1. Bulgaria Investment Climate in Selected Industry Sectors
Shanghai
November 2012

2. 2,257
FDI in Bulgaria comes mostly from EU countries and is concentrated in four main sectors, but new opportunities exist
FDI by host country, (€ mln.)
Economic sectors with high investment potential
(1) Netherlands
Services:
Transport and Logistics
Information technologies
Outsourcing of business processes
Health and tourism related to healthy lifestyle
Manufacturing:
Transport equipment and machine building
Electronics and Electrical engineering
Chemical industry
Food and Agriculture
(2) Austria
(3) Greece
(4) UK
(5) Germany
(6) Cyprus
(7) Russia
(8) USA
FDI flows by industry, (€ mln.)
Real Estate
10,901
Finance
7,652
Trade
6,522
Manufacturing
6,479
Energy
2,699
Telecom
2,260
Other
2,664
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3. Overview of the Electrical Engineering and Electronics sector6
Overview of the Electrical Engineering and Electronics sector
Wires and cables
1890s
Siemens participated in building the telegraph
network in Bulgaria
Industrial Batteries
25%
Electrical apparatus
Transformers
Integrated circuit 2% 2%
Telephone devices
1972
The first Bulgarian made space
equipment was launched into space
11%
Panels,El.tables 6%
PCBs
Electric heaters 6%
Radio and TV equipment
1985
The peak of the industry – manufacturing of
modern computers. Electronics comprise
25% of Bulgarian manufacturing
people are engaged in the industry
Other
Sector snapshot
Sector volume production increased almost 3.5 times in 2009, compared to 2000
The sector generates about 14% of total exports and main export partners are Germany, Italy, Spain, France and Turkey
More than 75% of the produced electronic equipment in Bulgaria is exported
About University students are enrolled in related majors
About people employed in over companies in the sector
1988
Bulgaria manufactures more than 40%
of the mainframes and personal
computers in Eastern Europe
2010
Revenues were over €1.5 bn, the
highest since 1990
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4. Leading global companies in the sector operate in Bulgaria4
Since 1997 Festo Bulgaria has been specializing in manufacturing of sensors and sensor applications
Operates two manufacturing facilities in Sofia and Smolyan with more than 400 employees
Currently expanding the production facilities in order to meet the increased demand
Holds 35% market share of the world wire harnesses for the automotive industry
Yazaki Bulgaria main customers are the automotive manufacturers in France and Spain
Yazaki Bulgaria,which employs more than 3000 people, has not only an assembly department, but also an engineering division
Global leader in power and automation technologies and electrical equipment
ABB operates in Bulgaria through 3 companies in 5 production locations producing mainly high and medium voltage electrical equipment
ABB companies in Bulgaria export their products in Russia, Iraq, Romania, Mexico, Brazil, Sweden, Norway, China, Germany, France.
In 1997 Hyundai Heavy Industries took over the Bulgarian state owned Elprom-Trafo Company which has been well-known manufacturer of Power Transformers and Tap Changers.
The company employs now more than 670 people and produces power transformers, on load and off circuit tap changers.
Page 4

5. Overview of the Chemical industry in Bulgaria
1901
One of the first foreign investments in the country – a shoe polish factory in Ruse – now Orgachim
1,137
Exports,
Mln. €
823
Inorganic Products
1954
The soda ash factory in Devnia was built, now the biggest facility of Solvay Group in Europe
Non-Metal Mineral Products
130
Mineral or Chemical Fertilizers 43
273
Rubber and Plastic Products
209
1980
The chemical industry enterprises generated 17.1% of total industrial output and 20.8% of country’s exports.
Paper and Paper Products 93
Chemicals and Chemical Products 56 60 65
Organic Chemicals 93 93
2009
2010
Sector snapshot:
Many foreign and local companies develop successful business in the country. The total amount of their investments is over €1.5bn.
In Bulgaria, €100 of labor cost investments generate €148 of output
After 1990, the majority of Bulgarian enterprises were purchased by foreign investors, which led to the modernization of technical and production facilities.
Exports of main products have risen by almost 50% in Main partners are UK, Russia, Italy, Germany and Serbia
1997
Solvay, Belgium bought 60% of the soda factory in Devnia. Today, this is Europe’s biggest soda ash factory in Europe.
1997, 1998, 2004
Holcim, Titan, Italcementi Group modernized cement factories
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6. 4
Leading corporations have already chosen Bulgaria as an investment location
Agropolychim is one of the leading manufacturers of nitrogen and phosphorus fertilizers in the region
About 400 ths tons exported to Europe, America, Middle East and Asia in 2010
Solvay’s biggest European factory for manufacture of soda ash with a capacity of 1.5 million tons per year
85% of company’s output is exported to Eastern and Western Europe, Russia, the Middle East, South America, Asia and Africa.
Sisecam (Trakiya Glass) is the largest greenfield manufacturing investment in Bulgaria
The plant produces glassware, fl at glass, household glassware, mirrors and car glass factories
Clients include IKEA, Coca Cola, Indesit, Bosch, Audi, BMW
The plant for production of plaster boards and gypsum fiber board panels was established in 1993
To date, investment totals € 85m, over 190 employees and two factories in Bulgaria
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7. Overview of the Mechanical Engineering and Machine Building sector4
1878
Arsenal (military products) was founded in 1878 in the town of Ruse as first factory meant to serve the newly created Bulgarian Army.
1957
Beginning of production of forklift trucks
in Sofia.
Engines and Parts for engines
13%
Refrigerators, freezers
Armature items
11%
Parts for lifting machines and loaders
Ball, roller and needle bearings
10%
Liquid pumps 1%
Air-conditioning and purifying machines 2% 3%
Agriculture machines 4% 5%
Automatic machines
1969
In Plovdiv began the assembling of
Renault 8 and Renault 10.
Calculating devices
Printing machines
Others
Sector snapshot
The industry generates revenues of € 1.03 bn
FDI growth in the sector is 134 % in 2010 compared to An average annual FDI volume in the last 5 years is around EUR 65 mln.
11% of the university students are enrolled in related specialties
Employs more than people working in more than 1500 companies
Generates about 15% of total exports and main export partners are Germany, Russia, Italy and France
2008
German company Lufthansa Technik
opened maintenance facility for repair and overhaul of aircrafts like Airbus A320 family and the Boeing 737 series.
2012
Start of the production in car manufacturing plant established by Litex Motors Corporation in cooperation with the Chinese Great Wall Motor Co.
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8. Bulgaria as a production hub has attracted world leaders in the sector4
Bulgaria as a production hub has attracted world leaders in the sector
In 2008, Lufthansa opened an aircraft repair facility at Sofia airport, the only base of the company in Eastern Europe
State-of-the-art hangars and equipment. Over 500 workers
D-checks, the most extensive scheduled maintenance is carried in Bulgaria
Innovative and powerful know-how in the development and production of technical solutions for locking and latching systems.
Delivers its products to the most auto producers in Europe
In the process of doubling its capacities and staff in Bulgaria
Montupet is a leading supplier of automotive aluminum parts
Greenfield investment project in Ruse for €80m
Bulgarian plant produces engine heads for Audi’s 4- and 6-cylinder engines and for the whole series “Q” of Audi.
One of the world’s leading manufacturers of hydraulic and vacuum equipment for vehicles
The factory near Plovdiv is the company’s 2nd largest
Clients include Mercedes, BMW, Porsche, and Audi
Greenfield project, completed in only 11 months
Page 8

9. Overview of the Transport & Logistics sector
1866
The first railway track (224 km) started operation between Ruse and Varna
Major trade partners
Import 2010, EUR mln
Export 2010, EUR mln
2 237
Germany
1 659
Major European/global sector companies entered in Bulgaria, such as DHL Willi Betz, In Time
3 127
Russia
441
1 418
Italy
1 511
1 341
Romania
1 417
2006
Sofia Airport, the largest passenger and cargo airport in Bulgaria, opened a Second Terminal constructed by STRABAG.
1 142
Greece
1 237
1 047
Turkey
1 317
630
France
628
804
Ukraine
198
2010
Yana Intermodal Terminal opened near Sofia, at the crossroad of 3 pan-European corridors , serving the European and the Central Asian markets
668
Austria
294
364
Belgium
587
597
Hungary
198
363
Spain
416
Bulgaria has:
6 Motorways, some under development
230 railway stations with capability for loading/unloading cargo
4 international airports
2 major seaports on the Black Sea
4 major river ports on the Danube
About university students graduate from transport and logistics related majors per year
538
Netherlands
234
202
Serbia
550
493
China
187
403
Poland
268
303 UK
303
257
Macedonia
332
133
USA
212
Page 9

10. Bulgaria has one of the lowest business costs in Europe7
Bulgaria has one of the lowest business costs in Europe
Lowest corporate income tax rate in Europe
Cost of electricity for industrial users is 70% of the EU average
Lowest cost of agricultural land in the European Union
€/kWh,
2012
Bulgaria
1,595
€ / ha, 2008
Bulgaria
10%
Estonia
0.065
Romania
2,000
Bulgaria
0.068
Romania
16%
Hungary
3,000
Romania
0.083
Hungary
19%
Greece
4,000
Turkey
0.083
France
5,000
Slovakia
19%
Germany
0.089
Czech Rep.
5,000
EU average*
0.092
Czech Rep
19%
Poland
5,000
Hungary
0.100
Germany
10,000
Croatia
20%
Czech Rep
0.100
Spain
11,070
Turkey
20%
Slovakia
0.127 UK
11,400
* 2011
Source: Eurostat; Savills
Page 10

11. Over 50 universities enroll about 285 000 students
Over 50 universities enroll about students. 17% of Bulgarian students are in industry-related majors
Sofia
Plovdiv
Pleven
Ruse
Varna
Burgas
Blagoevgrad
Pernik
Silistra
Shumen
V.Tarnovo
Svishtov
Stara Zagora
Gabrovo
Universities:
Multiprofiled
Technical
Medical
Economical
Pravets
Kardzhali
Smolian
Angel Kunchev University (Ruse)
8,500 students
Sofia Technical University
23, 000 students
Varna Technical University
8,000 students
Sofia University of Chemical Technology and Metallurgy
4,000 students
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12. Bulgaria offers a variety of potential and existing well connected investment locations
Northwest Bulgaria
Lowest costs of doing business
Proximity to Central and Western Europe
New Vidin-Kalafat bridge
North Central region
Transport links via Romania
Industrial background
Sofia region
Availability of skilled labor
Over 20 universities
Sofia airport
Black Sea region
Burgas and Varna ports
Tourist locations
Availability of skilled workforce
South Central region
Proximity to Turkish border and Burgas ports
Industrial and energy hub
Plovdiv region
Main industrial location for multinationals
Well developed industrial zones
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13. The government supports specific industries under the Investment Promotion Act (IPA)
Investments must be related to the following sectors:
Manufacturing
Research & development
Education
Healthcare
High-tech services
Warehousing and logistics
Minimum investment amounts must exceed €10m
€3.5 in regions with high unemployment and €2m for investment projects in high-tech services
Benefits for certified investors include:
Partial reimbursement of labor costs
Shortened administrative procedures
Preferential acquisition of state or municipal land
Financial support for professional training / education
Infrastructure subsidies
Individual administrative services
Priority projects (exceeding € 50m and creating at least 200 new working places for a 3-year period) receive additional support.
Financial grant scheme for up to 10% of the investment project cost for industrial projects. 50% for R&D.
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14. InvestBulgaria Agency
Sofia 1000, 31 Aksakov Str.
Phone: (+359 2)
Fax: (+359 2)
Web: