top of page

Vietnam - Bulgaria enterprises: Many opportunities for cooperation in production and export

Việt Nga -

31 Jan 2022

Due to good policies to attract foreign investment, Bulgaria is an attractive destination for Vietnamese businesses to invest and cooperate in production, thereby opening the door to the Bulgarian and EU markets for goods. Vietnam.

The advantages outweigh the disadvantages

According to Mr. Le Ho Khang - Chairman of Vietnam Business Association in Bulgaria, Director of Uni Export Bulgaria, when investing and cooperating in production in Bulgaria, businesses need to determine that this is a rather small market, with a small population. number is less than 7 million people, so consumption is not great. Besides, like other Eastern European countries, Bulgaria's labor force is not large and unavailable.

However, when it comes to the Bulgarian market, it means the large EU market. Goods that Vietnamese enterprises co-produce and penetrate into Bulgaria will also mean entering the EU market. Moreover, Bulgaria has a seaport, so it is very convenient for import and export activities. The infrastructure has been built for a long time and is quite good, the legal system is being perfected by the Bulgarian Government in the direction of EU development.

Another advantage, according to Mr. Khang, Bulgaria recognizes land ownership as private property. Therefore, when investing in this country, businesses buy land to build factories, all of which are owned forever. With a stable financial system, Bulgaria has officially applied to join the eurozone. Therefore, Vietnamese businesses operating in Bulgaria are strongly supported by banks with low interest rates. "Currently, we only borrow at an interest rate of 3%/year", Mr. Khang informed.

Mr. Le Ho Khang also emphasized: Cooperation in production in Bulgaria, Vietnamese enterprises will face more advantages than difficulties. Currently, the supply chain is broken, the world is forming a new supply chain by region, not according to the global flat chain like before the epidemic. This is an opportunity for domestic enterprises to shake hands with Bulgarian enterprises to break into the supply chain with high positions.

On the other hand, Bulgaria is undergoing drastic changes in its political structure with a new and young group of leaders creating breakthroughs in foreign investment attraction policies. When the supply chain has stabilized with the participation of transnational corporations, it will be difficult for Vietnamese enterprises to participate in the production and exploitation industries of the Bulgarian market, as well as the EU market.

Taking a closer look at the advantages of Bulgaria's investment attraction policy, Mr. Yulian Balchev, Senior Specialist, Investment Bureau of Bulgaria, said: Bulgaria is a member of more than 40 trade agreements with 80 countries around the world. world, including the EU-Vietnam Free Trade Agreement (EVFTA). Very favorable trade agreements support the development of trade for Bulgaria with other countries, including Vietnam. Bulgaria can easily become a distribution center for goods with other countries in the region.

"Vietnamese investors can be assured of Bulgaria's fiscal policy because Bulgaria's local currency is stable against the euro, currently 1 euro is equal to 1.95 lev (Bulgarian currency)," said Mr. Yulian Balchev. . At the same time, Bulgaria has the lowest tax rate in the EU, including 10% corporate income tax, 10% personal income tax, 20% VAT. In some localities, reinvested enterprises can enjoy 0% income tax and 9% VAT. Some fields Bulgaria has advantages and wishes to cooperate in investment and production with Vietnamese enterprises, such as: Automobile manufacturing, information technology, electronics

Exploiting advantages from EVFTA

According to experts, Vietnamese goods have been present on the Bulgarian market, in which mainly traditional consumer goods such as textiles, footwear, rubber, agricultural products, computers, and phones. In 2021, despite the complicated development of the epidemic, the trade turnover between Vietnam and Bulgaria still has impressive growth.

Pham Tuan Huy, Representative of the Vietnam Trade Office in Bulgaria, said: Vietnam and Bulgaria are both members of the EVFTA. And after more than a year of implementation, trade turnover between Vietnam and the EU reached nearly 55 billion USD, both export and import increased by 10% compared to the previous period.

With the Bulgarian market, trade turnover between Vietnam and Bulgaria has always grown by 10% per year in recent years. 10 months of 2021, has reached over 200 million USD. It is forecasted that in 2022, Vietnam's exports to Bulgaria will continue to grow but may be at a more modest rate than in 2021. In which, there are a number of items with good export potential, such as: Furniture, shoes, electronic product components...

According to the representative of the Vietnam Trade Office in Bulgaria, when promoting the export of goods to Bulgaria, Vietnamese enterprises have opportunities to go hand in hand with challenges. In terms of opportunities and incentives from the EVFTA of which Vietnam and Bulgaria are both members, Vietnamese goods can enjoy preferential tariffs. Regarding challenges, businesses have to face stiff competition, specifically electronic chip products from China, textiles and footwear from Turkey, Bangladesh, and agricultural products from Greece.

“Bulgaria is a market with low purchasing power, but in this country there are a number of potential areas for cooperation, especially production cooperation to create a source of goods for export to the EU market. In particular, the modern medicine product which is highly appreciated by Bulgaria is still known for its ability to produce high quality drugs at competitive prices. Next is cosmetics, high-tech agriculture. In addition, there are sea and land transportation, resort tourism, labor export, "said the representative of the Vietnam Trade Office in Bulgaria. At the same time, it should be noted that in the process of production and export cooperation, domestic enterprises also need to pay attention because Bulgarian enterprises lack initiative and are less interested in changes in tax policies.

Source: Việt Nga - Feb.1, 2022

bottom of page