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against the previous month. The assessments about the business situation ofretail trade enterprises as well as the expectations about business developmentover the next 6 months increased. More optimistic were also the expectationsabout orders placed to suppliers over the next 3 months, especially from domesticmarket.In the Service sector the managers were strongly optimistic behaved as regardsthe business situation; the composite indicator of business climate in servicesector grew by 9.6 percentage points in December. By the end of 2006 the relativeshare of managers pointed out the uncertainty in economic environmentand weakness in economic registration as problems for development of activityhas decreased.3. Foreign InvestmentsBy the end of 2006 foreign direct investment (FDI) stock in Bulgaria (assessedsince 1992) reached USD 20199,7 million with about 95.7% generated since thenew start of the economic reforms in 1997. In 2006 for a tenth consecutive yearFDIs through greenfield, joint ventures, reinvestments and additional investmentsin already acquired enterprises exceeded FDIs through privatisation.The top investors in Bulgaria during the period 1992 – 2006 (in USD m) areAustria (3018.1), Netherlands (1845.4), Greece (1598.2), UK (1350.3), Germany(1206.3), Belgium and Luxembourg (898, 1), Italy (892, 3). Other major investorsinclude the USA, Hungary, Cyprus, Czech Republic, Switzerland, Ireland, France,and Spain. The European Union is the major source of FDI for Bulgaria with about70% of the FDI stock. FDI distribution by sectors shows the major role of industry(43.6% of the total), followed by finance (18.7%) and trade (16%).Investment incentivesManufacturing companies enjoy 100% exemption of the corporate income taxfor investment in depressed regions, in case they meet the following conditions:1. All the sites and assets (except for cash in bank accounts and equity) ofthe company are entirely located within the administrative boundaries of adepressed region;2. The company does not have any due tax or obligatory social security liabilities.www.sme.government.bg 9