Greek companies seek Balkan refuge from debt storm

Page last updated at 11:32 GMT, Saturday, June 2, 2012 - 16:32 EST

Chicago Tribune:

Iosif Komninakidis smokes nervously behind his desk in the sleepy Bulgarian town of Rakovski and contemplates plunging sales of his Greek company's trendy jeans.

Business in Komninakidis's main market Greece was already in freefall when an election left Bulgaria's neighbor rudderless and further threatened its solvency and euro membership.

"Sales to Greece went down 30-35 percent. After the vote, they completely stopped. People just stand and wait," said the energetic 57-year-old manager of Staff Jeans & Co's sewing factory.

But his business can't wait. Staff Jeans & Co already has 800 people in Rakovski - some 180 km (110 miles) north of the border with Greece. It now plans to move more operations to Bulgaria to cut costs and ease shipping to markets in Germany and Italy.

Several of Greece's top companies spotted the Balkans' growth potential back in the 1990s, when names like Coca-Cola Hellenic and snack maker Chipita moved in to grab opportunities in quickly developing post-communist economies.

Now hundreds of small firms are following as Greek entrepreneurs abandon their shrinking home market with its uncertainty and high costs for lower taxes and cheaper labor in neighbors like Bulgaria, Romania and Albania.

Read the whole story: Chicago Tribune