. The terminals will be built by 2015. The loan will further strengthen the economic ties between the two countries, as well as boost co-operation in the Black Sea region.

ENERGY - Spanish company Coener Group plans to invest more than EUR 60 mln in Northern Bulgaria into a bio-diesel refinery, an installation for raw refined oil, a warehouse and a new port on the Danube. The complex is due to be completed in 2009.

CONSTRUCTION MATERIALS - The French-German conglomerate Saint-Gobain Weber will build a greenfield factory for mortar and paste-like coatings in Southern Bulgaria. The company will invest EUR 5 mln in the project, which would be completed within six months.

RETAIL - British clothing retailer Marks&Spencer set up a joint venture with the Greek Marinopoulos Group to expand its business in Eastern Europe. The British company acquired 50% of Marks&Spencer Marinopoulos BV, which manages 38 outlets under franchise in Greece, Romania, Bulgaria and Switzerland, for EUR 50 mln. Marks&Spencer plans to open 50 new outlets on the Balkans in the coming years.


January 2008

SCHENGEN - Bulgaria could join Schengen in 2010- 2011. On December 21 2007, the Czech Republic, Estonia, Hungary, Latvia. Lithuania, Malta, Poland, Slovakia and Slovenia joined the Schengen Treaty. Four-hundred million citizens can freely travel the new 24 country area. According to Bulgarian Foreign Minister Ivaylo Kalfin, Bulgaria and Romania could join Schengen in 2010 or 2011.

REAL ESTATE - Property prices in Bulgaria were the fastest growing in the world, according to the Knight Frank ranking. The company's index, Knight Frank Global Price Index, showed that residential property prices in Bulgaria rose by 30.6 per cent on the year in Q3 2007. In Q3 2006 Bulgaria was eighth in the ranking with a price increase of 14 per cent.

REAL ESTATE - Austrian business property investment company ECO Business-Immobilien AG said it was considering investing in Bulgarian property market. The company was evaluating properties in Ukraine, Bulgaria and Romania, the company media statement said. On December 3 2007, ECO Business-Immobilien announced its first investment in Ukraine worth 18.1 million euro. The company would construct a 19-storey, 14 000 square meter office complex. The project is to be completed by the end of 2008.