Date: 03.12.2019

Source: Bulgarian Industrial Association

Readed: 890

Lack of skilled workforce (72%), corruption (61%), bureaucracy (61%), poor education quality (47%), lack of confidence and negativity towards business (17%), poor infrastructure (12%) and civil pressure on investment projects (5%) are the main obstacles the business faces. These are some of the results of BIA's 2019 Business Perspective Survey. They were presented by BIA’s Chairman Radosvet Radev to the participants during the Bulgarian Economic Forum 2019, held today (December 3rd, 2019), in Sofia. The main topic of the forum was "The Bulgarian Economy at the End of 2019. Prospects for Small Businesses for 2020" and in the first part, alongside with Radosvet Radev, stood Tsvetan Kyulanov - Head of the EC Delegation to Bulgaria, Peter Ganev - Senior Researcher at the Institute for Market Economics , and Boyko Takov - Executive Director of BSMEPA.

During his presentation, Radosvet Radev stressed that the business in Bulgaria expects a predictable legal environment, a more limited interaction with the administration, simplified administrative procedures, better access to financial instruments and, above all, the required quantity and quality of human resources. According to Radosvet Radev, external and internal factors must be taken into account in the assessment of the business environment. External factors include economic problems with geopolitical dimensions, such as the ongoing trade conflict between the US and China and Brexit, and the risk of a global recession. The internal factors are mainly from a administrative-legal nature (the lack of an e-government, unreformed health and social security systems, often changing regulations, time-consuming procedures for issuing documents), the demographic aspect (an aging population and the need to import skilled workers) and the educational difficulties.

As an example of regulatory instability, Radosvet Radev pointed out that during the last 11 months the Labor Code has been amended 10 times, whereas the Social Security Codehas been corrected 4 times. The Tax Insurance and Procedure Code, the Insurance Code, the Commercial Law and the Concessions Act have been amended three times, and the Territorial Development Act has been amended six times.

According to the World Bank's “Doing Business 2019” ranking, Bulgaria falls 9 places (from 50th to 59th) on the scale “Ease of Doing Business”. It takes 23 days to start a business in Bulgaria with seven procedures; issuing a building permit takes 19 procedures and lasts 97 days; it takes 262 days to be connected to the electricity grid; indicators that set our country on the 147th place from the 190 countries in the ranking. "Given these results, it is not surprising that only 3.9% of Bulgarians intend to start a business in the next three years, compared to an average of 26% for the other countries in the so-called "investment-driven economies" (including Croatia, Hungary, Poland, Latvia, Romania and Macedonia), " Radosvet Radev claimed.

According to the chairman of BIA, the government needs to create an innovation and business-friendly ecosystem that stimulates and enables entrepreneurs to start new businesses. "There needs to be bridges, in order to pass on the experience of already accomplished entrepreneurs to the younger generation. Funds are also needed to finance the pre-launch phase of start-ups, as well as raise share capital for the development of different stages of entrepreneurial ideas," Radosvet Radev noted.