TOWARDS A MORE EFFICIENT FDI POLICY

The paper focuses on foreign direct investment (FDI) policy in Bulgaria. At first an analysis is made of national FDI policy since the beginning of the market transformation. Particular attention is paid to the last changes in legislation – the provisions and framework for FDI, that are contained in the Law for the encouragement of investment (2004). A critical assessment is made of the accomplishments of FDI policy so far. The necessity to improve FDI policy in Bulgaria is justified on the ground, that in an environment of underdeveloped market institutions, policy becomes a very important factor for the accomplishment of the objectives of national strategic development. The main purpose of the paper is to outline the main directions for the improvement of FDI policy. According to the author, to accomplish this, two things are essential: 1) An improvement of the statistical base is necessary. At present the official information is based on the statistics of FDI flows and stock, the way they are collected for the compilation of the Balance of payments of the country. But the FDI are the means, through which the international production systems of transnational corporations (TNC) are financed. Therefore to assess the impact of FDI on a host economy, and thus to construct FDI policy on a serious base, an additional set of indicators is needed – those, measuring the so called “transnationalization” of national economies. The experience of OECD economies in this respect is revealed. 2) A much deeper understanding of the contemporary dimensions of FDI policy worldwide is needed. In this respect the analysis and recommendations of the UNCTAD – a leading institution in the field of statistics and research of FDI and TNC, can be very helpful. A conclusion is finally made, that the re-orientation of FDI policy in Bulgaria during the last two years from “quantity” to “quality” of FDI may be considered as a step in the right direction