LONDON: Faced with a deep economic crisis at home, at least 11,000 Greek companies have found a safe haven in neighbouring low-wage Bulgaria — the poorest member of the European Union.
“We have stability here: reliable taxation, sound legislation and a positive environment,” said Ioannis Politis, manager of Greek hygiene products company Septona, which established a plant in the northern Bulgarian city of Ruse 10 years ago.
Some 120 large Greek businesses set up in Bulgaria in the 2000s in sectors such as retail, metallurgy, fuel distribution, construction and real estate.
And if the Greek crisis put an end to the big-business migration in 2009, a rising number of small and medium Greek companies — especially ones that trade with Europe, the Balkans and Russia — have continued moving to Bulgaria to take advantage of its lower taxes.
Kostas Mikhail left Athens in 2014 to open a bakery in Sofia.
He has already plans to expand his business.
“I don’t think the situation in Greece will impact this,” he said with a smile.
His fellow countryman Panagiotis Douvos made the move in 2011.
“Bulgaria gave me an opportunity to survive, which is difficult in Greece these days,” Douvos told AFP among rows of olive oil bottles and stacks of halloumi cheese in his deli in downtown Sofia.
“It is almost impossible to run a business in Greece, companies disappear within one, two, three months because the taxes and (bank) rates are very high.”
The 46-year-old wants to open shops in the Black Sea cities of Varna and Burgas.
But the chaos in Athens is still threatening his livelihood.
“All my suppliers are Greek and I am afraid that they might not be able to produce and keep up deliveries for the shop,” he said.
“Because of the capital controls in place, they can’t withdraw money for transportation and fuel. Now (NYSE: DNOW – news) it is definitely safer to keep your money here.”
– ‘Nothing to fear’ –
Many export-oriented companies had already discovered Bulgaria as a business haven two decades ago.
Working primarily with Western companies, Kyriakos Fotinos moved his clothing company to Bulgaria in 1996. He said he was “more touched by the economic crisis in Europe in the past five years” and Chinese dumping than by recent developments in his home country.
The company, which also has a factory near Athens, has an annual turnover of 50 million euros (£35.5 million) and claims 30 percent growth over the past five years thanks to the fact that it exports to Western Europe and not back to Greece.
The crisis in Athens has also spurred the flight of Greek capital into Bulgaria.
“Greek enterprises invested 4.5 to 5 billion euros in six years in Bulgaria’s economy,” Krasen Stanchev of the Sofia-based Institute for Market Economics told AFP.
