Investor Here, Investor There...
This article has been published at the "Unfiltered" column of the Bulgarian news agency BGNES.
Bulgaria is a paradise for investors. I have been trying to convey this message everywhere in the world for years.
Sometimes it is taken at face value, and I only need to register my interlocutors' startled expressions.
However, oftentimes I get tangled in not so pleasant discussions on whether that actually is true, and I am usually reminded that "it's not age but experience that counts"...
In fact, it is hard to invest anywhere. Especially in today's messy times that some tend to call a crisis.
In Bulgaria everything seems perfect, tempting, and positive except nobody is aware of that. Indeed, Bulgaria now has the lowest taxes in Europe. But nobody is aware of that, either, and by the time people become aware, the taxes would've most likely gone up.
And we are in a market, a highly competitive market in which the investor evaluates a lot of indicators in order to make a choice. The first one of those is the respective country's image, what people say about it, what the business sector says about it, and its forecasts for the years to come.
An investor's decision to put their money in a certain country is a tender balance consisting of three very important factors – the country's image, its taxes, and its bureaucracy. So if Bulgaria really has it alright with the taxes – especially the 5% dividend tax, and the 10% flat corporate tax, it is actually lagging very far behind on the other two factors in all kinds of rankings. And – note that – the balance really matters. Even if you offer zero taxes to the investors, if your bureaucracy is monstrous, or you've got a terrible image, not a single company will stage a preliminary investment survey, let alone invest its money in your country...
There are exceptions. For example, the banks - it's clear, they make a lot of money, and are everywhere. Real estate properties – when a country's economy is booming – can bring immediate, incredibly high, and low-risk revenues. Reminder: all that happened in Bulgaria after 2001 when it became clear that there is no coming back and that Bulgaria was soon to become integrated in the European economic structures.
But these exceptions, all or almost all of them, have long become a fact in Bulgaria, and now the enormous efforts of all ministries, businesses, agencies, and anybody who cares even a little for this nation must be directed precisely towards creating a better image abroad.
That will hardly be achieved with advertising campaigns, and that will hardly require millions of BGN from some "operational" (I never understood the meaning of this word) EU program or from the meager state budget.
Certainly, every successful Bulgarian is part of this positive image. Every feature, interview, even a lackluster news article about them in media outside Bulgaria is priceless. Every good thing done by us, and promoted, will make us all believe that life here is good, and that we can be successful.
It's unnecessary, I deem, for me to be telling how much I really believe that Bulgaria is a wonderful country in which you can be successful if you work conscientiously, with a vision and a desire to create something new.
All the more so for the foreigners who can find in Bulgaria hundreds of still unoccupied niches for their businesses. Of course, miracles aren't happening any more, the quick profits are history, and will probably never come back. But I allege that out of all European countries Bulgaria has the largest number of unoccupied business niches, it has the lowest taxes, and – I keep hoping – its bureaucracy is about to become more and more civilized – mainly because of the fact that historically we've never had lazy bureaucrats caring only for their position, and interfering with the business of others.
All we need to do is to be sending messages abroad that we are good people. All of us.
Constantly, every day. So that we can get more investors and more investments, right know when they are really vital for us. We can achieve that only with the things we keep accomplishing, just by telling the world about them.
The investors are looking forward to it...
Maxim Behar is a Bulgarian PR and media expert, founder and CEO of one of the leaders on the Bulgarian PR market, M3 Communications Group, Inc. As of January 2012, he is the Chairman of the Czech Republic Office of leading global corporation Hill+Knowlton Strategies. Behar is also the Treasurer and a Member of the Executive Board of the International Communication Consultancy Organization (ICCO), and a member of the Board of the global PR forum in Davos "Communication on Top".
- » Ex-Bulgarian FM Urges UK PM to Drop Nationalist Policies
- » Ukraine Had No Option - Drop EU for Russia or Be Crushed
- » Ukraine Govt Betrayed Democracy - Freedom House
- » EBRD Transition Report 2013 - Country Assessment: Bulgaria
- » Budget 2014 - Unable to Boost Bulgarians' Income
- » Concluding Statement of IMF Mission to Bulgaria
Poor baba Ivanka - I suggest she puts down the bottle for a moment and accepts the facts.
ALL of these indices that measure standard of living/quality of life rank Hungary (and the rest of Europe) above Bulgaria:
But according to baba Ivanka this can be dismissed as lies and a conspiracy cooked up by "counter-revolutionaries" and "imperialist dogs" aimed at discrediting Bulgaria.
Was that the rakia that was talking or are you getting a little excited from this discussion?
I'm sorry but any company that chooses Hungary above Bulgaria is doomed to fail, sooner or later.
IF you say Hungarians are better off then Bulgarians then there is something wrong in your head.
Ivanka, you really are a retarded drama queen, who fails to accept the reality of the facts presented which are backed up real figures and statistics. Instead you drunkenly ramble on with your conspiracy theories and ignore the obvious questions which are why any of the countries I cite have much higher FDI than BG, and have a nuch higherbstandard of living than BG. Whilst I applaud your claims that Bulgaria is a virtuous, non-corrupt country which possesses the best educated workforce in the world, the fact is you should really concentrate on growing tomatoes and lay-off the rakia.
Romania + 20.000.000 people, 240.000km2
Bulgaria + 7.000.000 people, +110.000km2
Hungaria, great example. Why not mention Greece too?
All those countries you are quoting are bankrupt, were saved by IMF or others and in Hungary they even stole the private pensions from the people.
Like I said, Bulgaria is stable. Those countries can start a civil war any moment.
Also funny to see negative article about bank funding going down.
Largely replaced by deposits... Which means, if this continous it will be Bulgarian banks funding other countries in the future.
China, you know shit about China.
IF Bulgaria would have had balls last 3 years and they would not have cutted so drastically but instead had more invested it was a booming country and this at the time there is worldwide one of the biggest crisis in hunderd years.
Now I'm going to feed my donkey and my goats, they sound a bit like you. Funny but absolutely stupid animals.
Ivanka, look at the figures before making such ridiculous statements.
Foreign direct investment is huge in China, because despite the risks the rewards are also huge (the clue is in the sheer scale and potential of a market that is rapidly modernizing and to take advantage of thev1.3 billion person population and its sizable and growing middle class which demands foreign goods and services). And if you did your homework instead of stealing electricity to provide lighting for your gypsy hovel then you would see that foreign companies are successful in China, which is why FDI in China is huge.
Your example of Great Wall in Bulgaria only goes further to underline your ignorance and inbreeding. The reason Bulgaria was chosen by Great Wall is not because of all these highly skilled workers that Bulgaria has, no establishing a production base is their way of getting fast tracked into the smaller, but potentially lucrative European market, whilst paying the lowest salaries.
You mention "Bulgaria is a very good place to invest. If you did not notice, every year you see more and more companies bringing office and production to here" - again I suggest you do some homework instead of spending your time stealing metal. FDI into BG is almost half that received by Romania, its just 30% of that received by Hungary and 20% of that received by Poland. even Croatia, a non-EU country gets more FDI that BG. These are facts, not your deluded tziganin interpretation of the world.
Chuski chuski, are you saying that most companies going to China are successful over there? (most fail, loose their products to copycats and do not ever consider again going back there. Only the real big ones have a chance in China, the rest will be eaten alive)
Great Wall is the first Chinese car builder in Europe.
Zheely could be considered the first one but they just are managing volvo.
So, if you are saying that those Chinese are such smart people and that they are the people to do business with ... Why do these Chinese choose BG instead of all those other countries?
And more Chinese coming next years.
Oh yes, maybe they also considered the lower labour costs compared with China(up to 10-20% lower in BG). Lower taxes too.
And did you know that China is paying more or the same for very capable people then they can pay in Western Europe?
Bulgaria is a very good place to invest. If you did not notice, every year you see more and more companies bringing office and production to here.
But hey, you probably live in a Gypsy quarter and I can imagine nothing much changed there.
Off course this needs time. Such things do not change in a few years. Every year it grows, and every year it grows faster.
Poor Ivanko, completely missing the point.
Clearly investors dont share your esteemed opinions on the risk v reward situation in Bulgaria, compared fro example to China. Perhaps you should start consulting multi-national corporations who I am sure would benefit from your erudite views, political nous and economic prudence.
"The rewards for doing business in wealthy but corrupt economies like China, far outweigh the risks. The reward part of the equation in Bulgaria just doesnt make it worthwhile doing business here once the risks have been fully evaluated."
The risk is very low in Bulgaria. The investments needed are very low compared with the rest of the world.
China is one of the biggest risks that you can find. A completely other culture in a nation that is set to concur the world and will copy all of your products and sell it cheaper.
You are a bulshit speaking parrot who knows shit.
The real reason is that Bulgaria had (and still partly has) an elite leading the country which is not part of their elite group.
With Boyko this changed. They did not even care (seeing the leaks reports) that he apparently (according to their reports) is one of the biggest maffioti in BG. Still Boyko is only a frontrunner which has to clear the path for the ones coming. He will realise that too in a few years.
EU has destroyed Bulgaria old school to buy everything up for nuts and then they make their own people the ones who cash in everything.
The same in East Germany and many other places.
Bulgaria absolutely is a good location for investments. Very low risks, low investments, good schooled people, cheap labor, no unions, stabil financial environment and plenty more.
If you are so well known with the situation then please explain your big risks for companies producing here.
Please, no 10 year old arguments.
Its simple Ivanko - risk v reward
The rewards for doing business in wealthy but corrupt economies like China, far outweigh the risks. The reward part of the equation in Bulgaria just doesnt make it worthwhile doing business here once the risks have been fully evaluated.
Hairydave is right, corruption has a large impact on potential investors - and its not surprising when a quick look at Transparency International's Corruption Perception Index shows corruption in Bulgaria has been steadily deteriorating since 2002, so that now the corruption problem in Bulgaria is worse than in countries like Colombia, Ghana and Saudi Arabia.....
Maxim makes some valid points - however I think his pre-occupation with negative headlines is misplaced. There are plenty of negative headlines about countries where investors flock. It's a non issue.
Thee problem is not the headlines, it is the reality.
Corruption is rampant, and the bureaucracy is astonishing. Dealing with the basics is terrible. Utility companies are horrendous. They don't have any concept of customer service. The government's need to have a form and an official stamp on everything, which then knocks through in to the private sector - is mental. And so it goes....
In my humble opinion what the country needs is a few "bright young things" to form new, stable, political groupings. Not political parties that are vehicles for the latest big character hungry for power. It's not a new politics, groupings will inevitably peel off to left and right, but form them around a set of ideas - not around a person.
Then, maybe, some of these deep seated problems may start to be addressed. Or then again, maybe not!
It is a great country - and I see plenty of people working hard day in and day out. Needs a bit of a tidy - but then where doesn't?
" we are in a market, a highly competitive market in which the investor evaluates a lot of indicators in order to make a choice. The first one of those is the respective country's image, what people say about it, what the business sector says about it, and its forecasts for the years to come."
Read this man, he talks sense. Take his words to heart all you politicians and take the right moves to eradicate (as far as possible) OC and corruption in this country. It is these two things that are the major cause of Bulgaria's bad image.