BESCO: IT’S TIME TO ENCOURAGE TECHNOLOGY INVESTMENT OUTSIDE SOFIA

Svetozar Georgiev, Chairman of the Board of BESCO – Bulgarian Entrepreneurs Association, Dobromir Ivanov, Executive Director of BESCO, in “Business Start”

The Investment Promotion Act in Bulgaria is not adequate to what our neighbouring countries are doing. Neighbouring countries are doing better than us because the way they define the classes of investors and the way state aid is given – what the state actually supports to make deals happen – are fundamentally different. We now have draft laws in place that should change the situation. We propose amendments to the law to focus on medium- and high-tech companies that are outside Sofia and, as a consequence, to change the way in which the relevant classes of investors are defined. This was commented by Svetozar Georgiev, Chairman of the Board of BESCO – Bulgarian Entrepreneurial Association, and Dobromir Ivanov, Executive Director of BESCO, in the TV show “Business Start” with host Hristo Nikolov.

Sofia is now considered a more developed region and especially when it comes to high-tech businesses, there is even cannibalism between companies in the capital and it is very important to develop the regions outside Sofia, the participants explain.

“In Sofia, the competition for staff is so great that at the moment of the arrival of a technology giant to extract more engineers to work for it, it is not clear whether this would help the ecosystem in the city at all…When a competition is too intense and we have a closed market, as in Sofia, we already become uncompetitive at the regional level because the cost of labor becomes too high.”

According to the interlocutors, it is very important to change the size of the budget with which we attract investors. At the moment, the budget of our Investment Agency is about BGN 9 million. By comparison, Serbia entered into a deal with 300 million euros a few weeks ago.

“Accordingly, we do not meet the basic requirements when an investor looks at the region to be able to be competitive with what other countries around us are offering.”

According to the interlocutors, urgent changes are needed in the education system and a key priority in the field is the creation of a standard for the quality of teachers’ work.

“Educational institutions, schools and universities need to be clear about what kind of product they produce in the end…At the moment the system is extremely formal, there are no quality criteria and we are lagging spectacularly behind Europe and the rest of the world.”

Commenting on the results of the parliamentary elections, the interlocutors stressed that the expectations of the business and the people are related to having a regular government that does its job. The state has been in a caretaker mode for two years, the caretaker government is not a body that can legitimise the important issues and the long-term commitments that need to be made and we need to get out of this mode.

Society is fragmented, but this is not just a Bulgarian phenomenon. Only – as in business, we cannot wait for all factors and conjuncture to line up perfectly to start doing work, it cannot be done, we have to work with what we have. Our plea to politicians is to stop trying for an ideal scenario as it will not happen. During this time, key aspects of Bulgaria’s way forward are actually questionable or to be postponed, or even neglected – like our membership in the euro area, in Schengen, the Recovery and Sustainability Plan is delayed too much, and to this we can add many institutions with expired mandates.

“We are a parliamentary republic, it has to be governed that way and the political parties that are in parliament – in whatever configuration they are – have to work”, the interlocutors point out.

The whole conversation can be seen in the video here.