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News from Bulgaria / May 22, 96

Bulgarian Telegraph Agency Directory - Previous Article - Next Article

From: Embassy of Bulgaria <>



22 May, 1996




    New York, May 21 (BTA) - The Joint United Nations Information Committee ended its 18th session. The conclusive papers of the meeting registered Bulgaria's willingness for opening a UN information centre in Sofia which will start from the National Library "Sts Cyril and Methodius". The UN Information Committee confirmed the initiative of UNESCO and the UN Department of Public Information for holding a regional seminar on the development of independent and pluralistic media in Central and Eastern Europe in Sofia in 1977.


    Sofia, May 21 (BTA) - The World Bank will provide financing that will help reduce the social price of the structural reform in Bulgaria. This emerges from a letter to Prime Minister Zhan Videnov by Kenneth Lay, World Bank Director of Southeastern Europe Department in connection with the measures the government is planning for the structural adjustment of the real economy and the financial sector. The letter describes these measures as "difficult but necessary actions to stem the drain of resources from the economy". The government is planning to close down nearly 70 loss-making state-owned enterprises, and liquidate insolvent and illiquid banks. The losses of companies included in the government's closure list amount to 14,000 million leva making up 28% of losses in industry.

    "Taken together, the Government's measures in these two sectors, as they are implemented, should make an important contribution to reestablishing confidence on the part of the business and financial communities, in Bulgaria and abroad, in the economic prospects of the country. Accordingly, management of the World Bank has concluded that these measures warrant recommending to its Board of Executive Directors that it approve use of resources previously committed to Bulgaria to help alleviate the social costs associated with the closure of loss-making state-owned enterprises," the letter reads.

    "Moreover, if these measures are implemented as proposed, and if the Government of Bulgaria is successful in establishing with the International Monetary Fund a satisfactory macroeconomic framework, they would form the basis of management of the World Bank to recommend to its Board of Executive Directors that it approve additional financing for Bulgaria to support the reform programme," says Mr lay. "If the Government were to depart from this programme in any material respect, we would, of course, have to reconsider the foregoing response," the letter says in conclusion.


    Sofia, May 21 (BTA) - Subscribers can take incoming international calls only in ten Bulgarian population centres, given that the total number of networks is 2,200, Valentin Tsenov, Director of Marketing and Development of Services with the Bulgarian Telecommunications Company said. Tsenov said that following the building up of digital overlay networks (DON) all Bulgarian population centres will be able to take incoming calls. The project for which the European Bank for Reconstruction and Development, the European Investment Bank and the World Bank provided the total of 150 million US dollars at a low interest was launched in early 1994. The project is expected to be completed by the end of 1997 and will allow making trunk and international calls through all 3,000 digital exchanges. According to Tsenov, neighboring countries account for 40 percent of Bulgaria's international traffic.


    Sofia, May 21 (BTA) - Greece will provide from the European Union 100,000 US dollars for the construction of consolidating structures along the banks of the Arda and Louda rivers in the region of Ivailovgrad (Southern Bulgaria), the local BTA correspondent said, quoting as saying Georgius Dolios, governor of Evros, a neighbouring region in Greece.

    Part of the funds will be used for the construction of a reinforced concrete river-bank dike to stop the Greek dam Kiprinos from overflowing into Bulgarian territory in high waters. The 4.2 ha of fertile arable land near the village of Slavejevo, Ivailovgrad region, which have been eroded by the dam waters, will be recultivated.

    Bulgaria delivers to Greece 168 cu m of water per year in World War II reparations under an agreement signed in 1964 for a period of 60 years. Greece collects the waters in the Kiprinos dam, some 2 km down the place where Arda river crosses the border, and uses them for irrigation of some 22,000 ha of agricultural lands. When the dam gets filled to the brim, the water overflows and returns upstream into the Bulgarian territory. The first cases of flooding of Bulgarian lands were reported in 1973. Greece received ECU 460,000 under PHARE and Interreg programmes for reconstruction works in 1994 but the consolidation of the Bulgarian bank has not been started yet.

    The other portion of the funds which Greece will receive from the EU have been planned to be used for correcting the course of the Louda river. The Bulgarian-Greek border passes along 16 km of this river's depression line. The depression line often changes because of the unstable banks which gives rise to arguments between the two states over border territories. The Louda river has been planned to be consolidated with special structures.

    The consolidating activities of the two rivers near Ivailovgrad were included in a project three years ago, but have not been launched yet due to the Greek party's lack of initiative. Now Greece's initiative is already a fact and the construction may begin with the arrival of the first investments, water engineers commented before BTA's local correspondent.


    Sofia, May 21 (BTA special correspondent Atanas Matev) - Bulgarian Prime Minister Zhan Videnov, who is on a formal visit to China, today met with the Chairman of the Standing Committee of the National People's Congress Qiao Shi and with Vice-President Rong Yiren. The sides discussed opportunities for the expansion of trade and economic cooperation between Bulgaria and China. They expressed dissatisfaction with the significant decrease bilateral trade, which halved in 1995, compared to a year earlier.

    Bulgarian-Chinese relations have good traditions and a sound base, Videnov told a press conference later today. Another five agreements, beside six signed yesterday, are in the making. The objective is to provide an incentive to relations for years ahead, and the Bulgarian Government will do its best in that respect, he went on to say.

    The Bulgarian Prime Minister today opened a bilateral business forum sponsored by the China Council for the Promotion of International Trade. After the opening ceremony, the Minister of Trade and Foreign Economic Cooperation Atanas Paparizov and Bulgarian business people began talks with Chinese business partners.

    Videnov visited the construction site of a Bulgarian-Chinese joint venture for making fruit juices near Beijing. Fruit juice is in great demand in China, and the plant expects a return on investment in two or three years.


    Sofia, May 21 (BTA) - At an extraordinary sitting today, the National Assembly passed by majority on first reading a Government- sponsored bill on protection of the deposits and accounts with commercial banks subject to bankruptcy proceedings initiated by the central bank. The largest opposition Union of Democratic Forces (UDF) abstained in the vote and said it will move their own bill for full protection of commercial bank deposits and accounts. Today's debate in Parliament came in the wake of a decision by the central National Bank of Bulgaria (BNB) at the end of last week to place under special supervision several commercial banks, including the majority state-owned Mineralbank and First Private Bank. Under the Government's bill, the State will guarantee lev personal deposits 100 per cent and company accounts 50 per cent. Personal deposits in hard currency will also be fully protected, but their holders will be limited to biannual withdrawals of up to 25 per cent of the assets over a period of two years, or will have the option to receive immediately the lev equivalent translated at the central exchange rate. The opposition UDF declared itself against these restrictions, saying it will move its own draft legislation providing full protection to personal deposits in both leva and hard currency and to company deposits. MPs of the Popular Union made similar remarks on the Bill. The ethnic Turks' Movement for Rights and Freedoms (MRF) said it approves of the bill in principle but it needs certain revisions before coming up for second reading. The bill establishes a procedure for state protection of deposits and accounts. The lev deposits with failed banks will be transferred to the State Savings Bank (SSB), and the hard-currency deposits to anothe designated bank (a couple of days ago Finance Minister Dimiter Kostov said this will be the Bulgarian Post Bank). A provisional guaranty fund for deposit and account protection will be established with the BNB and will be administered by the Minister of Finance. The collected claims of the failed banks will be pooled into that fund, and the rest of the money will come from the State Savings Bank against collateral of government securities issued annually up to a limit fixed by the national budget act. Later in the day, the parliamentary group of the Union of Democratic Forces circulated a declaration. "This is a bad bill because it saddles the State - i.e. the taxpayers with deposit guaranty," the declaration reads. "The bill deals a severe blow at all Bulgarians because the State will hit them all in the pocket in order to guarantee the deposits. It will impose higher taxes, stop adjusting pensions for inflation, and start printing worthless paper money," the UDF declaration says.


    Sofia, May 21 (BTA) - Bread flour shortage and the expected crisis in meeting consumers' demands were the problems discussed at a round table today by representatives of the Branch Chamber of Bakers in Bulgaria. The chamber seeks to protect the interests of nearly 30,000 employees which account for the manufacture of 65 per cent of the bread in the country.

    The demands of the industry are not met and every day the market is increasingly getting short of bread, was the conclusion of the participants. Almost no regions in the country provide with the necessary amounts of flour. According to cited figures, the profit margin of 12 per cent cannot be achieved, bread prices are held down and a number of bread producers are working at a loss.

    According to the bread producers, the state should license and list the companies, dealing with import and export of bread grain and to relieve from profits tax the municipal and state-owned bread manufacturers. The exact weight of certain types of bread must be specified in order to avoid speculation with their prices. The current situation brings forward the need for a legislation on grain and grain producers, the participants in the round table pointed out.


    Sofia, May 21 (BTA) - Leaders of the largest opposition coalition, Union of Democratic Forces (UDF), today sharply criticised the Government on the crisis of the financial sector and the economy, the dire straits of the banking system and its inept efforts at structural reform.

    "A structural reform should not begin with closures of companies. That is just one element in a reform," said UDF deputy leader Alexander Bozhkov. According to him, there should be three elements in the structural reformprivatization, banking reform and tightening controls and financial discipline in the financial sector. According to Bozhkov, the Government takes the unpopular steps only under pressure from the international financial institutions. "The government has been forced to launch reforms. It has no alternative employment programme," Bozhkov said. "We remain convinced the Bulgarian Socialist Party cannot rule in a market environment," UDF floor leader Yordan Sokolov said. UDF officials visiting Bulgarian cities believe social pressures are mounting. According to Bozhkov, UDF will not only support civil protests but will also try to organize them.


    The State Savings Bank (SSB) is ready to take over public deposits from First Private Bank and Mineralbank, "Pari" writes citing SSB Vice President Raicho Karagyozov. "We are not expecting any problems, bearing in mind the extensive network of the SSB and the training of our staff," Karagyozov said. The SSB and Post Bank will also take over the depositors of Crystalbank and Private Agricultural and Investment Bank after they are declared bankrupt, according to "Standart News".

    The Neftochim oil refinery in Bourgas is 2,500 million in the red, according to the refinery's financial report. This is the largest loss posted by Neftochim since it started operation, "24 Chassa" writes. Neftochim will lose 1,000 million leva more as a result of the collapse of the forex market, financiers say. The financial crisis is the result of the difference in diesel and petrol prices, according to Neftochim experts. This is the second time Neftochim is threatened with closure since 1992, "Continent" recalls. In May the refinery processed 300,000 tonnes instead of the contracted 700,000 tonnes. The aim is to decrease losses by shrinking production. Neftochim exports 90% of its chemicals and 60% of its plastics for hard currency.

    The Shoumensko Pivo brewery in Shoumen (Northeastern Bulgaria) started the production of an original "Tsarsko Pivo" (Royal Beer) to mark the forthcoming visit of Simeon II to Bulgaria. The idea occurred spontaneously when a label of this beer was found in an album of the Bulgarian printing industry, "Continent" writes. At the turn of the century the brewery in Shoumen had the official status of a purveyor of the Royal Household.


    Sofia, May 21 (BTA) - Belongings of the Proto-Bulgarian Khan Kubrat (late 6th century, around 651 A.D.) are displayed at the National Museum of History in Sofia. The museum shows part of the treasure of the khan who headed Great Bulgaria in the 6th century. These are two gold rings, Kubrat's sceptre, a rhyton - symbol of the khan's power, a goblet, a chalice, the clasp and the tab of the khan's belt.

    Kubrat of the Dulo clan, is the father of the founder of the Bulgarian state - Khan Asparuh. According to historical documents, he ruled the Khaganate of Great Bulgaria (near the Caspian Sea) for almost 60 years. He enjoyed great prestige among the rulers of the neighboring states and the numerous Proto-Bulgarian tribes. Legend has it that on his death bed he showed his sons how easy it is to break one stick and how strong a bundle of sticks is. His sons left the lands of the then Great Bulgaria. Part of the Proto-Bulgarians settled on the territory of present Bulgaria where in 681 they founded the Bulgarian state.

    The treasure of Khan Kubrat, comprising 300 items, was discovered at the turn of the century in Ukraine and is now the property of the Hermitage in Saint Petersburg. It comprises vessels, ornaments and stamps which have been proven to belong to Khan Kubrat. The treasure was buried in 651, the presumable year of the khan's death.

    The casts for the Bulgarian copies, of gold and silver, were made in 1991 when part of the treasure was shown in Sofia. Lack of funds delayed the making of the copies.

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