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What is the best advertising strategy for Bulgaria
submited on 07.08.2008 in category Political stability | Fiscal affairs | Monetary policy | Regulated markets | Privatisation | Macroeconomic developments
submited on 07.08.2008 in category Political stability | Fiscal affairs | Monetary policy | Regulated markets | Privatisation | Macroeconomic developments
In the context of the integration of Bulgaria in the world economy the global crisis is perceived as even more important factor to the Bulgarian business. The negative impact of the crisis on the Bulgarian economy has been lately overrated with the aim being argumentation of the necessity of public expenses in order to defend the social interest. As concrete examples of the urgency of state interference have been named the outflow of foreign investments, the not-so-good image of Bulgaria as holiday destination, the poor reputation of the country as a result of the ceasing of the European funds, etc.
Argumentation of certain public expenses often includes one-side interpretation of statistical data. Thus, for example the news that according to preliminary the inflow of foreign investments is slowing down substantially has been broadly published in the Bulgarian media. However, it has not been clearly stated that the final balance of payments’ data could change entirely the overall picture of the investment inflow into the country.
On the other hand, the data for tourism look at first sight rather positive – as of end-May alone 17% more foreign tourists have come in Bulgaria relative to the first half of 2007 despite the unfavorable impact of the current global environment. In the same time, more Bulgarians prefer to travel and rest abroad. On one hand, the improved ability to travel is indirect indicator for growing income and household wealth. On the other hand, the preferences for traveling abroad probably reflect competitive advantages of foreign destinations before the Bulgarian resorts. In this course of thought, the Bulgarian economy is already part of the single European, and world economy – hence, it must not be surprising that more and more Bulgarians travel abroad, where resorts are not overpopulated and the service better.
Another pivotal pint in the argumentation for providing public funds is the infamous ceasing of some of the European funds. The assumption that advertising the country abroad will improve the recently deteriorated image is however in doubt. Much more important to the country’s good name is the handling of the already diagnosed problems with absorbing European funds and potential further reestablishing of financing.
The above-mentioned examples are just some of the suggestions for spending budget funds – willingness which seems easy to explain in the context of the so far recorded budget surplus.
The common between the different ideas of financing new state initiatives is that they are allocated toward stimulating certain sectors of the economy, rather than improving the business environment in general. Certainly, certain positive effect of performing export-oriented strategies or advertising Bulgarian resorts abroad will probably emerge. The debate in this course however shifts the public attention from the more significant question – how business environment could be improved in general.
This issue is especially significant in the current global conditions and the reallocation of international investors as an effect of the world economic crisis. Recently large international corporations decide to emphasize on their business in developing countries, where they have greater growth potential. Such a process is notable in the banking sector as well – some of the largest banks, present in Bulgaria as well, announced their intentions to develop more intensively their operations in Southeastern Europe.
With that said the improvement of the business environment in Bulgaria via conducting reforms in key spheres is an opportunity to strengthen the competitive positions of the Bulgarian economy. In this context the global crisis is not only a threat to the local economy but also a source of many opportunities – the question is whether we will take full advantage of them.
Argumentation of certain public expenses often includes one-side interpretation of statistical data. Thus, for example the news that according to preliminary the inflow of foreign investments is slowing down substantially has been broadly published in the Bulgarian media. However, it has not been clearly stated that the final balance of payments’ data could change entirely the overall picture of the investment inflow into the country.
On the other hand, the data for tourism look at first sight rather positive – as of end-May alone 17% more foreign tourists have come in Bulgaria relative to the first half of 2007 despite the unfavorable impact of the current global environment. In the same time, more Bulgarians prefer to travel and rest abroad. On one hand, the improved ability to travel is indirect indicator for growing income and household wealth. On the other hand, the preferences for traveling abroad probably reflect competitive advantages of foreign destinations before the Bulgarian resorts. In this course of thought, the Bulgarian economy is already part of the single European, and world economy – hence, it must not be surprising that more and more Bulgarians travel abroad, where resorts are not overpopulated and the service better.
Another pivotal pint in the argumentation for providing public funds is the infamous ceasing of some of the European funds. The assumption that advertising the country abroad will improve the recently deteriorated image is however in doubt. Much more important to the country’s good name is the handling of the already diagnosed problems with absorbing European funds and potential further reestablishing of financing.
The above-mentioned examples are just some of the suggestions for spending budget funds – willingness which seems easy to explain in the context of the so far recorded budget surplus.
The common between the different ideas of financing new state initiatives is that they are allocated toward stimulating certain sectors of the economy, rather than improving the business environment in general. Certainly, certain positive effect of performing export-oriented strategies or advertising Bulgarian resorts abroad will probably emerge. The debate in this course however shifts the public attention from the more significant question – how business environment could be improved in general.
This issue is especially significant in the current global conditions and the reallocation of international investors as an effect of the world economic crisis. Recently large international corporations decide to emphasize on their business in developing countries, where they have greater growth potential. Such a process is notable in the banking sector as well – some of the largest banks, present in Bulgaria as well, announced their intentions to develop more intensively their operations in Southeastern Europe.
With that said the improvement of the business environment in Bulgaria via conducting reforms in key spheres is an opportunity to strengthen the competitive positions of the Bulgarian economy. In this context the global crisis is not only a threat to the local economy but also a source of many opportunities – the question is whether we will take full advantage of them.
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