A m e r i c a n C h a m b e r o f C o m m e r c e i n B u l g a r i a

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AmCham Events:AmCham Events:

U.S. Investors Outline U.S. Investors Outline Joint Projects in Joint Projects in Stara ZagoraStara Zagora

A Woman Elected A Woman Elected AmCham President AmCham President For The First TimeFor The First Time

Bulstrad Life Vienna Bulstrad Life Vienna Insurance Group, Insurance Group, EVS Translations EVS Translations Bulgaria, Bulgaria, Harley-Davidson Sofia, Harley-Davidson Sofia, NDB & Telelink NDB & Telelink Met With AmCham Met With AmCham Communit yCommunit y

A m e r i c a n C h a m b e r o f C o m m e r c e i n B u l g a r i a

Where The Pipe Routes LeadWhere The Pipe Routes Lead

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An important event co-organized by AmCham raised the issue of economic develop-ment in various Bulgarian localities. The round table titled “U.S.-Bulgaria Economic Partnership for More Business Opportunities” presented prospects for joint business projects between the Stara Zagora Region and U.S. companies (see page 4).

This get-together of investors and local authorities showcased the potential for mutually beneficial arrangements that can improve the economic lot of smaller municipalities. The case of Stara Zagora seems promising so far. At the same time, notoriously forlorn towns such as Vidin, Montana, Silistra, or even regional powerhouses with solid business reputation such as Blagoevgrad, Haskovo and Pleven have been neglected by foreign investors. Some troubling numbers came from the Institute for Market Economy (IME) recently. According to the statistics, since 2010, Bulgaria has no region with a natural increase of the population and no municipality has more children than retirees. IME also reported that as a recent trend, foreign investment has ceased growing, with the exception of Sofia, where FDI exceeds 9,000 Euro per capita. Burgas boasts 5,000 Euro per capita and Varna’s is around 3,000 Euro. Yet that’s about it, because the rest of the country cannot even approach such per-capita ratios. In Bulgaria’s Northwest the situation is quite dire – the region of Montana reports just 21 Euro per capita in FDI.

It is no secret that regional economy possesses some tremendous unrealized potential – be it in unemployed who can fill in jobs, be it in unoccpied buildings and land, or stemming from low rents. After all, how many more new offices and factories can Sofia accomodate? The key, it seems, lies in the concerted efforts by local municipalities, NGOs and citizens to meet interested investors and attract them with preferential treatment and business guaran-tees.

Only then the tide may start turning.

Sincerely,

Milen MarchevEditor-in-Chief

Dear Reader,

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Publisher American Chamber of Commerce in BulgariaBusiness Park Sofia, Mladost 4 AreaBuilding 2, Floor 6, Sofia 1766, BulgariaTel.: +359 (2) 9742 743Fax: +359 (2) 9742 741e-mail: amcham@amcham.bgwww.amcham.bg

Editor-in-ChiefMilen Marchev

Deputy Editor-in-ChiefChristopher Karadjov

Senior Editor:Irina Bacheva

ISSN 1312-935X

Writers:Boyko Vassilev, Marina Tzvetkova, Mina Georgieva, Panayot Angarev, Yuliana Boncheva

AdvertisingAmCham Bulgaria: Nadejda Vakareeva, nadia@amcham.bg

AmCham Bulgaria Magazine:Milen Marchev, milen@milenmarchev.com

The AmCham Bulgaria Magazine reaches a broad audi-ence of AmCham members, leading US, Bulgarian and international companies, US and Bulgarian decision-mak-ers, all AmChams around the world.Subscription is free of charge. If you would like to sub-scribe to AmCham Bulgaria publications, please contact the AmCham Bulgaria office.

AmCham Bulgaria Magazine is a primary forum for political and economic analyses, news, viewpoints as well as for the presentation of new business opportunities. The articles in the AmCham Bulgaria Magazine express the opinions of the authors and do not necessarily reflect the position of the American Chamber of Commerce in Bulgaria.

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Contentsa m c h a m e v e n t s

U.S. Investors Outline Joint

Projects in Stara Zagora Region . . . . . . . . . . . . . . 4

a m c h a m n e w s

Krassimira Chemishanska of Amgen Bulgaria

Becomes AmCham President . . . . . . . . . . . . . . . . 7

Radoslav Rizov with Microsoft Elected Co-chair

of Public Procurement Committee . . . . . . . . . . . . . 7

a m c h a m e v e n t s

AmCham, Aon Discuss Employee Benefits . . . . . . . 8

AmCham Members Showcase Services . . . . . . . . .10

Forty Candidates Take Part in the

Third Round of “100 Jobs” Meetings . . . . . . . . . . .12

a n a l y s i s

Property Market Grows in Q1 . . . . . . . . . . . . . . . .14

Pipe Dreams . . . . . . . . . . . . . . . . . . . . . . . . . . .16

By Marina Tsvetkova

After The End of South Stream . . . . . . . . . . . . . . .20

www.stratfor.com

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The Deal on Home Working . . . . . . . . . . . . . . . . .22

By Desislava Miteva, Country Manager at Regus Bulgaria

Anti-Terrorism Measures Workshop. . . . . . . . . . . .23

n e w m e m b e r s . . . . . . . . . . . . . . . . . . . . .24

ALD Automotive

Evrika Commerce Ltd.

Association "Informa"

Kinstellar

Xogito

3M Bulgaria EOOD . AA KRES EOOD . Abbott Products EOOD . AbbVie EOOD . Actavis Bulgaria . Adecco Bulgaria ltd. . Advance International Transport EOOD . AES Corporation . AFA OOD . AGORA-IN Ltd. . AHNtech Branch Bulgaria . AIG Europe Limited (Bulgaria Branch) . AIMS Human Capital . Air Berlin PLC & Co. Luftverkehrs KG . Albena AD . Alfred C. Toepfer International Bulgaria EOOD . ALICO Bulgaria ZhZD EAD, a MetLife Inc. Company . All Channels Communication . ALD Automotive . Alliance One Tobacco Bulgaria . Allied Pickfords Bulgaria . Alpha Bank Bulgaria . America for Bulgaria Foundation . American College of Sofia . American English Academy . American Research Center in Sofia . American University in Bulgaria (AUBG) . Amgen Bulgaria EOOD . Amway Romania Marketing Srl . Anglo-American School of Sofia . AON Bulgaria . APOLO Ltd. . Arexim Engineering . Ashtrom International Ltd. . Association Srednogorie Copper Industrial Cluster . Astra Zeneca Bulgaria EOOD . AT Engineering 2000 Ltd. . Atlantic Club Bulgaria . Atos IT Solutions and Services EOOD . Attica Media Bulgaria Ltd. . August Research . Aurubis Bulgaria AD . Auto Bavaria Ltd. . AVON Cosmetics Bulgaria . AW-Tronics . Axway Bulgaria EOOD . Baker Tilly Bulgaria . Balkan Star Automotive EOOD . Ballistic Cell Ltd. . Baxter Bulgaria EOOD . BC Serdon . Berlitz Schools of Languages . BG Radio . BICA International Ltd. . BMG Ltd. . BMW Vertiebs GmbH - Branch Bulgaria . BNP Paribas S.A. - Sofia Branch . BOYANOV & Co. . Braykov's Legal Office . British American Tobacco Bulgaria . Brown Forman Beverages Worldwide Sofia Branch LLC . bTV Media Group . Bulgarian American Enterprise Fund . Bulgarian Charities Aid Foundation (BCAF) . Bulgarian Executive Search Association . Bulgarian Property Developments EOOD . BulPros Consulting JSC . Bulstrad Life Vienna Insurance Group . Business Intellect Ltd. . Business Park Sofia EOOD . Carat Bulgaria . Castello Precast OOD . Center for the Study of Democracy . Chaos Group . Cheque Dejeuner Bulgaria Ltd. . Chevron Bulgaria Exploration and Production EOOD . Cisco Systems Bulgaria . Citibank Europe Plc, Bulgaria Branch . Club 50 Plus . CMS Cameron McKenna LLP - Bulgaria Branch . Coca-Cola Enterprises Services Bulgaria EOOD . Coca-Cola HBC Bulgaria AD . Coface Bulgaria Credit Management Services EOOD . COLLIERS International Bulgaria . Comverse . Congress Engineering Ltd. . Construction Management Group . Contitrans M Ltd. . ContourGlobal Maritsa East 3 AD . Credit Agricole Bulgaria EAD . Curtis / Balkan Ltd. . Dalkia Bulgaria EAD . Danailov, Mihaleva, Nedelchev & Co. . Delchev & Partners Law Firm . Deloitte Bulgaria EOOD . denkstatt Bulgaria OOD . Deutsche Bank AG . Devin AD . DHL Express Bulgaria Ltd. . Diamed Ltd. . Dimitrov, Petrov & Co. . Djingov, Gouginski, Kyutchukov, & Velichkov . Dobrev & Lyutskanov Law Firm . Dr. I.S. Greenberg Medical Center . Drujba Glassworks SA . Dundee Precious Metals Inc. . DuPont Pioneer . EcoPack Bulgaria AD . Edenred Bulgaria . Ekoterm Proekt EAD . Ekotoi - Service Ltd. . Ekzotika EOOD . Electron Progress EAD . Elevat Ltd. Legal House . Eli Lilly and Company . Eltrak Bulgaria Ltd. . EMC Computer Systems Austria GmbH . Emerson Process Management . EnergoService AD . Engineeringservice Sofia Ltd. . Enterprise Communications Group OOD . EOS Matrix Ltd. . Ernst & Young Bulgaria EOOD . EPAM Systems . EQE Control . ESRI Bulgaria Ltd. . Etap Adress . Eurobank Bulgaria . Eurohold Bulgaria . European Bank for Reconstruction and Development (EBRD) . European Trade Center EOOD . Evrika Commerce Ltd. . Expat Capital . Experian Bulgaria EAD . FairPlay International . Fama Consulting OOD . Flying Cargo Bulgaria Ltd. - Licensee of FedEx . Force Delta Ltd. . Forton International AD . Foundation Glob@l Libraries - Bulgaria . Fox International Channels Bulgaria EOOD . GAEA - Green Alternative Energy Assets EAD . Galardo EOOD . Gasstroymontaj Jsc . General Electric International . Georgiev, Todorov & Co. . Geostroy AD . Geotechmin OOD . Geotrading AD . Gi Group . GIFTA . GlaxoSmithKline . Grand Hotel Sofia . GTC Bulgaria . Helios . Power Hewlett-Packard Bulgaria Ltd. . HILD Asset Bulgaria Jsc. . Hilton Sofia . Honeywell EOOD . IBM Bulgaria . ICAP Bulgaria JSC . Ideal Standard - Vidima AD . Incotex Group Ltd. . Industrial Holding Bulgaria . Informa Association . InterConsult Bulgaria Ltd. . Interdean Relocation Services . Interlang Ltd. . International Data Corporation (IDC) . Intertek - Moody . Intracom Bulgaria EAD . Investbank JSC . Investor BG AD . IP Consulting Ltd. . ITT Exelis . Japan Tobacco International Bulgaria . Jobs.bg EOOD . JobTiger Ltd. . Johnson & Johnson Bulgaria EOOD . Johnson Controls Electronics Bulgaria . Junior Achievement Bulgaria . Kalamaris group Ltd. . Kaliakra AD . Kamenitza AD . Katilin Popov Enforcement Officers . Kempinski Hotel Grand Arena Bansko . Kempinski Hotel Zografski Sofia . Kinstellar . KPMG Bulgaria OOD . LANDMARK Property Management AD . Lexim Sofia Ltd . Lindner Immobilien Management EOOD . Lirex BG Ltd. . M3 Communications Group, Inc. A Hill & Knowlton Associate . Maria Vranovska, MD, MBA . Mars Incorporated Bulgaria EOOD . Marsh EOOD . Maxi I AD . MB Communications . MBL| Part of the CBRE Affiliate Network . Megatron EAD . Mellon Bulgaria EAD . Merck Sharp & Dohme Bulgaria . Microsoft Bulgaria . Miltech Ltd. . Minstroy Holding Jsc . Mobiltel EAD . Monbat Plc. . Mondelez Bulgaria AD . Moten Sport . Moto-Pfohe Ltd. . Movex Relocations . Mr. Alex Nestor . Mr. David Hampson . Mr. Jean Talmon . Ms. Anelia Tatarova . Ms. Kalinka Kovatcheva . Ms. Margarita Radeva, CPA . Municipal Bank Plc . Musala Soft AD . NDB Ltd. . Nemetschek Bulgaria . NEXTDOOR Ltd. . Nicholas Galabov . Novacon Bulgaria Ltd. . Novotel Sofia MHQ . Nu Boyana Film Studios . Office for Mining Industry and Metallurgy Ltd. . On Bulgaria Ltd. . Oracle East Central Europe Limited - Branch Bulgaria . Orak Group Europe Ltd. . Orbit Ltd. . Orkikem Ltd. . Panchim Ltd. . PANDA - IP Ltd. . Pedersen & Partners . Penev LLP . Penkov, Markov & Partners . Pfizer Luxembourg SARL Branch Bulgaria . Philip Morris Bulgaria EOOD . Philips Bulgaria Ltd. . PMB EOOD . PPD Bulgaria EOOD . Premier Luxury Mountain Resort . Premier Tours Ltd. . Prestige 96 AD . Progress CAD R&D Centre Ltd. . Provident Financial Bulgaria Ltd. . PSG Payroll Services Ltd. . PwC Bulgaria . Quadrant Beverages JSC . Radisson Blu Grand Hotel . Red Devil Catering Plc . Regus Bulgaria Ltd. . Renault Nissan Bulgaria SRL . Right Rental Ltd. . RSM BX Ltd. . S&T Bulgaria . Sanofi - Aventis Bulgaria EOOD . Sb Accounting and Consulting . Schenker EOOD . Schneider Electric Bulgaria . SECTRON . Sensata Technologies . Shell Bulgaria EAD . Sherita M Ltd. . Siemens EOOD . SIENIT Holding . Sitel Bulgaria EOOD . Sodexo Pass Bulgaria EOOD . Sofia Hotel Balkan . Sofita . Sogelife Bulgaria IJSC . Sopharma AD . Sopharma Trading JSC . St. Sofia Golf Club & SPA . Stanton Chase International Bulgaria . Steelcase International . Stefan Dimitrov, Norman Realestate Co. Ltd. . Sunfoods Bulgaria EOOD - Development Licensee of McDonald’s in Bulgaria . Sutherland Global Services Bulgaria EOOD . SYNCHRON-S . Tavex EOOD . TBI Bank EAD . TechnoLogica EAD . Telelink EAD . TELUS International Europe . The Coca-Cola Company Bulgaria . Tishman Management Company EOOD . Titan Zlatna Panega Cement . TMF Services EOOD . Tocheva & Mandazhieva Law Office . Totema Engineering JSC . UniCredit Bulbank . UniCredit Leasing EAD . Unimasters Logistics Plc . Unique Estates . Unisys Bulgaria Branch . United Bulgarian Bank . VAPTECH Ltd. . Videolux Holding / Technopolis . VISA Europe . VIVACOM . VMware Bulgaria EOOD . VSK Kentavar - IZ Dinamika EOOD . VUZF University Higher School of Insurance and Finance . Walltopia Ltd. . Welcome to Bulgaria . Westinghouse Energy Systems Bulgaria Branch . World Courier Bulgaria Ltd. . World Transport Overseas Bulgaria Ltd. . WorleyParsons Nuclear Services JSC . Wrigley Bulgaria EOOD . Xerox Bulgaria Ltd. . Xogito . Yastrebets Hotel Wellness & SPA . Zlatina Ruseva-Savova, LL.M., MBA . Zobele Bulgaria EOOD

Board of Directors of the American Chamber of Commerce in Bulgaria

President Ms. Krassimira Chemishanska Amgen Bulgaria

Vice President Mr. Alex Nestor Individual Member

Vice President Mr. Daniel Berg European Bank for Reconstruction and Development (EBRD)

Treasurer Ms. Petya Dimitrova Eurobank Bulgaria

Members Mr. Plamen Zhechev Cisco Systems Bulgaria

Mr. David Butts CMS Cameron McKenna EOOD

Ms. Diana Pazaitova Fama Consulting

Mr. George Brashnarov Nemetscheck Bulgaria

Mr. Peter Lithgow AES Corporation

Mr. Sergey Koynov Forton International

Mr. Solomon Passy Atlantic Club Bulgaria

Mr. Venislav Yotov AIG Europe Limited (Bulgaria Branch)

Ex-Officio Member Mr. Thomas Bruns Senior Commercial Officer, U.S. Embassy

Executive Director Mr. Valentin Georgiev

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The opportunities for joint business projects between the Stara Zagora Region and U.S. companies were presented at the “U.S.-Bulgaria Economic Partnership for More Business Opportunities” roundtable co-organized by the American Chamber of Commerce in Bulgaria, the U.S. Embassy and the U.S. Commercial Service in Bulgaria, and the Municipality of Stara Zagora. The event was hosted at the Stara Zagora Municipal Hall on March 12, 2015. The forum was supported by AES Bulgaria, ContourGlobal Maritsa East 3 and EY Bulgaria.

“The regional business missions of AmCham Bulgaria aim to

facilitate contacts between Sofia-based businesses and regional ones,” said Valentin Georgiev, the Chamber’s execu-tive director. “We believe that the exchange of best practices may contribute to the positive development of the business environment of Stara Zagora Region. Today’s roundtable brings together economic experts and central and municipal authorities on one side, and businesses, on the other side. This is key for the government-business dialog that can facili-tate the creation of a better regulatory framework that in itself can lead to better practical solutions to the issues investors have in the operation of their businesses.”

Stara Zagora’s mayor Zhivko Todorov welcomed some 100 guests, among them representatives from local companies and organizations interested in learning more about business opportunities with the United States. According to the mayor, business in the region needs a qualified and educated work force. Deepened contacts with U.S. universities will help to educate the young and promising work force in the Stara Zagora region, he added.

Stara Zagora Region among Economic Front Runners

The total amount allocated for development of Stara Zagora and the region has been

U.S. Investors Outline Joint Projects in Stara Zagora Region• The companies presented their programs in various industries and services:

electricity production, environmental protection, IT

• AES stressed the importance of business for the development of local

communities

• ContourGlobal Maritsa East 3 focused on enhancing the operating

environment with its transparent procurement procedures, anti-corruption

practices and innovative business solutions

The U.S. Commercial Service team presented key services for business.

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203 million Leva for 2007- 2015, explained Georgi Simeonov, Stara Zagora Municipality, Director Directorate “Sustainable development and euro integration.” The money comes from European Union funding and national programs. Since 2007 many projects were completed: renovation of kindergartens and centers for the elderly and disadvantaged youth; rehabili-tation of roads; and restoration of archaeological sites and monuments.

U.S. Ambassador Marcie B. Ries talked about positive devel-opments in the region thanks to the two largest investors - AES Bulgaria and ContourGlobal. Both companies invested in youth development and local infrastructure. Of their employ-

ees, 99 percent are Bulgarians. The two companies provide 75 percent of jobs in the region.

“We believe that sustainable development involves investments in the regions, and that is why we invest a lot in our relationship with them,” said Milen Raikov, executive director for tax and law at Ernst & Young. “For us this means giving support both for the successful implementation of foreign investments, and for the expansion of Bulgarian business abroad.”

Elitsa Nikolova, secretary for economic affairs, regional devel-opment and infrastructure with the Presidency of Bulgaria, elaborated on the head of state’s priorities in improving the

Upcoming Trade Expos in Europe and United States

American Food Fair at the National Restaurant Association Show (Chicago, May 16-19)

U.S. Food Showcase (Chicago, June 9-11)

Summer Fancy Food Show (New York, June 28-30)

All Things Organic – BioFach America/Natural Products Expo East (Baltimore, Maryland, September 17-19)

America’s Food & Beverage Show and Conference (Miami Beach, Florida, October 26-27)

ANUGA (Cologne, Germany, October10-14)

Food Ingredients Europe (Paris, France, December1-3)U.S. Ambassador Marcie B. Ries answers questions from media on the U.S.

investments in the region.

Garry Levesley, CEO of ContourGlobal Maritsa East 3 elaborated on the com-

pany values as safety and anti-corruption.

The mayor of Stara Zagora Zhivko Todorov was delighted to welcome over 100

guests.

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business environment in the country by being actively involved in the legislative process and in international relations.

Petar Ganev, senior economist with the Institute for Market Economy (IME), elaborated on the economic standards gap between northern and southern Bulgaria. While there are signs of significant recovery in most areas, employment and investment activity is below 2008 levels, he said. The demographic situation continues to deteriorate: since 2010, there is no area showing population growth, nor does any area have a larger population of children than of people over 65 years of age, Ganev added.

The analysis of IME for Stara Zagora shows its economy ranks second after Varna, but its development trends are negative. The area has a relatively good state of health, infrastructure, taxes and administration. The state of the environment is poor due to carbon dioxide levels.

Growth in Bilateral Trade for 2013-2014

Thomas Bruns, U.S. Commercial Service attaché, along with his colleagues elaborated on the trends in U.S.-Bulgaria bilat-eral trade and investment. U.S. imports from Bulgaria in 2014 amounted to $605.2 million, while American exports to Bulgaria in 2014 were $358.9 million. Bilateral trade grew by $143 mil-lion, or 17.42 percent, for 2013-2014, U.S. Department of Commerce data show.

There was a 16-percent increase in agricultural exports from the United States to Bulgaria and a 13 percent growth from Bulgaria to the United States for 2013-2014. Total bilateral trade for 2014 grew by 14 percent, or by $19 million, in com-parison to 2013.

Overall, U.S. agricultural exports to Bulgaria amounted to $44 million, or about $80 million when imports through other coun-tries are added, with a $6-million annual growth. Bulgarian agricultural exports to the United States were $105 million with a $13-million annual increase.

The importance of the Corporate Social Responsibility (CSR) programs for the development of local communities was the main point in the presentation of Olivier Marquette, managing director for AES Bulgaria. He pointed out that the company is working actively with the municipality of Galabovo and neighbor-ing villages on ongoing programs aimed at improving the education level of local residents. Marquette said that education and improvement of various skills that make people more competitive in the labor market are among the values underlying AES’s policy.

AES provides an average of more than 50,000 Leva annually for education ini-tiatives in the region. In addition, the company works to improve the infra-structure and has so far invested more than 3 million Leva in rehabilitation proj-ects. Since 2006 the company has invested nearly 7 million Leva in social

projects in Galabovo. Another large proj-ect of AES in Galabovo started in March: the rehabilitation of the municipality’s youth center, in which more than 4.4 mil-lion Leva will be invested. This is the largest public-private initiative in the region, according to Marquette.

“Improving the quality of life of the local community is part of the values of AES Corporation,” the AES director pointed out.” We want to be a good corporate citizen and act with responsibility toward the community and the environment. That is our priority and a core value!”

In his presentation, Garry Levesley, CEO of ContourGlobal Maritsa East 3, stressed the values that are foundations of the company’s business model. They include safety, anti-corruption and quality of supplies. Levesley emphasized the company staff’s exceptional stringency in observing the site’s rules, including

the ones related to safety. By following internationally recognized standards and principles, such as the U.N. Global Compact’s Ten Principles, the company succeeds in achieving its goals in har-mony with other businesses and in line with its clients’ and partners’ expecta-tions, as well as those of all of the other stakeholders.

“Thanks to our highly qualified and moti-vated Bulgaria team and thanks to our suppliers and counterparts, we can man-age our plant successfully and in a reli-able way, in a manner consistent with our global sustainability commitments to operate safely and efficiently and mini-mize impacts, manage our business responsibly, enhance the operating envi-ronment and to grow well,” Levesley said. “The good understanding of com-mon interest based on values and achieved results is the basis for our suc-cess and performance.”

AES Bulgaria and ContourGlobal Maritsa East 3 Local Community Initiatives

Olivier Marquette, managing director for AES Bulgaria.

Valentin Georgiev, AmCham elaborates on the regional business missions of

AmCham.

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The AmCham Board of Directors elected at the position of the president Krassimira Chemishanska, General Manager of Amgen Bulgaria on April 1st, 2015. Peter Lithgow has stepped down from the position of a President of the Chamber. AmCham extends special thanks to Mr. Lithgow for his substantial contribution and dedicated service as president of the chamber, and wishes him success in his future endeavors.

Krassimira Chemishanska is a business leader in the pharmaceutical industry with more than 20 years’ experience on the Bulgarian market. She has held senior positions in pharmaceutical sales and marketing areas in several multina-tional R&D based pharmaceutical com-panies.

Since 2009 Krassimira is the General Manager of Amgen Bulgaria, responsi-ble for opening the new Amgen affiliate, establishing Amgen’s operations, set-ting up the organization and developing the business in the country. She is mem-ber of the Regional Leadership team of Amgen for CEE and International lead-ership team in Amgen International.

Krassimira Chemishanska of Amgen Bulgaria Becomes AmCham President

Radoslav Rizov, Expert Projects & Programmes Esta Ert in service of Microsoft was elected as co-chair of the Public Procurement Committee at its meeting on April 1st, 2015. Mr. Rizov is a highly motivated professional with experience in public procurement and EU grant schemes. He has worked with governmental institutions, local authorities, NGOs and private companies in Europe and specifically in the Balkan region. Mr. Rizov expressed his willingness to bring his professional expertise and proactive approach to the Public Procurement and EU Funding Advisory Committee.

The other chair of the committee is Zlatina Ruseva-Savova of the same name law office.

Radoslav Rizov with Microsoft Elected Co-chair of Public Procurement Committee

Radoslav Rizov, Microsoft (second left) takes the co-chair position from David

Hampson who stepped down.

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Rumyana Bosseva, CEO of Aon, and Gergana Gancheva, project lead with Aon, talked the details and trends within the companies in Bulgaria and worldwide. AmCham HR Committee co-chairs Zlatina Kushkieva and Dobromira Manasieva opened the event by welcoming HR experts within AmCham member companies.

Key findings:

73 percent of employers across the EMEA region (Europe, Middle East, and Africa) currently communicate their com-pensation and benefits programs to employees, with a fur-

ther 12 percent planning to do so. The main objective of these communications is to improve employee engagement; this is consistent with the previous survey, where engagement, talent retention, and the need to comply with legal requirements were the top three communi-cation goals.

E-mail, face-to-face presentations and internal notices are the three preferred communications channels across the region.

In the future, many organizations are interested in using Total Reward Statements, online benefits portals and employee hand-books as ways to communicate benefits and compensation. 35 percent of employers in EMEA have a budget of between 1,000 Euro and 10,000 Euro for compensation and benefits communications, while 56 percent have no dedicated budget for this, a slight increase on the previous survey (52 per-cent).

90 percent of respondents manage their benefits communi-cations entirely in-house.

The study shows that taking benefits communications seriously, and having an eye to future developments, appears to be the key to reaching a company’s goals, especially focused on engage-ment and talent retention, but also to legal requirements.

Aon, the global talent, retirement and health solutions business

AmCham, Aon Discuss Employee Benefits

What is the right communication on the employee benefits in every reputable organization? The answer to that question becomes more and more complicated and fundamental for every company. The key trends in that communication and the new tools for 2015 were elaborated at AmCham-AON business breakfast held on March 20, 2015, at the Radisson Blu Grand Hotel. There is an overall insecurity in the perception of the employees from what exactly their benefits package consist of 57 percent of those surveyed across the region believe that their employees have a high or very high level of understanding of their employee benefits.

From left: Zlatina Kushkieva, co-chair, HR committee, Gergana Gancheva,

AON, and Rumiana Boseva, AON.

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of Aon plc (NYSE: AON), initiated a survey in the end of 2014 to draw the picture of compensation & benefits communication practices in the EMEA region. Over 1,149 organizations across 28 countries participated in it.

It is interesting to see that trends globally throughout EMEA are very similar to those observed last year, including the fact that surveyed organizations are moderately satisfied with the impact of their communication. Aon believes that this shows that employee communication appears to be stale in some of them and therefore strongly recommend a refreshed approach.

Furthermore, employee engagement is still a priority in many EMEA organizations when they communicate their compensa-tion package: a goal that could be reached by developing new support systems, which are more impactful according to Aon. It is clear from the findings that companies are aware of this need to develop new channels, especially multimedia ones, such as online portals in order to have a valuable return on investment. They have to take this into account, however, and build stronger communication programs in order to gain impact. This is not always easy and requires time especially because of to the fact that most of them handle benefits and compensation communications entirely in house.

It is important to note that within the EMEA region, communica-tions preferences and behaviors range widely. While some

countries report success from a fairly traditional range of com-munications channels, such as face-to-face presentations and notices within the workplace, others are embracing multime-dia, email and online portals.

Interestingly, while the survey results as a whole present a picture of widely-different communications practices, when these more confident respondents’ answers are analyzed, we can see that some approaches are shared by the most suc-cessful benefits communicators. Frequent communications and a willingness to embrace new communications channels were common among those who believe their benefits com-munications are understood by their employees.

Sandrine Fleury, EMEA communication leader at Aon, said: “Over the past 3 years, companies gradually shifted their posi-tion on communicating benefits and compensation, from a nice-to-have to a must-have element of HR strategy. In fact, in EMEA, the current economic environment contributes to accel-erate the changes in social security and retirement systems, we also observe a more diverse population of employees and ageing workforce. As a consequence, benefits and compensa-tion programs are getting more complicated and expensive to design and implement. Today more than ever, it is important that employers provide an effective communication to ensure a good level of understanding and engagement, and make the most of their HR investments.”

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Five members of AmCham presented their services at the AmCham Meet New Members cocktail on March 24, 2015, held at the Hilton Sofia hotel. General managers of Bulstrad Life Vienna Insurance Group, EVS Translations Bulgaria, Harley-Davidson Sofia, NDB, and Telelink met with the AmCham com-munity.

Solomon Passy, AmCham board mem-ber, Alex Nestor, vice president, and Valentin Georgiev, AmCham’s executive director, welcomed some 70 guests.

Svetla Nestorova, chair of the Managing Board and CEO of Bulstrad Life Vienna Insurance Group, elaborated on the activities of one of the leading life-insur-ance companies in Bulgaria, established in 1994. Bulstrad has long-standing tra-ditions in providing safety, security and financial protection to its customers through variety of attractive life-insur-ance solutions suitable both for individu-al and corporate clients.

Nikolay Yamaliev, general manager of EVS Translations Bulgaria, said his company provided language solutions and was specifically set up to complete

complex, high-volume translations in the areas of legal, technical, automotive, pharmaceuticals.

The first authorized dealership of the legendary brand in Bulgaria - Harley-Davidson® Sofia was presented by Aristovoulos Tzelepis, dealer principal. A motor bike was on display in Mousalla Hall where the members and fans could take photos.

NDB, which has been for 20 years the

software distributor for Bulgaria of the most advanced solutions in the IT field from IBM Software, VMware, Citrix, Veeam, Red Hat, was represented by Bogdena Blagoeva, deputy CEO.

Tsvetan Mutafchiev, CEO of Telelink, talked about the company which is a leading system Integrator in Europe with a team of more 500 people. The firm gained lots of experience participating in the most important and complex ICT projects in the region and worldwide.

AmCham Members Showcase Ser vices

Telelink, Tsvetan Mutafchiev, CEO.

Bulstrad Life Vienna Insurance Group, Mrs. Svetla Nestorova, Chairperson of the Managing Board &

CEO.

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EVS Translations Bulgaria, Nikolay Yamaliev – General Manager.

Bogdena Blagoeva, NDB Deputy CEO.

Harley-Davidson Sofia, Aristovoulos Tzelepis, Dealer Principal.

Hilton Sofia hotel hosted the event.

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Almost forty (40) socially disadvan-taged university students ran for more than 20 available positions

in the companies during the third speed dating event of the “100 jobs” initiative on April 8th, 2015. Ten AmCham member companies participated: Comverse, EY

Bulgaria, Hewlett-Packard, IBM, Mobiltel, PricewaterhouseCoopers, Regus, SITEL, UniCredit Bulbank and VIVACOM at the American Corner Sofia.

The candidates have been chosen by BCAF based on their motivation, aca-

demic background and merit.

BCAF’s pool of candidates varies from IT, Finance, Science, Business Studies, Law, Engineering to Media and PR, Medicine, Pharmacy, and Language Studies. The candidates achieved excel-lent academic grades during their stud-ies at the Sofia University, the University of National and World Economy, the Technical University and the Medical University in Sofia.

So far AIG, AIMS, Amgen, AON, August Research, AVON, Engineering Services, Experian, Geotechmin, Hilton, Mobiltel, Philip Morris International, PPD, Proxiad, Unique Estates have supported the ini-tiative. All companies willing to join the project can contact the organizers.

The 100 Jobs project was developed in 2014 by BCAF and Forton under the umbrella of AmCham. The overall goal of the project is to employ 100 disadvan-taged young people in AmCham mem-ber companies either as full time, part-time employees or as an internship.

For t y Candidates Take Par t in the Third Round of “100 Jobs” Meetings

Regus company meets with the candidates.

Sergey Koinov, AmCham BoD member welcomes

the audience. Vivacom meets with the candidates.

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The residential property market started strongly in 2015 - a growth of deals and mortgages on an annual basis, although the period January - March is tradition-ally lagging behind in comparison to October - December of the previous year. The leading consulting companies expect the tendency to remain steady until the end of the year and the housing market to go up permanently.

A clear and visible difference exists between the markets in Sofia and the rest of the country. The housing market in the capital has been revived much faster due to the stable economy and low unemployment. Urban markets and especially Sofia develop quite well, com-mented for Investor.bg Polina Stoykova of Bulgarian Properties agency. Moreover, Bulgarians are quite active in purchasing property in the ski and seaside resorts. The main interest is in Sofia, Plovdiv, Varna, Bourgas, Stara Zagora and Veliko Tarnovo, said Stoykova.

Address Real Estate reports a 40-per-

cent growth in the number of inquiries for Q1 2015 compared to 2014. There is a significant growth in purchases of investment - from 4-5 percent to about 15 percent now, according to the com-pany. Blagoevgrad and Pleven are among the most active markets.

More deals, more mortgages

In Q1 2015 there is a 9-percent growth in the deals compared to the first quarter of last year, according to data of the Registry Agency.

Once again Sofia stands out as the leading property market in the country with impres-sive annual growth of deals by 31 percent. Sofia has emerged as the leading mort-gage market of the country in the context of more secure and higher incomes. The mortgages in the first quarter increased by 47 percent compared to the first three months of the previous year.

In regional cities (Sofia excluded) the real estate deals have been finalized with almost 15.3-percent growth year-on-year, but 28.5 percent less compared with the previous quarter.

A similar trend was registered for mort-gage loans. In contrast to the crisis years, when Bulgarians refused to fall into debt for a long period of time, for some time there is a tendency for gradual growth of mortgage lending. The trend is most tangible in Sofia and the biggest cities whose residents clearly feel more confident in their income.

In Q1 contractual mortgages reached 5,770, which marks an increase of 42.5 percent year-on-year and a decrease of 90 percent compared to last quarter. With the inclusion of legitimate mort-gages, their total number reaches over 8,000, marking an increase of 40.5 percent year-on-year and a decline of 18.6 percent compared to last quarter.

Address agency indicates that fewer properties are sold at discount. In 30 percent of the deals made by the agen-cy there was no discount, and their share increased by 10 percent com-pared to the same quarter of 2014. In 10 percent of the deals the price was higher than the originally announced. This refers to the really high-quality proper-ties in top locations, though.

cent growth in the number of inquiriesfor Q1 2015 compared to 2014. There isa significant growth in purchases of

A similar trend was registegage loans. In contrast years when Bulgarians r

Proper t y Market Proper t y Market Grows in Q1Grows in Q1

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The news that Greece may receive a loan of between 3 billion Euro and 5 billion Euro from Moscow next week, which was spread by Germany’s Spiegel, has rein-vigorated the interest towards the Turkish Stream project. If this information proves true, the two states are going to sign an energy agreement that will allow Greece to receive advance payment for joining the new gas megaproject. A source from within the ruling party Syriza told the pub-lication that such a deal could “turn the flow” for Greece. Following a trip to Moscow in early April Greece’s Energy Minister Panagiotis Lafazanis said that his visit had cleared the path to signing a number of agreements between Russia and Greece in the energy sector. The main pillar in the energy cooperation between the two states would be Greece’s support for the implementation of the Turkish Stream project, which would pass through Greek territory.

The first 660 km of the new Russian Turkish Stream gas pipeline for the deliv-ery of gas to Europe will pass on the bot-tom of the Black Sea along the corridor originally intended for South Stream; the next 220 km will pass along a new route towards the European part of Turkey. Such at least are the initial plans announced by Russia’s energy giant Gazprom. That will allow the company to keep some of the investment made in the South Stream project to Bulgaria, which was suspended last year. For the last three years Gazprom has invested $4.66 Billion in it. The 3,600-km South Stream had to be completed in 2016, reaching Austria, Italy and the Balkans. Gazprom holds 50 percent of the project, together with Italy’s (ENI 20 percent), France’s EDF and Germany’s Wintershall, which is a subsidiary of Germany’s BASF (15 per-cent).

As of today, the route of Turkish Stream, which has to replace South Stream and allow Russia to give up gas transit through Ukraine, has become clearer. Gazprom has agreed to Turkey’s proposal that the gas pipeline should be laid on the Black

Sea bottom directly in the European part of the country. The offshore part will be built by Gazprom and the shorter onshore section will be built in partnership. The first stretch of Turkish Stream is expected to be put into operation by the end of 2016. Analysts say that the terms are achievable, but the main problem is find-ing financing in the conditions of sanc-tions and falling oil prices.

The new gas pipeline will be called Turkish Stream on the insistence of Russian President Vladimir Putin and will have the capacity for 63 billion cubic meters of gas. Analysts comment that Ankara’s aim is to become the main tran-sit country for oil and gas from the Middle East, Caucasus and Russia to Europe. That will allow Bulgaria’s southern neigh-bor to safeguard its energy security while collecting transit fees.

Project are still drafts

In the beginning of the year Gazprom and Turkey agreed on the onshore section of Turkish Stream for further survey and engineering. The onshore section will be

180 km long; the landing point will be in the region of Kayakoy, the gas delivery point for Turkish consumers will be in Luleburgaz, and the exit point of the pipe-line will be at the Turkish-Greek border in the region of Epsila.

Gazprom is ready to deliver 47 billion cubic meters of natural gas per year to Europe through Turkish Stream and com-plete the construction of the first line of the pipeline by December 2016. The capacity of the offshore gas pipeline from Russia to Turkey will be 63 cubic meters a year.

Various Turkish sources estimate Turkish Stream at about $19 billion, of which $18 billion will be invested in the route under the Black Sea and the rest of the amount, in the onshore section. Specialists how-ever note the estimations are approxi-mate.

A total of 910 km of the route will pass under the Black Sea, of which 660 km will repeat the route of the canceled South Stream project. The 260-km onshore sec-tion will pass through Turkish Thrace and

Pipe DreamsThe route of Turkish Stream, which is meant to replace South Stream and allow

Russia to give up gas transit through Ukraine, is becoming clearer

By Marina Tsvetkova

Prime Minister of Greece Alexis Tsipras (L) talks with the head of the Russian energy giant Gazprom, Alexei

Miller (L) during their meeting in Athens, Greece, on 21 April 2015. The main issue of the discussion will

be the new pipeline that will bring natural gas from Turkey via Greece to Central Europe. The investment for

the construction of the Greek section of the pipeline is estimated at 2 billion euros and its implementation will

improve the supply safety for the Greek market, create new work positions and upgrade geopolitically the

country.

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reach the Turkish-Greek border.

Gazprom has announced plans to begin construction of the offshore section on October 1, 2015, while Turkey, which will build the land stretch, will start on Dec. 15. Turkish Stream is envisaged to become operational on Dec. 30, 2016. After the first stage of the project is put into operation, supplies through Ukraine should to be entirely stopped. That will turn Turkey into the second most impor-tant supplier of Russian gas after Germany.

Why Turkish?

Turkey itself is a huge gas consumer: the annual demand reaches some 50 billion cubic meters. The European states in turn are feverishly seeking alternative energy sources to Russia, mainly in the Middle East and Caucasus. Producer countries are also trying to reach the European market. In many of those projects, Turkey turns out a bridge between Caucasus, the Middle East and Europe. The project for the Russian-Turkish gas pipeline across the Black Sea is still in embryo.

“We want to keep our cooperation with Russia and with other countries, too, based on reciprocal benefit. By starting the negotiations, we reached a non-bind-ing agreement. We will create an energy hub on Turkish territory at the Greek bor-der that will satisfy our needs. In case of demand from the European countries, they will also have the possibility to receive as much gas as they want,” Turkey’s President Recep Tayyip Erdogan said early in 2015.

Besides Turkish Stream, Ankara is work-ing on several other projects, too. The list is topped by TANAP, which will deliver natural gas from Azerbaijan to Europe. Two other gas-producing countries – Iran and Turkmenistan – also want to join the pipeline arrangement. Gas from Iraq, though, may reach the Turkish border sooner than Azerbaijani gas. Ankara signed a 50-year agreement with Iraqi Kurdistan on oil and gas supply. TANAP will supply only a sixth of the total amount of gas to be conveyed through Turkish Stream. Turkey has a lot of industrial zones and natural gas – from an energy viewpoint – is very important for the coun-try. In Bursa alone there are 30 industrial zones using natural gas. They employ nearly two million people.

In addition, Ankara is in talks with Israel. An offshore pipeline is planned to con-nect Israel and Turkey; it will cost more than $2 billion and deliver 10 billion cubic meters of natural gas a year. Construction can start as early as next year.

“Turkey is positioning itself as an impor-tant partner of the European Union in the transit of energy resources. I guess that some problems may arise but the fact is that the two sides have mutual interest. The more so that Turkey and Greece – as well as the European Union – are inter-ested in all going on well,” said Deutsche Welle’s economic analyst Andrey Gurkov.

If all those projects are carried out in the next three or four years, Turkey will become a bridge between Europe and the main natural gas producing coun-tries.

Déjà vu with EC’s blessing

During a meeting in Budapest in early April, the foreign ministers of Hungary, Greece, Macedonia, Serbia and Turkey confirmed the intention of their respective states to participate in Turkish Stream. A joint declaration on Turkish Stream states that all countries in the region are inter-ested in working together towards energy security and better gas supply.

“That is not only a vital energy issue but an issue of national interest,” Serbia’s Vice Premier and Foreign Minister Ivica Dacic said.

Back then the Russian media suggested that Austria would also join in. The param-eters of the additional routes of Turkish Stream through its territory will depend on the decision of the European Commission, though.

The EC in turn is waiting for the route of the gas pipeline to be specified before it comes up with a stand. The EC expects that the possible construction of the Turkish Stream gas pipeline will comply with the European regulations. The European services are currently analyz-ing the information received so far on the project from the viewpoint of its viability, its regulatory and legal aspects, EC’s spokesperson for energy Anna-Kaisa Itkonen said.

She added: “In any case the EC expects that all participants will respect and observe the applicable European rules – including those concerning public pro-curement and access to the network. We also expect that the obligations ensuing from existing gas agreements will be observed.”

In early April Russian President Vladimir Putin said that Russia could build a pipe-line to Bulgaria through the Black Sea that would be a branch of the planned pipeline to Turkey. He said Russia was forced to cancel South Stream after Bulgaria – under the pressure of the European Union – halted the preparatory works. That made Russia look for other routes and it is currently working on the so-called Turkish Stream, Putin said. He underscored that nothing had been decid-

Post-south stream options

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ed yet but he did not rule out the possibil-ity that the stream may pass through Bulgaria too. Russia is looking for a route that will not meet opposition, a route that will be cost-efficient and provide for long-term and lasting cooperation.

Bulgaria has to be part of the distribution of the natural gas

that will pass via Turkish Stream if the project is ever carried out, Bulgarian Foreign Minister Daniel Mitov said, com-menting on the declaration signed in Budapest by Greece, Serbia, Macedonia, Hungary and Turkey on “a commercial viable option of route and source diversi-fication” for delivering natural gas from Turkey to the European countries. Daniel Mitov defined the declaration signed by the five countries as “a statement of political intent.”

According to Mitov the participation of Bulgaria in the distribution of Russian gas from Turkish Stream that will replace South Stream through Bulgaria is neces-sary not only because of the source diver-sification concept but because routes also need to be diversified.

“With the current discussion of ideas about EU’s energy union there are many projects existing and some of them com-peting. Our stand is that the European energy union should first take care of the economic interests of member states, said Mitov and pointed out that most of the countries in the Budapest format were practically non-EU members,” Mitov said.

The idea stated in the declaration on Turkish Stream is much more expensive than all other options, the foreign minister added. Bulgaria and Romania have gas infrastructure built and what is offered now is a very expensive project that the EC has no reason to back as such, he underscored.

Prime Minister Boyko Borisov pointed out that Bulgaria’s priority was the construc-tion of a gas hub with four or five gas sup-ply sources and that “to this day we have not received a written notice of termination of the agreement (on South Stream) with Bulgaria from the Russian side.”

Meanwhile an inquiry conducted among 1,000 Bulgarians by ICM Research, com-

missioned by Rossiya Segodnya news agency, shows that 66 percent of Bulgarians believe that the decision to continue or terminate the South Stream project should be taken in Sofia and not in Brussels. Another 23 percent are of the opinion that the European Commission has the final say. According to 64 percent of the interviewed the cancellation of South Stream will have a negative effect on the Bulgarian economy. Although the revenue lost from the termination of South Stream amounts to tens of billions of dol-lars, Bulgaria can still turn out to be in a winning position.

The country is working on the exploration of different gas fields in the Black Sea, as well as on projects for production of green energy, which could make Bulgaria com-pletely independent from Russian energy supplies. At the same time the green energy business may turn out a no less lucrative and safe alternative to natural gas.

Besides, the production of energy from renewable sources is environmentally friendly and tourism will benefit a lot from the fact that the pipeline has been moved, environmentalists claim. On the other hand, natural gas is only a marginal source of energy for Bulgaria, accounting for 10 to 12 percent of energy consump-tion. This share is unlikely to increase. Gas is expensive and non-competitive as compared to other energy sources, espe-cially for heating. Consumption of natural gas in Europe is falling and the potential sources are many.

Too many conventions

The project for a gas distribution center in Turkey announced by Vladimir Putin can only be implemented if there is coinci-dence of many conditions. European bureaucrats will have to accept the fact that the transit of Russian gas through Ukraine will be terminated. The countries in South Europe will have to demonstrate more independence. And the price of Russian gas will have to be lower than that on the gas market in Europe even after the profit of the Turkish intermediary is taken into account. As for now, none of these conditions is fulfilled. Besides, the EC is demonstrating lack of readiness for gas cooperation with Russia during the discussion of options for gas supplies to the former participants in the failed South Stream project, Moscow-based

Nezavisimaya Gazeta reported.

Currently Gazprom’s access to money from Europe is limited and the European legislation does not allow a company to own infrastructure and supply gas through it at one and the same time.

The investment in two undersea pipes in the Black Sea in connection with the can-celled South Stream project to a large extent has been made already, but the current geopolitical conditions create a risk to Russian state giant Gazprom, said Jonathan Stern of the Oxford Institute for Energy Studies. In the next four or five years the Russian concern will have to build the $55-billion Power of Siberia gas pipeline for supplies to China and Turkish Stream (instead of South Stream, the offshore section of which was projected to cost $9 billion Euro, $4.6 billion Euro of which has been invested already). The company also plans to build the Altai gas pipeline, which too will supply China.

Consequently, Gazprom will not be able to participate in the construction of the new gas pipeline through the Balkans and Central Europe for the same reasons as in the case of South Stream, Stern said.

“I cannot quite make the difference between Turkish Stream and South Stream, except for the name and the small diversion of the route,” said US Special Envoy for Energy Affairs Amos Hochstein. He called on the countries in Southeast Europe to instead build con-nectors between their gas networks. The United States also advises the govern-ments to focus on smaller projects for reducing their energy dependence on Russia, instead of dealing with large gas pipeline projects.

Russia will remain a very important gas supplier to Europe, added Hochstein, but the region will remain exposed to risk while looking for some magical solutions instead of developing separate small proj-ects for alternative routes and sources. One such project is the Trans Adriatic Pipeline (TAP), which has to start supply-ing the region with gas from Azerbaijan by 2020. With EU help, the interconnectors between Greece, Bulgaria, Romania, Hungary and Serbia, which can convey gas to Central Europe, are much more feasible and cheaper than the megaprojects.

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The crisis in Ukraine, and in particular Russia's recent cancellation of the South Stream natural gas pipeline project, has had substantial ripple effects on the ener-gy dynamics on the European continent. The Russians and Europeans both have put forth several potential replacements for the now scrapped pipeline, with Turkey likely to play a pivotal role either way.

Russia's Options

The first possible replacement for South Stream was unveiled at the same meet-ing in which South Stream was put to rest. While speaking with Turkish President Recep Tayyip Erdogan, Putin announced that Russia would pursue the construction of a natural gas pipeline with a capacity of up to 63 billion cubic meters across the Black Sea to Turkey, with the possibility of a hub on the Turkey-Greece border that could send natural gas to Southern Europe. The project, which has since been coined "Turkish Stream," would essentially be a rerouting of South Stream through Turkey instead of Bulgaria.

From a political perspective, Turkish Stream makes a lot of sense for Russia. Given the poor state of relations between Moscow and the West, a high-cost pipe-line such as South Stream that would be at the mercy of EU regulations is too risky. However, a high-profile energy project with one of Russia's largest natural gas consumers — one that is outside the legal confines of the European Union — comes with substantial benefits. Russia would still have a supply route into Europe that bypasses Ukraine, but it would also have greater influence to persuade Ankara not to participate in energy proj-ects that threaten Moscow's interests. The latter is particularly important because of Turkey's position on the Southern Corridor route, which would bring energy from the Caspian region through Georgia and into Europe via Turkey.

Building a pipeline with a capacity as high as 63 bcm, however, could prove just as

costly as South Stream was projected to be, and such high costs are infeasible given Russia's economic problems and its energy commitments in East Asia. (The original South Stream project at least had a consortium of investors, including ENI, EDT and Wintershall, though ENI was wavering as costs con-tinued to rise.) A limited version of the project, such as an expansion of the existing Blue Stream pipeline, which car-ries Russian natural gas to Turkey via the Black Sea, could be more manageable for Russia and would come with a smaller price tag ($3 billion to $5 billion for an expansion of about 5 bcm to 10 bcm). But it would also have a smaller capacity to redirect supplies from Ukraine for con-sumption in Europe. Turkish Stream is thus the most likely option to replace South Stream.

It is also possible for Russia to reverse its decision on South Stream. The political relationship between Moscow and the West is at a post-Cold War low, but it is possible that ties — at least with the Europeans — can improve enough for the project to be revived eventually. EU countries such as Bulgaria and Hungary

have lobbied Brussels to revise its posi-tion on the project, and even Germany is trying to keep the option on the table in the event of an understanding being reached on Ukraine. South Stream's res-urrection is unlikely, but it is still possible.

A final option for Russia would be not to pursue any South Stream replacements and to instead rely on its existing pipe-line network through Ukraine. What would make this option more likely is a further deterioration of ties with the West, or a further weakening of the Russian economy to the point that any new projects are out of Russia's reach financially. Moscow may also go this route if it decides to direct its focus more on energy projects in China and Japan, including an expansion of the Power of Siberia pipeline.

Europe's Projects

The Europeans have raised or revived several projects in response to the can-cellation of South Stream. These projects fall into two broad categories: liquefied natural gas (LNG) terminals and the Southern Corridor route.

Russian President Vladimir Putin (L) and his Turkish counterpart Recep Tayyip Erdogan (R) chatting before

a press conference in the new presidential palace in Ankara, Turkey in the end of last year. Putin and Erdogan

began a meeting in Ankara to discuss foreign policy as well as gas supplies to Turkey. Russia agreed to send

more gas to Turkey and charge 6 per cent less for the energy in 2015.

After The End of South Stream

www.stratfor.com

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LNG Terminals

The construction of LNG import terminals has long been an item of discussion among Europeans as a way to dilute their reliance on Russia and diversify energy supplies to more distant and commer-cially minded suppliers such as Qatar. Germany, France and Italy have made strides in building LNG terminals over the past decade. Yet Central and Eastern European countries, which are typically much more dependent on Russia for their natural gas, have been much slower in developing LNG terminals. These coun-tries are usually less willing or able to finance the projects themselves, unlike the wealthier countries in Western Europe.

There have been two recent exceptions: Lithuania debuted an LNG import termi-nal in November, and Poland will open its own LNG import terminal early next year. The terminals have given Lithuania and Poland greater leverage and flexibility in the energy sphere because they are no longer solely dependent on Russia for their natural gas supplies. They are also relatively low-cost projects; Lithuania spent $325 million on its floating LNG import terminal, and Poland invested $1 billion in its own. The drawbacks, how-ever, are that the terminals have fairly limited capacities — 4 bcm for Lithuania's and 5 bcm for Poland's — and that they are located on the Baltic Sea coast, which is far from the European countries that were on South Stream's route. Barring a major expansion, the terminals are unlikely to be a viable substitute for South Stream for Southern Europe.

However, South Stream's cancellation has revived discussions of new LNG ter-minals in Southern Europe as well, par-ticularly in Greece and Croatia. As of May there were plans for two new terminals in Greece: one by DEPA and one by Prometheus Gas. The DEPA project, Aegean LNG, would be placed close to the borders with Bulgaria and Turkey and would have an annual capacity of 3-5 bcm. The Prometheus Gas project would be near the port of Alexandroupolis and would have a capacity of 2.5 bcm. The Croatian terminal, known as Adria LNG, would be located on the Adriatic island of Krk and would have a capacity of 10 bcm.

The estimated costs of these projects are

close to those of the Lithuanian and Polish terminals ($300 million to $1 bil-lion), but so far funding has not been secured to move them into the construc-tion phase. Greece and Croatia have been unable or unwilling to put up the funds themselves, but the crisis with Russia could spark outsiders — either in the European Union or others — to step in to help.

Another issue when it comes to poten-tially linking LNG importing countries to those that were on the South Stream route (such as Bulgaria, Serbia and Hungary) is pipeline connectivity. However, several pipeline interconnec-tors have been built recently throughout Central and Eastern Europe. Linking LNG terminals with pipeline interconnec-tors is a relatively inexpensive and quick way for Europe to increase the security and reliability of its energy supplies. For example, projections for the Greece-Bulgaria interconnector's total cost are between 150 million and 200 million euros ($185 million to $250 million), 45 million euros of which will be covered through EU financial support. Construction of interconnectors is likely to increase in the region, but countries will still require a reliable source of natural gas for them to be effective.

Southern Corridor Projects

The other major alternative for Europe to avoid transiting supplies through Ukraine is the Southern Corridor route, which would take energy supplies from Caspian countries (particularly Azerbaijan and Turkmenistan but also potentially Iran and Iraq) to Europe via Turkey or the Black Sea. Projects taking this route are attractive for European countries because they avoid Russia and Ukraine, but politi-cal considerations and economic costs have long served as major obstacles.

One such project is Nabucco West, which would involve construction of a 10-30 bcm pipeline from the Turkey-Bulgaria border through Bulgaria, Romania, Hungary and Austria. (It would also involve a connection to the Trans-Anatolian Natural Gas Pipeline, which is being built from Baku to the Turkey-Bulgaria border and is financed by Azerbaijan.) The estimated cost of Nabucco West is in the range of $5 billion to $10 billion, which was a main reason the Trans-Adriatic Pipeline (TAP) was

chosen over Nabucco West for rights to 10 bcm of the 16 bcm of natural gas that will come online from Azerbaijan's Shah Deniz II natural gas field in 2018. Construction of TAP, which will have a capacity of 10 bcm, is expected to cost around $1.85 billion.

Another reason the TAP project was cho-sen over Nabucco West is that the latter probably would have also necessitated another natural gas supplier to be viable given its larger capacity, with Turkmenistan being a point of interest for the Europeans. But there is currently no pipeline connec-tion between Azerbaijan and Turkmenistan across the Caspian Sea; Russia and Iran have objected to the creation of a Trans-Caspian pipeline on legal and environ-mental grounds, though their opposition is really about keeping Europe from hav-ing a larger alternative to Russian natural gas. The governments in Azerbaijan and Turkmenistan could change their minds — and there have been more meetings recently with EU and European officials to discuss the pipeline — but for now they are wary of directly challenging Moscow.

One other project that has recently been discussed is the Azerbaijan-Georgia-Romania Interconnector (AGRI). The AGRI project would involve a pipeline from Baku to Georgia's Black Sea coast as well as two LNG terminals — an export terminal in Kulevi, Georgia, and an import terminal in Constanta, Romania. The capacity of the project is 7 bcm, and the estimated cost would be 4 billion to 6 billion euros. But AGRI faces the same limitations has Nabucco West. It is rela-tively expensive and would require Turkmenistan to participate because Azerbaijan's natural gas is already slotted for TAP. The need to build two LNG termi-nals further complicates the AGRI proj-ect.

New LNG terminals or projects involving the Southern Corridor route could be floated in the future, or current projects could be expanded, such as an increase to the capacity of the TAP project. But with Russia pressuring Turkmenistan and with neither Iran nor Iraq in a posi-tion — in either political or security terms — to be reliable suppliers, the main obstacle remains the sourcing of natural gas. A shift in any of these coun-tries could make the Southern Corridor option more viable as an alternative to South Stream.

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When times are hard, the cry always goes up to cut costs. It’s not the best place to start. Over the past century or more, economists have come to realise that in a downturn, if you cut and cut again, your economy will simply shrink. In selective ways, you have to take risks, and spend money in order to give an economy the capacity to recover and grow.

One problem is the language we use. We should talk about saving money, not cutting costs. If you think only about cut-ting, it is hard to be creative. And it is possible to be creative about saving money. More than possible, it’s essen-tial.

One thing you must do is to look at those costs that are often thought of as “fixed”. Take property, for example. If you own your property, you can sell it and lease it back to generate capital; if you rent, you can still devise a commer-cial plan that allows for a workable rene-gotiation. Regus has a number of high-profile clients who have abandoned fixed office space in favour of flexible workspaces and found that not only do they save money on overheads, they also make productivity gains, as people make better use of their time.

We always need to look at people. Sooner or later, most organisations in search of economies will look at head-

count. It’s the wrong target. You shouldn’t be looking at headcount, but at produc-tivity. If people are sufficiently productive – and in many cases you can calculate that an individual is a net source of profit for the company – then why would you let them go?

In order to make employees more pro-ductive, you have to take them into your confidence and be prepared to embrace new working practices. Some people could do much of their work from home or be closer to their customers – which can mean they cost less in terms of office space, not to mention their own commuting time.

Remote working is becoming ever more a reality of modern day work habits, with employees and millennials fuelling demand for more freedom to choose their own work location. However, far too often remote working is simply syn-onymous with home working regardless of whether this space is professional enough or equipped to perform even basic work functions comfortably. Research carried out by Regus in 2012 revealed that makeshift home office arrangements often do not provide work-ers with the necessary works surface (21%) and, more importantly force them

The Deal on Home WorkingReport reveals working from home carries huge costs for both worker and

employerBy Desislava Miteva, Country Manager at Regus Bulgaria

Regus is the global workplace provider Its network of more than 2,300 business centres in 104 countries provides conve-nient, high-quality, fully serviced spaces for people to work, whether for a few minutes or a few years. Companies like Google, Toshiba and GlaxoSmithKline choose Regus so that they can work flexibly and make their businesses more successful. The key to flexible working is convenience and so Regus is opening wherever its 2.1million members want support –city centres, suburban districts, shopping centres and retail outlets, railway stations, motorway service stations and even community centres. Founded in Brussels, Belgium, in 1989, Regus is based in Luxembourg and listed on the London Stock Exchange. In Sofia, Regus has two locations – on 14 “Tsar Osvoboditel” Blvd., and on 53-55 “Totleben” Blvd. For more information, visit www.regus.com

Business lounge at Regus offices.

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into uncomfortable positions for long periods of time (20%) with the risk of causing repetitive strain injury and dis-comfort.

In addition to this, latest research by Regus shows that far too many busi-nesses leave workers to set up their own space, maintain it and take out any relevant insurance or health and safety measures. In fact, while 61% of workers globally say they have a home office, only half (51%) report this is a fully func-tional and well equipped professional space. This confirms views that home working is not ideal for concentration and productivity.

Of those that are lucky enough to report that their home office is fully profes-sional, only a third (34%) say that their employer made the investment to kit out the space. This is a significant saving for employers a fifth of workers report that setting up a fully functioning profes-sional office costs roughly the equiva-

lent of a monthly salary. In addition to this, running and maintaining this space reportedly represents an expenditure of $3400 a year or equivalent. It is not sur-prising therefore that 49% of workers think that businesses encouraging staff to work from home are just trying to shift costs onto employees.

But what too many businesses do not realise is that these makeshift offices could turn into a liability as the legislation of many countries states that employee safety is the employer’s responsibility when they are carrying out work tasks regardless of location. In the UK for example, the HSE states that the busi-ness is responsible for any accident caused by the equipment the business has supplied and suggests how to carry out a risk assessment for homeworkers.

79% of respondents confirm that most companies that encourage their employ-ees to work from home do not cover all the costs of creating and maintaining

that workspace and 77% say that they do not take out the appropriate insur-ance cover on this home workspace. The liability represented by not regulat-ing this workspace is enormous and just a small investment in providing workers with access to fully equipped workspac-es closer to home could help firms pro-vide a low cost, fully compliant environ-ment for workers who need to reduce their commute. Access to a near-by pro-fessional workplace can help improve productivity while offering workers the flexibility they demand.

Whatever the economic pressures, you have to retain a long-term view. You have to give yourself the chance to grow, to be in position to take advantage when markets pick up.

A leader’s job is to create and foster a sustainable business for the long term. That depends crucially upon making your investments and divestments as selec-tive and strategic as each other.

The OSAC Bulgaria Country Council held its first workshop On March 24, 2015 on Anti-Terrorism Measures at Business Park Sofia. The Council’s interest for the workshop topic came from the increased number of terrorist incidents globally, recent events in Europe over the past year, and by continued interest in the results of the investigation into the 2012 Sarafovo Airport bombing and its impact on the private sector and Bulgarian society.

More than 50 participants from over 35 companies, educational institutions and an NGO were briefed on how terrorist organiza-tions plan their attacks, and what measures could be taken to minimize the risk of being targeted and more effectively pre-pared to response to such an incident. During the workshop an expert from the Bulgarian State Agency for National Security touched on how the cooperation with the private sector could be improved, and shared unclassified information about the Burgas bombing which killed a Bulgarian bus driver and Israeli tourists on July 18, 2012. Participants had the opportunity to learn from the Commander of the Bulgarian Specialized Unit for Combating Terrorism on current terrorism trends, as well as what to expect from the Government emergency response to terrorist attacks. Speakers also included security professionals from a number of private companies.

The next event is planned for May, with the theme of “Security Leadership for Non-Security Professionals”.

OSAC was established in 1985 under the Federal Advisory Committee Act to promote security cooperation between American private sector interest worldwide and the U.S.

Department of State. The OSAC Council is comprised of 30 private sector and 4 public sector member organizations that represent specific industries or agencies. Today, the OSAC partnership encompasses ten federal agencies and over 4,600 private organizations, from the business and academic com-munities to non-governmental and faith-based organizations.

The OSAC Bulgaria Country Council, launched in November 2012, is one of 148 OSAC chapters around the globe attached to U.S. Embassies and consulates. This was the twelfth event Bulgaria’s Country Council has organized, in addition to the regular services and consultations OSAC’s leadership pro-vides the membership. For more information on OSAC, con-tact the Regional Security Office at the U.S. Embassy or visit the OSAC website or Linkedin group: OSAC Bulgaria Country Council.

Anti-Terrorism Measures Workshop

OSAC chair Stefan Dimitrov.

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ALD Automotive, being part of Societe Generale Group, with direct presence in 39 countries and managing a fleet of over 1 million vehicles is a global leader in full service operational leasing management. ALD Automotive offers optimized mobility solutions, providing cost effective fleet management and consistently high level of services. Some of the services we offer are: Financing Vehicle maintenance Insurance Tires management24/7 breakdown assistanceDoor to Door Reporting and Consulting

Contacts:Klaudija Casar-Torkar

CEOTel.: +359 (0)2 802 61 20

Address: 73, Al. Stamboliyski Blvd.1040 Sofia

“Evrika Commerce Ltd.” is a Bulgarian furniture factory established in 1992, manufacturing classic and contemporary furniture for the European markets. The company is one of the leading furniture manufacturers in Bulgaria, offering solid oak, cherry and beech furniture with exquisite design and style, hotel furni-ture, furniture for restaurants and private habitations, custom made furniture, French reproduction and Italian style furniture with special antique finishing. The company is ISO 9001:2008 certi-fied. The furniture is built with the most modern techniques incorporating the principles of tradition and craftsmanship. 90% of the company's production is exported to France, United Kingdom, Belgium, Holland and Switzerland. The remaining 10% is realized on the Bulgarian market. The factory is special-ized in the production of hotel furniture - bedroom furniture, tables, cabinets,

chairs and upholstered furniture for hotels.

Contacts:Mincho Minkov Owner

BulgariaGabrovo 5300

16, Hristo Botev St.Tel.: 00359-66-80-67-66

E-mail: info@evrika.bgWeb-site: http://www.evrika.co.uk

Association "Informa" is a non-profit organization which provides postgraduate studies in different occupations: Accounting, Marketing, Management, Business Administration, Graphic Design, etc. The organization is specialized in organizing courses and supporting the development of the young people in Bulgaria, improving their social, profes-sional and intellectual development; stim-ulating youth initiatives. Licensed in 2006, the training center has been approved in numerous European projects in the field of vocational training in agriculture, human resources development and other fields. Conducts seminars and discussions in the field of agriculture, economy and trade. In its activities the association cooperates with similar structures in the country and abroad; organizes and conducts a variety of sessions, workshops, exchange of experience and other forms of information exchange and cooperation between young people and institutions of similar organiza-tions; assistance for professional orienta-tion and realization of young people.

Contacts:Violeta Vladimirova

CEOTel.: +359 2 480 8899

http://www.informa-bg.netAddress: 13, Laiosh Koshut Str.

1000 Sofia

Kinstellar is a leading independent law firm in Emerging Europe, Turkey and

Central Asia, with offices in Almaty (Kazakhstan), Belgrade (Serbia), Bratislava (Slovakia), Bucharest (Romania), Budapest (Hungary), Istanbul (Turkey), Prague (the Czech Republic) and Sofia (Bulgaria). Founded as a spin-off of the Central European practices of a London-based Magic Circle law firm, Kinstellar operates as a single fully inte-grated firm and delivers consistently high quality services across all jurisdictions in an integrated and seamless style.

Contacts:Diana Dimova, PartnerTel.: +359 2 904 83 51

http://www.kinstellar.comAddress: 69 Bulgaria Blvd., Infinity Tower,

14th floor1404 Sofia

Based in New York, The Xogito Group is a digital development consulting firm. We build, operate, and advise. Our mission is to help your business exceed your goals. Digital technologies are constantly chang-ing to keep up with business needs and to create new ones. We help you think through where you are technically and help you map out where you want to go and how to get there. Data, RTB, E-Commerce, AdTech – we approach your needs within the larger technical land-scape in full accord with best practices, emerging trends and forward thinking solutions. We are long-time contributors to and supporters of open-source software (OSS), and are familiar with many OSS packages. Our OSS experience coupled with our up-to-date knowledge of architec-tures and technology help us to identify and leverage the solution that’s right for you.

Contacts:Constantine Spathis

CEO58, G.M. Dimitrov Blvd., Dianabad

Residential Complex, apt. 20, Izgrev District

1172 Sofia

Right Rental Ltd. is leader in event management, logistics and equipment rental for corporate events, weddings, sports events, exhibitions and concerts. We have national and regional coverage, delivering both equipment and

event services to neighboring countries – Greece, Romania and Serbia.We offer the most advanced tent solutions and aluminum structures produced by the leading Belgian company

Veldeman Structure Solutions.No event is too big or small, too far or too unusual for Right Rental.

Our team of professionals with over 10 years of experience is ready to meet any challengeable event!

Right Rental Ltd. Tel: 0700 13 700 www.rightrental.net office@rightrental.net

RIGHT TIME, RIGHT PLACE, RIGHT NOW

32А Cherni Vrah Blvd, 2nd floor, Aries Office Building, 1407 Sofia | Tel: +359 2 988 12 75 | Fax: +359 2 986 75 49 | www.aes.bg