Eng. Ilian Terziev, Chairman of the Board of Directors of BCC: The topic of the conference in Brussels is a clear sign of the important perspectives on which the BCC will focus its effortsI would like to thank Ms. Iskra Mihailova for our inclusion in this important initiative for the construction industry
Eng. Terziev, the official delegation of the BCC will be on a working visit to Brussels, during which the Chamber representatives will participate in the high-level conference "Digital and Innovation Challenges for the Construction Industry in Bulgaria". Tell us more.
The delegation of the Chamber includes deputy chairmen and representatives of the organization's management, chairmen of regional offices, heads of key directorates in the administration, and the team of Stroitel newspaper, which is involved in the organization and logistics of the event. We have also invited our colleagues from the Chamber of Architects in Bulgaria. It will be presented by the chairman arch. Milkov and Deputy Chairman arch. Hristov.
The conference is hosted by MEP Iskra Mihailova, who is also Vice-Chair of the Renew Europe Group in the EP. I take this opportunity to express my and the Chamber’s Board of Directors’ gratitude to Ms. Mihailova for our inclusion in this important initiative for the construction industry, as well as for the long-term fruitful partnership we have. This is the second such visit we are participating in. The first one was realized in 2016 and it marked great success. I am convinced that during our current visit we will comment on the most current topics for the industry in the context of leading European policies and initiatives.
What will be the main topics to be discussed at the forum?
Challenges the construction industry faces plus digitalization and innovation. One of the most important topics for the industry - energy efficiency as a means of energy independence in the context of the European Green Deal will also be discussed. In addition to Ms. Mihaylova, the EIB Vice President Lilyana Pavlova will also participate in the forum with a keynote speech, and she will present the opportunities for EIB to support the decarbonization and modernization of the construction industry. The conference program also includes the presentation of the new President of the European Federation of the Construction Industry (FIEK) Philip Crampton, who will deliver a speech regarding the challenges that the construction sector faces, and possible changes in the context of the Green Deal. The agenda of the event includes the Vice-President of the ITRE Committee Morten Petersen’s speech. On behalf of the BCC, in addition to me, the official part of the event will be attended by the Deputy Chairman of the Chamber, Eng. Kalin Peshov, and eng. Lyubomir Kachamakov, Chairman of the Sofia Regional Office of the Chamber and two terms Vice-President of FIEK. He will be talking about the digitalization of the sector, by focusing on opportunities for small and medium enterprises (SMEs). The BCC initiative for the creation of a Digital Innovation Hub in construction will be presented by Stoyan Stavrev from the Bulgarian Consulting Organization. A very important part of the event program, which will be held in the EP building, is devoted to presentations of leading Bulgarian construction companies that have implemented and are executing large-scale infrastructure projects with European funds. Personally, I am very proud of this part of the conference, because we will be able to show the capacity and professionalism of Bulgarian construction companies and the impressive sites that have been built in our country.
2022 posed extreme challenges for the construction sector. The COVID-19 pandemic has resulted in a serious increase in building material prices, and the pandemic disappearance, which has been awaited by the business with such hope, has been hampered by the war in Ukraine. The conflict has led to even higher prices, along with severe supply delays.
The COVID-19 pandemic posed several challenges to the countries' economies, and to the construction industry in particular, as an important part of those economies, and the war continued to cause havoc on the construction business. The supply crisis is extremely worrying, and the rise in prices of construction materials and raw materials is drastic. The search for a methodology for price indexation regarding construction contracts is the number one topic for BCC management. We held a series of meetings with all responsible institutions, including the Ministry of Regional Development and Public Works and the Ministry of Finance. We allarmed that due to the rising construction prices and the lack of compensation mechanism, the implementation of the country's commitments under European programs, and the government's investment program are under threat. As a result of the active efforts of the Chamber, an indexation methodology is already in place and the National Assembly is about to vote on an amendment in the Public Procurement Act to allow its implementation. Unfortunately, the methodology has a ceiling of up to 15%, which will greatly limit its effectiveness. According to data we receive from the country, the price of concrete has increased by over 40%, the price of bitumen by more than 70%, and the price of fittings and metals has jumped by 150%. In our opinion, the up to 15% set in the methodology, should be reconsidered. The problem with the prices of construction and raw materials is not local only to Bulgaria, it concerns the construction industry in Europe. The European Federation of the Construction Industry has taken the position that a common European response to this problem is needed. This topic will certainly be one of those discussed in Brussels.
Along with these extraordinary challenges, Europe is facing a double transition - digital and environmental. No country, industry, or business can afford to stay out of these processes if it wants to keep up with the times. How does the BCC fit into the transformation processes?
The Chamber of Builders in Bulgaria has focused on the forthcoming digital transformation in the sector for several years, and this is one of the main priorities of the organization in the short and medium term.
Construction is one of the conservative sectors in the economy, still lagging in terms of the introduction and implementation of high-tech solutions and innovations.
Digitalization in construction will increase the competitiveness of companies and will lead to higher process efficiency, economic growth, and the achievement of the strategic goals set in the European Green Pact.
As I have already mentioned, initiated by the Chamber of Builders in Bulgaria, which has united the efforts of industry organizations, leading universities and institutes, as well as representatives of the private sector, the Association "European Digital Innovation Hub in Construction" was established in 2021. Its work will be presented at the conference.
The investment opportunities that open up to the industry in the framework of the Green Deal, The National Recovery and Sustainability Plan, and the programming period 2021 – 2027 will be presented at the conference in Brussels. Is there enough information about what is to come, and is the industry prepared?
The topic of the conference is a clear sign of the important prospects in which BCC as a representative of the Bulgarian construction industry will focus its efforts. Unfortunately, the information that reaches us is not enough for both the National Recovery and Sustainability Plan and the operational programs. It is still not clear how and under what rules the energy efficiency measures under the Plan will be implemented, an issue of great importance for the industry and the municipalities. That is why through our visit, we welcome the opportunity to receive first-hand information from the EP, which will be so necessary to our industry. The Chamber aims at working to prepare the industry for the new conditions, to familiarise it with the latest European directives and requirements for energy performance of buildings, building materials, new technologies, retraining and training of personnel, and for funding opportunities under the National Recovery and Sustainability Plan, operational programs related to financial mechanisms and instruments, and to become an industry of the future. The topics are many and concern the long-term development of the Bulgarian construction sector. We declare our desire and readiness to work together with our representatives in the European institutions, with the ministries and agencies, and with the National Association of the Municipalities in the Republic of Bulgaria on the topic of future development of the regions and our country.