On July 5, the first Bulgarian geostationary communication satellite BulgariaSat-1 reached its orbital position. The facility is an investment of BulgariaSat, which is part of Bulsatcom Group. The satellite was launched by the US technology giant SpaceX of billionaire Elon Musk on June 23 from a rocket platform at NASA’s Kenedy Space Center in Florida.
If the tests are successful, the satellite will start broadcasting in August. BulgariaSat-1 will provide television and communication services on the Balkans and other European regions. According to BulgariaSat, the facility will have life and fuel for more than 20 years and Bulstatcom will be able to repay its USD 230 million investment in about 10 years. The investment has been implemented with a credit from the US export credit Eximbank and a consortium of European banking institutions led by Deutsche Bank – London and Citibank, Raiffeisenbank and KBC.
Bulsatcom will use 46% of its satellite capacity for its own broadcasting mainly in Bulgaria and Serbia. The remaining part of the satellite capacity will be leased.
Walltopia, the Bulgarian climbing wall company, has successfully completed the implementation of one of the largest centers for sports and leisure facilities in Innsbruck, Austria. The total climbing area is 5700 square meters, of which 3000 sq. m. are indoors, and the highest walls in the center are 17 m. Climbers will be able to choose between 800 different routes. The facility has a capacity of 350 people climbing at the same time.
See the full story behind the biggest climbing gym built ground up at once – 6377 sq.m / 68 641 sq.ft of plywood… https://t.co/eB8JWltgbx
— Walltopia (@WalltopiaBG) July 5, 2017
From design to construction, the team of Walltopia stands behind the building process of the facility. Next year, Innsbruck is expected to hold the World Cup in climbing.
On June 19, InnoEnergy, supported by the European Union for Innovation and Technology to the EU, opened the application procedure for the third edition of the PowerUp! competition. Innovative projects in the sustainable energy sector from Central and Eastern Europe can take part in the funding competition. The program is interested in ideas that could have global impact and may contribute to the environmental protection. The application deadline is September 11, and the winners will receive cash prizes of EUR 20 000, EUR 10 000 and EUR 5 000 for the top three places, and access to the prestigious accelerator program KIC InnoEnergy Highway Accelerator to further develop their businesses. The winners will be announced in November. The competition provides contact with key partners and potential clients, which is a key factor in the highly regulated energy sector, and it is of great importance that the business model is validated successfully not only at national but also at international level.
Requirements for participation
PowerUp! 2017 is open for start-ups established no more than two years ago, with a developed prototype. The program is in the lookout for already formed teams and among the prerequisites is the companies to have the ambition to develop their innovations at an international level (respectively the idea to be globally applicable). On the website of the competition you can find description of all application steps, as well as an online application form. If you have any questions regarding the competition, you can also contact Cleantech Bulgaria, a non-governmental organization that coordinates the competition at a local level. The Bulgarian teams will compete with projects from 22 other countries from Central and Eastern Europe, including Poland, Slovenia, the Czech Republic, Cyprus, Romania, Greece, Serbia, Turkey, Estonia, Ukraine and others.
The selected applicants will go through a number of training sessions and workshops before the big final of PowerUp! 2017 in Budapest in November. Thus the teams will be given the opportunity to develop their business skills, to establish international contacts with other companies in the field of sustainable energy. From September to November, all selected participants will be trained by foreign mentors and business specialists.
Last year, a total of 99 startups applied for the competition. 10 of them reached the big final in Warsaw, including two startups from Bulgaria – the Hybrid Gyrocopter project powered by Electro Engine – ultra-light gyrocopters with
Bulgaria went up 4 positions in the Global Competitiveness Report for 2016-2017 of the World Economic Forum. According to the organization’s assessment, our country ranks 50th out of 138 countries in terms of business development conditions. The report points out that problem factors for the business are corruption, inadequate training of staff against business needs and infrastructure problems. The indicators with positive trend include Strength of investor protection, Extent of market dominance, Effect of taxation on incentives to invest, GDP growth, FDI and technology transfer, Fixed-broadband Internet subscriptions, Country capacity to attract and retain talent. On its 50th place Bulgaria is ahead of several European Union countries – Greece (86), Cyprus (83), Croatia (74), Hungary (69), Slovakia (65), Romania (62) and Slovenia (56).
The three most competitive economies in the world remain those of Switzerland, Singapore and the USA. In top 10 are also the Netherlands, Germany, Sweden, Great Britain, Japan and Hong Kong.
Overall, the World Economic Forum’s assessment is that the growth of the global economy remains weak and many countries report poor productivity growth and high income inequality. A closing of the economies is registered, which has a negative impact on competitiveness. Another key conclusion is that reconsidering of business processes and investing in innovation are just as important as infrastructure, human skills and market efficiency.
The report states that the world is on the verge of the Fourth industrial revolution with a rapid introduction of technology in all sectors, which changes the world around us and the way we begin to perceive the “human”.
The complete report can be read here, and the indicators for Bulgaria are on page 130.
Last month the Deputy Prime Minister for Economic and Demographic Policy Valeri Simeonov announced planned simplifications in the procedures for hiring specialists from outside the European Union via the so called “EU Blue Card”. Part of the document requirements for candidates will be removed and employers will no longer be obliged to publicly announce vacancies.
According to the most recent data from the Ministry of Labour and Social Policy, the biggest number of specialists from non-EU countries are hired by the ICT sector. A total of 55 out of 67 blue cards issued in Q1 2017 were for positions in the ICT sector. Some of the other areas include education, construction, manufacturing, hotel and restaurant management and health care. The biggest number of blue card recipients for both permanent and seasonal labor and for all sectors come from Ukraine, Russia, China, Moldova and Macedonia.
For 2016, the most work permits for foreign citizens were granted to US specialists. A total of forty “blue cards” were issued to US citizens; mostly school teachers and athletes, followed by Serbia – 33, Turkey – 23, Russia – 16, Canada – 15, Tunisia – 14 and Ukraine – 13. A total of 70 blue cards were issued specifically for European countries outside the EU, mainly for Ukraine and Russia.
The EU Blue Card is issued for up to 1 year with the possibility of renewal if all the necessary conditions continue to exist. The forthcoming changes in the hiring procedures of foreign specialists are expected to make it easier for employers to find qualified foreign workers when the local market proves insufficient.
Since June this year, Bulgaria has its first interurban main road with full charging coverage for electric vehicles. The road from Sofia to Kulata, the busiest route to Greece, is secured with 3 charging stations. This makes the road to our southern neighbor possible for every serial electric vehicle. A new rapid charging station in Sandanski has been opened as this is the second station on the route after the one in Blagoevgrad. The third location is on the main road E79, at the parking lot of “Seas Cars – Sandanski”. The infrastructure was built by eMobility International through its integrated Eldrive platform. The company aims to develop the electromobility on the Balkan Peninsula by building a network of rapid charging stations (DC) and standard stations (AC) in urban environment and along the major main roads of Bulgaria, Romania, Macedonia, Greece and Albania.
The stations allow rapid charging in accordance with the two industry-approved standards – CHAdeMO for Asian manufacturers and CCS – used by most European manufacturers. The stations have a power of 50 kW DC and allow the charging of the mass electric car models in less than 30 minutes.
By the end of 2018, the company plans to build charging stations along other major interurban arteries in the country. At present, Eldrive’s charging points for electric vehicles are 32, of which 8 are rapid-charging. The stations are located in Sofia, Plovdiv, Varna, Burgas, Blagoevgrad, Albena and Damianitsa. You can find an interactive map with the charging locations on the Eldrive’s website. Payment for the charging service is done after an online registration on the website and can be done via mobile phone as well.
While the number of electric vehicles was insignificant five years ago, it reached 2 million in 2016. Currently, China is the largest electric vehicle market with a 40% share of sold electric vehicles worldwide, according to data from a report of the International Energy Agency (IEA). This is double the number of electric cars sold in the USA. At the beginning of June, the number of public charging stations there was 16,038. In the USA, the sharp increase of the number of charging stations for electric cars and hybrids began in 2011, when Nissan Leaf and Chevrolet Volt entered the market. Today, there are some 650,000 plug-in hybrids in the USA. Only Tesla Model S exceeded 100,000 units sold since the
A new investment package worth €86.6 million from the European Regional Development Fund (ERDF) adopted earlier this month will finance further works on the western part of the third line of the Sofia Metro, Sofia Municipality announced. The funding will be used to build four new underground stations on a 4 km-long section, from the city centre (Zhitnitsa Street) to the Sofia Ring road via the Ovcha Kupel district, in the south-western part of the city.
The state co-financing amounts to BGN 214.7 million. Sofia Municipality insisted on the construction of a multi-stacked parking right next to Gorna Banya station so that more people could leave their cars and shift to subway transport.
The new underground stations are part of metro line 3 that will run from Valdimir Vazov Boulevard to Zhitnitsa Street and include eight stations. It will link the districts of Suhata reka, Hadzhi Dimitar, Krasno selo, Slaviya, Belite brezi, Lagera, Hipodruma with central Sofia and provide connections to Lyulin, Mladost, Obelya, Nadezhda, Lozentets and Druzhba via lines 1 and 2. The investment also covers the construction of a depot and the purchase of 20 metro trains. When complete, line 3 is expected to expand to a total of 16 km in length, with 19 stations, bringing the network to 56 km of lines and 53 stations by 2020.
Over half a million people a day now use the Sofia Metro and with completion of the first phase of line 3, this is set to rise by additional 96 000 people. The reductions in travel times are expected to generate savings for the economy of over EUR 19 million by 2020. By diverting passengers away from other forms of transport, the new line should help to eliminate 90 000 tonnes of CO2 emissions a year, as well as cutting traffic accidents and transport maintenance costs, leading to additional savings of over EUR 8 million by 2020.
EU co-financing from the ERDF for the Sofia Metro in the period 2014-2020 amounts to EUR 361 million. This equates to a total EU funding contribution of EUR 847 million for the construction of the Sofia Metro from 2007 onwards.
Sofia Municipality plans to gradually launch 60 new gas buses on public transport lines. Buses have a capacity of 100 people and 32 seats. Vehicles are equipped with accessibility platforms, air-conditioners, cameras for the safety of driver and passengers, as well as information boards to help travelers. Public transport in England, Italy and Spain benefits from the same class of buses.
The new vehicles in the metropolitan transport are in line with the measures of the municipality to fight the high air pollution in Sofia. The first 20 buses are in operation as of July 25 on the lines in the northern and western regions of the capital.
Earlier this month, Evgeni Krussev, deputy mayor of transport, announced the installation of USB ports and providing free internet access to more than 230 city buses on a total of 20 urban lines. By the autumn, the charging ports will be gradually installed in all new vehicles. In the long run, provision of chargers in the trolleybuses, trams and subway is also planned.
On July 20 Sofia Airport was awarded the first prize for fastest growing traffic in the category from 3 to 5 million passengers from the online magazine for aviation news and analysis www.anna.aero. The EURO ANNIES award was given because of a record increase of 21.8% of passengers in 2016. The awards are given for the eighth consecutive year after an analysis of the results of more than 350 airports across Europe.
The number of passengers traveling through the airport is increasing again this year, and the trend is expected to continue in 2017 and 2018. A record number of 4 980 387 passengers passed through the two terminals in 2016. Mid July, Wizz Air, which had the largest market share for passengers to and from Sofia in 2016, announced it would increase its passenger capacity to 2.54 million in 2018, an 12% increase over 2017 and 40% over 2016. In early March, the carrier launched the first Sofia-Varna domestic line and plans to launch two more destinations from Sofia Airport – to Lisbon and Nice next year.
Since 2009 the tourist flow to Bulgaria has been growing steadily. The number of tourists and the revenue from the sector has also grown. In 2016 Bulgaria welcomed a record 8 252 000 tourists and the revenue from international tourism was EUR 3 151 900 000. This year a further 10% increase in number of tourists is expected.
A Deutsche Welle report recently highlighted the reasons why Bulgaria is expecting yet another great summer. According to the report, Bulgaria remains one of the most preferred tourist destinations for families from the Russian Federation (71 000 tourists from Russia visited the country for the period January-May, which is a growth of 6.4% compared to the same period in 2016).
The growth from the German market is even greater – over 15%. According to tour operators most inquiries about holidays in Bulgaria come from Germany.
Rural tourism in Bulgaria has also reported nearly 20% growth since the beginning of the summer, according to the Association of Bulgarian Villages. For August 85% of the accommodation capacity for weekdays is filled, and it is approaching 100% for periods of national holidays. Foreigners in rural tourism account for 20% of all tourists in the sector and from the beginning of the season there is an increase in the number of visitors from
At the end of June, Sofia Municipality was awarded the Partnership and Provision of Best Conditions for Growth in the Technological Sector in Bulgaria by the Bulgarian Outsourcing Association (BAA) and the Bulgarian Association of Software Companies (BASSCOM). At an official ceremony of the second edition of the Innovations, Technology & Sourcing Awards, BAA and BASSCOM recognized the efforts and achievements of Bulgarian companies in the sector of outsourced services and IT, as well as of investors and local authorities.
It is clear to everyone in the sector that Bulgaria continues to be a country that offers very favourable conditions for the development of the outsourcing and the IT industries. This is directly related to the quality labour pool and the long-term vision of local and foreign investors in the country.
Shared services in figures
According to Stanimir Nikolov, Chairman of BAA, the outsourcing industry is creating a sizable percentage of the country’s GDP. For 2016 growth is over 4.5% and the positive trend continues. The association predicts that growth will double by 2020, and the number of people employed in the sector will exceed 60 000 with 45 000 at hand at the moment.
The salaries in both process outsourcing and technology outsourcing are currently approximately four times higher than the national average, according to BASSCOM’s annual report on the state of the software sector in Bulgaria, 2016. The salaries in the sector are expected to continue to grow by 5-10% per year.
According to Cushman&Wakefield Forton, the outsourcing industry generates more than 70% of the demand for office space in the country, followed by pharmaceutical companies and companies in the financial sector. The interested generated is for Sofia, as well as for the other big cities, where many companies are opening a second office.
Bulgaria as an Outsourcing Destination
In 2015 Bulgaria received two awards for best outsourcing destination. In October the country was awarded with European Outsourcing Association Award (which distinguishes the best outsourcers in Europe) and a month later, the National Outsourcing Association of the United Kingdom. Then Kerry Halard, the Head of EOA and CEO of NOA shared in an interview with economy.bg that the awards were given as a recognition for the extremely rapid growth and are a proof of the impressive progress the country is making in building an increasingly stable image of a promising destination for outsourcing. Among the positive trends
The largest information and consultancy network in Europe Enterprise Europe Network (EEN) just launched the pilot phase of its newest online platform NIR-VANA. The project aims to develop online services that will help small and medium size enterprises (SMEs) to innovate together with external partners, often referred to as open or collaborative innovation. Innovation advisors will provide services during the entire innovation process through the online platform where SMEs can collaborate, co-create and co-participate in innovation projects with other SMEs, experts and researchers from all over Europe.
Several innovation support services are currently available – video lessons, each lectured by an expert in the field, videos, articles, publications, practical activities and a self‑evaluation questionnaires. Participants will be both guided and assisted during the process of learning the concepts corresponding to each lesson. After completing each task, the participants can share their solutions in the forums of the platform and the system will allow them to both see the solution that an expert has suggested for each task and share their conclusions with those colleagues that may be active in the forums. The open courses cover the following subjects:
NIR-VANA targets SMEs, Innovation support advisors and researchers and consequently will develop an online solution based on training that will not only consider new and existing technologies and platforms but also the innovation culture in SMEs and their ICT readiness.
The project is based on the Open Innovation concept – an innovation strategy by which companies go beyond their internal boundaries when designing and developing Innovation projects. Combining internal and external knowledge and skills appropriately, these companies are open to share and integrate/acquire ideas with a number of collaborating stakeholders (consumers, users, employees, other companies, technology centres or research institutions, universities…). Cooperations built in such a collaborative manner
Technology Fast 50 for Central Europe, a program organized by the international consulting company Deloitte, accepts applications by start-ups and developed technology companies until July 31. The applications must be completed online form on the Technology Fast 50 website. The ranking of technology companies is based on the revenue growth over the past 4 years – from 2013 to 2016. The applications will be processed by September 31 and the announcement of the list of Central Europe’s 50 best companies will be on October 12.
Bulgarian companies will compete with businesses from Albania, Bosnia and Herzegovina, Estonia, Kosovo, Latvia, Lithuania, Macedonia, Moldova, Poland, Romania, Slovakia, Slovenia, Serbia, Hungary, Croatia, Montenegro and the Czech Republic. Applicants may compete in three categories. The main category, “Fast 50”, ranks companies with at least EUR 50 000 in revenue for each year of the reviewed period. Well-established businesses, with more than EUR 25 000 000 in revenue, will compete in the “Big 5” category. The “Rising stars” category recognizes companies at an early stage of development but with a minimum of 3 years and annual revenue of over EUR 30 000. There is also a special award – “Most disruptive innovation”. This category was opened last year and now will rank for the second time the companies that develop innovative products or services that have a revolutionary impact on the market. For this category, revenues for the previous four years are not relevant. The award is given to organizations that are pioneers in a particular idea or development and its implementation. The first company that was awarded in this category in 2016 was Polish HiProMine, which uses technology based on the natural ability of various insects to process waste organic matter.
In 2016, a total of 261 applications were submitted for Technology Fast 50. Bulgaria’s finalist became Bulpros Consulting AD, which ranked 24th in the main Fast 50 ranking, with a growth rate of 560% for the four-year assessment period. Bulpros Consulting creates and develops software products, provides cloud services, develops web and mobile applications. The company’s profile can be found in the pdf file of the top list of the 50 companies for 2016.
Three international rating agencies improved their assessments of Bulgaria. These are S&P Global Ratings, Moody’s и Fitch Ratings. Here are the ratings.
S&P Global Ratings
The agency upgraded the outlook on Bulgaria’s sovereign credit rating to “positive” from “stable”. S&P affirmed Bulgaria’s long- and short-term foreign and local currency sovereign credit ratings at BB+ and B, respectively. The outlook revision reflects the solid development of the external and fiscal performance, which has lifted Bulgaria’s credit metrics. The economy is more export driven and less leveraged than in the past. The agency expects the economic recovery of our country to continue in 2017 thanks to an increased domestic demand and a smaller share of exports. The improvements are reflected in the labour market, thereby raising disposable incomes and private consumption.
S&P Global Ratings however warns that the level of non-performing loans in the banking system remains high. Bulgaria faces structural constraints related to demographic challenges – emigration of skilled parts of the labour force, and an aging society. The agency could revise the outlook to “stable” if Bulgaria’s balance of payments deteriorated or the financial system needed significant government support or if the downward trend in non-performing loans reversed.
International rating agency Moody’s confirmed Bulgaria’s issuer rating at Baa2 with with stable outlook. The rating is supported by the indicators of sustainable economic development, a good fiscal position and a stable expectation for GDP growth in the medium term.
In 2015 and 2016 Bulgaria’s economy grew by 3.6% and 3.4%, respectively, mainly thanks to rise in private consumption and net exports. In the coming years, Moody’s experts expect continued growth, supported by improved market conditions, strengthened domestic demand and greater absorption of EU funds, which in turn will result in positive contribution of investment to the gross domestic product. Moody’s forecast a GDP growth of 2.9% for both 2017 and 2018.
Another factor for Moody’s positive rating is the Bulgaria’s strong balance sheet – low and declining debt levels and a significant fiscal reserve. The analysis notes the budget surplus in 2016, amounting to 1.6% of GDP, as a result of good revenue collection and lower-than-planned capital expenditures. Furthermore, Bulgaria’s debt is significantly lower than the average for countries with the same credit rating (Baa2).
For the period until 2020 Moody’s forecast a decreasing deficit, a balanced budget and a decline in the government debt-to-GDP ratio to 23%