MARKETING STRATEGY OF MUNICIPALITY OF LOM

Municipality of Lom

Municipal Centre for Cross-border Cooperation

Project BG2004/016-785.01.01.01-19

Good neighbours – good Partners

MARKETING STRATEGY OF MUNICIPALITY OF LOM

Content:

Context and approach during the Strategy preparation 1

How the strategy was prepared? 2

Documents, considered by the Strategy 3

Objectives of the strategy 4

Strategic requirements and expected results 5

Vision of the Municipality of Lom 6

Development potential of the Municipality of Lom 7

Companies of structural importance 14

Small companies 20

Agriculture 23

Local economy – future development 25

Human resources 28

Administrative capacity 32

SWOT analysis 36

Strategic priorities of the municipality 39

Potential industrial investors 40

Potential investors in logistics and transport 41

Investors in agriculture 42

Investments in tourism 43

Investments in services 45

Social economy 46

Stimulus for investors 47

Presentation of the priorities 48

Possible sources of financing 49

The Marketing strategy is prepared by PhD Vassil Kirov and PhD Ekaterina Markova in

the frameworks of “Good neighbours – good Partners” project, financed by PHARE Programme

Cross-border cooperation.

Context and approach during the Strategy preparation

The municipality of Lom plans the present marketing strategy to be worked out during the

“Good partners – good Neighbours” project, Neighbourhood Programme, realized with the

partnership of the City Municipality of Pantelej from the Republic of Serbia and financed by

PHARE. The task for the working out of the strategy was given to team of consultants from the

Institute of Sociology, Bulgarian Academy of Science. The project of the strategy will be

discussed by the interested parties and will be presented to the local community in the autumn of

2007.

In the frameworks of the project for cross-border cooperation an analogous marketing strategy of

City Municipality of Pantelej, the Republic of Serbia is envisaged to be worked out. The

experience, gained during the process of strategy planning in the Municipality of Lom is

extremely important for the local authority from the City of Nish where is imminent to elaborate

development plans, needed for the process of European integration.

On the basis of the two Marketing strategies, a Strategy for economic cohesion and development

between the City Municipality of Pantelej and the Municipality of Lom for the period 2007 –

2013 will be developed. It will give an opportunity for joint development and cooperation

between the companies from both municipalities; will put the base for long-term partnerships for

realizing joint initiatives and public-private partnerships (PPP) as well as multiplication of the

results.

How the strategy was prepared?

The experts from the Bulgarian Academy of Science prepared the Marketing Strategy on the

basis of the existing documents, statistics and collected information by the stakeholders in the

Municipality of Lom. They researched the available strategic documents that outline the

priorities of the Municipality, including the Municipal plan for development for the period 2007

– 2013. A content analysis of existing documents and statistical information for the last three

years, containing varied economic and social information divided in sectors, production, human

resources etc, was made. That analysis outlined the current status of the Municipality of Lom

and the development potential of the local economy.

In the framework of the project, meetings with representatives of the municipality, business,

NGOs and other interested parties in Lom were held. These meetings contributed for outlining

the community’s opinion – the citizens who will live and work in the municipality in future.

Namely, their view, attitude and intention are important guarantee for realizing the present

Strategy.

The accomplished empirical sociologic research of companies, working in the territory of Lom in

the summer of 2007, showed the opinion and the preferences of the representatives of the local

business. The analysis of the plans for individual economic development gives important

information for the tendencies in the business climate, for the priorities according to the local

economic subjects, as well as the measures, which the local authorities should take for

improvement of the economic trend.

On the basis of the SWOT analysis of the strong and weak sides, the threats and the

possibilities, the priorities of the Municipality of Lom in medium-term plan are worked

out.

Documents, considered by the Strategy

The Marketing strategy of the Municipality of Lom integrates and interprets various

statistical, empirical and other information. The analysis and the recommendations made in the

strategy are in accordance with the following documents:

National plan for regional development for the period 2007 – 2013 will form the base for

creating of better conditions for sustainable development of the country in medium-and long-

term plan. The main objective in front of the Bulgarian government during this period is

connected with increasing of the income and the life standard of the population, as well as

the simultaneously turning of the country into better place for living.

National strategy for regional development of the Republic of Bulgaria for the period

2005 – 2015. It is the basic document for defining of the long-term purposes and priorities of

the country’s regional policy in distributing the aid from EU for implementation of the

programmes, concerning the regional development, including Northwestern planning region,

in which the Municipality of Lom is situated.

Strategy for development of the district of Montana 2005 – 2015, which underlines that

the main objective for development of the district of Montana for the period to 2015, is

overcoming of the backlog by accelerated socio–economical development of the district for

reaching the level of the most developed districts in Bulgaria, in consideration with

environmental protection.

Strategy for investment stimulation in the Republic of Bulgaria, where it is set the

increasing of competitiveness of the Bulgarian economy and the achievement of stable and

resistant economic growth by stimulation of the investments.

The Municipality of Lom - Municipal plan for development 2007 – 2013, whose purpose

is the achievement of balanced business and economic development of the municipality,

increasing the life quality and reaching the level of the most developed municipalities in the

country.

Objectives of the strategy

The basic objective of the Marketing strategy of the Municipality of Lom is to present to the

potential investors and donors of development projects the strategic priorities for economic,

infrastructural and social development of the municipality. Its working out in the framework of a

project for cross-border cooperation, financed by programme PHARE, defines the usage of

specific instruments for regions from the neighbourhood countries in an economic and social fit

in international and European aspect.

SPECIFIC OBJECTIVES:

- The Strategy aims an instrument for promoting the municipality and enticement of

appropriate investors to be created;

- The Strategy will be used during the process of rapprochement of the Municipality of

Lom and the City Municipality of Pantelej on the basis of opportunities for cooperation

of business, local authorities and NGO;

- During the process of work on the Strategy, the analysis of the condition will outline the

presence of new possibilities for projects and measures, which the Municipality of Lom

should use to increase the enticement of foreign assets and national investments;

- The Strategy will outline a frame for future development of the cross-border cooperation

with other municipalities from neighbouring countries;

Strategic requirements and expected results

The Municipality of Lom aims to attract investments that will require certain conditions,

connected with the quality of life and the available resources in the region:

- The attracted investments in the Municipality of Lom should be connected with the

opening of stable and quality jobs for the population of the municipality;

- The investments in the region should indicate the preserving of the environment;

- The municipal administration should keep its leading role of mediator between the

national and regional interest, the requirements of the community, the potential investors

and the local business, as a protector of the public interest of the citizens in Lom;

- The participation of the local business as a partner/subcontractor of the investors will be

well appreciated from the local community;

Expected results from the application of the Strategy

The successive and flexible implementation of the Marketing strategy will guarantee increasing

the level and size of direct foreign and local investments as a result of the improvement of

investment and business climate in the Municipality of Lom, which will lead to higher level of

employment and income of the population.

To guarantee the improvement of the socio-economical situation in the Municipality of Lom, the

strategic priorities should be followed and defended from every political authority, from every

representatives of the municipal administration in the next five years.

Vision of the Municipality of Lom

As it is worked out in the Municipal plan for development 2007 – 2013, the Municipality of Lom

should become a transport and a commercial centre on the Danube River, as a cross point of the

Pan-European corridors №4 and №7 with developed technical infrastructure, with stable and

resistant socio–economic development, based on territorial heritage, with balanced processing

industry, competitive economy, effective agriculture and preserved cultural and historic heritage.

Development potential of the Municipality of Lom

The Municipality of Lom has a key geographic location. It is situated on the crossroad of two

European corridors and this is rather favourable for the future development of the transport and

logistic activity. The territory of the municipality is 324 m2, which is about 9% of the territory of

the district of Montana.

The local economy is restoring from the crisis during the 90’s and shows stable growth during

the last years. The municipality has human resources with a potential. There are administrative

capacity and concrete plans for development.

According to the National Report for Human Development of UNDP for 2003, the Municipality

of Lom is at 53rd

place among the municipalities in Bulgaria with index for human development

of 0,784.

The Municipality of Lom is situated in North–Western of Bulgaria. Two European corridors - №

4 and № 7 are crossing on Port Lom. Lom is situated on the shortest from Greece and Macedonia

to Danube River and their connection with Central and North Europe. In addition to Danube

River, connecting several East - and West – European countries, the harbour is available for

processing and transportation of transit cargo from Macedonia and Greece.


The Port of Lom (или port “Lom”) can pretend to be the gate to Europe, as inseparable part of

trans-European network for combined transport Rhine – Main – Danube - № 7 and cross point of

Euro corridors from TINA network – corridor № 4 (route E 79) Vidin – Montana – Vratza –

Sofia – Kulata (RR I – 1); This is a base for development of the economic activities from

national and international significance. By the channel Rhine – Main – Danube all water routes

from North sea reach Lom. The existing railway network, after the appropriate modernization,

connects port Lom with port of Thessaloniki in huge transport hub of the Mediterranean.

Big transport harbour of Danube River is situated in the town of Lom, and it is the second

biggest harbour for cargo transport in Bulgaria. Harbour complex of Lom is situated on 741+800

km of Danube River. It is spread on 29,9 hectares, including 8,8 hectares aquatory. It is a

multifunctional harbour for processing of bulk, general and other cargo. About 40% of the cargo

turnover of the Bulgarian river harbours is processed in it. As a traditional transport centre, the

Municipality of Lom has good potential for management of cargo to different parts of Europe

and serious opportunities for cooperation with neighbour regions (Romania, Serbia,

Montenegro).

The harbour has enough automobile and railway sources which allow processing of ships to be

done directly and indirectly. The harbour includes 5 quays and 13 ship berths and as basic

facilities – 24 cranes.

The Ministry of transport started the procedure for the concession of “Intermodal harbour

terminal of Lom” on the 18 of October 2007.

The basic subject of the concession is the management and the maintenance of the harbour

terminal for the right of the concessionaire to process cargo and mail, to serve passengers and

marine – technical services, for which the usage of harbour territory and facilities is required.


An additional subject of the concession is the commitment of partial extension, reconstruction,

rehabilitation or repair works of the site or accompanying the terminal’s exploitation activities.

The time of the concession is 35 years and the minimum investment – 66 million BGN,

including 30 million BGN for the first four years of the concession. The concessionaire will be

chosen by conducting of an open procedure till the end of 2007.

The transport – logistical advantages of the municipality include also:

Constructing of embankment with quay two-leveled wall till the end of 2008. The wall is

long 800 m, the total value is 10 million BGN and according to the update project of

MRDPW, there will be 5 quays. The specialized company in building of hydrotechnical

facilities Rosilex Ltd is tapping 1,045 million BGN. The money disbursement is approved by

the Permanent Commission for protection of the population from disasters, emergency and

accidents, given by MRRB as a first stage for constructing the protection facility.

Land connection with Sofia – the shortest way to the capital is 145 km, the road is partly

rehabilitated and its total rehabilitation is forthcoming. The first stage of rehabilitation of 41

km from the republican road II – 81 Lom – Montana for 5 722 564 Euro on PHARE CBC

Bulgaria - Romania. The road is projected with width 8,50 m and will be finished in 2008. In

the National plan for development it is foreseen a tunnel under Petrohan Pass in Stara Planina

to be built with the assets from the structural funds of EU, which will considerably shorten

(about 40 – 50 km) the distance between Lom and Sofia.


Presence of double railway line and land transport connections with important cities –

the town of Lom is distanced 51 km from the district of Montana, 57 km from the district

centre of North-Western region for planning – Vidin, 88 km from the city of Vratza and 145

km from the capital Sofia;

The construction of ferry connection with the Romanian village Rast, which is distanced 4

km from the biggest transport highway in Romania, is foreseen. In Operative programme

CBC Bulgaria – Romania 2007 – 2013, section Infrastructure, a construction of ferry Lom -

Rast is planned, as the shortest connection between the Balkans and the North European

countries for identification of the region as a whole, which will adequately be presented in

international plan and in Brussels.

A former military–transport airport is distanced 32 km from Lom in the village of

Gabrovnitza, Montana. The Ministry of defense authorized the Ministry of transport to

manage 6 former military airports, including the one in Gabrovnitza, on 22 of November,

2007. This is a chance for signing contracts with interested companies for development of

charter flights, services and development of cargo transport.

LOCAL ECONOMY

The Municipality of Lom is situated in the district of Montana, North-Western region for

planning, which is with lower socio–economical indicators in comparison with the average of

Bulgaria, but has a serious development potential, especially with the intervention of the

instruments for regional development.

The Municipality of Lom is traditional industrial and logistical centre with national significance.

In the end of XIX century, Lom became popular as “the gate” of Bulgaria to Europe. A serious

percentage from the country’s export and import passed through it. The territory of the

municipality (part of Zlatia) is famous as one of the most fertile regions in Bulgaria. During the

socialism, in the town are built some significant industrial factories - electric fork-lift plant,

sugary factory, military plant etc, which provide the employment of the municipality population.

The agriculture also contributes for the economic development of the region by the processing

plants – dairy plant Serdika, packing plant Rodopa and the tinning factory. The transition is

extremely heavy for the local economy – all structure defining factories in the town are closed,

part of the population in the municipality moves to the capital or abroad.

The economic decline in the municipality after 1989 is overcome and in the last years, the

municipal economy indicates good results in turnover, investment, fixed assets, etc. It should be

said that the stable positive economic results are seen in the region as a whole. Only in 2004, the

growth of gross domestic product per capita for the district of Montana is about 24%.

Graph. Income of the companies’ activity in the Municipality of Lom

Total

90433

123413

163239

0

20000

40000

60000

80000

100000

120000

140000

160000

180000

2003 2004 2005


The income from the sales in the Municipality of Lom has considerably increased during the

period 2003 – 2005 (from 90 to 163 million BGN) and this tendency is kept in the upcoming

years. The growth is generated in almost all sectors, in the building sphere it is impressing - the

amount of sales has increased almost 7 times for two years, and exactly the recuperation in

building is a sign for total liveliness of the economy. It should be mentioned that the growth in

the processing industry and the sector Commerce, repair and technical service of automobiles

and motorcycles, personal belongings and household goods is also impressing. The sales are

almost doubled. In the background of these amounts, the growth increase in sector Transport,

storage and communication does not look so huge, although there is a growth of 39%. The only

sector, which results slump in the examined period 2003 – 2005 is Hotels and restaurants.

In the municipality’s territory there are 4 big and 8 medium functioning companies (6 in 2004).

The small companies are 35 in 2003, and according to the data from National Statistical Institute

(NSI), the number of micro-enterprises on the territory of the municipality shows crucial rollback

- from 720 in 2004 to 560 in 2006. Obviously, we observe the development of two tendencies –

on the one hand, part of the micro-companies show economic growth, they hire more employees

and transform themselves into small companies. On the other hand, obviously a part of the

micro-companies terminated their activity during the period because of bankruptcy. This would

raise the questions about whether the business environment is stable and favourable for starting

of new activities and stable economic growth.


Number of economic units in the Municipality of Lom, divided into sectors

Number of economic units in the Municipality of Lom, according to the number of the employed

Companies of structural importance

720

17

65

16

432

82

27

22

48

9

0 200 400 600 800

Total

Agriculture, hunting and forest farming

Processing industry

Building

Commerce, repair and technical service of automobiles andmotorcycles, personal belongings and household goods

Hotels and restaurants

Transport, storage and communication

Real estate operations, renting activity and business services

Healthcare and social activities

Other activities, serving the society and the individuals

720

675

35

3

3

4

0 100 200 300 400 500 600 700 800

All units

Micro up to 10 employed

Small 11 - 50 employed

Medium 51 - 100 employed

Intermediate group 101 - 250 employed

Big more than 250 employed

In the town of Lom and the municipality, there are companies functioning in several sectors. The

general and luxury food industry is prevailing in the region, followed by the sectors production

of machines, metal products, vehicles and the light industry (production of clothes).

GENERAL AND LUXURY FOOD INDUSTRY

One of the first breweries in Bulgaria is built in 1894, in Lom. In July, 2007, a company from the

brewery sector appeared for the first time on Sofia stock exchange, 900 000 shares or 20% of the

capital of Lomsko pivo SA were sold for the maximum allowed price 3 BGN per share. The

company itself is directed to the low price section and has a big market share, especially in the

region of Lom, but it is far from the big producers, owned by foreign companies. In this sense,

the investments in quality improvement would help in sales increasing, which will turn it into a

favourable investment. Lomsko pivo has signed a contract with a distributor for the Romanian

market and it is now negotiating with a second. The prognosis is that the sells in Romania will

increase till the end of the year reach their maximum potential in 2008.

Winery Polomie JSCo is a newly built company in the sphere of wine and spirits processing and

bottling, although it is found as winery in 1959. For its activity expansion and staple ensuring,

the company bought 2000 Ares municipal land on the bank of Danube River, aiming to create

vine massif near the villages of Kovachitsa and Stanevo. The annual production capacity of the

company is 10 000 tons of wine for the last year. The production is sold in the internal and

external market: the ex-Soviet republics, Poland, Germany, Belgium, Israel, USA and Japan. The

varied assortment of Winery Polomie includes more than 40 wines and spirits. The company

provides permanent and temporal (seasonal) employment of 300 people.


Among the good-working private companies is the company for production and processing of

meat – Miti Ltd, which uses modern technology, created by project on SAPARD Programme,

for production of salami and delicacies. The company is found in 1995. After an investment of

more than 5 million BGN in 1999 and reconstruction in 2000, Miti has become one of the

biggest producers of raw, minced and smoked meats, semi-finished products, salami and

delicacies in North–Western Bulgaria. Freshly chilled Bulgarian meat are used in the products,

there is strict control of animal purchase, uncompromising hygiene and modern technological

processing. Miti is a modern company for production and processing of meat, equipped with the

latest technique in the sphere of production and storage of foodstuffs.

In the field of milk-processing, MILKKOM Ltd is functioning on the territory of the

municipality since 1993. Its basic activity is purchase of raw milk and processing and production

of milk products (yoghurt and milk, yellow-cheese and cheese). The raw milk is bought from

milk producers on the territory of Lom and it is being transported with own transport. The

production is sold in the Bulgarian market.

Since 2001, Simers GRUP Ltd activity is: production of sugar and chocolate products. In the

company’s workshop, there are three technologically independent lines for production of roll

biscuits, stamped biscuits and waffles. The company is 100% private property, and sells its

production on the Bulgarian market. The annual sales volume is 200 000 levs in 2004. There are

70 employees in the company. The main priorities and future interests are directed in contacts

with new clients, expansion of the market share in the country and export, as well as

implementation of quality certificates.


LIGHT INDUSTRY – TAILOR BRANCH

In the municipality, there are 9 tailor companies for ready-made clothes that are mainly

outsourcing - work and specialized clothing, lady and gentlemen wear. About 1 400 people are

working in the branch. The main part of the production is sold on the international market, for

the EU member countries. The basic competitive advantage of the companies is the low cost of

production and the geographical closeness with the main partner – European Union. The

competitive pressure over the producers is the interest of the clients to order lower and lower

priced products and to orientate themselves to China, Turkey, Romania, Ukraine, etc. Basic

development direction for the representatives of the tailor branch is the gradual transfer from

outsourcing to achieving of the whole chain of the production, creating of their own products and

trends. This involves consolidation of the producers and increase of expenses for design,

marketing and advertisement. Among the leading companies are:

Almina SA (former tailor company for ladies wear Lomska Komuna), property of Limex Group

Holding SA with traditions and experience in ready-made cloths production. There are about 280

employees in the company.

Manifactura Forte, Italian company with 80% foreign capital in the sphere of tailor industry

with 220 employees. The basic activity is production of ladies wear – blouses, dresses, trousers,

skirts etc;

Practical Ltd – Greek company with 100% foreign capital in the sphere of production of

underwear and bed linen with 80 employees.


METAL PROCESSING AND MACHINEBUILDING

Bourgas Shipyard JSC, Bourgas is bondholder of 70% of the capital of “Balkancar – Dunav”

JSC. The contract for privatization sale is signed by the executive management of the

Privatization agency and Chavdar Minchev, representative of Bourgas Shipyard JSC, Bourgas.

The buyer becomes a holder of 624 734 shares from the capital of the company of Lom. The

buyer of the former Electric fork-lift factory is obliged to keep the basic activity and to avoid

liquidation and reorganization of the company for three years. The new owner does not have the

right to reduce its participation in the company’s capital under 51% even in increase of the

capital. The amount of the bargain is 4 000 000 BGN. “There is a bargain, the payment of half of

the shares’ price is done, and the payment of the other half is to be done. The procedure requires

from the new owner to fix date for meeting and then to step into position”, clarified the executive

manager of “Balkancar – Dunav” JSC. According to the signed contract, Bourgas Shipyard

JSC is obliged to pay the public debts of the company and the personnel up to six months after

the transfer of shares’ property. “Balkancar – Dunav” JSC has 2 746 626 levs obligations to 31

of December, 2006. Presently, there are 94 machine builders in the factory. The last year, the

company produced 100 electric fork-lifts.

The company Arcus SA, Lyaskovetz - OP Lom is found in 2000 with basic activity specialized

machinebuilding. It has 215 permanent employees, the production is sold in Bulgarian market.

The basic activity of the company includes production, marketing and realization of specialized

production of the military industry, civil production, machines and elements for the machine

building, etc. The company is a main part of the Bulgarian military industry complex and is

specialized in production of training and battle detonators, light firearm, grenades, mines,

rotational elements cartridge-chambers.

In 2004 – 2005, several companies with foreign capital started their activity in the territory of the

industrial zone in Lom. The first company Silpa Ltd, Lom is found in 2004 as joint Italian –

Bulgarian company, with basic activity production of air-conditioning and ventilation products

for home and commercial use, as well as the production of parts from plastic and sheet-metal.

The production capacity of the company, with total area of 60 000 м2, 10 000 м2 of which is

built up with manufacturing plants, is situated in the industrial zone of the town of Lom. Silpa

Ltd owns a work shop for die cutting and punching, equipment for injection of molding of plastic

materials, production line for fan-coals and chamber for powder coating. There are about 80

people employed in the company, which are constantly attending trainings where they improve

their knowledge of the different techniques involved in the production and raising their

qualification.

In June, 2006 in Lom is constituted new company with foreign capital – Bulgarian Metal Tubes

Ltd with basic activity production of metal tubes for sewerage and metal constructions. The

company’s property is 100% private. There are 43 permanent employees. The company is with

34% Ukrainian and 66% Bulgarian participation. ROA Bulgaria Ltd is company for production

of cast-iron balls for ball and roll mills. The company has 40 employees and it is still preparing

the production. The company is 100% Ukrainian. Slantze – S Ltd is company with basic activity

projecting and production of electric boards. The property is private but the buildings are rented.

There are 18 employees and the production is sold on the Bulgarian market. There are 5

companies for production and montage of plastic and aluminum window-frame with 25

employees.


The companies’ assets in town show considerable growth, which proves not only the good

economic trend but also the good condition and management of these companies. The value of

the fixed assets of all companies in the territory of the municipality increase from 21 million

BGN in 2004 to 33 million BGN in 2005. The growth is more impressive, if we observe the big

companies’ group. For a year, they doubled their fixed assets with unchanged number of

personnel, which shows considerable investments.

Fixed assets of companies in the municipality of Lom in thousands levs for 2004 – 2005

Small companies

In the last years, the economy of the Municipality of Lom shows very good results after the years

of crisis. These positive tendencies probably will go on, if the opinion of the interviewed

managers of the local companies is considered.

0

5000

10000

15000

20000

25000

30000

35000

All units

Micro up to 9 employees

Small 10-49

Medium 50 -249

Big over 250

2004

2005

In the framework of a sociological research among the companies in the territory of the

municipality made in 2007, the majority plan to increase their activities, which will lead to

higher turnover and more serious investment in near future.

The research data show stable economic growth of the studied companies. The expectations are

for gradual and sustainable growth of investments for the period to 2013 (approximately equal

number of companies stated investments respectively up to 100 000 BGN, to 2 000 000 and

more than 2 000 000 BGN). One-third of the companies declare that they will direct their efforts

in investments up to 2 000 000 BGN.

Table. 1

Total amount of the investments in the period 2004 – 2013 (in %)

2004 2005 2006

2007 2008-1013

up to 100 000 levs 54,5 31,3 41,2 21,4 26,7

101-500 000 levs

27,3 37,5 29,4 42,9 13,3

501-2 000 000 levs

9,1 25,0 23,5 28,6 33,3

more than 2 000 000 levs

9,1 6,3 5,9 7,1 26,7

TOTAL

100,0 100,0 100,0 100,0 100,0

Small companies

It is extremely important for the future development of the local business how the

international standards and the standards of European Union are inculcated. The research data

show that the system implementation is rare. One-third of the companies have implemented the

system for quality control ISO 9000. Over a half of the interviewed declared that they has not

implemented the system for management of the environment ISO 14000 and the system for

management of health and safe work conditions OHSAS 18001 yet. Two of the companies have

implemented additional system for self-control and TS 16949 and one company has license for

management of hazard waste from Regional Inspectorate of Environment and Water (RIEW).

Graph. 1

Implemented systems (%)

Equal number of the researched companies show that they have implemented all European

standards and respectively - that they are not familiar what are the standards in their sphere of

activity (graph. 2). Several of the companies declare that there are sign EC, stock-farming and

ISO to be implemented.

Small companies

31,8

9,1

23,1

41,2

31,8

63,6

53,8

35,3

36,4

27,3

23,1

23,5

0 10 20 30 40 50 60 70

ISO 9001:2000

ISO 14000

OHSAS 18001

HACCP

upcoming implementation

no

yes

Graph.2

The declared possibility of over a half of the researched companies to co-finance projects

makes an impression (Graph 3).

Graph.3

Part of the managers and the participants in the research, declare that they would participate

in cluster initiatives – depending on the possibilities and conditions.

57% 29%

14%

Does your company has the capacity to co-finance projects?

yes

no

can't decide

36,7

26,7

36,7

0 10 20 30 40

yes

no, they are upcoming

not familiar

Has your company implemented all European standards? (%)

Agriculture

The Municipality of Lom has traditions in the domain of the agriculture. The farms within this

territory have good potential for the production of grain, breeding of animals and the production

of fruits and vegetables.

Currently the agriculture in the municipality is in process of renovation after a long-lasting crisis.

Despite the significant decrease of the production in the 90s, this industry is still the main source

of income for the villages and the basis for the general and luxury food industry in the town. Big

part of the infrastructure is destroyed or not suitable (irrigation system), but modern farms have

already started to emerge. (Kovachitsa, Zamfir etc.). Lately in the field of agriculture a tendency

of making bigger farms have been observed, there are leaseholders in the different areas who

enlarge their operations and work with even more land.

Kovatchitsa village is a typical grain producing region with the present black earth. The main

grain producer is the large leaseholder from the town of Knezha Mitko Boev, who works with 31

180 ares through the signed ten-year contracts with land owners. The grown cultures are: wheat –

10 000 ares, barley – 9 300 ares, sunflower – 15 880 ares, corn – 2 000 ares. There are 5 private

farms in the village with 30 to 50 milk cows, which use the grown crops.

The agricultural lands take up a significant part of the municipal territory 63.7% of which are

arable land. The areas under irrigation take up 27,5% of the arable lands. The economic future of

the region is connected to the development of the agriculture and stock-breeding. The workable

land in the municipality is 220 000 Ares, 12 000 Ares of which are with perennial plants. The

climatic conditions are suitable for the production of grain and industrial crops, vegetables and

vineyards. Through appropriate financing and management can be specified serious niches in the

agriculture (fruit and vegetable growing, etc.) which can have stabilizing significance for the

economic development of the Municipality.

Agriculture

Presently on the territory of the Municipality there is only one functioning stock-breeding farm

which meets the European requirements, but this industry can surely be attractive for the

investors. Even though the number of bred animals are smaller than the numbers in 1989, the

tendency is positive and the building of farms for over 500 cows, such as the one “Aleksia” Ltd

(bought by “Zorov-97” Ltd, owner of Parshevitsa Dairy – Vratza after the implementation of a

project on SAPARD) can be shown as a good practice before the future potential investors. In

the region has been realized a serious investment in the buffalo breeding – project of

“Agrotrans” Ltd, on which are bread 88 animals with extensive development of the farm in the

past five years through the natural growth of female animals. This type of business is very

perspective, following our membership in the EU, because there is a demand fo buffalo milk on

the European market and as a primary material for the production of mozzarella type cheese.

Relative share of the land according to its purpose on the territory of Municipality of Lom

(%)

The possibilities for financing through projects on the pre-accession funds of the EU have not

been fully used on the territory of Municipality of Lom, but there are some successfully

0

0.6

4.6

7.3

8.5

79

0 10 20 30 40 50 60 70 80 90

For extraction of naturalresources

For transport

Forests

Water basins

Settlements

Arable lande

implemented projects. It is expected that the efforts of the local authorities will have greater

capacity for applying on Development of Rural Regions and “Leader” Programme, as well as

Operative program “Environment” and “Fishery and Aquacultures” of the EU structural funds.

The local economy – future development

Together with the positive plans of the local companies, the Municipality has already taken steps

for the development of municipal industrial zone on the territory of Municipality of Lom. In

2007, a project was worked out for the zone, which was applied to PHARE 2005 of MRRB. The

terrains proposed for the development of the municipal industrial zone Lom are located outside

of regulations, and are agricultural lands of IV /forth/ and VI /sixth/ category. Forthcoming is the

working out of PUP-PRZ of the property with total area of 125,700 ares including the

transformation of the lands purpose. The terrain can be linked, trough the construction of a

bridge as the shortest way connecting the municipal industrial zone to Ludovico Milanese Street,

which is servicing industrial zones “South”, mainly manufacturing facilities and “North” (mainly

community service facilities), freight railroad station and Port Lom. Zone “South” is located on

the other side of river Lom at a distance of 150 m.

The presence of this industrial zone is of key importance for the attraction of new investors. The

“inherited” terrains have already been used up and new manufacturing facilities can be

constructed only on new terrains. The development of the area is connected with the good

position transport servicing point of view.

The terrain is accessible through an asphalted exit with length 1.5 km., of the forth grade road,

connecting the road Montana-Lom with the future industrial zone. The forth grade road provides

transport connection and public transport to the town of Lom with the residential areas

Mladenovo, Humata and Zamfir village. The terrains will be provided with the infrastructure

needed for the production activities.

The town has not been gasified yet, but presently the established gas-supply network of

“Bulgargas”Ltd reaches the town of Montana, which has been used as a basis in the Municipal

plan for development 2007-2013 to be set as a priority the gasification of the Municipality. More

precisely this envisages the construction of a gas-distribution station for the needs of the

Municipality from the national supply network at Ruzhinci village, located 35 km away from

Lom. Steps have been taken for the conduction of engineering activities, carrying out of

geological studies and the preparation of a work project for the construction of the gas-supply

network in the town of Lom.


There are a lot of companies that have shown their interest in Lom’s future industry zone, such

as:

Road Construction Company JSC – Sofia, with intentions in the sphere of

infrastructure and low construction, tourism and logistics

Key Industry Engineering Group, with future intentions in the construction of a waste

processing plant and the production of bio-energy;

Almus Farma Ltd – Lom, construction of a facility for the production and packaging of

Galenic pharmaceutical products for humanitarian medicine;

Enerzone Ltd – owner of a terrain of 200 ares in industry zone “South”, with intentions

for establishing of a PPP with Municipality of Lom, working out of a project,

construction and development of a technological industry park with a transit zone;

FRITZ Geothermal energy – Germany, with a proposal for a water purification plant

and providing water to Mladenovo residential area and Zamfir village, Municipality of

Lom, as well as opening of an office of the company in Lom;

Institute of soil science “Nikola Pushkarov” – Sofia – opening of science consultancy

centre servicing state, cooperative and private owners in the sphere of agriculture,

production and realization of renewable energy sources. Opening of a branch of the

Central laboratory of Institute of soil science “N. Pushkarov” Sofia, for express services

for the farmers;

ENEMONA S.A. – Sofia – intentions concerning joint activities, forming of logistic

centre, production premises, as well as positioning of high-tech units on the industry

zone’s terrain;


Geotechmin SVS Ltd – Sofia – investment intentions in the sphere of construction,

tourism and logistics;

“Georgiev and Kirilov” Incorporated Partnership – Lom, operating on the territory of

industrial zone “North”, has shown readiness in expanding their production through the

tenancy of trade area for the production, sales and distribution of spare parts and units for

electric and diesel forklifts on national level;

Additional opportunity for the development of the region is connected with the development

of biofuel production. The presence of raw materials (agricultural production, already produced

based on knowledge), as well as the inexpensive waterway, stimulates the development of

projects for bioethanol. There are two project proposals on the territory of Municipality of Lom

for the construction of facilities for bioethanol, which have applied for investors of class 1. The

construction of a plant for the production of bioethanol near Lom is intended by the international

company “Radici Group”, Italy.

On the territory of the municipality is also planned the construction of installation for production

of bio-energy from biomass and the implementation of innovative ecological technologies in the

sphere of greenhouse production. The goal of the project is the use of new, for the region and the

country, effective way for development of renewable energy sources using biomass as a base.

On the territory of Northwest Planning Region the creation of cluster initiatives has been

foreseen. This can be the driving force of the local business. For example, a winery and vinery

cluster is being considered, which will be important for the region, as it can stimulate the

undertaking of business activities connected with the wine production.

Human resources

The population of the Municipality is 32 863 people. The demographic rollback through the last

few years has been partly overcome. This also reflects on the employment in the municipality.

Table: Population of Municipality of Lom (2004 – 2006)

Year Total Men Women

2004 32 863 15 860 17003

2005 32 135 15 473 16662

2006 31 689 15 206 16483

After a serious downfall in the employment sphere the number of employed people in the

Municipality is steadily rising. The people working in the local economic structures are

increasing – from 5 546 in 2003 to 5 829 in 2005 (respectively from 2 669 in 2003 to 3 003 in

2005 for the public sector). If we look at the dynamics of the employment by sectors we can note

the strong increase in the industry – 26.3% from 2003 to 2005.

In accordance with the data from the national statistics the number of employed people in the

companies increases from 4 082 to 4 201 in the period 2003 – 2005. The increase in the

personnel of the companies is present even now, as it can be seen from the answers of the firms

in the sociological study. Graph.5

2877

2831 2826

2669

2999 3003

2500

2600

2700

2800

2900

3000

3100

2003 2004 2005

Avarage number of employed people in accordance to work and legal status in Municipality of Lom

Public sector

Private sector

Human resources

The plans for future investments and development are connected with the need of opening new

work positions. The increased demand of labour leads to a situation where the companies

experience difficulties in finding certain professional profiles.

This statement is supported by the conducted empiric study of the businesses on the territory of

Municipality of Lom.

Firstly, the flexible form of employment is not very common amongst the studied companies.

The most popular form of employment is of work contract. The analyzed companies employ an

average of 33 workers on work contracts and approximately eight people with service contracts.

The data from the study proved the hypothesis that the companies, functioning on the territory of

Municipality of Lom, experience serious difficulties with employing of personnel (Graph6). The

spheres in which there is lack of qualified personnel are tailoring, wood processing, transport,

agriculture, bakery and catering establishments. The respondents state that they experience

difficulties with hiring management personnel and people with secondary and university

education.

Graph 6

Human resources

The statistical data shows that there is high unemployment still present on the territory of the

Municipality, but this population can be used if there is suitable employment in terms of

flexibility and sphere. Another problem is that nearly a fifth of the people in the Municipality

have very low educational characteristics. For these people is of great importance that the

instruments of the structure funds are fully used for the raise of their suitability for employment.

There are professional high schools on the territory of District of Montana and respectively

Municipality of Lom, as well as centers for professional education, which can carry out primary

and continuous education.

The professional high schools in Municipality of Lom prepare specialists in numerous spheres.

The opening of new educational centers is being planed in the town of Lom. The need for a

permanent (vocational training) qualification centre has long ago been noted, which should

64%

36%

Did you experience difficulties in hiring personnel in 2006?

Yes

No

offer specializations needed by the local companies, even if it means employing teachers outside

of Lom. In specific cases it can turn out that those teachers can be attracted from neighbouring

countries, through cross-border partnerships. The establishment of such a centre has been

planned in the future industry zone.

Human resources

On the basis of the principle of public-private partnership with the participation of the local

authorities and the interested business will be realized project “Regional centre for development

and improvement of the human resources” Ltd – Lom. It is expected that this centre will rent

premises for the purpose of educational base in the administrative building of industry zone

Lom. The centre is certified in the following professional aspects:

- Secretary and office activities;

- Motor vehicles, ships and aircrafts;

- Production of foods and beverages;

- Production of textile, clothing, shoes and leather products;

- Hotel management, restaurant-keeping and catering;

- Construction and geodesy;

- Social activities.

Most of the interviewed managers state that their staff has participated in some kind of training.

The data shows that an average of 60% participates in inhouse trainings, and about 17% out of

the company trainings. Most likely inhouse training is meant as training at the place of work. The

development of systems for training of the personnel, especially in the medium companies can

be an alternative to new skilled personnel.

Administrative capacity

The Municipal administration in Lom has made serious effort in the past few years to attract

investors and to improve the business environment as a whole. The infrastructure in the

Municipality is still in a non-satisfactory condition, but in the past years has been made serious

improvements. For example through a project financed by PHARE, PROON and Government

with 3 550 000 levs, were constructed new streets in residential area Stadiona and the streets

“Khan Asparuh”, “6th

of September”, “Dobrudzha” and “Stadiona”. The construction of new

streets continued through the project won by Municipality of Lom on SAPARD Programme. In

the rehabilitation of 16 streets in two quarters in the town of Lom were invested 1 900 000 levs.


A new bridge over Lom River financed by MRRB, costing 2 106 000 levs was finished and

officially opened. Lom has become one of most illuminated towns in Bulgaria. Through a

interest-free loan granted by MOEW in 2006, amounting 472 000 levs, was realized energy

efficient street lights, with which was improved the illumination of the town and the

residential areas from 18% to 100%. The street lights in the villages were reconstructed.

The studied representatives of the business give average evaluation of the services provided by

Municipality of Lom (graph 7). The average evaluation is 3,38. We should remark that for over

one forth of the companies the evaluation is excellent.

Graph 7

The majority of the interviewed representatives of the business have not used the given

opportunity to give remarks and recommendations for the work of Municipality of Lom. Only a

few have been made: to be established a desk for complex servicing, better organization of waste

collection, services, provided by Municipality of Lom to be given to local companies and to have

a better approach to the work in general.


The Municipality is preparing several projects for the economic development of the region:

- Projects for cross-border economic cooperation – Municipality of Lom is already

implementing projects in cooperation with City Municipality Pantelej (Nish), Serbia, there are

plans for projects with Municipality Bailesti from Romania. These projects may stimulate the

development of the local business and human resources. In the beginning of the Mayor’s

9.52

14.29

33.33

14.29

28.57

0 5 10 15 20 25 30 35

Bad evalualtion

2

3

4

Excelellentevaluation

mandate /2003-2007/ were established serious contacts with Municipality Linz, Austria. Town of

Linz has been pronounced the world’s culture capital for year 2009, which will give the

opportunity for some of the more talented artistic collectives to participate in this most important

cultural event in Europe. As an expression of the future cooperation with the Mayor of Linz, Mr.

Franz Dobusch were made official visits and work meetings. These contacts brought up the idea

for an international forum in Lom, dedicated to Danube River as a corridor of opportunities. The

international meeting was successfully realized in 2007 with the financial and logistic aid of Mrs.

Bridget Czarnota and the representative office of European Commission in Sofia, headed by

Michael Humphreys. Representatives of transport agencies from Germany, Holland, Austria,

Hungary, Romania, Serbia and Bulgaria discussed the ways to improve the future development

of economic and cultural relationships among the countries on the Danube River, as well as the

possibility of better conditions for development of tourism, transport and for a joint protection of

the ecosystem of Danube River.

- The Balkan Network – Municipality of Lom is at the base of the initiative for the

establishment of Balkan partnership network for applying with joint projects before the Euro

funds. Connections with the neighbouring Romanian Municipality Bailesti were made. The

active contacts with the Association of southern Romanian municipalities SUDOLT, with their

chairman Mr. Valentin Mitrica were made agreements for the establishment of new Euro region

with centre Lom, for applying directly in Brussels with ecological and infrastructure projects.

Besides the twin towns Municipality of Lom and City municipality Pantelej are also invited

municipalities from Greece, Turkey, Romania, Slovenia, Croatia, Macedonia, Montenegro and

Bosnia and Herzegovina.

The companies in the region are ready to participate in projects together with the local

authorities. The data from the conducted empiric study show that the projects which the

companies are ready to carry out in partnership with the Municipality are as follows: stock-

breeding, energy efficiency, afforesting, construction of installations for animal waste

processing, industrial park Lom and central heating supply of the town, public transportation on

the town’s territory. There is interest in future projects of Municipality of Lom, connected with

European funds, on PHARE, ISPA and projects for improving the infrastructure of the local

market exchange – asphalting, sewage, waste collection. There is interest in project involving

providing jobs for handicapped people.

The summary from the opinions and recommendations from the managers and owners of

companies shows that the Municipality must make an effort in attracting investors by making the

business environment favorable for the local companies too. Concrete idea can be discussed at

forums, as well as joint projects from the Municipality and the local business through public-

private partnerships (PPP).

SWOT analysis

We can make an analysis of the strong and weak sides of the Municipality, as well as the threats

and possibilities for its development, based on the data for the economic, natural resources,

infrastructure and Municipal administration.

Weaknesses

Part of Northwestern Planning Region, characteristic low economic values and high

unemployment;

Depopulation and aging of the population; high unemployment; almost a fifth of the Municipal’s

population is of very low educational characteristic (mainly of Roma ethnics).

Decreasing number of micro companies, small number of medium and big companies. Still weak

competitiveness of the local companies compared to the other countries, members of the EU.

Inflexibility in finding new attractive products. The sales are mostly in the region and the

country, relatively small export.

Ruined and not functional infrastructure for agricultural activities, in spite of the present

traditions in the sphere;

Registered drawback in the sales of “Hotel management and restaurants” sector, which is a sign

for the crisis in this industry. The state of the industry will be a problem in a possibly priority

development of tourism;

The absence of protective mechanisms against the migration of highly qualified personnel, close

the big settlements, border regions with easy access to other countries, still weak and

unappealing economic environment in the Municipality.

High structural unemployment, weak labour market, high necessity of adequate qualification and

prequalification of the work force in accordance to the demand.

SWOT analysis

Strengths

Key strategic geographical location – Pan-European corridors № 4 and № 7 – Danube River,

border region with possibilities for cross-border cooperation;

Well developed transport infrastructure, port complex, convenient land connection with Sofia,

the presence of railway and land transport connections; potential for development of logistical

activities;

Traditions in the economic sector – tailoring, general and luxury food industry, processing and

metal working industries. Steady increase in the sales in almost all spheres of the economy.

Ecologically clean region with good traditions in viticulture, fruit-growing, vegetable-growing

and grain-production. Most of the land (79%) in the Municipality is suitable for agricutural

activities;

Gradual restoration of the local economic with predominance of the micro companies. Stable

management of the big companies and increase of the fixed assets is being observed;

Administrative capacity and potential for servicing the local business. The Municipal

administration plans the building of an industry zone, works on projects for cross-border

cooperation, maintenance of municipal data base of the free terrains according to their purpose,

etc.;

Searching for adequate financing programmes for the increase of the qualification and

prequalification of human resources (unemployed, uneducated, handicapped);

Opportunities

Usage of the structural funds for reconstruction and modernization of the transport infrastructure.

Development of new logistic activities with accent on the transport profile specialization of

Municipality of Lom, on account of the present transport infrastructure of regional, national and

cross-border importance;

SWOT analysis

Potential for development of bio-fuel production and other projects for renewable energy

sources.

Establishment of bio-farms and building of factories for the production of ecologically clean

agricultural products and market for the last.

Informing and support for the local producers from the Municipal administration in the process

of finding ways of applying and financing of their activities by the EU funds through the seven

Operational programmes launched in the country.

Modernization and development of the traditional for the region agricultural activities like

viticulture, fruit-growing, vegetable-growing and grain-production through european financing.

Priority development of small, hightech production, which can prevent the qualified work force

from leaving Lom, as well as to attract new, highly qualified specialists in the sphere of

information and communication technologies.

Setting up of an industrial zone, as an instrument for attracting new investors and providing

employment for highly qualified teaching personnel.

Threats

Increase of the negative demographic tendencies, depopulation. Problems with the integration of

the Romany minority. New wave of emigration of the young and the qualified for the countries

from the EU;

Problems with the increase of the competitiveness of the local companies towards firms from the

European Union, regional encapsulation of the business in Municipality of Lom;

Possible illegal immigration, following the membership of Bulgaria in EU.

Rivalry with other neighbouring municipalities that also have advantages for attracting

investments.

Strategic priorities for the Municipality

Using the analysis of the available resources as a base and the potential for development of the

Municipality, as well as the expressed points of view of the concerned local parties, several

priorities can be set out for the attraction of investors in the Municipality. Each of them is

presented in detail in the following pages of this document.

So a steady growth of the economic can be guaranteed, Municipality of Lom must use with best

efficiency the present resources. So in medium-term plan for Municipality of Lom is important

the following:

To continue attracting investors in the transportation and logistics sphere, as well as

processing industry;

To develop modern agriculture, including on the basis of successfully use of European

funds;

To create conditions for tourist business as a new branch using the natural resources of

the region;

To ease the implementation of the announced investment projects and to make more steps

for the improvement of the technical infrastructure and business climate;

To stimulate the investments in human resources, so the needs of the businesses will be

met.

Potential industrial investors

The industry continues to be of great importance for Municipality of Lom. The growth from the

past few years shows that exactly the industry is the main source of work places. The presence of

serious traditions and qualified personnel is a prerequisite for a successful realization of such

investments. In the limits of a certain territory it is always preferable to be presents concentration

of productions of similar spheres for optimal “closing” of the production cycle, optimal use of

the skills of the work force, etc.

After a thorough review of the present investors, resources and view of Municipality of Lom for

the need of attracting investors in certain areas, as well as on the basis of the conducted SWOT

analysis we can indicate several groups of potential investors, which the Municipality will try to

attract:

Big and medium companies in the sphere of general and luxury food industry,

machine building and metal working. These industries are well developed on the

territory of the Municipality. They can manufacture production with high added value,

they are of priority for the country as a whole and there are successful investments in the

past and good traditions. The goal of the Municipality is to attract foreign and/or local

investors from these sectors;

Investors in the sphere of renewable energy sources, even though they a bit new for

Bulgaria, in terms of the rising cost of energy on the world markets and the global

warming, as a consequence of pollution of the environment, projects for production of

energy from renewable sources becomes of great priority for the countries of the EU,

including Bulgaria. There have already been made announcements of investment

intentions on the territory of the Municipality for such projects, production of bio-

ethanol, heating plant using biomass, etc. The Municipality has set for itself as a priority

to become an energy producer. Its goal is to attract foreign and local investors which

would operate in this sphere;

Small, high-tech manufactories, connected with informational and communicational

technologies, which can keep the existing qualified work force in Lom, as well as attract

new highly qualified specialists from other places and to facilitate the access of the local

business to the modern technologies.

Potential investors in logistics and transport

The strategic location of the Municipality of Lom and the upcoming concession of the port

complex are in the basis for new possibilities for development of transport and logistics

activities. According to the data of international observers, in the past few years the logistics

market recorded 20% annual increase in Bulgaria and Romania and the prognosis are that this

growth will continue onward. Whoever the concessionaire of the port complex is, from him is

expected the provision of significant investments, which on the other hand will make the

environment favorable for the attraction of the following types of companies:

Companies, operating within the port complex.

Logistic companies (including opening of offices and representative offices regarding the

developing of the importance of the port complex)

Transport companies for ground transportation

Companies managing storage areas

Investments in the agriculture

Investors in stock-breeding complexes. Municipality of Lom has interest in attracting

big investors who will breed animals on its territory. More precisely they can be cow

farms, pig farms, as well as specialized centers for selection of import animals, which is

the case with the farm “Aleksia” Ltd.

Investors in the production of grain and industrial crops, which can be suitable for

biofuel. The potential investors in production of bio-ethanol are interested in establishing

long-term partnerships. Suitable investors must be looked for in neighboring Bulgarian

regions.

Investors in perennial plants in fruit-growing and more precisely in viticulture, for

which are present good conditions and demand by the wine-producing company, but also

for the production of apricots, for which are present suitable micro-regions close to the

Danube River.

Small producers of bio production, for example in the sphere of vegetable-growing, the

increasing demand for bio-products for the European and Bulgarian markets give

indication this sort of investments have their chances. In the past years in the region there

have been no industrial or other pollutions, which is a prerequisite for the differentiation

of the agriculture in this direction. Additional possibility gives the fact that most of the

arable lands in the region have not been fertilized in the last years and the process of

transfer to bio-production can be sped up;

Investments in tourism

The tourism can have only secondary significance for the local economy – to create an additional

employment on the basis of small projects – this is also the view of the local communities in the

region, reflecting in the conducted sociological study. There are no traditions in the region, no

base and infrastructure forms of mass tourism.

The future development of the tourism must be mostly based on the initiative of the local

population, aided by consultant services and funding from projects.

Potential micro projects of the local investors, connected with the niche tourist products can be:

Fishing tourism. Near Lom on the Danube River there are several islands and zones

suitable for this purpose.

Observation of the wild fauna – (birds) in the reserves and protected zones on the

territory of the Municipality. This is a specific niche, which with the appropriate

development can bring tourists in the region.

Archeological tourism, if there are project proposals for providing access to the Roman

fortress located not far from the town.

Equestrian tourism. There is flat country around the town, with present traditions in the

horse breeding, which is an activity finding ever more clientele in Bulgaria, shown by the

growing number of stables offering such services.

Cycling tourism – there is an European project for creation of a cycling path along the

banks of the Danube River, the region is flat country which is a prerequisite for this kind

of tourism if there is the required infrastructure.

Farm tourism in the villages on the territory of the Municipality with accent on clean

environment.

Investments in tourism

In medium-term plan there are potential markets which can emerge through cross-border

tourism. It is foreseen the building of a ferryboat connection with the Romanian port

Rast, which will give the Romanian tourists the possibility to visit the town within short

journeys. In far perspective, based on projects for cross-border cooperation can be looked

for attraction of tourists from other neighbouring countries.

In medium-term plan it is also important the development of cultural tourism (based on

a festival for example). There are a lot of Bulgarian municipalities which show that this

can be in the base of successful tourist practices. The very history of Lom and its location

on the Danube River show that such a festival can be dedicated to the 19th

century music,

musical theater, Viennese waltz, etc.

Based on the fact that fishing is traditional occupation for the region and there are still

people employed in this industry, specific tourist products can be developed using that,

fishing villages, etc., which can be financed through the structural funds.

Last but not least we should keep in mind that potentially the Bulgarian regions on the

Danube River have potential for yacht tourism. Already on Bulgarian territory have

started the construction of several yacht quays.

Investments in the sphere of services

The increasing volume of local economic is the base for attraction new financial investors (bank

branches, insurance companies). Opening of such representative offices will give a boost of the

local business from one side, and from the other side will aid in the creation of quality work

positions.

There is a base for development of training services in the town, for providing qualification and

prequalification of the employed people, as well as training of the vulnerable groups, living on

the territory of the this and neighbouring municipalities.

According to the data from the conducted study, the representatives of the local business have

great interest in trainings on the structural funds of the EU (graph 8). The implementation of the

European norms and standards is something new, therefore a significant part of the respondents

show interest in such trainings. There is also need in courses in foreign languages.

Graph 8

In the framework of the continuous opening of the region to the world, of the expected foreign

investors, as well as of the development of cross-border cooperation, the foreign language

training will be of great importance for the people working in the region and their employers.

86.7

86.7

94.4

40

76.5

0 50 100

European standards

Marketing and commercial strategy

Structural funds of EU

Import and export documents

Foreign language

There is interest in trainings on:

The fast development of the chains for retail in Bulgaria in the last years raise the question for

the enticement of companies to invest in forming of supermarkets and other commercial objects.

There is potential for additional development of all kinds of transport services in the territory of

the municipality - transport of passengers by buses, renewal of the river transport on Danube.

Social economy

Significant part of the population of the Municipality is in unequal situation. That is why the

municipality needs the introduction of investors in the sphere of social economy, which an offer

business models for integration of these people and the increase of their employability.

There are two important companies from this sphere functioning on the territory of the

Municipality. The main activity of “Tih trud” Ltd, Lom, is outsourcing of work clothing and

ladies wear mostly for countries in the EU. At present there are 72 people qualified personnel

employed in the company with an upcoming purchase of new machinery for the increase of the

production power and competitiveness.

PKI “Georgitsa Karastoqnova” is one of the oldest companies in the town of Lom, which has

gone through different political and social conditions through the years. It is established in 1954

and is entirely Bulgarian cooperative property. For the entire period – from its establishment till

now, the cooperation has been functioning as a social company, employing handicapped people.

PKI “Georgitsa Karastoqnova” produces ladies, men and children’s clothing, as well as medical

work clothing. Almost the entire production is being exported – 98%. In the cooperation work

about 50 handicapped people, mainly women. PKI “Georgitsa Karastoqnova” has a certificate

for specialized manufacturer from the Agency for people with disabilities, because of the

specifics of the production and the use of labour with decreased ability to work.

A lot of local and foreign NGOs have started projects on Bulgarian territory in past few years,

leading to the establishment of stable employment for the vulnerable groups on the basis of real

economic activities.

In the framework of the started European structural funds has been set the support of existing

specialized manufactories and co-operations of handicapped people and social companies

through the development of social entrepreneurship, as well as newly created social companies,

specialized manufactories and co-operations of people with disabilities.

The Municipality will present the possibilities for such initiatives on its territory before leading

NGOs from other Bulgarian regions or abroad, which may have interest in the popularization and

multiplication of positive experience on its territory.

Stimulus for investments

The Municipality of Lom has committed itself to developing a full package of incentives, which

the local authority is ready to give as support to certain investors for certain investments.

Informational assistance for the use of the national stimulus of investments – for

municipalities with high unemployment, etc. – the employees of the Municipality will

inform the investors for all the possibilities, which they can use in the framework of

different measures set up by the government of the Republic of Bulgaria. For example,

the Municipality of Lom is one of the municipalities where the companies have tax-free

profit;

Facilitation of the license regime. The municipal administration guarantees that it will

do everything possible for the facilitation of the made representations of potential

investors in the best possible way.

Individual approach of the administration to the investors who have shown interest and

which answer to the priorities of the region and which make obligation to invest in the

economy of the Municipality;

Development of electronic services and one-stop shop, which will ease the connection

with institutions from the district centre – the program of the Municipality will allow

faster and effective issuing of the needed legislative documents for opening businesses.

The municipality develops a capacity for the support of small and medium business

– this is shown by the establishment of Centre for cross-border cooperation, which will

help the local companies in preparing project proposals on the structural funds of EU, the

project for creation of business-incubator and stimulation of the unemployed people to

start their own business.

Municipality of Lom is some what an administrative center for four other village

municipalities (Brusartsi, Medkovets, Yakimovo and Valchedram). It is expected that

through the European funds there will be joint projects which will solve the problems of

all these municipalities, and it is logical that Municipality of Lom should be the leading

one in formulating and implementation of such activities, given its previous experience.

Presentation of the priorities of the Municipality before potential investors

On the basis of the Marketing strategy of the Municipality of Lom it will be prepared a plan for

the presentation of the priorities of the Municipality before potential investors and the public.

Target groups

As target groups are outlined: potential investors, trade chambers and branch associations,

representative offices. They will be approached through:

- Presentation before European investors from the general and luxury food industry and

machine building;

- Presentation before agricultural producers from neighbouring regions;

- Presentation before companies in the social economy sphere;

- Presentation before locals, who can be the initiators of projects in the sphere of

tourism.

The attraction of investments is the main goal of the Municipality. The investors will provide the

funding, which will revive the region, that’s why the potential of Municipality of Lom must be

clear and more attractive to them.

The potential investors can be found through the participation of the Municipality in various

economy forums and exhibitions, as well as distribution of advertisement and informational

materials.

It is desirable that the investors are segment in some way – by sphere of operation, size, location,

etc. The segmentation will define the argumentation and approach.

For the presentation of the potential of the Municipality can be used the following materials –

leaflets, posters, advertisement gifts and souvenirs; advertising in the specialized national

electronic and printed economic publications; development of a section in the web site especially

for the investments – in Bulgarian and English. This section must provide clear information for

the region and its aspects, procedures in the Municipality, prices of land, auctions, etc.

Possible sources for finance and co-finance of investment projects

The development of favourable infrastructure for investments as well as the preparation of work

force in the region will be supported by development of successful projects, searching finance by

the structural funds of the European Union and other donor programmes of governments and

international organizations.

The local capacity for development of successful project is an important factor for the chance of

new project proposals.

Potential sources are:

Operational programmes of the structural funds:

Operational programme Development of human resources

Operational programme Competitiveness

Operational programme Environment

Operational programme Regional Development

Operational programme Transport

Operational programme Technical assistance

Operational programme Administrative capacity

National plan for development of rural areas 2007 – 2013

National strategic plan for fishery and aquacultures 2007 – 2013

Instruments for cross-border cooperation – projects for cross-border cooperation, transnational

cooperation and interregional development of the European Union.

Other donor programmes – programmes of organizations from the system of United Nations,

programmes of Norway, Denmark, Japan etc.