News from Bulgaria / Feb 28, 96

From: bulgaria@access1.digex.net (Embassy of Bulgaria)

Bulgarian Telegraph Agency Directory

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

BTA - BULGARIAN TELEGRAPH AGENCY

28 February, 1996

CONTENTS

[01] PRESIDENT RETURNS AMENDMENTS TO TAX ADMINISTRATIONS ACT

Sofia, February 27 (BTA) - President Zhelyu Zhelev returned today for reconsideration the Act to Amend the Tax Administration Act, which was passed on February 14. According to the President's press office the head of state challenges the provisions which allow the Tax Evasion Prevention Service to search premises and vehicles for office use without availability of laws specifying the circumstances under which this may be done.

A message received at the BTA states the President's motives for returning the amendments. According to the President, the Tax Administration Act endows the Tax Evasion Prevention Service with powers which may seriously violate the rights of the searched persons. The Law does not ensure adequate guarantees against using these powers for some other purposes, Mr Zhelev believes. If a state body is to act efficiently it should enjoy the the due respect and give no reasons for questioning in its impartiality , the President says in his address to the National Assembly.

[02] BULGARIAN GOVERNMENT DELEGATION LEAVES FOR MOSCOW

Sofia, February 27 (BTA) - "I expect the fourth session of the Bulgarian-Russian commission on economic, scientific and technical cooperation to discuss all major elements of bilateral cooperation," Deputy Prime Minister Doncho Konakchiev said upon his departure for Moscow at Sofia Airport. Konakchiev heads the Bulgarian delegation to the session. According to this Deputy Prime Minister, the talks will give priority to the energy sector, industry, trade, liberalization of bilateral trade and settlements. He said all preconditions exist for having a more liberal Bulgarian-Russian trade.

Bulgaria and Russia share problems in the timber industry, transport and construction and in a view of this three new working groups will be set up, Konakchiev said. "What encourages me is regional cooperation as a promising form of cooperation," he said. Agreements have to date been signed between 18 regions in Russia and Bulgarian local authorities, which marked the beginning of practical accords providing mostly for the setting up of joint ventures and exchange of goods. The agenda of the session also includes cooperation in production, investment and research, in nuclear power production, the fuel and energy complex. Sofia-based Russian Ambassador Alexander Avdeev, who was at the Sofia Airport to see off the Bulgarian government delegation, said the upcoming session of the intergovernmental commission is an essential element of the preparation for a visit in Moscow Bulgarian Prime Minister Zhan Videnov is scheduled to pay in March. Videnov and his Russian counterpart Viktor Chernomyrdin will open events that are part of the Days of Bulgaria in Russia.

[03] INTERGOVERNMENTAL BULGARIAN-RUSSIAN COMMISSION

[04] EU - BULGARIA

Minister Pirinski told the participants that Bulgarian Prime Minister Zhan Videnov sent letters to his Balkan colleagues proposing the holding of a conference of the Balkan foreign ministers in Sofia. Parallel to this, Bulgaria will continue its subregional cooperation with Greece as an EU member and with Romania, being an EU associated country, aiming to implement even more efficiently EU policy in the region by coordinated actions of the three countries, he said.

The Bulgarian Foreign Minister dwelled on the importance trans- European networks and their linking to regional projects, as much as the Balkan region is a focal point of the Central European and Black Sea initiatives to this effect. He urged the EU to be as much ambitious and purposeful in its regional approach in the Balkans as it was in earlier initiatives for the Mediterranean and the Baltics, reads the message.

[05] BULGARIAN PARLIAMENTARY DELEGATION ENDS VISIT TO ROMANIA

Bucharest, February 27 (BTA) - "There are no controversial issues between Bulgaria and Romania. It is of mutual interest to promote active cooperation and all prerequisites for that are available," said Romania's President Ion Iliesku at the beginning of today's talks with the Chairman of the Bulgarian National Assembly Blagovest Sendov and the accompanying Bulgarian MPs. Mr Sendov is on an official visit to Romania since February 25. The meeting in which the two officials familiarized each other with the development of the processes in their countries lasted almost an hour, much longer than scheduled. The parties found that the current visit has come just in time to enhance the role of the two parliaments for settling important issues of common interest through dialogue and willingness for understanding.

Before the meeting with the Romanian President the Bulgarian parliamentary delegation had talks with Romanian Prime Minister Nikolae Vakaroiu. Romania voiced its support for Bulgarian PM Videnov's initiative to hold a meeting of Balkan foreign ministers. The two countries confirmed their desire to boost economic relations, Chief of the National Assembly's press centre Nikolai Koev said.

At the two meetings today academician Sendov stressed the necessity to conduct constructive dialogue on the entire range of Bulgarian-Romanian relations without politicizing differences on certain issues but seeking rational decisions that would be acceptable to both parties. The position was shared by the hosts, who expressed satisfaction with Bulgaria's constructive approach.

The official visit of the Bulgarian parliamentary delegation to Romania convincingly proved the readiness of the two neighbouring and friendly states to overcome the delay in the development of contacts between their supreme law-making institutions. The practical results from the two-day meetings are the agreement for holding a meeting of the parliamentary friendship groups in Rousse in the spring and the voiced readiness for opening of cultural centres in Sofia and Bucharest. The Romanian party also accepted academician Sendov's proposal that the two parliament chairmen apply for participation in the sessions of the European Parliament. The parties agreed that their parliamentary environmental committees hold meetings on a regular basis and exchange information about the two countries' specialized legislation with view to harmonize their legal framework in environment protection, a sphere which is significant for both states, Chief of the parliamentary press centre said.

Today the Bulgarian delegation departed for Sofia.

[06] PROFITS FROM MASS PRIVATIZATION EXPECTED WITHIN TWO YEARS

Sofia, February 27 (BTA) - So far more than 400,000 Bulgarians have registered for participation in the mass privatization, latest data of the Mass Privatization Centre show. They represent some 6.62 percent of the people who are eligible to purchase voucher books.

The highest number of voucher books has been sold in the area of Sofia: some 90,000 Sofianites or 8.6 percent of the people eligible to buy voucher books have registered for participation in the mass privatization. It is followed by the second largest Bulgarian city of Plovidiv with 41,000 voucher books sold, the Black Sea cities of Varna and Bourgas with more than 20,000 books each, Haskovo and Veliko Turnovo with 16,000 each and Vratsa with 11,600. Lower is the number of the participants in mass privatization in the province and especially in the small towns and villages. Fewest voucher books have been purchased in Turgoviste, 6,000, followed by Kurdjali, Kyustendil and Silistra, each of them having as little as 5,700 participants in the mass privatization.

Experts attribute the slow progress of privatization to the inadequacy and delay of the awareness campaign. To help people decide where to invest their vouchers, experts of the Economy 2000 Club recently carried out a study of the financial and economic parameters of the 1,200 enterprises included in the mass privatization list. According to this study, on the average the enterprises are money losers. 53 percent of the enterprises subject to denationalization showed losses at the end of 1994. Experts say, however, that the participants in the mass privatization will not lose due to the low price of the voucher books. A voucher book has a face value of 25,000 leva against cash payment of 500 leva. Highest number of voucher books have been purchased by retired, conscripts and students, who buy voucher books at a reduced price of 100 leva.

According to experts, profit from the mass privatization may be expected within two years at the earliest. Specialists project that enterprises subject to privatization will operate at a loss in 1996 as well. As early as 1997 they may book some profit. The fixed capital of the enterprises included in the privatization list is of an aggregate 90,000 million leva's worth. However, their assessment was made in 1992 and since then it has not been adjusted to the 300 percent-plus inflation.

Experts are not alarmed by the comparatively low number of people who have purchased voucher books till now. According to them, this will favour the voucher books owners as the property will be distributed among fewer owners. The restitution claims will be handled at the second round of the mass privatization. Ten percent of the shares in each enterprise are earmarked for this purpose.

[07] BUSINESS PRESS

The budget deficit reached 32.5% of the projected surplus of expenditures over revenues. By February 17 expenditures exceeded revenues by 18,955 million leva, according to Finance Ministry data, "Standart News" reports. The great deficit is due to the USD 137 million paid to the London Club in late January. Bulgaria will have to pay 33,184 million leva on foreign debt interests alone by the end of the year. It will have to pay 88,619 million leva on internal debts.

Budget revenues total 18,523 million which is 7.4% of the planned annual revenues, "Standart News" also write. The budget sets revenues at 250,149 million leva. So far the state has spent 37,478 million leva - 12.1% of the total annual expenditures set by the budget act.

[08] BULGARIAN AND US DEFENCE OFFICIALS DISCUSS PFP

The two sides discussed a wide range of issues, including Bulgaria's Individual Partnership Program for 1996, the possibilities to extend funds in US defence security assistance and Bulgaria's willingness to participate in the IFOR activities in former Yugoslavia, says the press release. The Bulgarian delegation was led by Deputy Defence Minister Dimiter Mitkov and the US delegation, by Deputy Secretary of Defence Fred Smith.

[09] GAZPROM DIRECTOR VYAHIREV VISITS SOFIA

The project's subcontractor is the Bulgarian-Russian Topenergy joint venture. The partnership was founded in May, 1995 by the Russian Gazprom and the Bulgarian Bulgargaz companies who hold equal interest in it. The JV activities cover gas supplies, the transit transportation of gas across Bulgaria to third countries, reconstruction and extension of the gas systems already in operation in Bulgaria. The State, represented by Bulgargaz, holds 25.1 per cent of the Bulgarian interest, and the remaining 24.9 per cent are distributed among Multigroup, Overgaz, Bulbank, First Private Bank and Chimimport. In November 1995 the partnership increased its capital from 60 million to 120 million leva.

"We reached an agreement on the establishment of a Balkan controlling centre which will distribute gas deliveries coming from Russia to the Balkan states," Mr Vyahiren said about the results of his meeting with Bulgarian Prime Minister Zhan Videnov. According to the Gazprom Executive Director, they did not discuss any details because there are still a number of unsettled problems between the Bulgarian and the Russian partners. A team of Bulgarian and Russian experts should present a project for the extension of the gas supply system by mid-March, Mr Vyahiren said. He said that the next meeting of Topenergy's board of managers would be held on March 14 in Moscow.

According to a Council of Ministers news release received at the BTA, on the eve of the upcoming meeting between PM Zhan Videnov and Russian President Yeltsin in Moscow, an agreement has been reached to open negotiations on granting a concession to the Topenergy JV for the transportation and transit of natural gas to third countries, as well as on the extension of the gas transfer systems.

"The ownership of the new equipment which will increase threefold the capacity of the existing gas network is not a controversial issue. We shall abide by the law," Mr Vyahirev told reporters. The partnership's Executive Director Sasho Donchev said that the maximum amount of funds required to realize the projects should be specified by March 14. "If we have to pay too large concessions charges in addition to the investment loans planned, there will be no gas pipelines, no oil pipelines and some other projects the Concessions Act makes provisions for," he said.