Bulgaria is Europe’s Silicon Valley

Source: http://edukwest.eu/

The Bulgarian information technology industry is one of the fastest growing industries in this country. Arguably, since the 1990s, the IT industry in this country has enjoyed consistent growth, only slowing down between 2008 and 2010 because of the global financial crisis. According to European Information Technology Observatory (EITO), the Bulgarian IT industry has been enjoying at a two-digit rate, and there are no signs that this growth will slow down anytime soon.

While this market is characterized as least developed in Europewith respect to hardware penetration, there are signs that this market will boom soon with new customer base and adoption of new technologies such as cloud computing. Note that in 2011, Bulgaria was the only Southeast European country to be ranked as one of the most competitive countries in the IT Industry Competitiveness Index 2011. Importantly, this country has been shifting to a digitized economy, thus enhancing its ICT market potential.

Arguably, Bulgaria is one of the leading countries with a high number of top Multinational ICT corporations in Eastern Europe. Among these multinational corporations are HP, SAP, Johnson Controls, VMware, CISCO, ProSyst and Atos among others.

Note that the presence of the IT multinational corporations in this country implies that businesses that engage in ICT business can easily access top-notch technologies at affordable prices. In addition to this, Bulgaria has the second fastest broadband in the world after South Korea.1 Moreover, studies indicate that there is a considerable increase in hardware sales. In 2013, hardware sales account for 1.088bn BGN while in 2014, the sales rose to 1.119bn BGN, which represented a 2.9% rise. With respect to software sales, the Bulgarian market is expected to rise by 3% between 2014 and 2015, from 242 million BGN to 249 million BGN. This implies that this market is growing with respect to the use of ICT.
Notably, the ICT sector in Bulgaria generates approximately 10% of the total national GDP. Moreover, most players in the ICT industry in this country are SMEs. In this regard, there are minimal barriers of entry in the Bulgarian ICT market.

One of the most important factors to note about the Bulgarian IT market is the supply of IT labor. Notably, by 2011, this market had 78,000 of ICT workforce, which represented 2.7% of the total workforce. In this regard, the Bulgarian market had 15,000 people in the management and business architecture level, 35,000 core ICT practitioners, 17,000 ICT mechanics and manual workers, and 11,000 other ICT technicians. Moreover, evidence indicates that the Bulgarian universities produce 3,500 IT graduates every year.

Furthermore, of the 49 universities in this country, 50% of them offer computer specialties, with 11,000 Bulgarian students majoring in biotechnology, electronic engineering, computer science, physics and mathematics. Apart from availability of ICT workforce, Bulgaria’s average wages in the ICT sector is competitive as compared to countries such as the United Kingdom, Germany and France.
For instance, the average monthly salary in the software industry is approximately 1.174€. This implies that foreign businesses can outsource their ICT project to Bulgaria at a cheaper cost.

Speaking from this perspective, the ICT industry in Bulgaria is a promising industry that has potential to yield high returns on investment in the next few years.

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