“Financial Times”: Bulgaria becomes a leading outsourcing destination

“Financial Times”: Bulgaria becomes a leading outsourcing destination

Plovdiv, Veliko Turnovo, Varna and Burgas are recovering from outsourcing in the country, writes “Financial Times”  

Bulgaria becomes a leading outsourcing destination, reports in “Financial Times” in an article published today 

Plovdiv, a city with an ancient history and rich in archeological treasures, regains its former cultural and economic significance, writes the newspaper, quoted by BTA.  

In 2019 the second of the largest city in Bulgaria will be European Capital of Culture. Meanwhile, the Gross Domestic Product (GDP) of Plovdiv is growing by 12-13% per year – one of the fastest rates in the country 

Much of this can be attributed to the boom in IT and outsourcing sectors, which is backed by local government and government, says the article.  

“My dream is to see the revival of Plovdiv as an industrial and cultural center of Bulgaria,” said Ivan Totev, mayor of the town.  

Plovdiv is an example of the country’s thriving outsourcing industry, contributing almost 4% to GDP, according to the Bulgarian Outsourcing Association (BAA).  

 Bulgaria is the ninth most preferred outsourcing destination in the world, according to the Global Services Location index of the 2014 AKT Kearney consulting company.  

The Investors are attracted to the Plovdiv region by the Trakia Economic Zone (TEZ), uniting six industrial zoneswrites the authors in the article Teodor Troev and Angel Petrov. The advantages of TEZ are the built-in infrastructure and accelerated procedures.  

TEZ is the first of the kind in Bulgaria, separate as an area for targeted state support, which allows even smaller municipalities to apply for project financing from national budget or European Union programs.  

Investments in TEZ  exceed EUR 1 billion and are expected to double in the next 10 years.   

“We are conservative in these estimates. Interest is growing steadily”, said Plamen Panchev, director of TEZ and president of the board of directors of the construction company “Sienit Holding”, which has an important role in creating the area.   

More than 100 investors, mostly from Europe, were attracted by business-friendly legislation, low labor costs and a flat tax of 10% that Bulgaria offers to foreign companies, the article notes.  

Project, called “Intelligent city”, for encouragement by energy effective and reduction of industrial waste in TEZ, is being developed together with the German Institute “Fraunhofer” and Chinese technologies Huawei.  

Other Chinese company is partner to TEZ in Euro-Chinese zone for economic development, focused on attraction to more Chinese investments by creating a logistic hub connecting Asia and Europe.  

Twenty thousand people work in TEZ, rеcalls the publication. However, the lack of skilled labor is a problem.   

Other Bulgarian cities like: Veliko Turnovo, Varna and Burgas also are benefit from development, said “Financial Times”  

Foreign presence is expanding. The American technology HP, for example, explore laboratory in Sofia.   

“The potential, which we have can be double in outsourcing sectors in GDP through the next three until five years”, said Stefan Bumov, president of BAA and executive director of “Sofia Group”- the biggest Bulgarian outsourcing company, bought from TeleTech, which center is in USA, through the last year.   

Ilia Krastev, executive director of “Data Pro”, a smart content and data storage adds to the challenges of declining fertility and education “which they can be brake on sustainable growth”.  

He says Bulgaria should facilitate the procedures for hiring foreigners, stop brain drain, attract local residents who have a graduated abroad and improve the quality of life.