Automotive Industry Proximity to existing and new productions facilities of OEM and Tier 1 companies Traditions and expertise in the industry, two major subsectors – electronics and metal casting Attractive operational and start-up costs Availability of inputs at competitive prices Low risk
Fasteners Car tyres Castings, wheel covers Pistons, piston rings Car radiators, filters andbatteries Batteries,car accessories Wheel covers,non-ferrousmetal castings Cogged wheels, castings Forgings,chassis Engines Cogged wheels, car seats Steering mechanisms Driving axles, forgings, cogged wheels Steel, tyres, rubber products, electronicscogged wheels Castings Forgings Generators,starters,auto bulbs Cast-iron castings Section steel Section steel Bearings Forgings Batteries Fasteners,electronics Automotiveparts Production Locations
Credit Rating of Bulgaria Bulgaria has proven higher investment credibility BBВ- (stable outlook)by Standard&Poor’s; BBВ- (stable outlook)by Fitch IBCA; Bа1(stable outlook)by Moody’s; BBВ-(positive outlook)bythe Japan Credit Rating Agency June 2004 Standard&Poor’s gave an investment-grade foreign-currency rating
Tax Reform – Budget 2005 Corporate tax: 15% Incometax rate: min - 10%; max - 24% Increasing the amortization normfornewplant and equipment: 50% Expenditure on research and development of the companies are not subjects to taxation Tax Preferences: establishing new enterprise expanding of an enterprise increasing the average number of employees
Investment Categories Third category – universal measures (Euro 5-25mln.) Submission of information, prepared and processed in advance; Certificate, specifying the investment category and the type of administrative services, provided by the central and local executive authorities; Minimum deadlines. Second investment category (Euro 25- 50mln.) Individual administrative services; Individual information services; Institutional support. First investment category (aboveEuro 50mln.) Universal measures; Institutional support; State aid for developing the necessary elements of technical infrastructure.
Requirements to investors Establishing a new enterprise, expanding or modernizing an existing one Term of project implementation – up to 3 years Creating new jobs Economic efficiency
Investment incentives in Bulgaria 15% corporate income tax in 2005 0% corporate tax in areas with above average unemployment Depreciation rates – 2 years for computers and related equipment and 3 1/3 years for manufacturing equipment 2-year VAT exemption for imports of equipment, consumables and components related to investment projects valued over € 5 million 0% capital gains tax The highest bracket for personal income tax is only 29% for monthly income over € 300 The Employment Agency’s Programmes and measures for employment of young people
Innovation Strategy measures for stimulating innovative and research potential • Stimuls for research, related to industry and the co-operation among R&D units, universities and business; • Improvement of the innovations funding, evolving mechanisms for attracting private equity/capital; • encouraging implementation of new technologies; • support for the establishment of clusters in sectors, traditional for our country; • support for newly established companies and firms that develop successfully in view of enhancing their innovative potential; • creating mechanisms for attracting foreign investment in the spheres of science and technology.