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Small and economically-active Bulgarian municipalities register higher employment and earnings

Tomislav Donchev at the "Business and Regions" conference
Photo: BTA

The industrial zones are of key significance to the development of the regions, Bulgaria’s Deputy Premier Tomislav Donchev contends. Highest salaries are paid in regions with highest employment, analysis of the Institute for Market Economics shows.

Transport infrastructure, business connectivity, optimizing the link between the municipalities and the central authorities, improving the administrative services and adapting the education to the labor market-these were some of the topics discusses by ministers, mayors and businessmen at the “Business and Regions” conference organized by the Economist Magazine and the Bulgarian Industrial Association. 86% of the total produce, 81% of the foreign direct investments and 75% of the jobs are concentrated in one-third of the Bulgarian territory, but a significant change has occurred in the recent years-the big cities are no longer draining human capital from the nearby towns and villages. One the opposite, some labor force migrated to the periphery of the big cities. Thus, the small Bulgarian municipalities in the economically-developed districts remain attractive for living, because employment and salaries there have been growing, Svetla Kostadinova, Executive Director of the Institute for Market Economics announced. The Institute for Market Economics made a map which shows that the number of employed people in the past two years in municipalities such as Ruen, Mezdra, Elin Pelin, Kuklen and Maritsa is significantly higher than in cities like Sofia, Plovdiv and Burgas. According to the analysis of the Institute for Market Economics, the average salaries are highest not in the district centers or the big municipalities, but in regions with highest employment. That is why small towns such as Godech, Devnya, Radnevo and Galabovo are among the places with highest average incomes in Bulgaria which is due to the big employers doing business there. The analysis shows another important aspect linked with the labor market- the education of the staff demanded by the business. Serious attention must be paid to education in the small towns and villages in order to overcome the regional imbalances. In these places students do not receive the necessary training and education, in order to be able to make a successful career and meet the demand of the labor market.

In all honesty, the business needs a type of personnel which is rarely created by the humanities, the Mayor of Vratsa Kalin Kamenov said and added that one of the good practices developed in this Bulgarian town is linked with the revival of the professional education. The ice rink and the Christmas bazaar in Vratsa are example of the successful cooperation between the municipality and the local business, Mayor Kamenov pointed out. These events are traditionally organized in this town and attract children and parents from all over Northwestern Bulgaria.

The most important thing is to make people active and realize that this is our cause, not a business that brings profit to someone, Kalin Kamenov pointed out. People understand that all good things happen thanks to their employers. We can’t expect from the business to create events, because this is the job of the municipality. However, we should tell the business that the event we organize is important for their employees. The role of the municipal authorities and the non-governmental sector is to create atmosphere and events that make people happy.

Together with education, connectivity, the opportunities for labor mobility and the requalification of the unemployed are also important for the development of the regions. According to Bulgaria’s Deputy Premier Tomislav Donchev, the industrial zones are of key significance for the development of the regions.

Don’t get me wrong-I live with the conviction that the industrial zones must be a business event. We have wonderful examples of state-owned, municipal and private industrial zones, but through legislative amendments and dialogue with the local authorities I believe we must be far more audacious and we must have the ambition to see at least 7-8 industrial zones supported by the state authorities in the next 4 to 5 years.  I even dare thinking about 10 or 15 industrial zones.

The difficulties the business faces in Bulgaria cannot always be solved at a municipal or a state level. Although Bulgaria has district administrations, they are often powerless due to financial reasons or a lack of suitable personnel. In Tomislav Donchev’s view, this problem cannot be solved through the establishment of new institutional arrangements, but through a review of the funding models. These models must allow active supportand assistance of the useful investments planned at a regional level.

English version: Kostadin Atanasov

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