Bulgaria

1. Why Bulgaria is an interesting market?

• with 8 million people Bulgaria represents single market that is bigger than all the Baltic States. In the last 5 years the annual GDP growth averaged more than 5%.

• consumer spending grows with some 10% per annum while disposable income growth annual figure averages 15%

• foreign direct investments for the last 5 years reached 7660 million EUR – sure sign of the growing interest of investors

• Bulgaria could be your regional sales headquarters to the nearby markets of Greece (730km), Romania (377km), Serbia (380 km), Macedonia (223 km), Turkey (547 km)

2. Why Bulgaria is interesting investment opportunity?

• Stable and predictable business and political environment and an EU membership as of January 2007

• The lowest operational costs and tax rates ⁽¹⁾ in a European market economy

• Flat corporate income tax rate of 15%

• Highly-skilled, multilingual workforce at Europe's most competitive wages

3. Why enter Bulgaria now, not later?

• opportunity to obtain undervalued assets ⁽²⁾

• lower costs of market entry

• weaker competition allows gaining market size

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⁽¹⁾   Bulgaria's current income and corporate tax rates continue to be the most competitive in Central and Eastern Europe. In 2005, the already low, current corporate tax rate of 19,5% was decreased to 15%. Currently, it is zero % in areas of high unemployment. Manufacturing companies located in regions of high unemployment receive a corporate tax exemption for five years. The municipality tax has been repealed. In 2003, consistent with its policy to decrease the overall tax burden on business, the government accelerated the depreciation norms for most assets.

Source: http://www.tukkk.fi/pei/verkkojulkaisut/Liuhto_Zashev_Heiskanen_82005.pdf

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⁽²⁾   Bulgaria's 2005 housing prices up 36 pct.

"Price growth was fueled by the country's prospect for European Union entry in 2008 in the latest, the expansion of mortgage lending and the high foreign investor interest..."

Source: BusinessWeek http://www.businessweek.com/ap/financialnews/D8FAB7100.htm?campaign_id=apn_euro_up&chan=gb

Compared to western European standards - Bulgaria is cheap. Investors can still find some outstanding values on the market and opportunities are plentiful.

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