Members Share Strategies and Experience to Adapt to the COVID-19 Emergency in Bulgaria

In the eve of the first month in Emergency situation in the country, on Friday, April 10th, 2020, AmCham Bulgaria organized its first video-conference with the Board and members to share in person what the chamber is doing and to find out how members are coping with the crisis.

The first VC Friday Coffee with the Board was opened by the President of AmCham BG Olivier Marquette. He pointed out that organization’s main activities over the past month were in the advocacy front. He highlighted the 11 Bilateral Chambers’ proposals to the government; the Chamber’s position on the 60/40 rule as well as our position against the ban of public procurement in the Emergency Act and the idea of calculation of the corporate income tax. Olivier stressed the launch of the “UNITED Against COVID-19” joint campaign which is true testimony of our values.

In his capacity of AES Bulgaria President, he said that the supply of electricity is secured and will be secured over the next months.

Eliza Grancharova, Coca-Cola Bulgaria, and Board Member focused on the impact of The Coca-Cola system in Bulgaria and their support to the communities. Their highest priority is the safety of the employees, partners, customers, consumers, and products, as well as the close following of the guidelines of the authorities in any aspect of hygiene, protection, and prevention.

Coca-Cola put on hold any brand advertising and promotional activities globally and in Bulgaria. The company has put a number of support efforts in China, Italy, and other, with a contribution worth at USD 120 mln globally. It is a combined effort of the company, its global bottling partners and The Coca-Cola Foundation.

Coca-Cola support in Bulgaria:
  1. Donation of over 100,000 liters of drinks to the medical staff in more than 26 hospitals in the country.
  2. Donation of drinks to police officers at the checkpoints of Sofia, Kostinbrod, and Bankya.
  3. Support to the social patronage, helping up to 1,000 elderly people in Kostinbrod and Bankya.
  4. The Coca-Cola Foundation approved the immediate disaster relief application of Bulgarian Donors Forum and the initiative UNITED Against COVID-19.

“Definitely it will be a bad year for the economy,” said Levon Hampartzoumyan, member of the Board. He outlined two phases of the crisis. First, it is based on purely medical circumstances, which hopefully will end up in a month. The second one is the assessment of the damage and the effects on the economy. According to Levon many things should be restarted, and in this process the financial systems, the banks will play an important role. “As opposed to the previous crisis in 2008-2010, when the banks were the root cause for the crisis. Now the banks are in a pretty good shape and they will be used as a supportive network for the businesses to recover,” he said also.

Leaders’ Insight

Then came the time for sharing by leaders of various members.

Krassimir Nenov, Executive Director, ContourGlobal Maritsa East 3 said that the company has adapted to the current conditions to protect the personnel and the contractors that operate at the power plant. “We have worked very reliably. The demand for our generation was quite high, so all the four units of the plant have been operating,” he said.

13% of the generation over the last month has been done by ContourGlobal Maritsa East 3 TPP, and the share of AES Galabovo TPP is 11%.

“Our business in Bulgaria is strongly influenced by the automotive. In Plovdiv, we are somewhat more diversified, said Yavor Nikolov, Plodviv Plant Director, Sensata Technologies. “Due to our main customers’ plant closures in the U.S. and Western Europe, we are struggling with the situation of a significant demand drop.” The company is taking measures to preserve our personnel, mainly sending people on leave or reducing working time. They are interested in a more workable version of the 60/40 rule because companies like Sensata are not in the focus of the current version of the rule.

“Automotive in general started to experience the crisis when the restrictive measures of the Chinese government were introduced,” said Alexander Milanov, BMW Bulgaria, who gave a thorough overview of the global supply chain and business of the BMW. The effect was on the workshop network down by up to 90% down in January. The recovery started in February. In China they have a V-curve of the downturn of business (based on consumption). Expectations are until Q4, we will be about 95% to 110% of the currently planned sales with an uncompensated drop in March.

Ever since the crisis, Amgen globally and in Bulgaria started working remotely with the exception of critical positions at warehouses and production facilities, said Krassimira Chemishanska, Amgen. They also tried to contact doctors in order how to continue treating their patients with chronic diseases. Led by Amgen Bulgaria, the pharma-industry started to support financially the healthcare system in Bulgaria. “With the ArPharm we have managed to donate 3 respiratory equipment to the Ministry of Health plus other safety protective equipment, and in addition to this effort Amgen Bulgaria has donated BGN 110,000 to the COVID-19 combat funds,” she said.

Additionally, the 23 innovative pharma companies we have donated over BGN 1 million. “The other thing that is on the top of our priorities is to ensure the smooth and regular supplies of medication to chronic patients,” said Krasimira. Also, there are a lot of R&D attempts, a lot of new clinical trials for new vaccines, and medications that are currently registered for different indications to be used against Corona virus infection. Together with Adaptive Technologies Amgen has announced partnership in finding a quick fix (antibodies creation) to COVID-19 to speed up the prevention, because for vaccines will take at least a year to be registered and to prove efficacy.

“When China was hit by SARS in 2003, we as a group – IHG – learned from it. So, when the state of emergency happened in Bulgaria, we were ready,” said Angelo Zuccala, GM, InterContinental Sofia. The hospitality sector was hit very badly. At the InterContinental Sofia only room service is offered to guest as no restaurants are in operation; they have still some rooms occupied. “In Sofia, and Eastern Europe the revenue per available room dropped on average by 73%; in April the overall RevPar forecast is to drop by 94%,” he pointed out. “We are very strong at being able to keep employees,” said Angelo. At the InterContinental they apply variety of safety measures to keep their guests and staff safe, as well as ensuring business continuity after the lockdown by implementing new measures.

“As we have roughly 2,000 employees and at about 5,000 people with the subcontractors, we also went through these challenging times,” said Kalin Peshov, Chairman of the Management Board, Glavbolgarstroy AD. They took all the protective actions and measures. After the initial uncertain period as of the outbreak, currently all GBS construction sites are fully operational. “It’s a little bit less efficient, a little bit more expensive with all these measures, but we are happy that we are working,” said Kalin. The company is satisfied as well with the economic measures the government proposed, and the 60/40 Rule works for them.

“The plants of Woodward Inc. in the US are considered a manufacturer and supplier for the critical infrastructure having customers like Boeing, Airbus, Bombardier, General Electric. I would like to suggest that AmCham with its advocacy expertise to do the same for some of its members,” intervened Emil Iliev, GM, Woodward Bulgaria. The Bulgarian factory continues operation with its 250 people. Its core production is for the aerospace industry and all products are shipped back to the US.

“The trend we see in the last couple of weeks is that people send proactively their resumes,” said Irena Bushandrova, Pedersen & Partners. As soon as the lockdown started, there was a hiring freeze across companies. “It is the right time for companies to critically review of their staff and keep only their best people,” recommends Irena.

In Bulgaria Modis have over 1400 people in 3 physical centers, 2 in Sofia and one in Plovdiv. We are specialized in IT outsourcing and have significant experience in IT support which represents a little more than a half of our activity here in Bulgaria. Also, we have other data infrastructure management activities, and for two years now we are providing software development / support, maintenance and automation,” Philippe Rouvrais said about Modis Bulgaria portfolio. Since the lockdown due to Covid-19 the entire organization is working from home and producing services to its clients remotely.

“In the past four weeks, we have recruited over 80 people and will continue recruiting to cover our client needs,” he pointed out. However, they are experiencing a strong reduction of activities in Germany, Italy and France. Their operations in APAC are slowly but surely coming back to normal.

“In the light of the epidemic situation we have offered help in some areas in Bulgaria: reusable protection masks for the Red Cross and several hospitals,” shared Philippe.

“Cargill is the global leader in the food supply chain with more than 150,000 employees. Their safety is and has always been priority number 1 for the company. On the first day when the emergency situation was declared in Sofia, we successfully activated our Business Continuity Plan,” said Vasil Petrov, Cargill Bulgaria. They see no loss in productivity since they sent 1,300 people to work from home. In terms of Cargill as a company, the expectation is they will not be harmed a lot from the crisis because of their type of business. 

Shell’s priorities were outlined by Kamelia Slaveykova, CEO, Shell Bulgaria. They took care of their people – working from home; salespeople don’t travel; banning of international and domestic travel. Shell fuel stations operate 24 hours. Also, they are trying to ensure business continuation. However, the requirements of the government to stop travelling and to stay home impact their business seriously. They have stopped selling fresh food at our sites. “It is good that we as a business join our efforts and support the government,” concluded Kamelia.

Shell Bulgaria donated fuel worth BGN 100,000 for the ambulances in the whole country.

VC Coffee with the AmCham Board, April 10th, 2020