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Not so very long ago it was rich ‘Arabs’’ who were buying high profile hotels and houses in cities such as London and Paris. With the fall of the iron curtain, Russian money started to arrive on the scene to compete with the ever present though often stalled procurement desires of those from Middle East origins. Recently, the new kids on the block are the Chinese and like their booming economy, their thirst for investment promises to out strip both Middle East and Russian investments, particularly in tourism.

Whilst it is still true that many of the world’s iconic hotels are owned by Middle East assets, this has not stopped the Chinese getting in on the act. This week for example, an iconic Bahamas hotel, the British Colonial Hilton, famous for its roll in the James Bond movie Thunderball, was sold to a Chinese company that also has a stake in a 3.5 billion tourism project on the island. Earlier this month, New York’s Waldorf Astoria was bought by another Chinese company.

Closer to home here in Bulgaria, a Chinese company is supposedly planning to build a huge tourism project east of Sofia that will include numerous hotels and leisure facilities. The Golf Course at Ravno Pole, together with huge tracks of surrounding land is also now in Chinese hands. This also begs the question, perhaps optimistically; will such investments extend further on the local level to include ski and beach investments? Whilst this may sound romantic, the idea of Bulgaria having golf courses and European standard compliant ski resorts was also a romantic notion not so very long ago.

There is of course always a ‘yes but’ in all this. Governments for whatever vested reason can block any type of investment if they so wish to. The Americans, whilst not blocking the Waldorf Astoria deal, have introduced into the fray that old potential deal breaking nugget

‘”security’’ into the subject.  ‘Security’ is the noun that acts as like a “get out of gaol free’ card. It is used whenever the mood dictates and where a justifiable or legal reason can’t be used to otherwise say ‘no’. Airports, airlines as well as government regularly use this trump card. The security card was even used back in 2006 by the American government when it blocked a UAE based company’s bid to manage six USA seaports, the UAE being arguably one of the more friendly states to the West.

However we digress, the investment pecking order of the world has not only changed, it is continuing to change, Whereas before, countries might have been in a position to reject inward investment, for the majority this has all changed and every country is begging for projects for its own shores regardless of where the funds originated: within reason. Bulgaria is no different.

 

Mark Thomas

Managing Director

HRG Bulgaria