Opportunities for Manufacturing of Home Furnishings

Low Labor Cost: The mean wage in the apparel industry was $0.75 per hour in 2003, including health and welfare benefits. This puts Bulgaria at the lower end of wage scales in Eastern Europe and places the country in a competitive position with wages in the Far East.

Low Cost Manufacturing: Standard Per Minute (SAM) charges: $0.10 – $0.18 USD

Wide variety of skills and production capabilities: Factories ranging from 50 to 2000 employees, traditionally skilled work force with expertise in budget, moderate and better apparel, constructed and semi constructed men’s and ladies’ apparel, active wear, sports jackets, etc. Very low minimum runs (200-200 pcs).

Strategic Geographic Location: Bulgaria is a natural gateway to the large markets of CIS, Asia and North Africa. Warehouse to warehouse time for Bulgarian imports to the US is 3-4 weeks, compared to 6-8 weeks for imports from Asia.

Proximity To European Mills: 2-3 days maximum trucking time from mill to apparel production facility.

Available Quotas or Quota Free: Bulgaria has ample, unused quotas in all categories for the U.S. and Canada. No quota limitations on cotton and man made fabrics and garments. No Quota limitations for import in EU

Current trade agreements

European Union: Bulgaria has finalised harmonization with EU its accession is scheduled for 2007.

United States: all quotas between Bulgaria and the US are being phased out and will be completely eliminated on January 1, 2005

EFTA: Preferences on trade with EFTA countries (Switzerland, Norway, Island and Liechtenstein) are granted under almost the same terms and conditions as those pursuant to the Europe Agreement of Association

CEFTA: Bulgaria has signed free trade agreements with CEFTA countries (Poland, Czech Republic, Slovakia, Hungary, Romania and Slovenia).

Turkey: Free trade agreement with Turkey entered into force on 1 January 1999.

Macedonia: Free trade agreement with Macedonia entered into force on 1 January 2000. Customs duties will be reduced gradually until 2005.

WTO: Bulgaria has been a member of the World Trade Organization since 1 December 1996. Bulgaria applies a liberal foreign trade regime that meets GATT/WTO requirements. Bulgaria's membership in the World Trade Organization guarantees the stability of its customs duty system.

Double taxation: Bulgaria has established treaties to avoid double taxation with 41 nations

Other Advantages

Stable government and financial sector: In 1997 Bulgaria adopted a currency board that continues to provide a stable and predictable macro economic environment. The Bulgarian Lev is pegged to the Euro at the rate of Euro 1= BGN1.95583. Inflation is 3-4% per annum.

Established import/export transportation infrastructure. Bulgaria is home to the Balkan cross roads that connect the EU with Turkey, the Middle East, Ukraine, Russia and Central Asia and between Greece and Scandinavia. Movement of people and goods from Europe to Asia and vice versa occurs along the five Pan-European corridors that cross Bulgaria.

Ease of transportation: Bulgaria is home to several sea/river ports (Bourgas, Varna, Rousse) that have recently been upgraded; well maintained and local highways; an international airport in Sofia

US support of economic growth in Bulgaria: Sponsored by US Government FLAG is implementing a program aimed at helping the development of the apparel manufacturing industry in Bulgaria.

No ethnical problems, center of economic and political stability in South East Europe

Bulgaria is a NATO member as of April 1st, 2004.

Full national treatment of foreign investment

Institutional support for priority investment projects