Ambassador Mustafa Full Speech at the Business Meeting with AmCham Members

It is such an honor to be here with all of you this morning. Let me just say that for us, at the U.S. Embassy, Olivier Marquette, Petar Ivanov, you have been incredible partners. I have worked with American Chambers around the world and this chamber here is among the best. Your vision and leadership, combined with that of the AmCham Board, so I want to say thank you to you.

We are all coming together today at a pivotal moment. This year has been very difficult in many ways – we have this raging pandemic that has taken a devastating toll – human toll and economic toll; psychological toll, we have this prolonged political uncertainty in Bulgaria, with multiple rounds of elections; and around the world we’ve had an ever complex challenges that have been testing our collective resolve – we’ve had the risks to energy security, worrisome global trends towards political partisanship and social division.

And yet, as this year comes to a close, I see tremendous potential to turn the page on this time of hardship, and to chart a way forward together. I see hope (надежда, it’s my favorite word in Bulgarian) and the potential for positive change. There is cause for optimism all around. Last night, Secretary Blinken congratulated the Bulgarian people on your future, on the fact that you have a new government, the congratulations goes to the Bulgarian people. You have gone to the polls for five times this year and your commitment to democracy is just incredible. And as a result, Bulgaria has formed a new government that carries with it a renewed sense of dialogue and collaboration. The Bulgarian economy is stable and it’s poised for growth in 2022. We have developed and are deploying vaccines and other life-saving treatments and, slowly but surely, we are helping to turn the tide against COVID-19. And we – the United States and Bulgaria – have sown the seeds for a deep and multifaceted partnership. So we have done this over the years and we are going to continue this, and we are going to work together to bring greater opportunity, security, and prosperity to our two nations.

This speech comes, also, at another more personal milestone, for me. As Olivier said, I recently commemorated my two-year anniversary in Bulgaria. And in fact, my very first speech was here with the American Chamber at this forum two years ago. Over these two years, I have crisscrossed the four corners of this amazing country and I have seen first-hand the strong bonds that our countries – and our two peoples – have forged. I have met with Bulgarians from all walks of life and they have shared with me their stories, and have given me such a deep and lasting appreciation for this country’s history, its rich culture, and the Bulgarian people’s hope and commitment to building a better, more secure, just, and prosperous future for the generations to come. As I have always said – Bulgaria’s population is around seven million. I’d like to think of it as seven million and one, including me…

What I would like to do today is give you what I see as the hope and the partnership for the year ahead. And in particular, I would like to focus on three key ideas. The last time I was here I spoke about the 3 C’s – not the Three Seas Initiative (which is also important), but the 3 C’s being “Connectivity, Collaboration, and Countering Corruption.” Today I would like to talk to you about 3 I’s — Investment, Innovation, and Integration.

Investment

First, investment. What I’m talking about here is investing together in our future. Investing together – I want to underline that word – together. Our two nations’ success hinges on investing in infrastructure, investing in human capital, investing in good governance, and investing in new and promising sectors of the economy. These critical investments will not only help us turn the corner, to turn that page from this COVID pandemic, but also position our countries for long-term stability and prosperity.

Obviously, 2020 was a difficult year economically, and we saw that the Bulgarian economy declined 4 percent in 2020. But Bulgaria is expected to rebound this year, with estimates of up to 4 percent growth. This recovery looks to be driven by higher wages, an injection of billions in euros from the EU’s post-COVID investment funds, as well as export increases.

Our bilateral trade in 2020 also took a hit because of COVID when it fell to USD 1.2 billion, an almost 11% decrease from the year before. However, if we look at the latest trade numbers from January to September of this year, the data shows an almost 25% surge compared to the same period last year. So, Bulgaria is bouncing back.

I’m very proud to see how American companies – many of whom are represented here today – are providing critical investment and jobs that are helping to drive this recovery. In fact, American companies have invested well over two-and-a-half billion dollars in the Bulgarian economy, creating over 30,000 high-paying jobs, and placing the United States among the top six investors in the country.

I would love to see more American investment in Bulgaria. This past summer I visited international companies across Bulgaria and they told me that in order for Bulgaria to continue to attract foreign businesses and capital, the country must continue to invest in good governance. International investors remain concerned about the rule of law – obviously this is very, very important for businesses. These companies cite recurring difficulties, such as obtaining needed permits, the unpredictability due to frequent regulatory and legislative changes, and an inefficient judicial system. During my outreach to American companies, many have cited old labor laws that date back many, many years, that need to be updated in order to fit this new economy.

The regulatory environment in Bulgaria in many areas is characterized by complexity, lack of transparency, and arbitrary or weak enforcement. And these factors create incentives for public corruption. Now, I don’t say this to point a finger. We in the United States have difficulties as well, and we in the United States are constantly aiming to do better. I say this as a partner, as a friend, and as an ally, because we are in this together.

And it would be wonderful to see Bulgaria move up on EU member states’ ranking in the Transparency International index, right now, it is the lowest in 2020, in that index. It would be wonderful to see Bulgaria move up in that ranking. And again, I say this as a partner, a friend, and an ally. So, fighting corruption, the importance of rule of law, the American Chamber has played a role and I believe should continue to play a role in this. I know that the American Chamber and the German Chamber partnered together last year, and you developed a program on the Foreign Corrupt Practices Act; this workshop was the first time we have done this in years, so we should continue to do that. Also, again for the American Chamber, I know that you have lots of new ideas how the economy should improve, you should share these ideas with the new government.

Also key to Bulgaria’s future is investing in energy diversification. You’ve heard me say this before. We support Bulgaria’s efforts toward energy independence and sustainability, as we always have for all of our European friends and colleagues. Choice and competition, including the option to choose Western solutions, enhance our shared security. To that end, last year we signed a Memorandum of Understanding Concerning Strategic Civil Nuclear Cooperation (NCMOU). And this memorandum provides a framework for engagement between experts from government, industry, national laboratories, and academic institutions. We already have planned a small modular nuclear reactor workshop here in Bulgaria next year, which will be funded by the U.S. Trade and Development Agency. We are also recruiting – this is news – a Bulgarian delegation to attend the latest, largest American energy trade shows — POWERGEN and DistrubuTech—in Dallas in January 2022.

I mentioned the investment of the U.S. Trade and Development Agency. This is the first time they have invested in ten years; for ten years, they were absent. And last year for the first time they decided to invest in Bulgaria. They have awarded a feasibility study to the Sofia Municipality that would modernize its district heating company that serves over one million of its residents. The citizens of Sofia, we believe, deserve a cleaner, more modern, more effective heating service, and we know that this heating system is need of modernization. USTDA has given a million dollars to help the city develop a plan to modernize its heating system.

I flag these examples because a partnership with America means an investment in the future. We are in this partnership, we bring resources, we bring training, we bring feasibility studies so when I say invest, I mean we invest. We need to do this together. You’ve also heard me say what we want is a strong Bulgaria because when Bulgaria is strong, we are strong.

Together with the AmCham, the Embassy we are going to continue to be an advocate for fair access to markets, to increased transparency and oversight of government procurements, and partnerships with international companies to break the market dominance of one country in the energy sector. And we think this will result in more competitive prices for consumers, for families, and for businesses.

You have heard Olivier mention that the American Chamber has an EU Green Deal working group, and this working group has hired wonderful international consultants to conduct a thorough study of all the options that are available for Bulgaria as it transitions to a coal-free future, obviously while also accounting for the social dynamics of that transition. It’s not easy, we have done this as well, and doing it in a way that also makes sure that those workers are taken care of and that they continue to have well-paying jobs. But the purpose is to have clean energy, energy storage, next-generation renewables, civil nuclear solutions, and carbon capture.

As I was visiting with international companies this summer, another thing they flagged for me is the need to continue investing in human capital, and that is really important in order for Bulgaria to retain its competitive advantage. And I know that there is a wonderful example of this. The AmCham accompanied me to an outreach visit to Plovdiv earlier this year where we saw a very, very effective vocational educational program supported by the America for Bulgaria Foundation and the Trakia Economic Zone. This project trains students from local vocational high schools for jobs as machine technicians, operators, and electricians. These are the types of programs that are needed, more of these types of vocational training programs.

I also know that the American Chamber has worked previously with the Swiss Chamber and with the German Chamber to make legislative changes that created more vocational training opportunities. Let’s do more of that! These are all very good examples of private-public partnerships that could help Bulgaria attract more foreign direct investment. So, we must continue to drive innovation through more educational and vocational projects.

Innovation

This takes me to my second point – innovation. The second “I”- innovation. We are facing increasingly complex challenges, as I mentioned – just look at how COVID has disrupted the entire global supply chain, or how these cyber-attacks from malign actors can cripple Fortune 500 companies and critical infrastructure, and how climate change threatens every corner of the globe. To overcome these challenges, we need innovation.

Bulgaria has a strong and growing tech sector, and I see boundless opportunities to build on this foundation and jointly develop innovative solutions to our most pressing challenges. U.S. exports are already bringing to Bulgaria cutting-edge tech products, with growth in electronic devices, automotive parts, power plant equipment, and medical technology. While some may expect Bulgaria’s main export to the United States to be agricultural products, the reality is that computer and electronic products rank number one, underscoring the mutually beneficial relationship.

The growing sophistication of cyber threats requires a sophisticated and coordinated response. We were pleased when last year the Bulgarian government signed with the United States the Joint Declaration on 5G Security. Bulgaria showed foresight and courage in signing this document. Whoever builds a nation’s 5G networks gains the keys to that country’s most sensitive personal, commercial, and governmental data. So, this is why a trusted network offers a comprehensive approach to addressing these long-term threats to data privacy, to security, to human rights, and to trusted collaboration. Now that there is a signed declaration, this needs to be turned into a national strategy to be truly effective.

And of course, as the COVID pandemic has shown us, we face ever more complex health threats that do not respect borders. We need to come together to deploy the latest science and technology to contain these threats. Also last year, we had a very productive year, we signed a 5-year healthcare cooperation agreement with the Ministry of Health. The United States is working with the Bulgarian government to combat infectious diseases, share best practices for e-health initiatives, and to promote educational exchanges of medical professionals. I know Olivier mentioned this Health Care Investment Report. I hope that you share that report with the new government, it’s important for them to see the data and findings.

Integration

And finally, I’d like to spend a few minutes talking on integration – the third “I”. In particular, I’m talking about Bulgaria’s integration with Western markets and its partnership with the United States and other Western allies to build a more secure future.

I truly believe that we are stronger together and that we should continue to promote regional integration. For example, Bulgaria should be on a path to further integration into leading economic institutions, including the OECD and the Euro Zone. I was here two years ago and I said this. I believe it even more today. Bulgaria should find its way into OECD and should be a member of the Euro Zone. Bulgaria is a leader in Balkan integration; take back that role. Bulgaria has great potential to become a vital, contributing member of critical regional and global institutions. And further adoption of European standards and practices will modernize Bulgaria’s economy and will spur much needed democratic reforms.

The American Chamber has demonstrated its regional leadership when it played a key role in helping organize the successful Three Seas Initiative Summit and Business Forum with eight presidents and other high-level representatives from the 12 member states, as well as Germany, the European Commission, Greece, and the IMF. I am very happy that AmChams in Europe, all of the AmChams are gathering in Bulgaria next year to have their annual meeting. Bulgaria is the future.

One of the focus areas of the Three Seas that I do want to highlight it in this Integration category is energy, and as we have said, Bulgaria has the potential to become an energy hub for gas and for electricity markets. One of the key components of this is the Greece-Bulgaria Interconnector. You know I am a very strong advocate for the IGB, and I will continue to be a strong advocate for the IGB.

It goes without saying that Bulgaria also plays a very integral role in regional security. As a NATO member, Bulgaria’s armed forces have seen unprecedented regional cooperation, training, and investment. And Bulgaria has taken giant steps forward in its military modernization. Last year, we signed a 10-year military modernization plan with Bulgaria. We’ve already had our one year review, and we are looking forward to working together with Bulgaria when it modernizes its military. And I am proud that it started with the purchase of the first eight F-16s, and with that we have also invested in the training of new pilots for this equipment. Our Department of Defense and Bulgaria’s Ministry of Defense have continued to work on our defense institutions, deepening Black Sea cooperation, bolstering cyber security within the Ministry of Defense, and doing whatever we can to increase national resilience.

One final note I want to say on integration – in our interconnected world, businesses are no longer purely businesses with a profit motive. The private sector must be fully integrated into society as a whole, playing the role of responsible corporate citizens to address deeply rooted social challenges.

I am very proud of the fact that American companies have set the standard for corporate social responsibility and they have given back to their communities; they have given back to Bulgaria. Just one example that Olivier mentioned is the United Against COVID-19 Relief Fund. In just two months, we had the AmCham, the America for Bulgaria Foundation, the Bulgarian Donors Forum, and the Embassy together working to raise BGN 1,000,000 for Bulgaria. I have to say this is not only the first time that this collaboration took place but the fact that in just two months we had so many companies donate the one million and also in kind – so much equipment that they also donated, truly this was a wonderful collective effort.

On top of this the American Chamber has supported the Academy of Women Entrepreneurs (AWE) with mentors, and this program has grown to three cities across Bulgaria. When I congratulated the graduates of this program in Dobrich last month, it reminded me of my favorite word – надежда! I saw how that hope was reflected in the faces of these graduates as they embark on turning their business dreams into big companies, turning their dreams into reality. Thank you AmCham for playing a membership role in that. This initiative is the State Department’s premier global women entrepreneurship program. Bulgaria was the only country in Europe to be given an award in this competitive process. Again, I flag this because wonderful things are happening here in Bulgaria.

As I mentioned, in the Charities Aid Foundation World Giving Index, over the last 10 years Bulgaria was ranked 120 out of 126 in that Index. This year Bulgaria is ranked 45. So, it is the fourth best improvement among all countries. I know that it’s the American Chamber – and NGOs like ABF, BCause, and the Bulgaria Donors Forum – all of you deserve credit for that. Again, this is what gives me hope that positive changes in Bulgaria can happen in many areas despite the challenges that we face.

Closing

My friends, in closing, I want to thank all of the members of the AmCham for your tireless work to promote the interests of American companies in Bulgaria and to help lead the country’s pro-growth business climate. We have accomplished a lot together these past two years, and I’m very proud of our partnership. Each and every one of you has a role to play in building this future of promise, and I look forward to working with all of you in the months ahead to create more opportunities for American businesses in Bulgaria and to improve the investment and business climate here.

So, from the 3 Cs to the 3 Is – increased investment, innovation, and integration – all of this is good for the Bulgarian economy, it’s good for the U.S. economy, and it will bring our two nations and people even closer together. Now, I hope you see why optimism and надежда are my favourite words, and to all of you I wish успех.

Thank you.

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Source: U.S. Embassy in Bulgaria website