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News from Bulgaria, 96-09-26
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From: Embassy of Bulgaria <email@example.com>
EMBASSY OF BULGARIA - WASHINGTON D.C.
BTA - BULGARIAN TELEGRAPH AGENCY
26 September, 1996
 AMENDMENTS TO FOREIGN INVESTMENT LAW ON FIRST READINGSofia, September 25 (BTA) - Parliament today passed on first reading a bill of amendments to the Business of Foreign Persons and Foreign Investment Protection Act, providing for liberalization and legal safeguards for foreign investment. The bill, moved by the Council of Ministers, also envisions safeguards against legal changes unfavourable to investors.
The amendments have been necessitated by changes in the economic environment in this country and the desire to encourage foreign investment in the economy, says the statement of the parliamentary Finance and Budgetary Committee which supported the bill.
The amendments envision the exemption from customs duties and VAT of non-cash contributions in joint ventures, if they amount to at least 30% of the capital. This would allow the duty-free import of technology, patents, know-how, etc, said Deputy Prime Minister Roumen Gechev who presented the bill.
The texts in the bill that define foreign investment would be brought into line with the legislation of OECD countries and International Monetary Fund requirements. Deposits by foreign persons would not be considered foreign investment.
The opposition MPs supported the proposals that would allow foreign investors to buy land. "We are ready to amend the Constitution with the majority's support, to enable foreign investors to buy land in Bulgaria," said Ventseslav Dimitrov of the Popular Union (of Democrats and Agrarians). According to Rossen Mihailov of the Democratic Left, the bill should clearly define the rights of foreign investors to repatriate profit.
 BULGARIA SIGNS COMPREHENSIVE TEST BAN TREATYSofia, September (BTA) - Bulgaria signed the global treaty banning nuclear tests, Bulgarian Foreign Ministry spokesman Pantelei Karasimeonov told the press today. Minister Georgi Pirinski, who is in New York for the UN General Assembly meeting, signed the treaty on Tuesday. This made Bulgaria one of the first countries to sign this important document.
Bulgaria took an active part in the discussions and drafting of the treaty as member of the Conference on Disarmament in Geneva and by signing this treaty it showed in deed its commitment to nuclear disarmament, the Foreign Ministry spokesman said. Bulgaria views the treaty as a resolute step to continuing the efforts of the international community for a final liquidation of nuclear weapons as a means of combat. To this end it is working for perfecting the existing and developing new mechanisms for exercising control over the proliferation of mass annihilation weapons.
 STATEMENT ON BOSNIAN ELECTIONSSofia, September 25 (BTA) - Bulgaria met with satisfaction the news of the first general elections in Bosnia-Herzegovina after the signing of the Dayton peace agreement in Paris. The elections are of exceptional importance not only for Bosnia's future, but for stability, security and goodneighbourly relations in Southeastern Europe as well, says a Foreign Ministry declaration released today.
Bulgaria is in favour of the comprehensive and timely implementation of all aspects of the Dayton peace accords, including the election of new political institutions in Bosnia, the document says. The September 14, 1996 elections are a major guarantee of an irreversible peace process in Bosnia and a stepping stone to building a democratic political state system.
The Bosnian elections create prerequisites for further development of relations among the countries of former Yugoslavia, as well as for the final lifting of sanctions against the Federal Republic of Yugoslavia. This opens up new prospects to realize the hopes and expectations of the nations of Southeastern Europe for lasting peace and prosperity, the Foreign Ministry stated.
In conclusion the document expresses a hope that the important event, made possible by the active efforts of the international community as well as by the voters' responsible attitude, will give a serious impetus to the process of achieving civil consensus among the ethnic communities in the country, with a view to guaranteeing Bosnia's viability, its total reconstruction and full integration in international relations.
 MINISTER PIRINSKI MEETS EUROPEAN COMMISSIONER VAN DEN BROEKSofia, September 25 (BTA) - Bulgarian Foreign Minister Georgi Pirinski who is in New York to attend the 51st session of the U.N. General Assembly met with Hans van den Broek who is in charge of external relations with the countries of Central and Eastern Europe with the European Commission, reads a Bulgarian Foreign Ministry press release. Hans van den Broek praised Bulgaria for the prompt and detailed answers it has given to the European Commission questionnaire and for its active participation together with the other associated countries from Eastern Europe in the dialogue for the further promotion of relations with the Union. The EU will use the answers to the European Commission questionnaire in taking a stance on Bulgaria's membership application.
Asked by Minister Pirinski about Bulgaria's removal from the EU visa black list, the European Commissioner confirmed the Commission's intention to continue cooperation on the issue with the competent Bulgarian authorities. On the basis of hitherto meetings the EC will seek a positive solution to the problem in the nearest future.
The talks focussed on the possibilities that the EU exerts assistance to Bulgaria in the supply with and delivery of grain foods to this country and in resolving the problems with the balance of payments.
 FINANCE MINISTER KOSTOV LEAVES FOR WASHINGTONSofia, September 25 (BTA) - Bulgarian Finance Minister Dimiter Kostov today left for Washington for the annual session of the International Monetary Fund (IMF) and the World Bank due this weekend. In a series of preliminary meetings with representatives of the two financial institutions Kostov will discuss the implementation of the measures Bulgaria pledged to take to get loans to support this country's structural reform and balance of payments.
"I leave with a hope for support," Finance Minister Kostov said before getting on the plane. He is accompanied by the chief of the central bank Economic and Monetary Analyses Department, Zdravko Balyozov. Central bank Governor Lyubomir Filipov and Plamen Ilchev who is in charge of the contacts with international monetary institutions at the central bank Governing Board, will join in on Friday.
Despite the obvious failure to implement the macroeconomic parameters, we expect good results from the meetings during the annual session because at this stage both the IMF and the World Bank are more interested in the progress of the structural reform and privatization, Lyubomir Filipov told journalists yesterday.
 MEETINGS OF CULTURE MINISTER IVAN MARAZOV IN GERMANYBonn, September 25 (BTA exclusive by Simeon Vassilev) Bulgarian Culture Minister Ivan Marazov, presidential candidate of the Bulgarian Socialist Party-led coalition, had meetings at the German Bundestag today. Marazov arrived on a visit here yesterday at the invitation of the Friedrich Ebert Foundation.
This morning Prof. Marazov met the floor leader of the Free Democratic Party, Dr Hermann Otto Solms, and later Bundestag Vice- President Burkhart Hirsch. "It is very important for our two countries to discuss not only economic contacts but also cultural cooperation. This would contribute to the better understanding between our two peoples," Dr Hirsch said after the meeting.
Later today Prof. Marazov conferred with the President of the North Atlantic Assembly - Karsten Voigt, and with the deputy floor leader of the parliamentary group of the Social Democrats, Guenter Verheugen. The talks focused on the economic and social situation in Bulgaria, this country's integration into Europe, NATO enlargement and the Russia factor as well as the situation in Bosnia.
The meetings in Bonn showed once again that Germany understands Bulgaria best in all of Western Europe, Prof. Marazov said after the meeting. "I was particularly pleased with the fact that our hosts here recognize Bulgaria's special role as a stability factor in the Balkans," Prof. Marazov said.
Prof. Marazov read a lecture on the topic "Bulgaria at Crossroads" at the Friedrich Ebert Foundation.
 I.A.E.A. TO FINANCE SIX ENERGY PROJECTS IN BULGARIASofia, September 25 (BTA) - The International Atomic Energy Agency (IAEA) will finance six projects for development of the energy industry in Bulgaria in the coming two years. Speaking at a news conference, the chairman of the Committee for the Peaceful Uses of Atomic Energy, Luchezar Kostov said about USD 140,000 will be extended to the Committee to carry out its controlling functions. Another USD 150,000 will be made available for improving the safety of the nuclear waste storage facility in Novi Han, near Sofia; USD 1.06 million for electronic technologies for treatment of the exhaust gases in thermal power plants; USD 116,000 for fighting the negative effects of uranium mining, said Kostov. An additional USD 70,000 will come to finance projects aimed at finding alternatives to the nuclear energy in Bulgaria. The traditional annual aid for development of nuclear technologies total USD 223,000.
 YUGOSLAV PARLIAMENTARY DELEGATION IN SOFIASofia, September 25 (BTA) - On the second day of its visit to Bulgaria, a Yugoslav parliamentary delegation led by Dr. Radoman Bozovic, Chairman of the Chamber of Citizens with the Yugoslav parliament today met Bulgarian National Assembly Chairman Blagovest Sendov, with the parliamentary Foreign Policy Committee, Deputy Foreign Minister Ivan Hristov, Prime Minister Zhan Videnov and President Zhelyu Zhelev.
The peace process in Bosnia and Hercegovina, the elections held there and the Dayton accord create a favourable environment for the development of bilateral relations, Sendov told the Yugoslav MPs. He voiced a hope that the Federal Republic of Yugoslavia will stand by its commitment to guarantee the constitutional rights of the Bulgarian minority there. This commitment was taken during last year's visit to Belgrade by a delegation of Bulgarian lawmakers. Dr. Bozovic said the Yugoslav government and public see this minority as a factor of stability and friendship.
It is wrong to turn the minority issue into an international one and I hope that the Bulgarian population in Yugoslavia will be a bridge between the two nations, the Yugoslav MPs were told by the chairman of the parliamentary Foreign Policy Committee, Nikolai Kamov.
The sides will sign four agreements, including one on investment promotion, said Kamov.
In the next few weeks the Yugoslav Parliament will consider a bill on Balkan cooperation, the leader of the Federal Assembly Dr Radoman Bozovic said during the meeting. He said there is a need to liberalize tax legislation and cross-border trade.
The need for building an up-to-date legal framework of bilateral relations between Bulgaria and Yugoslavia was discussed at the meeting of the Yugoslav delegation with Foreign Ministry officials.
Later today, the Yugoslav MPs were received by Prime Minister Zhan Videnov. During the meeting the sides emphasized the intensive development of bilateral relations lately, the deputy head of the Government Press Office Mila Manova said.
The meeting outlined the main areas of cooperation of mutual interest, including stepping up economic contacts. The sides made a review of the progress of bilateral relations in culture, science, transport and energy infrastructure projects, important not only for regional cooperation but also for the two countries' integration into European economic structures. The two sides noted that Bulgaria and Yugoslavia are working to regulate bilateral customs preferences, an issue requiring assistance at parliamentary level.
Dr Radoman Bozovic stressed the importance of the peace process in the region and Bulgaria's role as a stability factor. The guest said that the FR of Yugoslavia is yet to launch reforms in which Bulgaria has already made considerable progress, such as privatization and structural adjustment. Bozovic and Videnov agreed that economic crises require resolute actions.
The Chairman of the Chamber of Citizens of the Yugoslav Parliament and the delegation headed by him were also received by President Zhelyu Zhelev. The talks focused on bilateral relations in the new stage revealing opportunities for cooperation mainly in the economic sphere, presidential foreign affairs adviser Kamen Velichkov told BTA.
The two sides noted the good pace of work in drafting a new interstate treaty for friendship and cooperation and of a package of economic agreements. One of these - an agreement on investment protection, is already a fact, the presidential adviser said. The two sides agreed that the success of the reforms in the two countries us a precondition for successful economic cooperation.
 YUGOSLAV PM KONTIC RECEIVES BULGARIAN AMBASSADOR ISHPEKOVBelgrade, September 25 (BTA corr. Lyudmil Mitakev) Yugoslav Prime Minister Radoje Kontic received today Bulgarian ambassador to Belgrade Filip Ishpekov. The meeting assessed bilateral relations in positive terms, devoting special attention to possibilities for broadening economic cooperation, including through closing joint production deals in the chemical industry and machine building, Ambassador Ishpekov said after the meeting.
Opportunities should be sought for increasing commercial exchange and balancing trade, Prime Minister Kontic said. The two countries should work for setting up a free trade zone by first granting each other customs preferences, Kontic said. The FR of Yugoslavia also proposed to speed up work in drafting a friendship and cooperation treaty between the two countries. Belgrade is also ready to sign a document on confidence building and security measures in the military sphere which is currently being drafted by the defence ministries of the two countries, Kontic also said.
The FR of Yugoslavia has guaranteed the equal rights of all its citizens both through its Constitution and its legislation, the Yugoslav prime minister said in response to a question by Ambassador Ishpekov on the insufficient realization of the rights of the Bulgarian national minority in Yugoslavia, guaranteed by the Yugoslav Constitution.
 CENTRAL BANK GOVERNOR FILIPOV MEETS MPSSofia, September 25 (BTA) - "The base interest rate hike was a painful measure. It has to reverse expectations about inflation and depreciation of [people's] deposits. The base interest rate was increased to 300 per cent since the central bank's Board of Governors does not intend for the rate to remain effective long. It may change any moment now. We are well aware what the short-term expectations about inflation and depreciation are," Governor of the Bulgarian National Bank (BNB, the central bank) Lyubomir Filipov commented before MPs of the Budgetary and Finance Committee today the BNB's Monday decision to increase the base interest rate to 300 per cent. According to Mouravei Radev, MP of the opposition Union of Democratic Forces, the measure seeks to make people sell their foreign currency. Left MP Ivailo Kalfin too believes that the measure will have a negative result.
The next package of measures will seek to ensure the settlements of all the banks which have not been placed under special supervision, it emerged from Filipov's statement. The BNB is ready to provide secured leva refinancing to all banks which need such funds; if necessary, the central bank can provide unsecured refinancing as well. "We have been doing this since yesterday," Filipov said. According to him, the measure has been coordinated with the International Monetary Fund (IMF) as it required that the central bank ensure normal settlements in leva. "The more difficult question concerns foreign currency," Filipov said. According to him, BNB's small foreign currency reserves are the chief factor for the instable lev.
The government set forth guidelines for a stepped up privatization schedule, as we believe the confidence in the Bulgarian lev is unlikely to be restored without additional foreign exchange resources, and undertook to formulate clearly the ways of guaranteeing bank deposits, said the BNB chief.
The credit rating of the country is sure to be low, said Filipov. He said the major problem of the Bulgarian economy is its serious indebtedness. A way to find fresh capital is for Parliament to allow the BNB to use its gold reserves as collateral.
The central bank relies much on privatization as the idea is to use the privatization proceeds for debt payments. However they are used - directly or indirectly - they will support the foreign exchange reserves. The BNB is considering measures to encourage the government securities market. The IMF was informed yesterday of the steps taken by the central bank but no response has come as yet, Filipov said.
 VOUCHER PRIVATIZATION GETS GOING WITH OVER 900 ENTERPRISESSofia, September 25 (BTA) - Voucher privatization will get going with 968 enterprises offered to the public in the first privatization auction, Auction Commission chairman Yossif Iliev told a news conference today. The enterprises have an aggregate capital of 86,000 million leva distributed in 87 million shares. Another 82 enterprises earmarked for voucher privatization dropped from the list for the first auction because of their delayed registration as one-man commercial partnership.
Mass Privatization Centre chief Kalin Mitrev said the statutory meetings of privatization funds have started. According to final data, the Doverie privatization fund has raised the highest capital (6,400 million investment vouchers), ahead of Petrol (5,600 million vouchers) and the Bulgarian-Dutch privatization fund (4,000 million vouchers).
Over 3.2 million Bulgarians have registered for mass privatization. A public opinion poll found that 58% of them have invested their vouchers in one fund and 7% in more than one fund. Only 8% will bid personally for shares of state-owned enterprises.
 JAPANESE PRINCESS SAYAKO ARRIVES SUNDAYSofia, September 25 (BTA) - Japanese Princess Sayako will pay a four-day visit to Bulgaria at the invitation of the Bulgarian government, a Foreign Ministry spokesman said today. Princess Sayako will open the Days of Japanese Culture in Bulgaria which will continue for almost two months, and is expected to meet President Zhelev and Prime Minister Zhan Videnov. Princess Sayako will visit St Kliment Ohridski Sofia University the Sts Cyril and Methodius University in Veliko Turnovo (Northern Bulgaria), the National Museum of History and the Rila Monastery.
Princess Sayako has made only eight visits abroad since 1974. "It is an honour for Bulgaria that Princess Sayako will visit here," said Foreign Ministry spokesman Pantelei Karasimeonov.
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