Operations - Bulgaria

Bulgaria, a growing economy
With its accession to the European Union scheduled for January 2007, the Bulgarian government is working towards meeting all EU requirements. Under the “Encouragement of Investment Act” passed in August 2004, DPM received a Class 1 Investor Certificate for both of its projects. This translates into preferential administrative services in relation to its investment projects, reduced timeframes in the processing of permits, licenses and land acquisitions.

The reduction of corporate taxes to 15% for 2005 from 19% the previous year, the completion of large scale privatizations and further municipal and public sector reforms, show a commitment to improve the country’s investment climate.

Institutions like the European Bank for Reconstruction and Development (EBRD) are investing in a considerable number of projects supporting private sector development in energy, telecommunications, banking, agriculture and general industry. These institutions continue their involvement in privatization and post privatization projects, both with direct foreign investors and creditworthy local corporations. In April 2005, DPM announced the agreement with the EBRD for a $10 million loan facility towards its Chelopech redevelopment efforts and environmental rehabilitation programme.

In February 2005, Standard and Poor’s Ratings Services revised its foreign and local currency outlooks on Bulgaria from stable to positive. The outlook change is based on Bulgaria’s robust economic growth prospects as well as debt reduction that is proceeding faster than previously expected. Presently, Bulgaria’s Fitch Rating and S&P’s Rating coincide in its long term foreign currency rating of BBB- with a positive outlook.