News from Bulgaria / Mar 14, 96

From: [email protected] (Embassy of Bulgaria)

Bulgarian Telegraph Agency Directory

EMBASSY OF THE REPUBLIC OF BULGARIA - WASHINGTON D.C.

BTA - BULGARIAN TELEGRAPH AGENCY

14 March, 1996

CONTENTS

[01] I.M.F. REPRESENTATIVE CONFERS WITH P.M. VIDENOV,

Today, Havrilishin held talks with Deputy Prime Minister and Minister of Regional Development and Construction Doncho Konakchiev. The IMF official stressed that after his talks with Bulgarian officials in the past two days, the distance between the IMF and Bulgaria diminished and that there is greater possibility for signing of an agreement. Havrilishin discussed the measures of the Cabinet for the rehabilitation of the banking system, the situation of the enterprises and privatization.

[02] BULGARIAN PM VIDENOV LEAVES ON FORMAL VISIT TO RUSSIA

Bilateral economic cooperation will be in the focus of the talks. This is indicated by the composition of the Bulgarian delegation which includes the Ministers of Trade and Foreign Economic Cooperation Atanas Paparizov, of Finance Dimiter Kostov, of Labour and Social Affairs Mincho Koralski, the Deputy Chairman of the Energy Committee Roumen Ovcharov and the boss of Bulbank Chavdar Kunchev. Customs concessions for Bulgarian goods in Russia and the mechanism of settlement of reciprocal debts resulting from the winding up of joint timber plants in Komi, are other issues on the agenda. Bulgaria insists on customs preferences for Bulgarian exports to Russia, while Russia is in favour of a comprehensive settlement involving the establishment of a free trade zone. There has been no duty-free arrangement between Russia and Bulgaria since 1990.

The sides will also discuss practical aspects of BulgarianRussian cooperation, after an agreement was reached on setting up joint ventures in Russia in the tobacco industry, medicines and wine bottling. Another topic will probably be the problems to Bulgarian-Russian gas joint venture Topenergy.

Trade between Bulgaria and Russia, which fell to 1,500 million dollars, from 15,000 million, in 1990-1994, has been on the rise. According to inconclusive data, it amounted to 2,000 million dollars in 1995.

The visit has been prepared at bilateral political consultations between Foreign Ministry officials and at the fourth session of the joint intergovernmental commission for economic and scientific-technological cooperation in Moscow last month.

During the visit to Bulgaria last May by Russian Prime Minister Viktor Chernomyrdin, Bulgaria and Russia signed 15 agreements. This brought the number of accords regulating bilateral relations to over 40, providing an incentive to relations, in doldrums in the last few years.

Prime Ministers Videnov and Chernomyrdin will attend the opening of Days of Bulgaria in Russia, to continue through May. Seventy-two Bulgarian cultural figures today leave for Russia to take part in the Days. The Ministers of Culture of the two nations will read opening addresses on behalf of the two governments.

The concert marking the start of the Days will be opened by the Moscow State Philharmonic Orchestra for Youth and Children, conducted by Dmitri Orlov. The programme includes works by Bulgarian composers Pancho Vladigerov and Lyubomir Pipkov. Other participants in the concert are mezzosoprano Hristina Angelakova, violinist Pavel Minev, pianist Yovcho Kroushev, pop musicians, folk groups and jazzman Teodossi Spassov.

The Days feature the exhibitions "Modern Bulgarian Painting", "Russian Emigre Artists in Bulgaria" and "Bulgarian Ethnographic Exposition" and a photo exhibition, poetic recitals, and a Week of Bulgarian Cinema. Two Bulgarian theatrical companies will participate in a traditional Russian Chekhov festival.

Beside Moscow, Bulgarian culture will be presented in St Petersburg, Nizhni Novgorod, Samara, Volgograd, Stavropol, Tula, Tver, etc. The Days are organized by the Ministries of Culture and Foreign Affairs.

[03] SLOVENIAN PRESIDENT KUCAN ADDRESSES BULGARIAN PARLIAMENT

Milan Kucan stressed the role of the Bulgarian and Slovenian parliaments in this process. As he put it, they "may clear many redundant obstacles on the road to mutual better acquaintance".

In his address President Kucan dwelled on the reforms in Slovenia, its bids to join the European Union and his country's efforts to maintain good neighbourly relations. He focussed on the disintegration of Yugoslavia and Slovenia's decision to declare independence, taken by a referendum. The Slovenian President also spoke about the recent changes in Europe, the prospects for its integration and the situation in the Balkans.

The future belongs to a state based on the principle of equality of its citizens, regardless of their nationality, race, religious faiths or political convictions, Kucan said. "The Balkans will no longer be what they used to be before yesterday," he stated.

[04] BULGARIA AND SLOVENIA PROMOTE RELATIONS

Bulgaria and Slovenia have common interests and goals as to European and Euroatlantic structures, the Bulgarian President said. According to him, the two countries have common interests and opportunities for cooperation on the regional level and in the framework of the Central European Initiative, the Central European Free Trade Area and the Black Sea Economic Cooperation initiative; common interests and almost identical views on the crisis in former Yugoslavia, especially the conflict in Bosnia, the postwar reconstruction of the region and the involvement of the two countries in it, and common interests in bilateral cooperation. "We found a lot of shared interests," the Slovenia President reaffirmed. He invited Zhelev to visit Ljubljana.

Bulgaria and Slovenia are united by the common goal of building modern, prosperous societies and integrating into Europe, Prime Minister Videnov said today, after meeting with Kucan. Presidents Zhelev and Kucan agreed there are a lot of untapped opportunities for cooperation.

Bulgaria and Slovenia need to build up the legal framework of cooperation, Zhelev emphasized, stressing the need to sign major economic accords. Earlier today, President Kucan and Prime Minister Videnov agreed the sides needed to sign by year-end agreements on reciprocal investment protection and promotion, the avoidance of double taxation and a free trade zone. The session of the joint economic cooperation commission scheduled for April is expected to boost economic relations. Zhelev and Kucan discussed the East-West transport corridor in which the Slovenia side displayed interest.

Kucan's visit to Sofia showed that Bulgaria supports Slovenia's interest in involvement in the Black Sea Economic Cooperation initiative of which Bulgaria is a member. Bulgaria can count on Slovenia's support in its aspirations as regards the Central European Initiative and the Central European Free Trade Area.

In answer to a question, Kucan said Slovenia supports the Bulgarian Government's initiative for a meeting of the Foreign Ministers of Balkan countries in Sofia. Kucan wished the meeting success, but added Slovenia could not get directly committed to such a project.

At the press conference, Zhelev stressed Bulgaria's desire to maintain equally friendly relations with all Balkan and Southern European countries. The Bulgarian President said that from Bulgaria's point of view, his talks with the Slovenian President completed a round of Bulgarian political activity in the Balkans and Southern Europe. Sofia was visited by the Presidents of Turkey, Greece, Romania, Macedonia and Albania, and the Bulgarian Head of State visited Croatia and Bosnia. "I've not been to Serbia, at first for intelligible reasons because of the war, now I'm waiting in line behind Bulgarian Socialist Party officials [...] but the future is a ahead of us," Zhelev said.

[05] PARLIAMENT AMENDS FREE TRADE ZONES DECREE

Principal goal of the free trade zones is to stimulate the production of goods and the performance of services in order to increase Bulgarian exports. Obviously, this goal has not been achieved so far, is said in one of the Government motives for proposing the amendments. According to the Government, there is no production and almost no services performed in the free trade zones and the import is nearly double the export. In its motives the Cabinet recalls that more than 140 cases of alcoholic drinks and cigarettes smuggling were registered in 1993-1995.

[06] COLLECTION OF GOVERNMENT CLAIMS ACT PASSED

The Act adopted today supersedes the Collection of Government Claims Act of 1989; the purpose is to accelerate the collection of government claims. Until now such claims were collected by the tax authorities and bailiffs. In future their collection will be enforced by a specialized branch of the tax administration. The Act regulates in detail the actions preceding the enforced collection of government claims from defaulting debtors (natural persons, sole traders, for-profit or non-profit juristic persons, foreign persons carrying out economic activities or receiving incomes in Bulgaria, branches of foreign persons found in debt to the Exchequer).

The methods which the new Act provides for enforcing the collection of government claims are blocking of a debtor's accounts with the State Savings Bank and other banks and selling his movable and immovable property, including the property of spouses. The tax authorities may apply either one of the methods or employ them at one and the same time.

The Act regulates in detail each of the methods and lists the items of movable or immovable property which cannot be confiscate in enforcing the collection of government claims. As an exception, in case the debtor faces financial troubles temporarily, his debt to the Exchequer may be rescheduled over a period of three years.

The Act Parliament passed today is part of a Cabinet-drafted package of legislation aimed to improve the collection of taxes.

[07] TRADE FAIR OPENS IN PLOVDIV

This year's edition features 322 Bulgarian and foreign participants. In addition to the Bulgarian exhibitors, there are distributing companies from Greece and distributors for Italian, Spanish, US, Dutch, Israeli and Japanese companies.

The fair is specialized into three exhibitions: "Home", "Clothing" and "Hobby". The "Clothing" exposition boasts the largest number of participants: 213 companies which is 72 per cent of the total number of exhibitors. The "Home" exhibition features 60 companies and the "Hobby" exposition - 23 companies. At fashion shows in the framework of the fair the manufacturers will present their collections.

The trade fair continues the traditions of the popular spring contracting of household goods which has been held in Plovdiv since 1965. Unlike the spring and the autumn multi-industry fairs, the trade fair is directed to the small and medium-sized manufacturers and to the wholesalers. According to Executive Director of the International Fair in Plovdiv Atanas Kaloudov the fair is increasingly becoming a venue for demonstrating the potentials of the small and medium-sized businesses in Bulgaria.

[08] SUSPENSION OF U.S. WHEAT EXPORTS WILL NOT AFFECT BULGARIA

Wheat imports are made only when necessary and demanded by the Bulgarian Ministry of Agriculture, to which effect special credit lines at soft financial terms are established. There have been no data so far which indicate the emergence of a grain crisis on the market so that no grain imports are necessary, Trade Ministry experts say. If there arises the need for grain imports, Bulgaria will seek other exporters.

[09] BUSINESS PRESS - NEGOTIATIONS WITH IMF POSTPONED FOR SUMMER

The International Monetary Fund (IMF) postponed the negotiations for a new lending agreement with Bulgaria for this summer at the earliest, "Standart News" writes. A meeting between the IMF experts led by Anne McGuirk, and Bulgarian government officials is due to be held today, according to this daily. Bulgarian statesmen will make a last attempt to convince the Washington financiers that they are contemplating a reform in the real economy, "Standart News" says. The condition the IMF has set forth is winding up several loss-making enterprises. The IMF experts are reportedly alarmed over the condition of the banking system in Bulgaria, the story goes. It further quotes officials of the Bulgarian central bank saying that the IMF "wanted to see speedy measures in the financial sector and we took them". According to the same central bank officials, the IMF is supportive of the decision for revoking banking licences and the scheme offered by Bulbank for rehabilitation of the banking system. According to "Standart News", the government will have problems implementing the reform in the real economy. Preoccupied with the danger for a cabinet reshuffle, the cabinet ministers have shelved for an indefinite period the structural adjustment, this daily says in a commentary. There is a 50% chance for signing a lending agreement with the IMF, Deputy Prime Minister and Minister of Economic Development Roumen Gechev tells an interviewer of the opposition "Demokratsiya" daily. This daily further quotes Gechev as telling a news conference yesterday that Bulgaria stands tangible chances for signing the agreement. He is also quoted saying that Bulgaria and the IMF are negotiating for some 150 million US dollars in loans to be extended over 2-3 years. Another 65-68 million US dollars are expected from the World Bank but only after Bulgaria signs a separate contract with specified parameters, Gechev says quoted by "Demokratsiya". He says the money will go for this country's balance of payments. Bulgaria can also rely on financing under projects of the European Bank for Reconstruction and Development and the European Investment Bank, Gechev tells the "Demokratsiya" interviewer.

[10] US DOLLAR TO STAY AT 77.90-78.20 LEVA

[11] DEPOSIT PROTECTION FUND

The fund was set up in early 1996 by the BNB and the Association of Commercial Banks (ACB). It guarantees deposits of up to 250,000 leva made in commercial banks across the country. Until late 1995, the guaranteed sum was 50,000 leva. The BNB increased the guarantee ceiling as part of the bank's programme to regain confidence in the Bulgarian lev and protect the national production.

The fund's Board of Directors includes, on the part of BNB, Georgi Purvanov, Chief of the National Currency Operations of the Bank, Roumen Simeonov, Chief of the Audits Section with the Bank Supervision Department of the Bank, and on the part of ACB, Kiril Kalinov, Executive Director of the Bulgarian Foreign Trade Bank and Stoyan Alexandrov, Chairman of the Board of Directors of the Central Cooperative Bank.

The BNB Governing Board repealed the text in the Ordinance on Deposit Protection which required that all commercial banks with a license to conduct transactions in Bulgaria participate in the fund, the BNB said. According to the BNB Governing Board, the amendment was necessitated by the several foreign banks which do not take deposits of members of the public so that these institutions could not be required to contribute to the deposit protection fund, the BNB said.

[12] ON PROTECTION OF THE DANUBE

The session will be attended by officials of Danubian countries which signed the Convention: Austria, Bulgaria, Croatia, the Czech Republic, Germany, Hungary, Romania, Slovakia, Slovenia, Ukraine, Moldova, as well as representatives of the European Union.

[13] DEPUTY PM KONAKCHIEV ON PARTICIPATION IN BALKAN CONFERENCE

In his report to the conference he set forth Bulgaria's position on the implementation of the Dayton agreement. Konakchiev said this country considers regional cooperation part of European cooperation.

"I proposed that a centre for information exchange and contacts be set up in Sofia to coordinate and internationalize Balkan regional and trans-regional cooperation," Konakchiev said.

Speaking about Balkan economic policy and Bulgaria's priorities in it, Konakchiev underlined the importance of infrastructure projects in the energy sector and environmental protection; of attracting foreign investment; trade; humanitarian and cultural cooperation.

At his meetings with Greek Prime Minister Kostas Simitis and Foreign Minister Theodoros Pangalos, Konakchiev reaffirmed the Government's position in favour of opening three new border crossings between Bulgaria and Greece, and of the Bourgas- Alexandroupolis oil pipeline. Konakchiev emphasized the need of a single organization working on the oil pipeline project and guaranteeing its security.