Business Sofia 2018 - Digital Horizons Conference16/04/2018

"Sofia produces 40% of GDP in the country and one-third of Bulgarian exports," said Sofia Mayor Yordanka Fandakova at the conference "Business Sofia 2018 - Digital Horizons". The forum, organized by the Sofia Municipal Privatization and Investment Agency (Sofia Investment Agency), was dedicated to the benefits and opportunities for the Bulgarian business in implementing a digital single market, the challenges of staffing and the economic and financial programs of the European Union. Special guests at the conference, attended by the top 100 companies in Sofia, were EU Commissioner Maria Gabriel, MEP Andrey Novakov, Labor and Social Affairs Minister Biser Petkov and Hewlett Packard General Director for Bulgaria, Iravan Hira.
"Sofia is the largest regional economy, and in recent years the capital has convincingly been proving to be an attractive place to invest," said Mayor Yordanka Fandakova. "The city is working to develop partnerships with other ones, and we are negotiating, through the Sofia Investment Agency, Sofia to join the European cities network in support of start-up companies - SCALE (Startup City Alliance Europe) where the lead partner is the city of Amsterdam" added Yordanka Fandakova.
Information technologies are among the fastest growing industries in Sofia. The capital has established itself as one of the most dynamic start-up environments in Central and Eastern Europe. Sofia Investment Agency works on projects and specific cases with more than 80 Bulgarian and foreign companies and has managed to present the city’s opportunities as a business destination in EU countries, South Korea and Scandinavia. The first major City-to-City project is a fact and Bulgarian entrepreneurs can take advantage of the program's terms and present their products in London, as well as the London business can open offices in Sofia. There is already "Sofia Banitsa" in London. There is a similar project with the Austrian capital Vienna as well.
The challenges to personal data security and the relevant EU policies have been presented by Commissioner Maria Gabriel, whose portfolio is the Digital Economy and Society. In front of the business, she has presented the EU's ambitious task to conclude the negotiations on all 25 Digital Single Market proposals by the end of the year. Her team is trying to speed up the following 3 elements: negotiations on the proposed copyright protection directive, offer of a European AI strategy and maintenance of communication with companies depending on Brussels’ regulations. She urged Bulgarian companies to be active and participate in all EU projects, explaining how this participation could become real in concrete steps.
Andrey Novakov exposed that there are currently BGN 80 million of EU funding under Horizon Program: European funding for micro, small and medium-sized enterprises willing to realize their most innovative ideas. In some areas there are more European grants under different programs than candidates for this funding. He urged Bulgarian entrepreneurs to seek for these opportunities through google just looking up for EU financing – in 30 seconds all currently open projects will show up. Bulgaria’s membership fee to the EU is 450 million EUR annually while we receive 4 times this amount under EU funded programs, he said.
Minister Biser Petkov presented data according to which in 2017 the unemployment rate in the country is historically low - 6.9%, and the employment rate for the 20-64 age group registered the highest growth rate since Bulgaria joined the EU in 2007 and reached 72.1%, which is only 0.4 percentage points lower than the average European employment rate. He reminded that the goal is to achieve an employment rate of 75% of the population by 2020. Minister Petkov drew attention to the existing regional imbalances between supply and demand as an essential characteristic of our labor market. He gave an example with the Northwest region, which has the highest unemployment rate - 11.4%, while in the Southwest region unemployment is only 3.3%. In this respect, the Ministry of Labor and Social Policy has launched the "Work" program, which started last year in 14 municipalities in Northwestern Bulgaria. Since 2018, it has been funded under the Operational Program "Human Resources Development" with a total of BGN 80 million. There are already municipalities from all over the country taking part, with a quota for employers from the real sector at least 40%. "We are counting on this program to attract a large proportion of the unemployed people from regions with high unemployment rate, so that they can form working habits, skills and permanently settle on the labor market," the minister said. Efforts are also being made to activate the significant number of inactive persons who are a sort of reserve on the labor market. In this regard, the Employment Agency offers several mechanisms and has already certain results in this direction. The Minister also spoke about the issue of the labor market mismatch between the needs of the business and the skills of the workforce. He explained that the discrepancy is due, on one hand, to the changing reality, to the rapidly advancing modern technologies and digitization and, on the other hand, to the delayed supply response to the changed demand. "Our efforts to solve this imbalance in the long run aim at adjusting the education system to the new needs of the labor market," said Minister Petkov. The Minister also drew attention to the rapid growth of non-traditional forms of employment, which largely blur the boundary between employer and worker and sharply raise the question of the social protection of the workers involved in them. Regarding this challenge in the social dialogue with our partners, we are looking for a solution, he said.
"Analysts say 2018 will show higher economic indicators than 2017 – the expected growth is around 4.4%," said Vladimir Danailov, CEO of Sofia Investment Agency. He reminded that "last year, GDP growth reached 3.6%, which was driven mainly by domestic consumption and exports. This year we expect investments to line up these factors - investments from domestic and foreign investors in capacity, staff development, in modernization and efficiency, in new markets. Our economy’s growth structure is becoming more balanced. Private sector investments have risen by about 7% annually (in 2017) in real terms. Expectations for 2018 are all components of private investment to account growth, "said Danailov.