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TAOFES Manager Boesten: Bulgarians Take 'Ostrich Approach' on Environmental Legislation

Bulgaria-Netherlands » BUSINESS | Author: Ivan Dikov |January 29, 2010, Friday // 15:52
Bulgaria: TAOFES Manager Boesten: Bulgarians Take 'Ostrich Approach' on Environmental Legislation

Interview with Rene Boesten, Manager of TAOFES, a Dutch consultancy on environment legislation, for the Dutch Survey ("International Survey: Bulgaria-Netherlands") of Novinite.com. 

Your firm TAOFES appears to fall in the category of small and medium-sized enterprises run by an expat. What is the scope of its business activities in Bulgaria?

The scope of our business is pretty straightforward. What we do is consultancy on environmental issues. We focus mainly on EU legislation, and its implementation. Recently, I started picking up some things that I did a lot on in the past – working on process optimization.

Certainly, in times of crisis companies have to be very careful with their costs. And process optimizations is a well-established methodology to analyze the process, to make sure that costs are kept under control, that you don’t produce too much waste water, don’t use too much energy, all of those things. We use a tool for this analysis which is from UNEP and UNIDO, which I partly developed some time ago when I worked for these organizations.

What’s the popularity with Bulgarian companies of that sort of services? They don’t have a reputation for being very eager to engage in sustainable measures. Do they differ from the foreign ones in that respect?

For companies operating in Bulgaria, environmental legislation is often seen as a burden – “I have to build a waste water treatment plant, I have to have a permit, to reduce of air pollution.”

Sure, it is a greater cost for the company but just establishing a waste-water treatment plant is not the way to proceed. A company should analyze it processes very carefully. You can protest against environmental legislation but it does not go away. So try to use it.

What I see in many companies in Bulgaria is either a total lack of imagination, or a little bit too much imagination. By lack I mean that people would object against legislation and the new costs but are not creative enough to use these as a way to improve their own facilities.

Too much imagination is basically the ostrich approach – stick you head in the sand and the problem will go away. It will not. Many people think that if you pretend to be very quiet, it will go away. Brussels won’t see us, the government won’t see us, the people won’t see us. But it does not work that way. So that is too much imagination.

Which gives me the opportunity to point out why I am in Bulgaria. With my company, I’ve done work in Bulgaria, Turkey, Romania, the Netherlands, in China, in many other countries.

But my reason for being in Bulgaria is more connected with people than with the country, and especially with one particular person. I started here ten years ago, a project came along, I picked it up, met some great people and continued to work with them.

The environmental legislation in the EU is more or less the same. Yet, each country, or region, but also each company, each political party has its own peculiarities how it deals with this type of legislation. That is different everywhere. Whether I do that from my home base in Utrecht or in Sofia, Bucharest, it does not matter. And Sofia is a nice place to live, I like this city very much. I might be one of the few who likes it.

What’s peculiar about Bulgaria – in terms of the implementation of the environmental legislation?

One thing is this ostrich approach – try to hide and it will go away. We now have at least 15 infringement procedures running against Bulgaria, and I expect some more to follow.

For example, air quality legislation in the EU – every country has asked for a derogation from the European Commission. The only country that has not is Bulgaria.

Air quality legislation in the Netherlands is a total horror. It is extremely difficult to comply with, and then we had to go to Brussels and say, “We can’t.” That took 4 years. And in Bulgaria no one has even thought about it. Again, this will not go away. You’ll have to deal with that at some point.

If you ask me to make a difference between Bulgarian-owned companies and foreign ones, I see is two types of foreign companies coming to Bulgaria.

There is a group that used Bulgaria because of its location, logistics possibilities, labor costs. Fine, they are doing well.

But there is a group of companies here that I call “regulation refugees.” 10-15 years ago companies in the West started to think they had a lot of problems with environmental legislation, for example, in the Netherlands, and they would leave the Netherlands because of that. And they would go to Bulgaria, for example.

How many such companies are there in Bulgaria?

I don’t know exactly. I know of a few but I don’t want to talk about the individual companies. There are a number of companies here who left the Netherlands just because it is easier for them to do things here. Sure, 10-15 years ago that was true. But now these companies are complaining again about environmental regulations.

So are they going to leave Bulgaria because of that?

Some will.

In your view, what is Bulgaria’s greatest problem with the environment – is it inadequate legislation, or corruption – enabling illegal resort construction, or lack of concern?

All of these are important. But I think there are two more issues which are very important here.

One I already mentioned – this lack of imagination. Implementation of EU legislation is not just copying it and then try to do something with it. It is a careful process of how it fits into the society. The EU does tell you what to do but doesn’t tell you how to do it. Bulgaria has done little in the past to 8-10 years setting up organizations and thinking about how this should be done. This lack of imagination is one thing.

The other thing is I see as a problem, and I especially saw it in a project I did in the past 2 years on the Black Sea coast. There was absolutely no communication between the political levels and the expert levels in the ministries. I don’t know how it is now with the new government. I think it has changed but that thought is partly based on the fact that it cannot get worse.

What I saw during these last 2-3 years when we were working on the Black Sea project was that the people in the Ministry who are experts in their own right, were qualified to do a certain job but did not have any connection with their political bosses.

The politicians came with ideas, dumped them somewhere, and the staff did not know how to work with them because they did not have any guidance. And vice versa – experts would give ideas to the Minister on how to do things, and the Minister ignores them. And that cut between the two layers of the administration is very bad in terms of what should be done, how it should be done. The Minister of course is the political boss, and the expert should be loyal to them. But the Minister can’t do anything without the experts. If that communication is cut, basically, nothing works. And that’s what we saw working with three ministries and a state agency.

Do you have impressions of the new Bulgarian government?

They have been busy since July with cleaning up, as they call it themselves, lots of things have changed, lots of people have been fired. The Prosecutor’s Office must be extremely busy at the moment. But I don’t see very clear policy plans. Let’s give them a bit more time. Given the total lack of any quality of the previous two governments – not just the Stanishev government but also the Saxe-Coburg government – same problems, same horrible non-communication – let’s give them the benefit of the doubt.

The EC has started infringement procedures against Bulgaria on 15 different cases. Do you think the EU has sufficient leverage to save Bulgaria’s nature? How would you evaluate the impact of EC measures against Bulgaria over environmental violations so far?

That’s a wrong perception. It’s not the EU that has leverage, it’s the legislation that has it. The legislation in Bulgaria has been implemented without thinking of how it should be executed. There is only a limted sytem for implementation.

It is not the EU that has the leverage, it’s the Bulgarian legislation that has the leverage (double). And I am very pleased to see that more and more people find the right way to use their right to object via court procedures against decisions that are made by governments, and they just take the piece of Bulgarian legislation and ask the courts to enforce.

What is your thought on the fact that a number of murky businesses made profit causing environmental destruction in Bulgaria in the last two decades?

This happened here and in many other countries after the changes of the 1990s because there was the building of a new legal system, and there was a gap in it. There are those who would try to take advantage of that gap with very little respect for other people’s properties, values, rights.

At the end, this will go away with the buildup of a regulatory system. This is happening very slow in Bulgaria but it is coming.

How much damage have these processes done to Bulgarian nature?

They have done a lot of damage. But what some people don’t realize yet is that they will be held responsible for cleaning up the damage.

Go and have a look at Spain. In the late 1990s many investors thought – before NATURA 2000 comes, let’s build some hotels. It did not work that way. And now they are forced again by the Spanish and EU legislation to destroy those projects, and pay for that.

Yes, it has been done, it’s close to unavoidable because of laxity in the regulatory system, but it will be cleaned up. Most of it, not all.

Working at the Black Sea coast, I found it shocking to see that one guy builds a hotel, makes some money out of it, and everybody copies the idea without any further thinking.

People in Sunny Beach go there in the summer, they see there is lots of money around, and they think, “Let’s make another Sunny Beach in Pomorie, Tsarevo, Byala. What I regret in this is that it is not only damaging the natural and economic values of the coast but also that it is so silly. It is great to have a lot of people in the summer there but look at what we see in the Netherlands, Belgium, Germany.

The Netherlands is one third the size of Bulgaria. Nature areas there are about 7% or 8% of the territory. But we manage to earn EUR 6 B per year from this, from tourism. And the logic is very simple. The guys that go to Sunny Beach spend 200-300 euros maximum per week. The guys who go for eco tourism, or whatever you call it, they spend double that amount, and in a season from April till October, at least. The season is much longer, and tourists would spend more money.

This is something that the Bulgarian tourism industry just doesn’t grasp. It’s a pity. It’s not only a loss of nature but of potential – not using assets that are there in a sensible way. And sure, nature should be protected but there are many good ways to make it economically beneficial.

With all that said, do you have specific examples of such sustainable development and business practices transferred, or copied from the Netherlands to Bulgaria?

Yes, there are plenty of examples. However, they are all small-scale examples at the moment. I see that a number of people in the tourism industry in the Strandzha-Burgas area who realize that these things can be beneficial, or can be combined. I see it in many smaller villages in Bulgaria where the use of the historical characteristics can be used for the development of sensible tourism. More and more people are beginning to understand how it works.

The Netherlands is a country that has a tradition of 300-400 of working in consensus. We know that if we cooperate with our opponents, both of us can get better from it. Bulgaria is a country made up of individualists. Like it or not, is it good or bad, I have no comment on that. It’s just a given fact. What we saw in the project on the Black Sea coast is that the methodologies we used are based on this consensus approach. In Bulgaria ,we substantially had to change it in order to try to get the same effect in the end. We learned the hard way, I must admit.

So what’s the approach like that you have had to adopt for working in Bulgaria?

Work very much with individuals. In the Netherlands, I would work with industry associations or with tourism associations. They exist in Bulgaria. But which one? I saw their number rising. There are 53 tourism organizations. In itself, it is not much of a problem but they spent more energy on fighting with each other than on building tourism policies for the country.

And of course, what everybody does – as in the Netherlands – point to the government and say, “You should do it.” But you can wait for the government to do it, or you can do it yourself. So my approach now is much more focused on finding one group that wants to do something, one person wants to do something, and then I work with them, and we do something. If the whole system needs time to move, so be it.

Do you see much of a potential for business related to the environment in Bulgaria? If so, in what spheres – green energy, sustainable tourism, etc?

Those are the key things. And Bulgaria has this enormous potential for developing green or renewable energies. Bulgaria has many potentials – for all kinds of tourism, etc. A potential is one thing but the capability to realize it is something totally different.

We see a lot of activities in renewable energy, business development in that respect. I see very little activity around sustainable tourism, regrettably. For us as TAOFES I see a potential in work with systems like life cycle analysis, eco design, cradle-to-cradle concepts for how to make a product as economical as possible without damaging the environment.

That is what is the most interesting for us in Bulgaria. But this is not for every industry, this is only for industries who have already made a step into sensible business. It is sometimes technically and intellectually complicated for most industries.

The Bulgarian government has recently pressed for a moratorium on the construction of wind power parks because many of them encroached upon protected areas and bird habitats. Many businesses have reacted negatively. Do you think the move of the government is right, isn’t Bulgaria going to lose lots of foreign investments as a result of that?

Bulgaria is losing investment? What kind of investors – that don’t care and want to build in NATURA 200? Lose them, fine. Those are what I call the regulation refugees. You don’t want that kind of investment.

Those who want to build serious, long-term, well-established renewable energy plants in Bulgaria are not the companies that do things like this. A moratorium of six months does not hurt them, they won’t run away from it. On the contrary, they will be glad that finally the business is being cleaned up. So you lose foreign investment but it is investment that you don’t want because it is from the people with the wrong mentality.

A moratorium is a little bit of an emergency measure. But if you look at what has been done in the past four or five years in this field, it’s a necessary measure. It needs to be cleaned up and then apparently the capabilities of the Ministry of Environment are not that great, they don’t have sufficient staff apparently, or maybe not sufficiently qualified staff, so such an emergency measure is necessary.

If they had sufficient people who can go out and control them, that would not have been necessary.

How do you evaluate the problems of the Bulgarian Black Sea coast and the international efforts – or the lack thereof – to save the Black Sea?

I do see some positive sings there. The project we did on the Black Sea coast was extremely difficult, and it depends on your perception whether we failed or succeeded. I see a number of interesting developments there. I see that people are trying to develop more opportunities.

I saw a number of very nice examples of people – for example, from the Architecture University in Sofia – who – with very little means and resources – came up with very interesting ideas for a more coherent development of the Black Sea coast.

So I see positive things, I see negative things, and I see stupidities. And the biggest stupidity was – the sales of First Alley (the garden along the sea) in Varna. I don’t understand how a city can sell its heart. It has nothing to do with whether the company that bought the place is reliable or not. You just don’t sell it. Can you imagine Berlin selling Alexander Platz, London selling the Tower Bridge? You can organize public private partnerships, concessions, but as a municipality you don’t sell the heart of your city.

What is your position on the Burgas-Alexandroupolis oil pipeline?

Well, the Netherlands is one big oil pipeline. We have gas fields and oil fields all over the place. It is not whether you build a pipeline but how it is build. From an environmental point of view you can build them in such a way that there is no damage to nature. You can build a pipeline in such a way that the only damage is during the construction and it can be repaired, no problem. From an energy strategy point of view, it is a different story.

So are the local people in Burgas and the region justified in protesting against the pipeline?

The result of this protest is that the competent authority has to be extremely precise. You need these watchdogs. That helps the quality of the decision-making process. The decision-makers don’t like it. All those people protesting in the streets, calling for referendum, etc. But it is just a part of the system. People have a fundamental right to express their concerns and to protest or go to court.

When they do that it contributes to the quality of the decision making process. What I see in Bulgaria is that many people from the government are still afraid and irritated by it. But it is a part of the democratic system. And that people can go to court and win – it’s inconvenient, expensive, for the government, but it’s part of the process. People in Burgas should keep an eye on the government decisions.

What is you view on the results of the Copenhagen Climate Change Summit? What sort of an international outcome do you expect in that respect? Do you think the Bulgarian government adopted the best possible position for the country?

It was extremely disappointing. What I saw was that everybody was sitting and waiting for Obama and Hu to come as a salvation army. They had to save the world. The EC had no position. The EU should have acted in a much stronger way than it did. It sat there and waited. It’s a missed opportunity.

I think there was something that Gordon Brown said a few years ago - climate change or not, everybody is going to buy renewable energy technology. So let’s spend a lot of money on developing it. We can sell it everywhere. Why wait for Obama and Hu? And then there is India and Brazil, and the developed world sits there and is confronted with powerful nations that in the past we could pay them off. But that doesn’t work any more. And if we are not careful, the whole definition of “developing countries” would be revised, and there will be developing countries and non-developing countries.

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