NCIZ's industrial parks are an attraction centre for investment and an opportunity for the construction industry

Antoaneta Bares, PhD, Executive Director of National Company Industrial Zones EAD (NCIZ) in front of “Stroitel” newspaper:


Ms. Bares, how is IP Sofia – Bozhurishte developing, what are the investments there, what is planned for the future?


IP Sofia – Bozhurishte is already a real example of well-functioning industrial park, which in the last years has grown up a lot. Nowadays 37 investors, developing 39 projects, have been opened or are building their sites in the park, worth over BGN 610 mln. creating more than 2000 work places. The park is a priority project of the NCIZ, attracting national and foreign companies, operating in different economic sectors – automobile industry, high technologies, warehousing and logistics, etc. The industrial park is built on an area of almost 3 mln. sq.m. two thirds of which are already sold. We offer terrains with built infrastructure, electric supply, water supply, sewage, gasification, optics. I would say that the interest towards the Park is growing up and only since the beginning of 2023 we have two finished contracts and we are about to attract some strategic investors only this year.

Having in mind the present geopolitical situation, Bulgaria is emerging as extremely favourable destination for relocation of manufacturing and investments from neighbouring countries in the region – the so called “nearshoring”. In relation to this. NCIZ is aiming at managing IP Sofia – Bozhurishte in a way that will realize the potential of our country as a destination for attracting investors, wishing to relocate their manufacturing nearer the region of the main company, as well as to outsource activities and services, dedicated to the markets in Western Europe, but not only. At present NCIZ is in a process of negotiations with several European and Asian companies, which are thinking over such relocation and outsourcing of their manufacturing.


A meeting between the management of the Bulgarian Construction Chamber /BCC/ and NCIZ was held in IP Sofia – Bozhurishte. Which are the most important points you would outline and where do you see opportunities for developing of cooperation?


Our meeting was focused on the opportunities existing before the construction industry in relation to the industrial terrains, subject to extremely rapid infrastructural development. I think that our partnership with BCC is important, because it is the construction industry that realizes the projects of our investors. We have many opportunities to work together.

I am sure that the industrial zones in Bulgaria will continue to enlarge and their number to grow. I believe that that construction companies can contribute to their rapid development with high-quality construction of the objects in the required terms. Here for example, the new projects which are about to be built, have a total developed area of 107 938 sq. m. This is our contribution as attracted investors who will rely on the construction industry for the implementation of their projects.


The measure under the National Recovery and Sustainability Plan (NRSP) in support of industrial parks in the amount of BGN 212 million has been opened. What do you expect from now on? Will NCIZ apply under the Plan and with what projects?


AttractInvestBG is a programme for public support for the development of the industrial parks with the aim of attracting investments, one of the most important procedures for us under the NRSP. Of course, I expect us to be approved into the programme after applying. NCIZ manages 13 projects, five of which are parks under development. Needless to say, industrial parks, which are inherently large area sites, to attract investors, must have well-built internal and upstream infrastructure, be electrified, have gas, water, internet access, which be extremely serious financial resource. It is good that the undertakings, managing industrial parks will be supported in their efforts with funds from the Plan, because industrial zones are seen as an engine of economic development in a global scale.

NCIZ will use the financing under the programme and other similar programmes precisely for this purpose – for infrastructural development and modernisation of its parks. By investing European funds in internal and upstream infrastructure, the objectives set out in the Industrial parks Act, could be achieved, namely: to create the possibility of building new ones and complementing with the necessary infrastructure existing modern industrial parks and zones with the whole infrastructure necessary for investors and favourable conditions for the implementation of new projects in the industry in support of economic growth. In this way, the financial resource provided for in the NRSP will be used to attract key investments and develop the investment ecosystem in Bulgaria. At the same time, the administrative and financial measures under the Investment Promotion Act will continue to apply to strategic/key investors.


The creation of the Dobroslavtsi State Economic Zone was announced. What is your comment and can you say something more about it?


This new economic zone, focused on automotive industry is planned to be built on the site of the former military airport in the village of Dobroslavtsi, near the capital and with an area of 290 hectares. With state support and by attracting strategic investor it will become an industrial park, through which projects with high added value will be realized.


Before the pandemic we organized a round table on the Aksakovo economic zone – what happened to this idea?


Aksakovo economic zone, as you know, is in close proximity to the biggest Black sea city of Varna and in this regard its location is strategic. This area is going to be developed in the future, and the money from the National Recovery and Sustainability Plan would help a great deal to realize this project. An industrial area near a seaport will always attract investor interest. Its construction is still at a very early stage due to objective difficulties encountered by the local authority, we for our part are ready to help with our experience. We are also about to sign a Memorandum of Cooperation with Aksakovo Municipality.


What are the investment intentions of NCIZ by the end of the year?


They are very clear - NCIZ is implementing its investment and business programme rigorously and consistently, working actively to attract new investment projects. One of the important objectives for us is to participate in the Industrial Park Financing Programme under the NPVU, to carry out the ongoing maintenance and expansion works in a timely manner, to cooperate with municipalities and educational institutions to implement joint initiatives to improve the local economic environment and employment opportunities.

NCIZ plans to build a video surveillance system and a parking lot for 100 cars on the territory of the IP Sofia-Bozhurishte. It is also planned to design and implement additional sections of the street network of this park, as well as the reconstruction and rehabilitation of existing streets and related facilities. In addition, a new park environment and the design of production halls on its territory are under construction. A new electrical substation for the needs of the Park is also to be implemented. NCIZ also plans to take timely action to improve the infrastructure of Vidin Industrial Park.

As it became clear, the planned investments in the construction of new infrastructure and rehabilitation of the existing one in the parks managed by NCIZ will contribute for attracting Bulgarian and foreign companies to implement investment projects with high added value. This in turn will lead to a significant increase in the country's GDP as well as to the creation of new jobs.


Are you in talks for investments with foreign companies and in what areas are they interested? How can we attract companies to implement really serious projects in our country?


Our investors are not only from Bulgaria, but also from broad. In IP Sofia – Bozhurishte we have foreign investors from Germany, Denmark, Greece, Switzerland. The interest expressed by foreign companies is a constant value – recently we had inquiries from Chinese companies, who are traditionally very keen to do business in Bulgaria. Apart from them, since the beginning of the year we have also had meetings with investors from Germany and Turkey. The fields of activity in which they operate are versatile - electronics, packaging, processing of cereal raw materials, etc.

Companies consider many things - location, infrastructure, plot size, price. In our industrial park in Burgas, our joint project with the municipality, Bulgarian specialised armoured vehicles and equipment are to be manufactured. In “Zagore” Industrial Park near Stara Zagora, which we manage together with the local government, a high-tech health park “Heart and Brain” will be built with a focus on cardiovascular operations.

In conclusion, I would like to say that Bulgaria has always attracted investor interest, our goal is to be able to retain it, and for this reason we need a lot of work on building social infrastructure and maintenance, as well as developing the infrastructure of the sites we manage.



Where do you think investments should be focused?


As I have already pointed out, for an industrial park to be truly functional, it must have a well-established infrastructure with streets, sewers, gas, electricity, internet, fiber optics, etc. It is effectively a small town and therefore investment in building and completing the internal and feeder infrastructure is necessary. Directing the invested capital not only in technical infrastructure, but also in improving the living and social environment inside the parks, so that they become an attractive place not only for work, but also for recreation, is our goal.

For the people, engaged in the industrial park, it is especially important that it offers the opportunities that the big city has typical for the big town – greenfield, kinder gardens, playgrounds, street fitness, shops…. As well as industrial and administrative places, offering various services – bank, insurance, event places, meetings, etc.

For the people who are employed in the industrial park, it is especially important that it offers the opportunities - green spaces, kindergartens, playgrounds and playgrounds for street fitness, restaurants, shops, as well as industrial and administrative facilities that offer various services - banking and insurance, premises for events, meetings, etc., business centres that offer social services.

Industrial parks have their own socio-economic impact on individual regions. They support their development with a focus on regional smart specialisation and the region's competitive advantages. This in turn will encourage investment in new sectors of the economy and those with high-added value.

In the coming years, we will develop the potential to expand our cooperation with Bulgarian municipalities in the implementation of specific projects, including assistance from the NCIZ with expertise or operator activities.


Does Public-Private Partnership (PPP have a foreseeable future domestically, or does it remain for the indefinite future?


PPP can be defined as long-term cooperation between public and private actors, in which they jointly develop products or services and share risks, costs and resources, associated with the products or services concerned. To a great extent PPPs are also applicable in the construction of industrial zones and parks, because many of the characteristics of this kind of partnership are present in their creation. The ultimate goal is to attract additional private investors to priority sectors of the economy.

In the case of industrial parks and zones, we have a long-term collaboration between public institutions and private investors. For this partnership to be successful, the parties share the risk - the costs of planning and establishment, legalization, administration through various institutions and the construction of the accompanying infrastructure are borne by the public partner. Location linkage, investment in production, finding and training a skilled workforce, and securing permanent employment are risks associated with the private partner.

There are several factors, on which the success of a PPP depends – a favourable investment environment, economic viability, appropriate risk allocation, good finance package, a reliable concession consortium, as well as the achievement of the intended results, the realisation of the defined tasks in the process of work and, as final result – satisfaction from the partnership management. Each party makes a rational decision based on the cost-benefit analysis and, based on the results, a long-term contractual cooperation is established that satisfies both parties.

The opportunities offered by PPPs, as listed above, show that they are also fully applicable to the construction of industrial zones, which are a suitable option for a number of public initiatives. Therefore, with a clear mechanism of obligations of the partnering parties, we would participate in the construction of sites on this principle.


What are the main problems and challenges you face?


Our aim is to realise our parks in a short time, to turn a field into a small town that has a life of its own, with a number of companies working in it. I believe that in time we will call them "smart" - this is the next generation - smart industrial zones - with a focus on digital solutions and innovation, which will be extremely technologically advanced. These industrial parks are modern spaces that attract businesses and contribute significantly to the sustainable development of cities. This is a new concept for our country, which is why NCIZ needs the "know-how" on how to build and maintain an innovative digital industrial park model with modern infrastructure to support innovation and investment activities. To this end, over the previous two years, NCIZ participated in 2 projects.

One is "Strategic Transformation in Innovative and Digital Industrial Parks in Bulgaria", in which we participated under the Knowledge Sharing Program 2021/22 - Knowledge Sharing Program (KSP) together with the Ministry of Economy and Finance of the Republic of Korea and the Korea Development Institute (KDI). The aim of the programme was to learn from experiences and best practices in high-tech park management policies. The main theme of the project was innovation and digital technologies as a key to the development of industrial parks.

The other one is under the Digital Europe Programme for European Innovation Hubs, a competition on "Digital- 2021 - EDIH - 01 - INITIAL - Building an initial network of European Digital Innovation Hubs". It foresees the establishment of a European Digital Innovation Hub called "Regional Centre for Digital Solutions and Innovation NCII" on the territory of the Industrial Park "Sofia - Bozhurishte". The project aims to build an innovative digital infrastructure supporting the digital transformation of companies in the area, mainly SMEs, as well as public sector organisations in order to increase their competitiveness. Preliminary research has been done by the NCIP on the interest of investors in the IP Sofia-Bozhurishte on the use of 3D printing services that will provide users with laser visualisation of buildings, machines and new products and services before they are put into operation. Building this kind of virtual reality laboratories on the territory of an industrial park is in line with the concept of the so-called smart zone.


How do you see the initiative to organize a round table jointly by the BCC, NCIZ and "Stroitel" newspaper for exchange of good practices and experience and to discuss the prospects before the industrial zones in Bulgaria?


Of course, forums and workshops where current topics and opportunities can be discussed are always useful. Regardless of the format of the meeting, I express my readiness for partnership relations with representatives of the construction industry, as I believe that we have common goals and if we look in the same direction, the results will not be late.


What are the challenges in managing a state industrial park?

As a public enterprise, the NCIZ is obliged to comply with the applicable legal framework and the rules and procedures derived from it. This is not an easy task, as in addition to the need for administrative (staff) support to ensure the implementation of procedures, NCIZ has to cooperate with a number of other state bodies and depends on their efficiency. Therefore, one of the main challenges in the management of a state industrial park is to ensure the rapid implementation of all administrative steps and processes. In this respect, the creation of a favourable and competitive environment for investment in Bulgaria is undoubtedly conditioned by a clear regulatory framework with facilitated procedures and conditions. In this regard, work should be done on refining and supplementing the regulatory framework and synchronizing the actions of the institutions involved so that the state industrial parks become an even more attractive place for investment projects.

The management of an industrial park faces another interesting challenge - to create a closed and secure system of investors who have different interests and areas of implementation, but fall within a common territory. The latter requires continuous effective communication with all parties. It is important to stress that, in addition to providing adequate feeder infrastructure and maintaining a good living environment within the territory of a park, the NCIZ seeks to provide other "privileges" for investors. For example, to stimulate natural synergies between firms and shortened supply chains by creating conditions to close the loop of existing industries in the park by attracting investment in new interrelated industries. There are several successful examples of concentrating the activities of interconnected industries in one location in the IP Sofia-Bozhurishte, resulting in a reduction in unit costs.

One of the priorities set by the management of NCIZ is to act as a kind of "bridge" between investors and their partners in the implementation of individual projects. On the one hand, this is the construction industry, which is facing the task of building a total area of more than 107 thousand square meters within the IP Sofia-Bozhurishte alone. On the other hand, NCIZ is actively partnering with a number of universities and vocational schools to provide a two-way link between young staff and the investor companies operating in the industrial parks and zones in order to overcome the problem of labour shortages. The examples do not stop there. The role of the NCIZ is multifaceted and evolves dynamically according to the changing environment.