At the intersection of east and west,Bulgaria remains a highly attractive,low-cost and high yield climate for investment. Let’s take a look at some of the reasons why.
With the world still in the grip of the Covid-19 pandemic,economic contractions reverberate throughout Europe and Bulgaria is not different. However,despite the predicted drop in GDP this year,the economy is expected to see a rebound in 2021. On a general level over recent years,the Bulgarian economy has performed strongly on the back of consistently strong levels of investment growth. In 2019,the economy grew by 3.4%,which was above the EU average.
Bulgaria is a popular destination for investment from other EU states in particular,although it also remains a significant destination for growing rates of investment from outside the EU,with Russian,US and Asian companies contributing to its globalised economy. One of the most attractive elements for investors is the country’s low tax rate,with a flat rate of 10% for both income and corporate tax,whe lowest rate in the European Union. It is also low cost in terms of salaries. The minimum wage in Bulgaria is approximately â¬312 (January 2020) and the average monthly salary is in the region of â¬650. The Bulgarian currency,the Leva,is pegged to the Euro with a fixed exchange rate of 1â¬=1.96 Leva.
The country has a relatively young and educated workforce,with good IT and language skills,particularly in English,German and Russian. It is one of the leading nations in the EU for outsourced production and services. In terms of manufacturing it is a common choice for firms in the IT,automotive and professional services sectors. Its geographical location,with well serviced ports at Varna and Bourgas,and a rapidly developing airport in Sofia,make it an increasingly attractive hub for distribution. The Black Sea region,and the mountainous ski resorts,are increasingly popular areas for investment and development as the country remains very popular as a low-to medium range holiday destination. Property prices remain very low compared to European averages,with prices on the coast in the region of â¬500 per square metre,while in Sofia it can start as high as â¬800 per square metre.
For buying agricultural land in Bulgaria an additional requirement is that the buyer is resident in Bulgaria for a period of five years or more. The land can be purchased whether you are either a Bulgarian citizen or if you have lived legally within the country for this period. Bulgarian agriculture is a significant growth sector for investment,boosted by an EU investment project (SAPARD),which provides for up to 50% on an investment subsidy if the investment is directed towards agriculture. There is also a widely available low-cost workforce for this sector. There are almost 5 million hectares of agricultural land in the country,which constitutes 44% of Bulgarian territory. Grape production is particularly virnat,supporting the nation’s burgeoning wine industry,and large tracts of arable land are able to support a wide variety of fruit,vegetable and grain crops in addition to livestock or dairy farming.
How easy is it to start business
Despite some lingering issues in relation to bureaucracy and the speed of doing business,the situation in relation to establishing companies in the country has become much easier. You can establish a company in Bulgaria in as little as 14 working days in Bulgaria,once you have prepared all the necessary documents. Obviously the system is easier if you are from an EU nation,but on a general level the business of forming a company has become a lot more streamlined.
Investments and law
With its liberal financial management laws,Bulgaria has become increasingly popular with investors. According to the law,a foreign investor in Bulgaria may be an individual or a company,who can then register Bulgarian companies with the Bulgarian Chamber of Commerce and the country’s Trade Register. You can then open accounts at any of the country’s well resourced and financed banks. Foreign investors can deposit in either Leva,Euro or foreign currencies to their accounts and can purchase properties once the process of company formation is complete.