U.S. Commercial Service

1
U.S. Commercial Service

• The New EU 2 Bulgaria Romania

2
Why Bulgaria and Romania?

• Following 7 years of preparation, Bulgaria
  Romania became full members of the EU 1/1/07
• Both are strategic partners in strategic
  locations
• Both are NATO Members signed Defense
  Cooperation Agreements
• Both enjoy a Pro American environment
• Together they have a combined GDP of over 13

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More EU does not mean less US!

• EU Membership improved business climate, lower
  tariffs customs duties for US products, new
  trade opportunities
• Single largest economic entity in the world
• Total bilateral trade with last 10 new EU members
  states increased 60 03 06 US exports
  almost doubled
• Enter EU through the most economic alternative
  access 30 BILLION in structural funds over next
  7 years!

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Why Bulgaria?U.S. Exports to Bulgaria

• 42 increase in 2005-2006

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Why Bulgaria?
U.S. FDI in Bulgaria
Key U.S. Investments -- AES, Maritsa East I,
500 in a 1.3 bn. project -- American Standard,
Ideal Standard, 200 -- Alcoa -- Johnson
Controls -- Tishman International -- GE Real
Estate, 80 -- Bulgarian American Enterprise Fund,
71 -- Alico, Bulgarian Post Bank, 55 -- Kraft
Foods, Kraft Foods Bulgaria, 36 -- Coca Cola,
Coca Cola Hellenic Bottling, 35 -- Socotab,
Socotab Bulgaria, 32 -- McDonalds, McDonalds
Bulgaria, 23 -- World Trade Company, Radisson
Hotel, 17.7 -- Soros Funds, Eurocom Cable TV,
15.1 -- Seaboard Overseas, Vinprom Ruse, 15 --
News Inc., television, bTV, 12
FDI by Country of Origin 1992-2005 (millions of
USD)   Greece 1,167.6 Austria
1,143.1 Netherlands 708.9 Germany
701.3 Italy 677.8 Belgium
493.6 Hungary 465.0 USA
404.0 Note US FDI in 2004 alone was
over 400 million USD
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Why Romania?

• - Second largest market in CEE after Poland
• - Skilled labor force IT, engineering English
• speakers
• - One of most biologically diverse countries in
• Europe. Rich natural resources oil, gas,
  fertile land
• - Extensive maritime river routes with 4th
  largest
• port in region
• - Corporate and individual income tax cut from
• 40 to a flat tax of 16.

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Why Romania?

• 2006 7.7 GDP, 7th consecutive year of economic
  expansion. Economy driven by balanced mix of
  consumption and investment
• Estimated 1 billion barrels of oil equivalents of
  gas and oil, 4th largest reserves in Europe after
  Norway, Britain and Denmark.
• 2006 4.8 inflation
• Standard Poors, Moodys, Fitch give Romania
  investment grade

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Why Romania?

• US Exports / Investment
• In 06 FDI reached a record US 12 billion, up
  75 over 2005. Most
• attractive FDI destination in SEE.
• US, UK and Czech Republic in 11th place (each
  with the same 2.5)
• in exports, following Germany, Italy, Russia,
  France, Turkey, China,
• Austria, Hungary, Kazakhstan, Poland.
•       
• US is in 7th place (4.45) in investment
  following
• Netherlands, Austria, France, Germany, Italy UK

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Why the New EU 2 Bulgaria Romania?

• Top Sectors for Export Investment
• Automotive Parts and Service Equipment
• Aviation equipment and Services
• Building Products
• ICT
• Power Equipment and Services
• Medical Equipment
• Pollution Control
• Tourism Infrastructure
• Franchising
• Safety and Security / Defense

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Automotive Parts and Services

• Steady growth of new car imports and sales
• High demand for spare parts and analyzing and
  testing equipment due to the average age of cars

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Aviation Equipment and Services

• USTDA airport studies in both countries
• Must upgrade all airports to meet European US
  safety and security standards
• Demand for aviation, runway systems, air traffic
  control equipment, safety and security

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Building Products

• Most visible growth sectors in Bulgaria
  Romania
• Rapid expansion of housing market due to
  availability of credit and foreign investment
• Large investments in commercial and industrial
  construction

13
ICT

• Strong demand for wireless and cable equipment,
  3G, Internet services and VoIP, computers and
  peripherals
• Deregulation of the telecommunications market
• Launch of 3G and Wi-Max networks

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Power Equipment and Services

• Need to find secure sources of energy
• Privatizations and rehabilitation of existing
  facilities
• New thermal, nuclear, and alternative sources
  planned
• EU requirements to increase percentage of
  electricity from renewable sources

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Medical Equipment

• Public hospital purchases financed by the
  Government
• Appearance of the first private hospitals and
  clinics with state-of-the-art equipment

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Pollution Control

• Massive investments in environmental
  infrastructure water, waste water, solid and
  hazardous waste management, large combustion
  plant air quality
• 11.7 billion Bulgarian water sector
• 40 billion Romanian environmental protection

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Environmental Trade MissionOctober 1-5,
2007Turkey, Bulgaria, Romania

•        
• Pre-screened, individualized
  appointments with potential business partners
•       Country Market Briefings
•         Meetings with Key Government Officials
•         Logistical Support (interpreters, ground
  transportation)
•         Networking and U.S. Ambassadors
  Reception        
• Technical Site Visit
•         Pre-Departure Counseling and Follow up
  Assistance
• Interested? http//www.buyusa.gov/environment
  al/tbrtm

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Tourism Infrastructure

• High growth in the tourism sector Black Sea
  beaches mountain ski resorts, Danube Delta
• Need for improved tourism infrastructure and
  increased standards for international clients

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Safety and Security/Defense

• Banks, airports, ports, power plants, border
  stations need safety and security upgrades
• Modernization of Armed Forces to meet NATO
  interoperability requirements
• Establishment of U.S. Army joint-training
  facilities with bilateral DCA

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Franchising

• In the Bulgarian news McDonalds, Berlitz, ERA,
  Century 21, Remax, Mathnasium, KFC, Dunkin
  Donuts, Pizza Hut
• In the Romanian news Starbucks, Ruby Tuesdays,
  Howard Johnsons, Hertz, Budget, Best Western,
  Fast Track Kids
• Opportunities hotel/restaurant management, fast
  food services, stationary, specialty retail
  stores, automotive products and services,
  education, and more.

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Recognize these names?

• All of these firms have a presence in the New
  EU 2
• 3M, AIG, Alcoa, Amway, Avon, Bunge, Cargill,
  Cisco, Citibank, Coca-Cola, Colgate Palmolive,
  Ernest Young, Delphi, General Electric, HBO,
  Honeywell Garret, Howard Johnsons, HP, IBM,
  Johnson Controls, Kodak, Kraft, Lockheed Martin,
  McDonalds, Microsoft, Motorola, New Century
  Holdings, Oracle, Philip Morris, Proctor and
  Gamble, Qualcomm, RAEF, Solectron, Timken, UPS,
  Visa, Washington Group, Xerox...to name a few!  
• Your firm could be next!

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How to Do Business in the New EU 2

• Work with your USEAC, use the New EU 2 CG,
• market research, Gold Keys, ICPs
• Find a distributor, agent or JV partner
• Hire a law firm, PR firm
• Show respect for the culture
• Learn a few words Da! Nu! Merci!
• Try the food
• (In Romaniadont ask about Dracula!)

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BulgariaUS Ambassador to Bulgaria Road
Show May 2006US Presidential Visit June 10-11,
2006AWWA June 24-28, Toronto, CanadaBulgaria
and Romania Environmental TM Turkey, Bulgaria,
Romania Oct. 1-5, 2007 http//www.buyusa.gov/envi
ronmental/tbrtm.htmlRomaniaMilitary
Contracting Seminar October 2006 Nato Summit
April 2-4, 2008US Ambassador to Romania Road
Show Feb. 2008
New EU 2 Upcoming Events

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Can your firm afford to miss out on theNew
EU 2?
Good Luck!
Bulgarian Uspeh Romanian - Succes
Thank you! Bulgarian
Blagodaria Romanian Multumesc
www.buyusus.gov/bulgaria
www.buyusa.gov/romania