Arab and Chinese investments in Bulgarian agriculture
Radio Bulgaria | 29 May 2012
The major investment in Bulgarian agriculture so far belongs to the Chinese Tianjin State Farms Agro Business Group Company (Photo: government.bg).
by Maria Dimitrova
Foreign investors have shown real interest towards Bulgarian agriculture for the past 2-3 years. The trend has changed a bit and now different Arab countries and China are the interested ones, instead of Italy, France, etc. Companies from Qatar, Kuwait, Saudi Arabia, the United Arab Emirates, Israel and China have been attracted to Bulgarian agriculture since 2010. Many memorandums and agreements were signed, but there are still few cases of real cooperation. One of the problems is the fragmentation of Bulgarian farmlands. Foreign investors look for areas of at least 1,000 ha, while the biggest ones in this country are 50 ha on the average.
The major investment so far belongs to the Chinese Tianjin State Farms Agro Business Group Company that has invested EUR 10 mln. for the rent of 2,000 ha of farmland near the village of Boynitsa, Vidin region. This is the first Chinese state investment in the sector of agriculture not only for Bulgaria, but for the entire EU. China sees this country as a bridge for an easier access to the European markets. The good thing is that this investment is aimed at the poorest region in Bulgaria and the EU – the northwestern one. This is only the first stage of the Chinese plans for the region, where corn, alfalfa and sunflower will be grown. The company intends to invest at least EUR 20 mln. more in plant growing, along with additional funding for stock breeding. Currently the Bulgarian branch of the company cultivates 1,000 ha of corn, but without a single local employee, since the appliance used requires very high qualification.
Local companies negotiate for Chinese investments in this country to the tune of USD 1.5 bln., Finance Minister Djankov has recently voiced to Bulgarian MPs. A significant part of this money will be provided exactly for agriculture. The investments of the Asian state in Bulgaria marked a 320 percent progress in 2011, which was a real boom on the average 94 percent for Europe.
At the same time Qatar looks for projects that need an initial investment of EUR 100 mln., predominantly in the stock breeding sector. Kuwait is ready to invest USD 480 mln. in Bulgarian agriculture through the establishment of a joint company. This country is just perfect for the initiative of the Saudi king that wants to invest USD 800 mln. in foreign countries’ agriculture and food industries. The goal is enough quantities and stable prices to be ensured with mutual benefits for both Saudi Arabia and the country that receives the investments. The Arab country has shown interest towards growing of crop plants, development of stock breeding and fishing, the food production… Bulgaria exports to the Saudi market mainly cereals, sugar products and seeds. However, this country has a significant potential for export of oil-bearing cultures, milk products, lamb and chicken, eggs, fruits and fruit juices, wines, tobacco, cigarettes etc.
“Our petrol – these are foods and hundreds of mineral springs. The world really needs food and waters, we have huge abandoned lands and we should take advantage of this wealth,” Bulgarian PM Boyko Borissov has recently stated. Its government is the first one that actively looks for foreign investments in agriculture. It is a pity that with these fertile lands and this nice climate Bulgaria is not able to exploit on its own this resource that becomes more and more precious – farmlands. However, foreign investments are still a solution in these times of global economic crisis.
English version: Zhivko Stanchev
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