investbulgaria agency ictalent in bulgaria software partnership opportunities for german companies...
TRANSCRIPT
Colour palette – RGB valuesSYSTEMS, Munchen
October 2004
The ideal near-shore investment destination
… Hundreds of small software companies do contract programming for some of the largest customers in the world, including Boeing, BMW and Nortel. Other giants such as SAP and Computer Sciences have local labs in Sofia…
…It was access to nearby talent that convinced SAP to set up its Bulgarian outpost…
…There is an exceptionally high level of talent in Eastern Europe (Kasper Rorsted, Managing Director HP EMEA)…
MARCH 1, 2004
www.investbg.government.bg
Bulgaria: a 2007 EU accession country with strongest track record in stability
Deutsche Bank Eurasia Group Stability Index: Bulgaria ranks 5th ahead of India, China, Turkey, Russia
A NATO member, Bulgaria closed ALL EU chapters, ensuring legal system compliance
Bulgaria has gained sustainable economic position as EU business gateway:
GDP growth of above 4% in 7 consecutive years and a privatized economy
Currency board with € peg, 0% budget deficit, 3% av inflation and 60% of exports to EU
Record FDI of $1.4 bn in 2003, driven by pre-EU attractive investment opportunities
1st half 2004 FDI amounted to $1.2 bn, telecom FDI shares 14% of the total FDI 98-04
Low taxes ranging from 0% to 19.5% (15% in 2005)
Robust, foreign banks dominated financial sector and modern telecom infrastructure
No VAT for software export
ICT legislation is well in place
S&P and Fitch investment grade ratings as of June-Aug 2004
Bulgaria is positioned to enter the EU in 2007 as the Southeastern Europe’s hub for developing sophisticated products and solutions in ICT
InvestBulgaria Agency
FDI inflow in Bulgaria 1995-2004F, EUR m
FDI stock by country 1998 - H1 2004
FDI stock by sector 1998 - H1 2004
Sources: BNB, WIIW – “Foreign Direct Investment in South East Europe in 2003-2004”, InvestBulgaria Agency
FDI reached € 1,343 in July 2004
FDI as % of GDP, 2003
Total EUR 6.9 bn
Total EUR 6.9 bn
Chart8
Greece
Austria
Italy
Netherlands
Germany
Hungary
Sheet1
316
25.8
25.2
21.8
30.2
11.4
1.2
1.5
2.5
1.9
1.7
2.6
34.9
4.6
5.2
7
6.2
5.9
6
59.5
5.6
7
11.2
8.5
12.1
15.1
111.5
13.3
16.3
18.3
22.4
21
20.2
11.7
1.3
2.3
0.9
2.6
2.4
2.2
38.4
4.3
6
7.3
5.2
4.8
10.8
236.5
31.7
40.6
41
43.1
37.2
42.9
Sheet2
163
256
636
620
819
813
1,002
905
1,419
2,000E
Sheet6
Foreign direct investment inflow in Bulgaria by country and by year in USD m
No
Country
1998
1999
2000
2001
2002
2003
Total by Country
FDI stock by country 1998 - 1H 2004 Total USD 6.8 bn
Sheet3
Sector
1
Finance
1404
6
Manufacturing
1736.1
2
Telecom
1270.9
3
Trade
1244.3
4
376.5
5
Utilities
109
Other
635.1
6775.9
Sheet3
0
0
0
0
0
0
0
FDI stock by sector 1998 - 1H 2004 Total USD 6.8 bn
Chart9
Industry
Finance
Telecom
Trade
Sheet1
316
25.8
25.2
21.8
30.2
11.4
1.2
1.5
2.5
1.9
1.7
2.6
34.9
4.6
5.2
7
6.2
5.9
6
59.5
5.6
7
11.2
8.5
12.1
15.1
111.5
13.3
16.3
18.3
22.4
21
20.2
11.7
1.3
2.3
0.9
2.6
2.4
2.2
38.4
4.3
6
7.3
5.2
4.8
10.8
236.5
31.7
40.6
41
43.1
37.2
42.9
Sheet2
163
256
636
620
819
813
1,002
905
1,419
2,000E
Sheet6
Foreign direct investment inflow in Bulgaria by country and by year in USD m
No
Country
1998
1999
2000
2001
2002
2003
Total by Country
FDI stock by country 1998 - 1H 2004 Total USD 6.8 bn
Sheet3
Sector
Industry
1736.1
1
Finance
1404
2
Telecom
1270.9
3
Trade
1244.3
4
Utilities
Other
FDI stock by sector 1998 - 1H 2004 Total USD 6.8 bn
1404
1736.1
1270.9
1244.3
376.5
109
635.1
Chart1
1995
1995
1995
1996
1996
1996
1997
1997
1997
1998
1998
1998
1999
1999
1999
2000
2000
2000
2001
2001
2001
2002
2002
2002
2003
2003
2003
2004E
2004E
2004E
GDP, USD m, 2003
FDI / GDP (EUR) 2003
215
160
98
64
Hongrie
Bulgarie
Pologne
Roumanie
215
160
98
64
Bulgaria
Poland
Hungary
Romania
€ 1.8 billion investment in ICT sector in 2003
ICT is expected to continue growing although at a declining rate of some 11.6% in 2005
Telecom will keep developing faster than IT
Steadily growing ICT sector
246
1055
1301
274
1265
1539
312
1452
1764
355
1637
1992
388
1835
2223
Sheet1
2002
2003
2004
79
85
89
7%
5%
2001
2002
2003
value
29.9
37.7
53.4
Sheet1
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Sheet2
0
0
0
0
0
0
Data&voice transfer equipment
0
0
0
0
0
0
Sheet3
0
0
0
value
0
0
0
More than 50% of the exporting companies are software developers
Electronic assembly and specialized hardware manufacturers account for the lion’s share of the revenues from exports
Fast growing IT exports
InvestBulgaria Agency
www.investbg.government.bg
Bulgaria is the leader in the field of outsourcing among the countries in East Europe ← Latest research of CIO and Meta Group
Bulgarian software companies develop the expert specification together with the client, provide smart solutions and meet the deadlines within the initial budget
Bulgarian software developers have a wide expertise in:
Key markets of the Bulgarian software industry – the US, Canada, Germany, France, UK, the Netherlands, Austria, Italy, Japan, China
ESI Centre in Bulgaria since 2003
Bulgarian software industry review
Gaming solutions Web design Complex B2B solutions Embedded software CAD/CAM Multimedia
InvestBulgaria Agency
Software development: skills availability
More than 40 years of experience in the development of hardware, software and electronic products
Well educated, talented and committed workforce
Very good language skills
Large talent pool
More than 15% Bulgarians have higher degrees (3rd in the EU)
More than 20% speak a foreign language
More than 5,000 university and college students enrolled in IT degree programs annually
Bulgaria employs more than ICT 20,000 professionals
Bulgaria ranks 3rd in world for certified IT professionals per capita and 8th in the world in terms of absolute numbers
5th in the world in sciences
11th in mathematics
2nd in international IQ tests (MENSA International)
1st in Tokyo math Olympics 2003
110 CISCO academies in the country – in 2003 Bulgaria won 2 of 6 world CISCO annual awards: “Best project” and “Best student”
InvestBulgaria Agency
Monthly gross salary comparison 1 (June, 2004) for software development companies (€)
1 Company information, June 2004:
Data for Sofia; salary levels in the countryside of Bulgaria are around 20% lower
Data for Bucharest
Data for Budapest; salary levels in other Hungarian regions are 15 to 20% lower
2 Assuming the office has 25 junior developers, 20 senior ones and 5 project leaders and develops 10 projects at a time; highest salary bracket used for calculations
Country
Bulgaria
180 people in Sofia R&D office
Innovative software for J2EE SAP Web Application Server for SAP sites worldwide
Infrastructure for portal, warehouse, exchange, and all application components
Web services in J2EE and ABAP through open standards
Fastest growing subsidiary of SAP worldwide
June 2004 SAP Labs Bulgaria have announced expansion
Tumbleweed Communications (NASDAQ:TMWD):
Since 2002: leading provider of enterprise solutions in the areas of anti-spam, anti-virus, e-mail filtering, and e-mail encryption
more than 600 enterprise customers
Announced selling Indian (Bangalore) operation to expand the existing business operations in Sofia, Bulgaria by 50% by the end of 2004
Employs approximately 60 people, to recruit 30 more by Dec 2004
InvestBulgaria Agency
InvestBulgaria Agency
Contact:
246
274
312
355
388
1,301
1,539
1,764
1,992
2,223
1,835
1,637
1,452
1,055
1,265
0
500
1,000
1,500
2,000
2,500
2001200220032004F2005F
Bianor
Eastisoft
eBility, Germany; Sauer Danfoss Inc., USA; Bach-Harrison Ltd., USA; FingerPrint Checks, USA; Parker International, Inc., USA
Interconsult
MPS
Siemens AG L&A Postal Automation; Schauenburg Consulting GmbH; Uhle & Gerock Ltd.
Musala Soft
Nemetschek
Germany – Nemetschek AG, DocuWare AG, Henke & Partner, S3 AG, Maxon, MyBau AG, Valley Forge
UK – BuildOnline; Mantis; USA – VectorWorks; Austria – Strabag AG
Sirma AI
Webgate
Global Market Institute, USA; USA; Ton und Tronic, Germany; SUN TV, Germany; BRC GmbH, Germany; E-WebDesign,
Netherlands; KFM Inc, USA
Aonix; BMW; Boeing; Credit Suisse Danzas/Deutsche Post; Ford Group; General Motors; Goldman Sachs; Lockheed Martin;
Nortel Networks; Swiss Federal Railways
October 2004
The ideal near-shore investment destination
… Hundreds of small software companies do contract programming for some of the largest customers in the world, including Boeing, BMW and Nortel. Other giants such as SAP and Computer Sciences have local labs in Sofia…
…It was access to nearby talent that convinced SAP to set up its Bulgarian outpost…
…There is an exceptionally high level of talent in Eastern Europe (Kasper Rorsted, Managing Director HP EMEA)…
MARCH 1, 2004
www.investbg.government.bg
Bulgaria: a 2007 EU accession country with strongest track record in stability
Deutsche Bank Eurasia Group Stability Index: Bulgaria ranks 5th ahead of India, China, Turkey, Russia
A NATO member, Bulgaria closed ALL EU chapters, ensuring legal system compliance
Bulgaria has gained sustainable economic position as EU business gateway:
GDP growth of above 4% in 7 consecutive years and a privatized economy
Currency board with € peg, 0% budget deficit, 3% av inflation and 60% of exports to EU
Record FDI of $1.4 bn in 2003, driven by pre-EU attractive investment opportunities
1st half 2004 FDI amounted to $1.2 bn, telecom FDI shares 14% of the total FDI 98-04
Low taxes ranging from 0% to 19.5% (15% in 2005)
Robust, foreign banks dominated financial sector and modern telecom infrastructure
No VAT for software export
ICT legislation is well in place
S&P and Fitch investment grade ratings as of June-Aug 2004
Bulgaria is positioned to enter the EU in 2007 as the Southeastern Europe’s hub for developing sophisticated products and solutions in ICT
InvestBulgaria Agency
FDI inflow in Bulgaria 1995-2004F, EUR m
FDI stock by country 1998 - H1 2004
FDI stock by sector 1998 - H1 2004
Sources: BNB, WIIW – “Foreign Direct Investment in South East Europe in 2003-2004”, InvestBulgaria Agency
FDI reached € 1,343 in July 2004
FDI as % of GDP, 2003
Total EUR 6.9 bn
Total EUR 6.9 bn
Chart8
Greece
Austria
Italy
Netherlands
Germany
Hungary
Sheet1
316
25.8
25.2
21.8
30.2
11.4
1.2
1.5
2.5
1.9
1.7
2.6
34.9
4.6
5.2
7
6.2
5.9
6
59.5
5.6
7
11.2
8.5
12.1
15.1
111.5
13.3
16.3
18.3
22.4
21
20.2
11.7
1.3
2.3
0.9
2.6
2.4
2.2
38.4
4.3
6
7.3
5.2
4.8
10.8
236.5
31.7
40.6
41
43.1
37.2
42.9
Sheet2
163
256
636
620
819
813
1,002
905
1,419
2,000E
Sheet6
Foreign direct investment inflow in Bulgaria by country and by year in USD m
No
Country
1998
1999
2000
2001
2002
2003
Total by Country
FDI stock by country 1998 - 1H 2004 Total USD 6.8 bn
Sheet3
Sector
1
Finance
1404
6
Manufacturing
1736.1
2
Telecom
1270.9
3
Trade
1244.3
4
376.5
5
Utilities
109
Other
635.1
6775.9
Sheet3
0
0
0
0
0
0
0
FDI stock by sector 1998 - 1H 2004 Total USD 6.8 bn
Chart9
Industry
Finance
Telecom
Trade
Sheet1
316
25.8
25.2
21.8
30.2
11.4
1.2
1.5
2.5
1.9
1.7
2.6
34.9
4.6
5.2
7
6.2
5.9
6
59.5
5.6
7
11.2
8.5
12.1
15.1
111.5
13.3
16.3
18.3
22.4
21
20.2
11.7
1.3
2.3
0.9
2.6
2.4
2.2
38.4
4.3
6
7.3
5.2
4.8
10.8
236.5
31.7
40.6
41
43.1
37.2
42.9
Sheet2
163
256
636
620
819
813
1,002
905
1,419
2,000E
Sheet6
Foreign direct investment inflow in Bulgaria by country and by year in USD m
No
Country
1998
1999
2000
2001
2002
2003
Total by Country
FDI stock by country 1998 - 1H 2004 Total USD 6.8 bn
Sheet3
Sector
Industry
1736.1
1
Finance
1404
2
Telecom
1270.9
3
Trade
1244.3
4
Utilities
Other
FDI stock by sector 1998 - 1H 2004 Total USD 6.8 bn
1404
1736.1
1270.9
1244.3
376.5
109
635.1
Chart1
1995
1995
1995
1996
1996
1996
1997
1997
1997
1998
1998
1998
1999
1999
1999
2000
2000
2000
2001
2001
2001
2002
2002
2002
2003
2003
2003
2004E
2004E
2004E
GDP, USD m, 2003
FDI / GDP (EUR) 2003
215
160
98
64
Hongrie
Bulgarie
Pologne
Roumanie
215
160
98
64
Bulgaria
Poland
Hungary
Romania
€ 1.8 billion investment in ICT sector in 2003
ICT is expected to continue growing although at a declining rate of some 11.6% in 2005
Telecom will keep developing faster than IT
Steadily growing ICT sector
246
1055
1301
274
1265
1539
312
1452
1764
355
1637
1992
388
1835
2223
Sheet1
2002
2003
2004
79
85
89
7%
5%
2001
2002
2003
value
29.9
37.7
53.4
Sheet1
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Sheet2
0
0
0
0
0
0
Data&voice transfer equipment
0
0
0
0
0
0
Sheet3
0
0
0
value
0
0
0
More than 50% of the exporting companies are software developers
Electronic assembly and specialized hardware manufacturers account for the lion’s share of the revenues from exports
Fast growing IT exports
InvestBulgaria Agency
www.investbg.government.bg
Bulgaria is the leader in the field of outsourcing among the countries in East Europe ← Latest research of CIO and Meta Group
Bulgarian software companies develop the expert specification together with the client, provide smart solutions and meet the deadlines within the initial budget
Bulgarian software developers have a wide expertise in:
Key markets of the Bulgarian software industry – the US, Canada, Germany, France, UK, the Netherlands, Austria, Italy, Japan, China
ESI Centre in Bulgaria since 2003
Bulgarian software industry review
Gaming solutions Web design Complex B2B solutions Embedded software CAD/CAM Multimedia
InvestBulgaria Agency
Software development: skills availability
More than 40 years of experience in the development of hardware, software and electronic products
Well educated, talented and committed workforce
Very good language skills
Large talent pool
More than 15% Bulgarians have higher degrees (3rd in the EU)
More than 20% speak a foreign language
More than 5,000 university and college students enrolled in IT degree programs annually
Bulgaria employs more than ICT 20,000 professionals
Bulgaria ranks 3rd in world for certified IT professionals per capita and 8th in the world in terms of absolute numbers
5th in the world in sciences
11th in mathematics
2nd in international IQ tests (MENSA International)
1st in Tokyo math Olympics 2003
110 CISCO academies in the country – in 2003 Bulgaria won 2 of 6 world CISCO annual awards: “Best project” and “Best student”
InvestBulgaria Agency
Monthly gross salary comparison 1 (June, 2004) for software development companies (€)
1 Company information, June 2004:
Data for Sofia; salary levels in the countryside of Bulgaria are around 20% lower
Data for Bucharest
Data for Budapest; salary levels in other Hungarian regions are 15 to 20% lower
2 Assuming the office has 25 junior developers, 20 senior ones and 5 project leaders and develops 10 projects at a time; highest salary bracket used for calculations
Country
Bulgaria
180 people in Sofia R&D office
Innovative software for J2EE SAP Web Application Server for SAP sites worldwide
Infrastructure for portal, warehouse, exchange, and all application components
Web services in J2EE and ABAP through open standards
Fastest growing subsidiary of SAP worldwide
June 2004 SAP Labs Bulgaria have announced expansion
Tumbleweed Communications (NASDAQ:TMWD):
Since 2002: leading provider of enterprise solutions in the areas of anti-spam, anti-virus, e-mail filtering, and e-mail encryption
more than 600 enterprise customers
Announced selling Indian (Bangalore) operation to expand the existing business operations in Sofia, Bulgaria by 50% by the end of 2004
Employs approximately 60 people, to recruit 30 more by Dec 2004
InvestBulgaria Agency
InvestBulgaria Agency
Contact:
246
274
312
355
388
1,301
1,539
1,764
1,992
2,223
1,835
1,637
1,452
1,055
1,265
0
500
1,000
1,500
2,000
2,500
2001200220032004F2005F
Bianor
Eastisoft
eBility, Germany; Sauer Danfoss Inc., USA; Bach-Harrison Ltd., USA; FingerPrint Checks, USA; Parker International, Inc., USA
Interconsult
MPS
Siemens AG L&A Postal Automation; Schauenburg Consulting GmbH; Uhle & Gerock Ltd.
Musala Soft
Nemetschek
Germany – Nemetschek AG, DocuWare AG, Henke & Partner, S3 AG, Maxon, MyBau AG, Valley Forge
UK – BuildOnline; Mantis; USA – VectorWorks; Austria – Strabag AG
Sirma AI
Webgate
Global Market Institute, USA; USA; Ton und Tronic, Germany; SUN TV, Germany; BRC GmbH, Germany; E-WebDesign,
Netherlands; KFM Inc, USA
Aonix; BMW; Boeing; Credit Suisse Danzas/Deutsche Post; Ford Group; General Motors; Goldman Sachs; Lockheed Martin;
Nortel Networks; Swiss Federal Railways