Sofia Echo


Renewable relations

Author: Clive Leviev-Sawyer Date: Fri, Oct 21 2011 1 Comment, 3759 Views
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In the distinguished interiors of the embassy of Austria in Sofia, warmth radiates gently on the first day on which the central heating provider has begun spreading its service for the season.

The building dates back more than a century, and its substantial walls furnish a naturally efficient insulation; and still, ambassador Gerhard Reiweger is seeking more, to enhance the building’s capacity for energy-efficiency and the avoidance of waste.

There is an analogy in this, in the context of the Austrian – Bulgarian bilateral relations that Reiweger, in office as Vienna’s envoy in the Bulgarian capital since January 2010, sits down to describe.

In all things these days, "renewable" is a key word. It extends to energy, to architecture, to every endeavour, including relations between states, including states that can point to a healthy modern history of cordial ties.

Here and there
n the past year or so, there have been a number of high-level engagements between Austria and Bulgaria.

Austrian federal chancellor Werner Faymann was in Sofia in spring 2011, a return visit reciprocating by Bulgarian head of government Boiko Borissov's trip to Austria last year.

At the invitation of Austrian federal president Heinz Fischer, Bulgarian head of state Georgi Purvanov went calling in March this year.

One of the key outcomes of those engagements was the opportunity to clarify Austria’s position on the issue of Bulgarian accession to the EU’s Schengen visa zone, with Vienna underlining that it saw this as a matter to be decided on fulfilment of the standard criteria, without linking the question to Bulgaria’s performance under the European Commission’s Co-operation and Verification Mechanism put in place at the start of 2007 to assist the country in meeting the bloc’s justice and home affairs standards.

Austria, within the Salzburg Forum of interior ministers, of which Bulgaria currently holds the rotating chairmanship, has taken a supportive stance regarding Bulgaria and Schengen.

At the September meeting of EU interior ministers which held off a decision on Bulgarian and Romanian accession to Schengen, Austria was among the EU states that was prepared to accept a proposed compromise on a phased implementation of accession.

If much of this sounds to be the stuff of high policy, it should not be forgotten that bilateral engagements, when ministers sit down together, are intended to – and frequently do – produce tangible consequences for the people of the countries represented.

Austria’s social affairs minister, Rudolf Hundstorfer, was here in September, a highlight in a co-operation process that has been going on for some years to share best practices and experiences in labour market polices, a process involving regular meetings of experts, with financial support from the Austrian ministry. The Hundstorfer visit resulted in an agreement in principle that Austria will support the establishment of a centre for training and further education of unemployed people.

The details flowing from the agreement are still to be worked out, but an innovative aspect is that rather than embarking on a new building project for the centre, a network drawing on existing facilities in Bulgaria will be set up. Therein lies a renewable principle.

Austria has an experience to share in labour market policies; currently, even against a background of the recent times of global economic crisis, within the EU the country has the lowest unemployment, according to Eurostat figures for August 2011, of 3.7 per cent.

Doing business
Austria currently is Bulgaria’s second-largest investor, with 5.45 billion euro as at the end of 2010, and there are more than 400 active Austrian investors in Bulgaria.

According to Reiweger, recent months have seen positive results in Austrian companies getting new contracts for participation in motorway construction projects as well as railway rehabilitation projects.

Among significant ongoing projects is that by power distribution firm EVN and the National Electricity Company, NEK, regarding plans for the Gorna Arda hydropower project.

Agreement has been reached on a joint venture in which EVN will be the majority participant. Work is to go ahead on feasibility and environmental studies and the ultimate outcome will be, Reiweger says, a project that will benefit Bulgaria not only through providing a new source of renewable energy but also will assist in flood control.

"And, of course, it means investment, jobs, and is another instance of an Austrian company being part of the Bulgarian economy. EVN is a company that is here to stay and is playing an important role in Bulgaria’s economy."

Corporate responsibility
During Faymann’s February visit, Austria hosted a conference on corporate social responsibility, a joint effort with the Bulgarian side which drew enthusiastic participation from companies from both countries.

"The important element in this conference," Reiweger said, "was that we had experts from Austria and from Bulgaria presenting the concept in its substance which goes far beyond charity, and is about the approach of being a good, socially-minded employer while at the same time working for environmentally sustainable production and management. This is a benefit to your company, in the medium to long term; and this was something very well received by the audience."

A number of Bulgarian Cabinet ministers participated in the event, including Environment Minister Nona Karadjova, who has expressed interest in a follow-up event.

Advantage Austria
The country’s commercial arm abroad, Advantage Austria, has been very active in identifying areas of business development for Austrian and Bulgarian companies.

Advantage Austria this year has focused on various sectors, including stimulating exports, training and education, foodstuff and beverages, and medical technology.

The most recent conference was on energy efficiency, which was opened by Deputy Minister for Regional Development and Public Works Nikolai Nankov.

Interest in the event was so strong that the venue hardly could accommodate all the participants.

Renewable, renewable
Austria’s energy usage from renewable sources in relation to total energy consumption is third in Europe after Norway and Sweden.

In Austria too, there is a big movement towards energy-efficient building.

The country has Güssing, a model town in south eastern Austria that boasts, justifiably, of the fact of its use of renewable energy resources and its absence of dependence on outside energy sources, for instance through the use of solar power. The deputy governor of Veliko Turnovo visited last year to inspect the town.

Business environment
As to Austrian businesses’ views on Bulgaria’s current business environment, Reiweger confirms this country’s competitive advantages in terms of low taxes, relatively lower wages and opportunities through EU-funded projects, but adds that feedback from companies indicate some problem areas such as an inadequate responsiveness among some local administrations and a sense that the tax system could be managed more efficiently.

In the latter case, this means that feedback has been heard – notably, from Bulgarian companies – about the fact that while they pay their taxes due, other companies are not seen to, which means an effective disadvantage for scrupulous taxpayers.

"We’re not complaining about being badly treated," Reiweger says, "but the point is that everyone should be treated equally when it comes to being required to pay taxes due. After all, proper social responsibility starts with paying your taxes."

Overall, the embassy’s view of the business environment is that while the number of new Austrian investments is not significantly high, Austrian companies that already have engaged in Bulgaria are looking at ways to optimise their operations but also are considering options for expansion, down the road ahead, for instance by buying up companies here. There is particular interest in the services sector, such as telecommunications, insurance and banking.

Austrian companies generally are currently taking a look at south eastern Europe, in particular Bulgaria, Romania and Serbia to consider options for investment in the longer term, a process that now is moving at a measured pace and with careful consideration of the factors at play.

Meanwhile, on November 16, an Austrian Showcase event is to be held in Sofia, with more than 25 Austrian companies already having confirmed their participation, to discuss opportunities in road infrastructure projects.

  • Austria and Bulgaria: Of borders and building
    • Profile previewriogfdjlafdaSun, Oct 23 2011

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