12 gen. gourko st, 1000 sofia, bulgaria [email protected] of ministers and all...
TRANSCRIPT
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12 Gen. Gourko St, 1000 Sofia, Bulgaria
Sofia Investment Agency part of Sofia Municipality
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CONTENTS
MAYOR’S ADDRESS ................................................................. 4
SOFIA INVESTMENT AGENCY ................................................ 7
BULGARIA: AN OVERVIEW ...................................................... 8
WHY SOFIA .............................................................................. 10
SOFIA: AN OVERVIEW ............................................................. 13
THE PEOPLE OF SOFIA .......................................................... 14
EDUCATION IN SOFIA .............................................................. 21
FOREIGN LANGUAGE PROFICIENCY IN SOFIA .................... 25
ECONOMY OF SOFIA .............................................................. 27
STARTING A BUSINESS IN SOFIA .......................................... 32
TRANSPORT AND CONNECTIVITY ......................................... 36
OFFICE & INDUSTRIAL SPACES ............................................. 40
SOFIA: PRIORITY INDUSTRIES .............................................. 44
LIVING IN SOFIA ...................................................................... 54
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MAYOR’S ADDRESS
In recent years, Sofia has developed as an attractive place to invest. The work that’s being done in Sofia brought the city to leading positions in both national and international rankings in terms of
employment, infrastructure, quality of life, education, successful business and growth in visitors. Investors are attrcted by Sofia’s location, good connectivity, but most of all, by the qualified and educated young people.
Sofia remains the largest regional economy in Bulgaria, providing the highest standard of living.
By the end of 2015, Sofia had attracted more than half of the foreign investments to Bulgaria, totaling over € 12 billion or € 9 000 per person, or three times the country's average.
Sofia is characterized by good uptake of European funds. By the end of September 2017, the city had absorbed 3.5 billion leva.
Sofia is among the top 30 fastest growing city - economies in the world, according to the “Brookings Institute survey” for 2015. Research, conducted by the Institute for Market Economics for 2017, ranks Sofia first in the country in terms of economic and social development.
Sofia accounts for 40% of Bulgaria’s GDP and the GDP per capita is twice the country’s average. The average salary for 2016/17 was over 30 % higher than the average for the country, approaching the average for the European union.
Sofia is among the top 3 cities in Europe with the highest growth in the number of international visitors, 9.4% for the period 2009-2016 (Mastercard’s Global Destination Cities Index).
IT is among the fastest growing sectors in Sofia, forming 5.7% of the total production in the city and an increasing share of Bulgaria's exports. In 2015, the export revenues of IT companies reached BGN 1.2 billion or nearly 9% of total exports of services from the country.
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Our efforts are focused on implementing innovative solutions in city governance and urban development.
For the current funding period we have secured over half a billion euros, with which we continue to develop Sofia as a green and innovative city.
The city ‘s financial stability was affirmed by the “Standard & Poor's” international rating agency, which awarded Sofia an investment rating in 2017.
The availability of financial resources and the city’s established reputation in the field of education are helping Sofia in developing and attracting investments.
The results achieved are due to educated and enterprising people, which are the city‘s most valuable asset.
The future of Sofia is to develop as a green and innovative city.
YORDANKA FANDAKOVA
Mayor of Sofia
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SOFIA INVESTMENT AND PRIVATIZATION AGENCYWe support local and foreign businesses in building their success stories in Sofia.
Sofia Investment and Privatization Agency is part of Sofia Municipality.
Our services are free of charge and include:
Tailor-made solutions for locating your project, business or research activities in Sofia.
Information and analyses relevant to establishing business activities in Sofia, including strategic strengths, business climate, investment incentives, business costs and location factors such as distribution, work environment and human resources.
A comprehensive opportunity and benchmarking service.
Facilitating contacts and networks with potential partners, public authorities, research and educational institutions.
Practical assistance in setting up a business in Sofia.
Aftercare programme to grow your business once you are here.
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SOFIA
BULGARIA: AN OVERVIEW
Area: 110 993.6 km²
Population: 7 101 859
Capital: Sofia
Largest city: Sofia (Population: 1 323 637)
Language: Bulgarian
Time Zone: EET (UTC+2)
EU member since January 1st, 2007.
NATO member since March 29th, 2004.
From January 1st to June 30th, 2018 Bulgaria holds the Presidency of the Council of the EU.
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IN 2016 BULGARIA HAD THE 4th HIGHEST GDP GROWTH AMONG THE EU MEMBER COUNTRIES.
Currency:BGN/LEV pegged to the EURO 1EUR= 1.9558 BGNEuropean Central Bank (2017)
GDP: 52.4 Billion USD (92.6 billion BGN)National Statistical Institute (2016)
GDP per capita:7 239 USD (12 967 BGN)National Statistical Institute (2016)
GDP Growth3.9%National Statistical Institute (2016)
Sofia’s share of the national GDP 40%Economy and Investment Profile of Sofia (2017)
GDP Sofia 35.2 billion BGNEconomy and Investment Profile of Sofia (2017)
GDP per capita Sofia26 690 BGNEconomy and Investment Profile of Sofia (2017)
Corporate tax 10%
Personal Income tax 10%
Doing Business Index* 50 (out of 190 countries)The World Bank (2018)
Economic Freedom Index** 48 (out of 159 countries)Fraser Institute (2017)
Global Competitiveness Index*** 49 (out of 139 countries)World Economic Forum (2017-2018)
* ahead of Croatia – 51st, Turkey – 60th, Greece – 67th
** ahead of Poland – 51st, France – 52nd, Slovak Republic – 53rd, Hungary and Italy – 54th, Macedonia – 67th, Croatia – 72nd, Slovenia – 73rd, Turkey – 81st, Serbia – 88th, Greece – 116th
*** ahead of Turkey – 53rd, Latvia – 54th, Slovak Republic – 59th, Hungary – 60th, Romania – 68th, Croatia – 74th, Serbia – 78th, Greece – 87th
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WHY SOFIA
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SOFIA: AN OVERVIEW
Sofia is one of the oldest cities in Europe. Its history dates back several millennia.
In 1879, after a close vote by the Parliament, Sofia became the capital of the newly independent Bulgaria.
Today Sofia is Bulgaria’s capital, its largest city, the center of the legislative, executive and judiciary power in the country (National Assembly, Presidency, Council of Ministers and all Ministries), the financial, educational, cultural, business and commercial center and the biggest city-economy in Bulgaria.
Sofia’s population exceeds 1.3 million over an area of 492m2, making it the 15th largest city in the European Union.
Sofia accounts for 40% of the nation’s GDP, 1/6 of the industrial production and 52% of the FDI.
Sofia is one of the European cities with fastest growing GDP and was ranked among the top 10 best performing cities in Europe in 2017*.
High-value added sectors are growing in Sofia.
IT now accounts for 5.7% of the city’s economy.
A growing start-up ecosystem attracts investments and entrepreneurs to the city.
The employment in the sector of the creative industries is increasing.
Sofia is a magnet for talent. Twenty-three of Bulgaria’s 51 universities are in Sofia, with over 110 000 students.
A well-developed transport infrastructure, with bus, tram and underground public transport, make Sofia a well-connected city. The largest international airport in the country is just 20 min from downtown Sofia.
Sofia is among the TOP 3 cities in Europe with the highest growth of international visitors (9.4% for the period 2009 – 2016). During the same period tourist spending in the city grew 20%.
*Best-performing Cities, Europe 2017, Milken Institute
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THE PEOPLE OF SOFIA
TOTAL POPULATION
Population of Sofia and the surrounding region in 2016
Source: NSI
Total population in Sofia (annual average)
19%of Bulgaria's population
21.6%of the total labor force in Bulgaria
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LABOR FORCE
Sofia has a young and educated population.
The natural population growth, while still negative, is the most favorable in the country (-1.5 ‰ in 2015). Sofia is one of the few cities in Bulgaria experiencing a population growth.
In the period 2003-2016, the total population of Sofia grew by 10% or 120 174 people.
The labor force in the city has increased by 24.09% since 2003, a total of 136 700 people, for the same period.
Sofia’s workforce by year
The age group distribution of the population in Sofia is also favorable.
Age group distribution of the population in Sofia aged 15-64 (2016), %
Source: NSI
Bulgaria % Sofia %
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Source: NSI
Number of employed by sector of economic activity in Sofia
Sector 2015 2014 2013 2012 2011
Total 707 299 696 588 679 356 674 505 681 915
Wholesale and retail trade 146 522 144 951 138 579 139 648 143 691
ICT 64 779 59 660 58 011 55 883 53 172
Manufacturing 60 072 59 226 59 743 59 628 62 664
Administrative and support service activities
59 957 60 519 56 855 54 508 53 415
Transportation and storage 48 152 47 096 46 904 46 702 48 559
Professional, scientific and technical activities
48 080 46 854 45 448 46 071 44 979
Finance and insurance 40 479 41 527 38 819 38 487 38 730
Public administration and defense; social security
38 437 38 473 38 432 38 513 37 170
Education 36 448 36 261 35 291 33 978 34 214
Human health and social work activities
34 773 34 448 34 629 32 994 32 606
Accommodation and food service activities
29 273 29 581 30 746 31 065 31 698
Arts, entertainment and recreation 11 679 11 242 11 125 11 012 11 039
Real estate 10 295 10 291 10 202 10 321 10 991
Other activities 34 506 34 039 33 429 32 359 33 041
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Sources: “Sofia – State and Development of the IT industry”, September 2017, “Sofia – Outsourcing Industry”, December 2017
THE BIGGEST PERCENTAGE GROWTH IN THE NUMBER OF EMPLOYED IN SOFIA
FOR THE LAST 5 YEARS HAS BEEN IN IT AND BPO.
(1)IT is a part of the ICT economic activity, while BPO is classified as “Creation and distribution of information and creative services and telecommunications”, “Professional activities and scientific research” and “Administrative and Auxiliary activities”. Calculations IPI
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Source: Labor Market in Sofia, November 2017
KNOWLEDGE WORKERS
Much of Bulgaria’s “brain business” is concentrated in Sofia. The city ranks 16th among the European capitals with 82.6 brain business jobs per 1000 working age population.
The city is performing very well in the tech and creative sectors. Some of the specific strengths of the city are in design and creative brain business and IT, with strong development in computer programming, IT services and Telecom.
Bulgaria was 25th in the country ranking with 34.3 such jobs per 1000 working age population.
Source: The Geography of Europe’s Brain Business Jobs, October 2017
Private vs. public employees in Sofia
The share of the employed in the public sector in 2015 was 21.5%, or four times lower than that of the private sector, and was mainly concentrated in the sectors of Government and Education.
78.5%
Public
Private
21.5%
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WAGES AND SALARIES
As of Q3 2017, the average monthly gross salary in Sofia was BGN 1 405 (EUR 718), showing an increase of close to 10% over Q3 of 2016.
The estimated annual gross salary for 2017 was BGN 16 754 (EUR 8 565) or close to 7% increase over 2016.
Although the upward trend is expected to continue in 2018, Sofia continues to have one of the lowest labor costs among the EU capitals.
Average annual gross salary BGN (2013-2017)
BulgariaSofia
*Forecast for 2017 with 7% estimated increase Source: NSI
IT and professional services, incl. business process outsourcing (BPO) offered the highest salaries in Sofia.
The average salary in the IT sector was three times higher than the average for the city, while in the BPO sector it was 30% above the average for the city.
Employer social security tax rates
*Income exceeding BGN 2 600 per month or BGN 31 200 per year is not a subject to social security tax.
Source: KPMG, Employer social security tax rates, 2009-2017
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INITIATIVES FOR ATTRACTING A TALENTED LABOR FORCE
The European Union Blue Card is a work permit entitling highly qualified non-EU nationals, to reside and work in Bulgaria. In October, 2017, the requirements for receiving a Blue Card were eased up and the duration of the employment permit was extended to 4 years.
In addition, in June 2017, Bulgaria facilitated the procedure for registration of seasonal (up to 90 days) workers from non-EU countries. The new procedures are expected to facilitate the attraction of workers for the Tourism sector.
Citizens of all EU and EEA countries and Switzerland have the right to reside and work in Bulgaria.
The University of Sofia “St. Kliment Ohridski”
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EDUCATION IN SOFIA
UNIVERSITIES IN SOFIA
Population aged 15 and over by education level in Sofia
2011 2016
Total: 635 100 Total: 677 200
279 200 344 500
21 800 14 400
334 200 311 600
Higher Education Secondary Education Primary Education Source: Labor Market in Sofia report, November 2017
The city acts as a magnet for educated workers. As of 2016, the majority of the working age population in Sofia, over 50%, holds a university degree. The number of people with university degree has grown significantly since 2011 when it was 40%. The trend is expected to continue.
Sofia has 23 of Bulgaria’s 51 universities.
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Major Sofia universities offering IT, Engineering, Mathematics, Economics and Business related majors
University Students
Sofia University 24 000
University of National and World Economy 21 430
New Bulgarian University 12 000
Technical University 9 202
Sofia University of Mining and Geology 2 000
Sofia University of Architecture, Civil engineering and Geodesy 5 000
Medical University 8 000
National Sport Academy 10 000
Number of recent graduates and current students in Bulgaria and Sofia
Professional field Graduated students (Bulgaria 2013 - 2017)
Current students (Sofia 2016)
Administration & Management 34 116 6 234
Economics 80 663 20 753
Informatics & Computer Science 7 231 3 811
Communication & Technology 9 286 4 176
Mathematics 447 299
Mechanical Engineering 5 243 2 174
General Engineering 7 714 3 840Source: Ministry of Education and Science
THE TOTAL NUMBER OF UNIVERSITY STUDENTS IN SOFIA IS CLOSE TO 110 000 OR 40% OF ALL UNIVERSITY STUDENTS IN THE COUNTRY.
Yearly, 17% of students graduating from secondary school in Bulgaria continue their university education abroad with Germany, UK, Austria, the Netherlands and France being the preferred destinations.
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The State Agency for Bulgarians Abroad estimates that the Bulgarian studentс abroad are approximately 30 000.
An increasing number of graduates are returning to Bulgaria upon graduation.
Bulgarian university students abroad (by country)
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2 3
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1. USA (1 171)2. UK (6 355)3. Netherlands (1 600)4. Germany (7 326)5. Austria (4 000)6. Italy (1 000)7. France (1 318)8. Spain (800)
SECONDARY AND PRIMARY EDUCATION IN SOFIA
*Data is for Bulgaria**18 559 students in all vocational classes in various types of schools in Sofia
Source: Ministry of Education and Science
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SOFTWARE SCHOOLS
In the last several years an alternative form of IT education has developed in Sofia, offering shorter educational programs (6-18 months) than a university degree. Over 10 private software academies offer courses in programming and web design, among others. The courses are often developed in collaboration with local IT companies in accordance with their labor demands.
The private software academies already have over several thousand graduates.
ENTREPRENEURIAL SKILLS
The Pre-school and School Education Act, adopted in 2016, included the education in entrepreneurship and digital skills in the mandatory school curriculum.
Currently, over 27 000 students in Sofia, grades 1st to 12th take classes in entrepreneurship.
LANGUAGE EDUCATION
In 2016, 64 074 students in Bulgaria studied intensively English at profiled high schools, followed by German with 13 283 students and French with 6 218 students. Rare languages that can be learned at schools are available mostly in Sofia. For example, over 2 000 students in Sofia study Japanese or Chinese. In Bulgaria Hebrew was studied by nearly 1 000 children, while Latin - by 305. Rare languages such as Norwegian, Danish and Swedish are also taught in Sofia.
In Sofia, 116 350 students, grades 1st to 12th studied at least one foreign language in 2016.
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FOREIGN LANGUAGE PROFICIENCY IN SOFIA
The labor force in Sofia is characterized by especially high level of foreign language fluency. The most common languages spoken are English, German, Russian, Spanish and French.
Bulgaria ranks 22nd in the English Proficiency Index 2017, ahead of countries like Lithuania, Spain, France, Japan, South Korea and India. The country climbed up 2 places in 2017 versus 2016 alone.
It is estimated that approximately 30% of the total population of Sofia between ages 19 and 34 are proficient in English (level C1 or C2), 6.7% have advanced knowledge of Russian, 16% are fluent in German and 1% - in Spanish.
Close to one-third of the population between 19 and 34 years speak more than one foreign language at an intermediary level, or higher. The most common language combinations are English and Russian, followed by English and German.
EF English Proficiency Index – World Ranking
Source: EF English Proficiency Index 2017
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ECONOMY OF SOFIA
ECONOMIC GROWTH
Sofia GDP: 35.2 billion BGN
Sofia GDP per capita: 26 690 BGN (2.2 times the national average)
Sofia is the biggest city - economy in Bulgaria. It provides about 40% of Bulgaria’s GDP. The city’s economy is export oriented and accounts for 1/3rd of the national export.
Due to the strong export and final consumption in the last several years, Sofia’s economy continues to expand faster than in many EU capitals.
Sofia’s GDP is currently growing at an increasing rate and outpacing the growth of the national GDP. In 2015 (last official data from NSI) Sofia’s GDP growth reached 5.3%.
Real GDP Growth: Sofia, Bulgaria, %
Bulgaria Sofia Source: NSI (2011-2016) and Institute for Market Economy (2017 estimate)
Real GDP in Sofia
Real GDP per capita in Sofia, right scale, BGN Real GDP in Sofia, left scale, BGN, thousands Source: NSI
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SOFIA ECONOMY BY SECTOR
Value added at factor costs of non-financial enterprises, in Sofia 2016 (in %)
Trade & repairs 26%
Real estate 3.4%
Production and distribution of electricity, heating and gas 4.5%
Construction 4.9%
Administrative and support activities 5% Professional activities and
scientific research 9%
Creation and distribution of information and creative products,
telecommunications 17.9%
Manufacturing 10.6%
Other 9.5%
Transport, storage and posts 9.2%
Source: NSI
FOREIGN DIRECT INVESTMENT (FDI)
At the end of 2016, the cumulative foreign direct investment in Sofia was 12.2 billion EUR (2000-2016). This was 52% of the FDI to Bulgaria.
Cumulative Foreign Direct Investment as of Dec 31 of the year (billion EURO)
Bulgaria total Sofia total Source: NSI
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Foreign Direct Investment in Sofia by sector (2000-2015)
Trade, repair of automobiles, transport, hotels 34%
Other 2%
Construction 4%
Scientific research and simulation activities 10%
Creation of creative products, telecommunications 14%
Processing and other industries, mining 16%
Real estate transactions 20%
Foreign Direct Investment in Sofia by country (2000-2015)
Other4 779 765 032 EUR
Austria
1 424 958 700 EUR
Germany
1 277 136 700 EUR
The Netherlands
1 163 286 300 EUR
Cyprus
902 049 600 EUR
Greece
821 805 600 EUR
Luxembourg
716 801 700 EUR
Switzerland
557 360 800 EUR
British Virgin Islands
468 178 200 EUR
UK
447 168 400 EUR
France
359 052 800 EUR
Source: NSI
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CURRENCY
The Bulgarian Lev (BGN) is pegged to the EURO at 1.96 BGN per 1 EUR. It will remain pegged until Bulgaria enters the Eurozone.
FINANCE
Credit ratings assigned to Bulgaria
Fitch Ratings as of December 2017 BBB/Stable
Standard and Poor’s as of December 2017 BBB-/Stable
Moody’s as of May 2017 Baa2/Stable
Credit ratings assigned to Sofia
Standard and Poor’s as of December 2017 BBB-/Stable
Sources: Bulgaria Ministry of Finance
Credit to the private sectorPercent change
New loansAnnual percent changes
Economic growth, % Current and financial account balancepercent of GDP
Source: IMF Financial Stability Assessment, August 2017
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Source: IMF Financial Stability Assessment, August 2017
In 2016 the Bulgarian banking system remained stable with growing assets and deposits and improved capital and liquidity positions. Stress tests and the Asset Quality Review (AQR) conducted by the Bulgarian National Bank (BNB) and independent consultants in August 2016 indicated stability and resilience. The year was marked by several bank consolidation deals.
THE BULGARIAN STOCK EXCHANGE
Bulgarian Stock Exchange – Sofia /BSE/ is the only regulated securities and other financial instruments market in Bulgaria, bringing together investors, listed companies, and members who mediate investors’ securities transactions.
SOFIX INDEX
The Bulgaria Stock Exchange Sofix Index is a free float market capitalization weighted index representing the most liquid companies listed on the exchange.
MARKET SUPERVISION
The Financial Supervision Commission (FSC) is responsible for stock market supervision. The Commission is an independent state authority whose mission is to protect investors’ rights and to enhance the development of a transparent and efficient capital market.
General government operations, % of GDP
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STARTING A BUSINESS IN SOFIA
Establishment of new business entities, including entities with foreign participation or acquisition of shares in existing local entities is governed by the Commercial Act.
There is no limitation on the share participation of foreign legal entities and individuals.
Under the Bulgarian Commercial Act, the following entities can be set up and have foreign investor participation:
No prior permission from governmental institutions is required for the establishment of an entity of the above types, except for cases involving banking or insurance activities, investment funds, management companies or investment intermediaries, or special concession rights and others.
Registering a business - fees and turnaround times
Procedure Time(business days)
Fees
Implementation of the Articles of association 1 day none
Receipt of notary verified statement of consent, specimen and signature by the manager and a verified copy from the company's founding documents
1 day BGN 5
Depositing subscribed capital in the bank 1 day BGN 10-30
Registration in the Commercial Register of the Registry Agency
2 daysBGN 55
for online registration
VAT registration 14 days none
Registration of fiscal device (cash register) 7 days BGN 50-200
Commercial Establishment Registration of the company 7 days none
• Unlimited partnerships • Joint-stock companies (solely-owned joint-stock companies)
• Limited partnerships • Limited partnerships with shares
• Limited liability companies (solely-owned limited liability companies)
• Sole traders
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BUSINESS TAXES AND FEES
TypeNumber of Payments Tax Rate Tax Base
Corporate tax 1 10% Taxable income
Social security contributions
118.7%, up to the monthly ceiling
of BGN 2 600Gross monthly salary
Communal taxes (waste collection tax) - Sofia
1 (in 4
installments)
0.1 %(or container fee + 0.04% or by direct
agreement)
Book value or taxable value of the property or/and the number of the used containers.
Real estate transfer fee 1
Notary fee from 30 to 1 531 BGN+ 0.1% -1.5% of the property value
(max. BGN 6 000)
A 20% VAT is charged on the notary's fee.
The taxable value or the selling price
(whichever is higher)
Real Estate Transfer Tax 1 2.5%The taxable value
or the selling price (whichever is higher)
Property Tax1
(in 2 installments)
0.1875% Book or taxable value (whichever is higher)
Vignette 1 From 97 to 1 743 BGN(annual fee for various vehicle types)
Vehicle type
Vehicle Tax 1 From 16 to 1 313 BGN Vehicle type(car or truck)
Insurance premium tax 1 2.0% Insured amount
Value added tax (VAT) 1 20% Value added
Final/One-off tax on some expenses
1 10% Gross expenses
Tax on fuel 1 - Included in the fuel
price
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INVESTMENT INCENTIVES
Investment incentives in Bulgaria are national and local. They are provided through a certification of the investment project with an investment certificate. The certification procedure takes a few weeks.
NationalAwarded by the Bulgarian Government via the Bulgarian Investment Agency
Class A Requirements:• Investment value - 1 to 5 M EUR;• Employment – 25 to 150 jobs
Benefits:All the incentives for Class B+:• Consulting and individual administrative services; • Financial support for the construction of technical infrastructure elements to the borders of the project site, needed for implementation of one or more investment projects.
Class B Requirements:• Investment value - 1 to 5 M EUR;• Employment – 25 to 150 jobs
Benefits:• Information services;• Shortened administrative procedures;• Financial support of up to 25% for the vocational training for obtaining professional qualifications;• Reimbursement of labor costs paid by the employer;• On the request of certified investor, the corresponding authorities may transfer ownership rights or establish a limited ownership right over real estate (private state or private municipal property) without a tender.
Priority Requirements:• Investment value - 7.5 to 50 M EUR;• Employment – 15 to 200 jobs
Benefits:All the incentives for Class A and B+:• Institutional support; • Financial grants of up to 50% for education and R&D projects and up to 10% for manufacturing projects; • State tax exemption for changing the land status;• Acquisition of real estate private state or private municipal property without a tender and at a price lower than the market value, but not lower than the tax assessment of the property; • Establishment of public-private partnerships
LocalAwarded by Sofia Municipality via Sofia Investment Agency
Class C Requirements:• Investment value – up to 1 M EUR;• Employment – at least 1 job
Benefits:• Information services;• Shortened administrative procedures;• On the request of certified investor, the corresponding authorities may transfer ownership rights or establish a limited ownership right over real estate (private state or private municipal property) without a tender.
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To be awarded with Class A, B or Priority certificate, the investment must be in:
1. Manufacturing industry 2. Services sector including:
High-tech activities in the field of ICT, R&D, Outsourcing of business processes, Activities of head offices, Education, Human health care, Warehousing and support activities for transportation, Accounting and auditing, Architecture and engineering
The certificate class depends on the value, region and sector of the investment.
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TRANSPORT AND CONNECTIVITY
SOFIA AIRPORT
Sofia Airport is the biggest international airport in Bulgaria.
In 2017, Sofia Airport registered a record high increase in number of passengers (30.3%). The increase in aircraft movements was 11.3% and the number of passengers exceeded 6 million.
Aircraft movements (2015 – 2017)
2015
44 416 51 829 57 670
2016 2017
11.3%
London was by far the most popular destination with 422 821 passengers to and from Sofia Airport, followed by Milan with over three times fewer passengers.
Sofia Airport: Top destinations in number of passengers (2017)
1. London 422 821
2. Milan 134 306
3. Varna 129 039
4. Rome 122 138
5. Amsterdam 118 431
6. Brussels 107 660
7. Madrid 100 900
8. Tel Aviv 98 303
9. Frankfurt 98 100
10. Munich 88 675
Source: Sofia Airport
25NEW FLIGHTS
ADDED 2016 - 2017
30.3%PASSENGERINCREASE
2017
6 490 108NUMBER OF
PASSENGERS 2017
20 min
DISTANCE TOCITY CENTER
16.7%
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RAIL AND HIGHWAY NETWORK
Sofia is part of 3 Pan-European transport corridors.
Several highways connect Sofia with the Black Sea coast, the city and the port of Bourgas, as well as the borders with Turkey, Greece (Thessaloniki) and Serbia.
SOFIA
Varna (443 km)
Bourgas (383 km)
Istanbul (550 km)
Alexandroupolis (403 km)Thessaloniki (293 km)
Skopije (244 km)
Belgrade (394 km)
Budapest (768 km)
Vienna (1 000 km)
Athens (793 km)
Plovdiv
Rousse (310 km)Vidin
VelikoTurnovo
Bratislava (961km) Bucharest (357 km)
Kiev (1 300 km)
Moscow (2 148 km)
Prague (1 285km)
Corridor IXCorridor XTINA Links
Corridor IVCorridor VIICorridor VIII
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INTERNET CONNECTIVITY
Bulgaria ranked 23rd (out of 162 countries) with an average speed of 15.5 Megabits per second (Mbps). The average speed in Sofia was 17 Mbps.
Data for Bulgaria Data for Sofia
96% - 4 Mbps Broadband Adoption (IPv4) 69.4% of households with Internet access. Above the national average of 63.5%
64% - 10 Mbps Broadband Adoption (IPv4) 75.8% of people aged 16-74 use the Internet
38% - 15 Mbps Broadband Adoption (IPv4)
A stand-alone monthly broadband subscription costs from around 15.54 BGN/ 8 EUR (10mbps) to around 70 BGN/36 EUR (100mbps) per month.
Currently there are over 170 free hot spots in city.
ACCESS TO UTILITIES
ELECTRICITY
Price of electricity in Bulgaria for industrial use is one of the lowest in the EU. The main electricity supplier in Sofia is CEZ Bulgaria EAD.
Annual electricity consumption (MWh)
Prices (including all taxes, levies and VAT)
in BGN / kWh in EUR / kWh
< 20 0,252 0,129
20 < 500 0,209 0,107
500 < 2 000 0,179 0,092
2 000 < 20 000 0,160 0,082
20 000 < 70 000 0,129 0,066
70 000 < 150 000 0,125 0,064
> 150 000 0,118 0,061Source: NSI
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The major natural gas suppliers in Bulgaria and Sofia are Bulgargaz EAD and Overgas Inc, AD.
Sofiyska Voda AD is the water supplier and provider of waste water services in Sofia.
NATURAL GAS WATER & SEWAGE
Annual gas consumption (GJ)
Prices (including all taxes)
BGN / GJ2
EUR / GJ2
< 1 000 17,36 8,90
1 000 < 10 000 16,30 8,36
10 000 < 100 000 14,25 7,31
100 000 < 1 000 000 11,230 5,76
70 000 < 150 000 10,77 5,52
> 4 000 000 10,44 5,35
Service Price (incl. VAT)
Total (water supply, sewage and wastewater treatment)
BGN EUR
level 1 (< 200 mg/l) 2,207 1,132
level 2 (200 < 400 mg/l) 2,506 1,285
level 3 (> 600 mg/l) 2,678 1,373
Source: NSI Source: Sofiyska Voda
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OFFICE & INDUSTRIAL SPACES
BUILDING PERMITS
According to a report by the World Bank, completing the construction permitting process for a simple warehouse in Sofia, including connecting it to water and sewerage, requires 18 procedures.
Among Bulgarian cities, Sofia has the easiest and fastest construction permitting process, taking 97 days with a fast-track option at an additional fee for several municipal services.
Dealing with construction permits in Sofia
Indicator Sofia, BulgariaEurope &
Central AsiaOECD High Income
Procedures (number)
18 16 12.5
Time (days)
97 168.3 154.6
Source: World Bank (Doing Business in Bulgaria, Hungary and Romania 2017)
OFFICE SPACES IN SOFIA
During the last several years the market for office space in Sofia has been expanding rapidly, with close to 500 000 m2 new office spaces to be added by 2020.
1 663 000 m²Existing stock of class A and B office spaces
450 000 m²New office spaces
Class A to be delivered by 2020
10-13 €/m²Average rental prices -
Class A and B
Source: Colliers International
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INDUSTRIAL SPACES IN SOFIA
RETAIL SPACES IN SOFIA
* Prime rent - the average top open-market rent estimated to be achievable for a new lease of a 100 sqm (net internal area) unit of the highest quality and specification in the best location, excluding service charges and taxes and not reflecting tenant incentives.
40 000 m²406 660 m² 38 €/m²
133 000 m²New industrial spaces to
be delivered by 2020
New retail spaces to be delivered by 2020
Existing stock of retail spaces
864 000 m²Existing stock of industrial spaces
2.70-4.50 €/m²Average rental prices -
Class A and B
Average rental prices in prime shopping centers*
Source: Colliers International
Source: Forton / Cushman and Wakefield
1. Todor Alexandrov blvd2. Central Business Zone3. Sofia Square Zone4. N. Vaptsarov blvd5. Sofia Tech Park Zone6. Capital Fort Zone 7. Grand Kanyon Zone8. Business Park Sofia
Business zones in Sofia
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INDUSTRIAL AND TECH PARKS IN AND AROUND SOFIA
Over 6 industrial and logistics parks are located in or around Sofia, including the biggest economic zone in the region – Sofia-Bozhurishte.
The first science and technology park in Bulgaria, “Sofia Tech Park” is also in Sofia.
Technological parks and industrial zones in and around Sofia
1. Sofia-Bozhurishte economic zoneArea: 1 914 000 m²
Sofia City Center: 15 km
Sofia Airport: 23 km
Next to the international road connecting Europe with Turkey, Western arc of the Ring Road and the Sofia Northern Bypass, facilitating the supply chain to Central and Western Europe.
5 km to a highway bound for Greece
2 km to a highway bound for Serbia
30 km to a highway bound for the Black Sea
Companies: JYSK, Behr Hella Thermocontrol
2. Sofia Tech ParkThe first science and technology park in Bulgaria
Area: 57 000 m²
Sofia City Center: 3 km
11 high-tech labs 1000 people meeting hall + various smaller meeting rooms and labs
3. Elin Pelin Industrial ZoneArea: 1 600 000 m²
Sofia City Center: 27 km
Sofia Airport: 23 km
Next to routes E79, E83, E871, E772 and Sofia Northern Bypass
Companies: Overgas, Baumit Bulgaria
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SOFIA: PRIORITY INDUSTRIES
INFORMATION TECHNOLOGY (IT)
The IT sector is one of the fastest growing sectors in Sofia. Its current share in the city’s economy is 5.7%, a growth of over 50% since 2011. The IT sector in Sofia is almost entirely export oriented and comprises 2.1% of the total export of Bulgaria, a 78% growth since 2011.
Share of IT sector in Sofia's economy
3.94.4 4.7
5.25.7
2011 2012 2013 2014 2015
Source: Sofia – State and Development of the IT industry, September 2017
90% of the technology companies in Bulgaria and 72% of the Bulgarian IT professionals work in Sofia.
40 000 people or 6% of the city’s workforce are employed in an IT related job. The number of employed in the sector has increased by 51% since 2011.
Distribution of employees in the IT sector in Sofia by type of activity
Computer programming activities 12 047
Data processing, hosting and related activities 3 602
Web portals 513
Other information activities2 162
Computer consultancy activities 4 617
Computer facilities management activities
1 395
Other IT and computer service activities
15 536
Source: Sofia – State and Development of the IT industry, September 2017
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The average monthly gross salary in the sector was 2 688 (EUR 1374) or 3 times higher than the average for the city, according to the last available data from NSI for 2015.
The IT sector in Sofia has one of the highest labor productivities in the country: in 2015, the average value added per employee in the sector was 47 thousand BGN, a 22% increase from 2011.
Gross value added per employee in the IT sector in Sofia (BGN, thousands)
Average: 38.58 BGN thousand Average: 47.04 BGN thousand
Programming
Systems management
Data processing, hosting and other
Web portals
Other IT services
IT consulting activities
Other IT services.
Source: Sofia – State and Development of the IT industry, September 2017
10+ private software schools and academies provide additional IT classes.
IT sector has attracted 260+ million euro of FDI since 2000.
11 000 UNIVERSITY STUDENTS ARE CURRENTLY ENROLLED IN IT RELATED MAJORS.
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PUZL CowOrKing
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THE START-UP ECOSYSTEM IN SOFIA
Sofia has one of the most vibrant startup and entrepreneurial ecosystems in Central and Eastern Europe.
In 2012, the European Investment Fund allocated 21M EUR through the JEREMIE program to two funds – the accelerator and early-stage fund Eleven (Eleven Ventures) and the seed fund LAUNCHub (LAUNCHub Ventures). This has been a catalyst for a substantial rise in the number of startups and the investment activity in the city.
Alongside the two funds, a community of angel investors has started investing in idea-only or early-stage companies. Incubators and pre-accelerator programs such as StartItSmart, 9 Academy, and Founder Institute provide knowledge and skill set to first-time entrepreneurs.
The formation and expansion of the VC community in Sofia has supported the more mature startups and companies in their growth stage. These VC funds include NEVEQ, Black Peak Capital, Empower Capital and Rosslyn Capital Partners.
The city has managed to attract top talent from all neighboring countries and has become an entrepreneurial hub on the Balkans.
IN LATE 2015, FORBES MAGAZINE RANKED SOFIA IN THE TOP 10 PLACES TO START A BUSINESS.
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Coworking spaces in Sofia
In order to be part of the close-knit startup community, most entrepreneurs prefer to work in one of Sofia’s many coworking spaces. Betahaus Sofia was the first coworking space in the city, followed by SOHO, while Puzl CowOrKing received the award for Best Coworking in CEE for 2017 by the Central European Startup Awards.
THE DIGITAL ONES
THE CULTURAL ONES
THE EXPERIMENTORS
THE SOCIAL ONES
•Puzl CoWorking
•Betahaus
•Work&Share
•1HUB
•init Lab
•Mastilo
•Co Share HIVE •Cosmos
•SOHO
•Malkite 5
•NGO House
•MOVE Together
•Incubator for innovations and creativity
•Incubator Sofia Tech Park
•CleanTech
•JA Hambar
•Microsoft Innovation Center
Source: Edit.bg
1
2
3
4
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BUSINESS PROCESS OUTSOURCING (BPO)
The outsourcing of IT and business processes is developing rapidly into a leading sector in Bulgaria.
In 2016, outsourcing contributed 3.6% of Bulgaria’s GDP and it is estimated that by 2020 the share will reach 4.2%.
Revenues from outsourcing activities reached 1.5 billion EUR and it is expected that the number will be 2.5 billion EUR by 2020.
BPO and ITO revenue in Bulgaria (billion EUR)
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Total ITO 0,29 0,33 0,37 0,42 0,51 0,58 0,67 0,77 0,88 1,01
Total BPO 0,52 0,58 0,62 0,71 0,88 1,00 1,15 1,31 1,49 1,70
Total Outsourcing 0,81 0,91 0,99 1,13 1,39
Total Outsourcing Forecast 1,59 1,81 2,07 2,37 2,71
Source: Bulgarian Outsourcing Association
IT&BPO companies by segment and size in terms of full-time employees, Bulgaria (2016)
The outsourcing industry is among the leading taxpayers in Bulgaria – in 2016 it accounted for 1.5% of all taxes paid in the country.
Outsourcing companies spend, on average, 0.9% of their operating revenues on taxes.
Source: Bulgarian Outsourcing Association
BULGARIA WAS RECOGNIZED AS EUROPE’S TOP OUTSOURCING DESTINATION FOR 2015 BY THE NATIONAL OUTSOURCING ASSOCIATION - UK AND RANKS 15th IN AT KEARNEY’S GLOBAL SERVICES LOCATION INDEX (GSLI).
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The outsourcing industry creates close to 10% of the value added in Sofia, while the share of the wider ICT sector exceeds 18% (2015).
By the end of 2016, the sector in Sofia had attracted 1 billion EUR of foreign direct investment (cumulative). The number of the employed in the wider outsourcing industry in Sofia reached 68 500 people or 10% of all people employed in the city.
Number of employed in the wider outsourcing industry in Sofia (thousands)
BPO IN SOFIA
Over 80% of the outsourcing companies in Bulgaria are in Sofia and account for 20% of all companies in the city.
According to preliminary data provided by the Institute for Market Economics, in 2016, the value added of the outsourcing sector in Sofia reached the record- breaking 2.2 billion BGN or over 1.1 billion EUR – a 50% increase since 2011.
Share of BPO in Sofia's economy in %Value added by the outsourcing industry in Sofia (billion BGN)
Source: NSI By production outputBy value added
Source: “Sofia - Outsourcing Industry”, December, 2017
Source: “Sofia - Outsourcing Industry”, December, 2017
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CREATIVE INDUSTRIES
Sofia is the center of cultural and creative industries in Bulgaria: 58% of the Bulgarian creative workforce is located in Sofia. According to the Cultural and Creative Cities Monitor, Sofia has above average performance in the Creative and knowledge-based workers dimension, especially in “jobs in media and communication”.
Employment in the sector is still growing.
About 7% of all people employed in Sofia are working in the creative sector that includes, among others, advertising, architecture, crafts, design, film, interactive leisure software, i.e. video games.
Every 10th enterprise in the capital is a creative economy enterprise.
CREATIVE ECONOMY
Dimension Performance Dimension Performance
Creative & Knowledge - based workers New Jobs in Creative Sectors
Jobs in arts, culture & entertainment Jobs in new arts & entertainment enterprises
Jobs in media & communication Jobs in new media & communication enterprises
Jobs in other creative sectors Jobs in new enterprises in other creative sectors
Source: Cultural and Creative Cities Monitor, European Commission
FILM INDUSTRY IN SOFIA
Sofia is home to an active service sector focusing on the film industry. Many professional organizations bringing together film directors and producers are also based in Sofia. Sofia is home of one of the leading film production studios in Europe.
Bulgaria’s biggest film school (NAFTA) is located in Sofia.
Over the past 18 years, the Sofia Film Festival has emerged to become the Balkans’ largest and most important film festival.
In 2014, Sofia joined the network of creative cities of UNESCO, and was awarded the title “City of Film”.
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TOURISM
Sofia is among the top 3 cities in Europe with the highest growth of international visitors for the period 2009 - 2016, with an average increase of 9.4%.
Top 10 cities in Europe by growth in international visitors (2009-2016)
1. Bucharest 10.4% 2. Lisbon 10.2%3. Sofia 9.4%4. Warsaw 9.4%5. Budapest 8.6%6. Hamburg 8.4%7. Moscow 8.2%8. Copenhagen 8.1%9. Berlin 8.0%10. Amsterdam 7.1%
Source: Mastercard Global Destination Cities Index for 2017
In 2016, the number of foreign tourists in Sofia increased by 15.3%.
Sofia: Number of visitors by purpose of the visit
Source: “Tourism and Air Transport Market in Sofia”, September 2017
The top source countries for 2016 were Germany, Greece and Great Britain.
Business12,8%
Leisure87.2%
Foreign visitors738 697
Bulgarian visitors458 867
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LIVING IN SOFIA
COST OF LIVING
Sofia remains one of the most affordable EU capitals.
Utilities
Basic (Electricity, Heating, Water, Garbage) for 85m2 apartment
81.63 €
1 min. of prepaid mobile tariff - local (no discounts or plans)
0.14 €
Monthly internet fee 8.41 €
Restaurants
Meal, Inexpensive Restaurant 5.11 €
Meal for 2 People, Mid-range Restaurant, three-course
23.45 €
Water 0.33- litre bottle 0.51 €
Rent per month (average)
1 bedroom apartment city centre 312.92 €
1 bedroom apartment outside of centre
232.44 €
3 bedroom apartment in city centre
550.83 €
3 bedroom apartment outside of centre
390.17 €
Transportation
One-way ticket (public transport)
0.82 €
Taxi 1km (normal tariff)
0.40 €
Gasoline 1.05€(per litre)
Source: Numbeo
INTERNATIONAL SCHOOLS IN SOFIA
Primary and secondary schools
• British School of Sofia*
• Anglo-American School of Sofia*
• The American College of Sofia
• German private schools – “Erich-Kästner”* & Deutsche Schule
• French Lycee Victor Hugo*
*with a kindergarten
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PUBLIC TRANSPORT
Sofia has an extensive bus and tram public transit system and an expanding rapid transit network.
Sofia metro currently operates 34 stations over the length of 40 km. Metro line 2 is to be extended by 4 additional stations. The approved route of Metro line 3, currently under construction, will add 16 km and 16 new stations, expanding the daily passenger capacity of the three lines up to 550 000.
The metro connects the city with Sofia Airport's Terminal 2, Sofia Business Park, most of the business zones in the city, the Inter Expo Center, the Central Railway and Bus station and most large residential areas.
Sofia Metro
Line 1 Line 2 Under Construction
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CULTURAL LIFE
Sofia offers over 1 400 cultural landmarks and over 40 art galleries.
ALEXANDER NEVSKY CATHEDRALone of the largest Eastern Orthodox cathedrals in the world. The bell tower is 50.52m high with
12 bells.
BOYANA CHURCH “ST. NICHOLAS AND ST. PANTELEIMON”
famous for its medieval frescoes, included in 1979 in UNESCO's World Cultural and
Natural Heritage Convention.
“IVAN VAZOV” NATIONAL THEATREis one of the major landmarks in Sofia due to its prime location and grandiose architecture.
NATIONAL ART GALLERYthe largest and most respectable institution of its kind in Bulgaria. A center for national cultural heritage.
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MUZEIKOmodern educational space for children, provoking
interest in science, technology and arts.
KVADRAT 50028 halls featuring 2000 art pieces from the collection of the National Museum.
SOFIA OPERA AND BALLETthe National Opera and Ballet welcomes world-renowned performers and is one of the major cultural attractions in the city.
BASILICA ST. SOFIA NECROPOLISthe 5 c BC necropolis of the ancient city of Serdica (current day Sofia) is now open to the public.
SOFIA HISTORY MUSEUM8 halls telling the story of Sofia.
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FESTIVALS
Sofia is one of the UNESCO’s Creative Cities of Film. Some of the other festivals taking place annually in Sofia are:
MOUNT VITOSHA
Vitosha mountain overlooks the city of Sofia and offers recreational options like hiking, skiing, mountain biking, etc. just 30 min. from the city centre. The mountain is accessible by public transport and is encompassed with a good network of lifts, trails and mountain huts.
In the winter months, a night ski slope attracts skiers.
SOFIA CITY OF SPORT
In 2014, ACES Europe designated Sofia as European Capital of Sport in 2018.
This put Sofia among the cities that over the past century have proven their contribution to the development of many sports through conducting hundreds of national and world championships.
since 1997, more than 1,600 feature films & documentaries, and guests such as Wim Wenders, Claudia Cardinale, Terry Gilliam, Nikita Mikhalkov
one of the symbols of music Sofia, spreading the jazz spirit for three days
an international platform for high-quality photography
since 2010, a multi-genre urban festival combining visual and stage arts, literature and more
SOFIA FILM FEST SOFIA BREATHESA TO JAZZ FESTIVAL
PHOTOFABRICA
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12 Gen. Gourko St, 1000 Sofia, Bulgaria