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20 I Companies & Markets bne August 2023
Outside Romania there have been some investments by major retailers which are expanding in the region, among them supermarket chains Lidl and Kaufland.
Kaufland Bulgaria, a subsidiary of the German retail chain Kaufland, invested BGN6.8mn (€3.5mn) to expand its logistics base near Plovdiv. According to the retailer, the warehouse the largest logistics centre in the Balkan region with a capacity of over 111,000 pallet spaces.
Lidl also expanded its logistics and distribution centre near Sofia in February, with a BGN90mn investment to add 16,000 sqm of space. Lidl's logistics center in Ravno Pole is now the company’s main hub in Bulgaria. Lidl has 115 stores in 51 Bulgaria towns, served by two logistics centres.
In EU candidate country Serbia, Lidl opened a new logistics centre in the city of Lapovo in August 2022. The logistics centre is Lidl’s second in Serbia, and is bigger than its initial centre at Nova Pazova, as it expands in the Serbian market. It will serve the Lidl stores in central and southern Serbia.
Lidl has been present in Serbia since 2018, serving not only Serbians but also large numbers of people from neighbouring countries such as North Macedonia, who used to cross the border on shopping trips before they got their own Lidl network. Now it is pursuing expansion in other countries in the region as well.
Outside the food retail sector, furniture and home goods retailer JYSK announced in February 2022 the start of an extensive enlargement project for its distribution centre in Bozhurishte, Bulgaria, reported Balkan Engineer, with an investment of €12mn.
E-commerce yet to take off
E-commerce still lags behind the rest of the CEE/SEE region, though Romania is again the frontrunner for SEE and one of the largest markets in the wider region.
“During the Covid era we observed a massive growth of e-commerce in north part of CEE (Poland & Czech Republic) and Western Europe, recently internet sale is also looking favourably on SEE region,” said Sinkiewicz.
“The popularity of e-commerce as a sale channel is growing and to meet clients expectations in reference to delivery time, e-commerce companies are requiring additional distribution centres in the region (the most popular are Romania – H&M, LPP and Bulgaria with a major food store provider). It is important to point out that the SEE region became more interesting for many of e-commerce companies, as an expansion area, after the war in Ukraine started.”
Dhami notes that e-commerce has not yet become a driving force for warehouse investment in Southeast Europe, as it lags behind Western Europe.
“Retail has changed throughout the world, it is moving towards ease of getting to the customer. In more traditional markets such as SEE where retail particularly in shopping malls, it is a relatively newer concept and customers are thus still interested in seeing and touching the product, so online retail has developed slowly,” she says.
However, she adds, “I believe however in the future, the big international retailers will move more towards this trend even in market such as ours and as a result there will be continued demand for warehousing space.”
Bulgarian lawmakers to take control of Lukoil oil terminal
bne IntelliNews
Bulgaria’s parliament voted on July 21 to take control of an oil terminal controlled by Lukoil, marking the latest move against the company’s business within the EU by national authorities.
Lawmakers in the 240-seat parliament voted 144 in favour of a bill that would end Lukoil’s concession to run the Rosenets oil terminal near the Black Sea port of Burgas. Lukoil will be able to continue operating the facility after the concession expires, which is expected to happen within a week, but it must pay fees to the Bulgarian government to do so.
Lukoil has controlled the facility since 2011, when the private
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oil firm secured a 35-year concession. It exclusively supplies crude to the 196,000 barrel per day (bpd) Neftochim Burgas refinery, which is also under Lukoil’s umbrella.
Lukoil could also lose that asset, though, after Bulgarian lawmakers voted in January to enable the government to take over the operation of the plant for up to a year.
Justifying the latest move, Bulgaria’s ruling centre-right GERB, We Continue the Chance-Democratic Bulgaria (PP-DB) and Movement for Rights and Freedoms parties said that terminating Lukoil’s concession would prevent Russia from financing its war in Ukraine with proceeds from Bulgarian