Bulgaria is Europe’s second and world’s fifth most attractive destination for outsourcing activities. The country ranks third in terms of the number of software engineers in IT industry and first in terms of IT experts per capita. Perhaps this is the only sector of the national economy with zero unemployment. Moreover, the industry is in a deficit of young personnel. Outsourcing is a key industry when it comes to attracting new investors to this country. Is Bulgaria going to remain on the top of the European rankings and outstrip its rivals from the Central and Eastern Europe?

Outsourcing is a source of huge revenues for any developing markets, including the Bulgarian. How can Bulgaria turn into a leading outsourcing destination? This issue was tackled by the Bulgarian government and the local business at the first annual conference on outsourcing. This sector is of great importance for the country’s economy, because it forms 3% of the gross domestic product and 90% of the product is exported abroad. “The country’s export has increased by 8% in 2013 due to the outsourcing sector”, Bulgaria’s Deputy Minister of Economy and Energy Krassin Dimitrov commented during the forum. Will the outsourcing sector continue to grow in the future? It is possible, only if the state and the local business walk hand in hand and adopt a new outsourcing strategy. Huge world companies such as US TeleTech and C3i, Canadian TELUS and Ukrainian SoftServe have already shown interest towards Bulgaria. The ones which have already started functioning in this country are planning to expand their business by end 2014. Bulgaria has a strategic advantage, because it is situated on five Pan European transport corridors and the time zone in this country allows the companies in the sector to serve in three hours the whole industrial world. The access to markets such as Russia, Turkey and the Middle East is also easy. Moreover, most Bulgarians speak several languages. English is the most popular one, but many people also use Russian and Turkish. This is a good signal to the foreign investors, because they can select the most appropriate personnel.

“Serbia, Romania and Hungary are among our biggest rivals. If we lose the battle for a given investor, it does not mean we have lost the war”, says Executive Director of InvestBulgaria Agency Svetoslav Mladenov. “When a big investor chooses to position in Romania for example, it may choose to do outsourcing in Bulgaria, due to the country’s good location and resources. Sometimes we assess the opportunities on a regional level.”

Where new investments will come from?

“Investments in the EU have dwindled, because of the European Commission global policy in sectors such as power engineering and environment”, Krassin Dimitrov specifies. “The EU goals for CO2 free economies by 2020 are very ambitious, difficult and impossible for most EU member states. This policy line may cost 15% of the EU GDP in the next ten years. Currently we are holding discussions about the impact of such policy over the competitiveness of the European economy as compared to the main rivals on the world market such as the USA, China, India and Japan. The latter concerns Bulgaria and the outsourcing industry developed in this country.”

Outsourcing is a new sphere for Bulgaria, but it develops quite rapidly. It is based on innovations in the IT and the telecommunications sector.

“The term outsourcing is not very popular among people. What matters the most is that the worlds’ economic development goes through amendments of the current business models”, says Chairman of the Bulgarian Outsourcing Association Stefan Bumov. "Part of this change is linked with the ability to use the human knowledge and potential, no matter where the expert physically resides. His competence and knowledge is valuable for a given corporation in a certain moment and in a certain aspect. Bulgaria which ranks among the countries with highest intellectual potential of its young people must benefit from this opportunity”, concludes Stefan Bumov.

English version: Kostadin Atanasov