Economic Update
Heavy snowfall in the first weeks of November bodes well for Bulgaria in its ever- growing role as a ski destination. However, environmental concerns and the growing spectre of oversupply in some winter resorts have highlighted the importance of adopting a clear long-term strategy for touristic development.

On November 15 Alexander Kravarov, mayor of Bansko, a major resort in the Pirin mountains 150km south of Sofia, announced that construction in the town would be banned between December 1 and April 1 next year in preparation for the influx of visitors. Market analysts could accuse Kravarov of locking the barn door after the horse has bolted as Bansko has earned the unwelcome reputation as one of the country’s most overdeveloped locations.

Once home to the mercantile elite that helped fund the restoration of nearby Rila Monastery, Bansko has become home to a different type of entrepreneur. Construction firms and property developers have come to the town in force.

While certain areas retain the traditional wood architecture and cobbled streets, they are increasingly being overtaken by large concrete constructions that fan out into the city’s growing suburbs. Newly constructed ski runs above the resort have also come under attack from environmental groups who have claimed the runs were built without permission nor a prior assessment of their potential environmental impact.

Since EU accession at the beginning of the year, Bulgaria has been part of the EU’s Natura 2000 programme, which seeks to protect threatened habitats and species in member states. As a result, a strong protest movement has grown in the country in recent months that is focussed on defending the 28% of the country covered in the programme, including sites in the Bansko area currently being developed.

The rush to build accommodation in the country’s premier ski resort has often outstripped the growth of infrastructure, leaving many apartments without access to good roads or water. A survey by a local newspaper reported that the number of beds in Bansko has risen in the past year from 9000 to 13,000 or 14,000. Earlier this year, Kravarov told the press the town’s future lay as a modern winter resort. He predicted there would be between 800,000 and 1m visitors to the area this year.

This prediction is looking increasingly overoptimistic as many analysts have said the supply of beds in Bansko is outstripping demand. A report by the UK property investment firm Assetz, released in June, highlighted the town as one of the areas, along with the Black Sea resort of Slanchev Bryag (Sunny Beach), suffering from a severe oversupply of apartments. Last year an exceptionally mild winter and negative publicity surrounding the town’s rapid development are thought to be the prime causes behind a 15% drop in visitor numbers from 2005.

There is concern that UK bookings, which make up two-thirds of Bulgaria’s winter visitors could be set to decline. Galin Georgiev, manager of Solvex a Sofia-based tourist agency, told media he expected a 20% drop in British tourists compared to last year.

In response, tour operators have sought new markets. The acquisition of Finnish tour operator Domina by locally based Alma Tour in November is a salient example of Bulgaria’s efforts to attract visitors from northern and Eastern Europe. Alma Tour manager, Lyubomir Pankovski, told media his company aimed to bring 12,000 Finnish visitors to Bulgaria in 2008, an increase of 5000 on 2007’s anticipated figure. He said Alma Tour also expected to bring 10,000 Russians to Bulgaria in the next year, with Bansko receiving the bulk. This would represent a 30% to 40% growth in Russian winter visitors to Bulgaria.

Brian Coneelly, managing director of West Properties International, an Ireland-based property developer in Bulgaria, told OBG, that the Scandinavian, Russian and Romanian markets offered strong potential for the continued growth of tourism in the country. He said he believed Borovets, in the Rila mountains 73km from Sofia, would soon reclaim its position as the country’s leading ski resort.

He told OBG, “Borovets could soon become the new hotspot for winter tourism. It has a traditional feel, being home to the royal winter palace. The development of the Super Borovets resort demonstrates the town’s ambition to become a quality winter destination. If the proposed mountain road that would drastically cut transport times from Sofia comes to pass, the potential is enormous.”

Super Borovets is a ten-year project that aims to modernise Borovets’ ski infrastructure, accommodation and other facilities. Significantly, the project calls for more small hotels located at higher altitudes as opposed to the large, dense constructions that crowd Bansko. A third major ski resort, Pamporovo, in southern Bulgaria, has also grown with Bansko and Borovets in recent years.

Kamen Kitchev, Austrian Airlines’ regional manager and a member of the Bulgarian Tourist Board is optimistic about the future of Bansko. He told OBG, “The negative effect of mass construction on Bansko has been exaggerated. It should be remembered that the resort targets visitors, often from small towns, who come on holiday to be with people and engage in a lively and vibrant social life. Bansko will never be an exclusive resort and it still has the ability to attract large numbers of tourists from all over Europe.”

Even better news for Bansko, in the face of recent negative publicity, came in the form of a guide to the world’s top ski resorts for beginners, published by a British newspaper on November 19. Bansko was rated in second place saying, “Skiing here is great value and once you progress, there’s a superb 16km intermediate run.”

Bansko has a lot to offer, especially to beginners and families. A long-term plan, outlining the future development of construction and ski infrastructure, similar to that of Super Borovets is needed.