MERELY 7% OF EMERGING FIRMS SURVIVE UNTIL THEIR FIFTH YEAR

Merely 7% of the emerging firms in the country managed to survive until their fifth year. The remaining 93% went bankrupt, announced Deputy Chairman of the Bulgarian Industrial Association (BIA) Kamen Kolev at the MySuccess.bg in Finance Forum yesterday. According to him, the business environment in Bulgaria is good, given the competitive fees and taxes, lower labour costs and others, but unnecessarily burdensome regulations create the biggest difficulties. 

Investments also continued to decline - in the first seven months of this year these were four times lower than in the same period last year. "If you look at the numbers from the pre-crisis period - at the beginning of 2008, it appears that Foreign Direct Investments now are 20-22 times lower," said further Kolev. 

Exports are the main engine of growth, although some 60% of their dramatic increase this year was due to the situation on foreign markets and merely 40% resulted from larger volumes of exported products. 

According to the data submitted by the deputy Head of BIA, innovative products account for just 3.6% of exports. Consumption remains relatively low. Corporate debt exceeds GDP 2 times, while in the USA this ratio is 1 to 1 and in the EU - 1.3 to 1. Inter-company indebtedness reached BGN 160 bn, out of which real corporate debt is about BGN 100 bn. Some 40% of it are defaulted payments, added Kolev. He forecast a 3% growth of GDP this year.