Bulgaria Non-Banking Financial Sector Hardest-Hit by FDI Exodus
Bulgaria's non-banking financial sector has suffered the hardest blow in the wake of the mass outflow of direct foreign investments from the country.
"Foreign direct investments in the sector towered to over EUR 1 B in 2007 and 2008, only to slump to minus EUR 480 M in 2010," the head of the InvestBulgaria Agency Borislav Stefanov said on Monday at the "Banks Investments Money" forum.
Stefanov vowed the agency's readiness to help the non-banking financial sector through marketing and administrative support.
About 300 companies invested in the financial sector last year, more than fourteen of which – a dozen leasing companies and one insurance company - ended up with a negative balance for more than EUR 10 M.
Ten banks have made investments in the financial sector in 2010 worth more than EUR 10 M.
FDIs have almost doubled to EUR 103.8 M, against EUR 57.3 M a year ago, which gives grounds for moderate optimism, according to Stefanov.
In 2010, FDIs in Bulgaria totaled EUR 1.6 B, down by only 30% , according to revised data of the central bank, which denies gloomier estimates for a 50-60% slump.
"Investments are the main driver for small, open economies like Bulgaria as they bring fresh capital. Foreign direct investments are one of the main factors for the improved living standards of part of the Bulgarian citizens over the last few years," he commented.
Most of the foreign investments in the last three-four years have been the financial, property and construction sectors.
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