News from Bulgaria / Mar 19, 96

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

Bulgarian Telegraph Agency Directory

EMBASSY OF BULGARIA - WASHINGTON D.C.

BTA - BULGARIAN TELEGRAPH AGENCY

19 March, 1996

CONTENTS

[01] JUSTICE, INTERIOR MINISTERS LEAVE FOR BRUSSELS

[02] PRESIDENT ROMAN HERZOG OF GERMANY IN SOFIA

"President Herzog is coming here in a significant for Bulgaria moment, when this country has already announced its aspirations for joining the European Union and the other European organisations," presidential Foreign Policy Advisor Kamen Velichkov told BTA. Mr Velichkov also said that Mr Herzog's visit comes at a time when the dialogue on NATO's expansion is in progress. These issues are expected to be discussed during the visit of the German President in Sofia. Besides the talks with Bulgarian President Zhelev, Mr Herzog will also have meetings with Prime Minister Zhan Videnov, National Assembly Deputy Chair Nora Ananieva, intellectuals, businessmen, students. The German President is going to address the Bulgarian National Assembly. In addition to Sofia, Roman Herzog will visit Plovdiv (Bulgaria's second largest city, Southern Bulgaria) and the nearby Bachkovo monastery. A number of additional trade agreements are expected to be signed once the basic accords are concluded. Trade and economic relations between Bulgaria and Germany are expected to be high on the agenda of the talks. Germany is Bulgaria's second major trade partner following Russia and accounts for the largest foreign investments here. The commercial exchange between the two countries almost halved from 1990 to 1991 from 3,140 million to 1,330 million Deutschemarks but since then it has been on the rise. In 1994 it reached 1,860 million Deutschemarks, which is a 36.8 per cent growth. The upward tendency continued into 1995 with overall trade marking a growth of 14 per cent against the like period the previous year. In 1994 net transfer of German investments amounted to 98 million Deutschemarks.

[03] FRANCE'S MINISTER OF STATE FOR TRANSPORT VISITS

Sofia, March 18 (BTA) - A French government delegation, led by Anne-Marie Idrac, Minister of State for Transport, arrived here today on a two-day official visit. The delegation includes representatives of the business circles and mainly executives of leading transport firms, who will discuss here priority activities and projects in transport, some of which will be funded by the EU.

This morning Transport Minister Stamen Stamenov and Ms Idrac made a review of bilateral relations in transport. Both sides agreed that Bulgaria's strategic location in Europe determines the importance of bilateral cooperation in this sphere.

Though Bulgaria has not been visited by a French transport minister in the past 20 years, our contacts never ceased, Mr Stamenov said. He stressed the importance of some joint projects such as the one with the French firm Campegnon Bernard for building Sofia Airport. This firm which won the tender eighteen months ago, may return to the investment market, Mr Stamenov stressed Bulgaria's interest in restoring leasing contracts which are of mutual interest.

Several billions of dollars will be needed in the construction of European transport corridors which will cross this country, Stamenov said. Of a total of nine corridors through central and eastern Europe, four will pass through Bulgaria, he said. President Zhelyu Zhelev received Anne-Marie Idrac to discuss prospects for Bulgarian-French and Bulgarian-EU cooperation in the development of regional infrastructure.

The sides conferred on the EU-approved transport corridors, the President's Foreign Policy Adviser Kamen Velichkov said after the meeting. The seven leading French companies represented in the delegation want to take part in carrying out various transport projects in Bulgaria, Velichkov said. Air transport cooperation involves the national air carriers, Balkan Bulgarian Airlines and Air France, as well as the construction of Sofia Airport. Cooperation in sea transport involves the ports of Bourgas and Marseille. Road transport cooperation will focus on liberalization and the enforcement of the EU's new environmental rules entering into force in 1997, the presidential advisor said.

[04] TRILATERAL BALKAN MEETING IN VARNA

The meeting focused on the projects for the construction of a second bridge across the Danube, details about which will be clarified in September in Salonika (Greece), the construction of the Bourgas- Alexandroupolis oil pipeline as well as the creation of a trans-regional centre for coordination of infrastructure projects on the Balkans. Romania and Greece reportedly supported the initiative proposed by the Bulgarian Government for holding an all-Balkan conference in Sofia later in the year. Preparation for the conference will start at the forthcoming meeting of the European Union (EU) in Florence at diplomatic level.

The issue of the second bridge across the Danube stroke a discordant note in the second trilateral meeting on the Balkans, "Continent" says in a front-page story. Greek Foreign Minister Theodoros Pangalos insisted that Sofia and Bucharest iron out the differences between them; Bulgarian Foreign Minister Georgi Pirinski said that the Romanian-Bulgarian dispute provokes the ridicule among the other European partners, "Continent" says. If the Balkans have any future, it is nowhere else but in the intensification of the contacts and discussions at the broadest possible basis, the daily says. There is no doubt that holding of regular all-Balkan meetings would be a decisive step in fending off and avoiding regional conflicts, "Continent" says.

Prime Minister Zhan Videnov is pleased with the Varna meeting, "Troud" says. Videnov assessed in positive terms the dialogue between the three foreign ministers, the daily says. Details of the construction of the second Danubian bridge will be further specified in Salonika, "Troud" says.

The dispute between Bulgaria and Romania on the location of the second bridge across the Danube was left unresolved at the first meeting of the foreign ministers of Bulgaria, Greece and Romania in the Greek resort of Ioannina in August 1995, "Standart News" says. Analysts' forecasts that this meeting will too fail to reach an agreement proved correct, "Standart News" says. As early as the start of the meeting in Varna, there were dissatisfied voices from the Turkish capital Ankara that an EU member is meeting two associated countries, which, according to the Turkish side, is formation of a Balkan axis, "Standart News" says.

The Balkan cooperation has to pass through economic and political cooperation, "24 Chassa" says. Infrastructure projects implementation needs to stem from a common interest, the daily says.

The Varna meeting failed to achieve the desired result as regards the location of the second Danubian bridge, the opposition "Demokratsiya" daily says. The joint key infrastructure projects between Bulgaria, Greece and Romania may receive financial aid from the PHARE and INTEREG II programmes, the daily says.

The trilateral meeting in Varna showed that it is possible to apply European standards in the policy on the Balkans, "Douma", the daily of the ruling Bulgarian Socialist Party (BSP), quotes Videnov as saying. Details on the construction of the second bridge across the Danube remained to be specified in the autumn, while Russia will be an arbitrator in the dispute over the Bourgas-Alexandroupolis oil pipeline, "Douma" says. The issue of the construction of the pipeline will be raised during the Greek Foreign Minister's forthcoming visit to Moscow, the daily says.

The Varna meeting focused on the need for Bulgaria's and Romania's preferential participation in the projects on the economic reconstruction of the war-affected areas in former Yugoslavia, "Pari" says. Holding of Balkan meetings may erase the bad image of the Balkan countries as being unable to themselves resolve security issues and find peaceful solution of all conflicts, "Pari" quotes the closing speech of Romanian Foreign Minister Teodor Melescanu.

[05] BUSINESS PRESS - BANK FAILURES BILL

The National Bank of Bulgaria (BNB) is the only institution which may ask for a legal process to put a bank into liquidation under the Bank Failures Bill, says the "Capital" weekly. The Bill retains the provision that failure is the last resort after all avenues to rehabilitate a bank have been explored. The Association of Commercial Banks is less concerned about the central bank's great powers than about the lack of clear criteria as to when they may be exercised, "Capital" comments.

A bank is a public institution in terms of its transactions. The state has the right and the obligation to rehabilitate, wind up or restructure a bank, even if it is a hundred per cent private. The matter lies within the competence of the BNB, which is fully in charge of it, says the central bank's Vice Governor Mileti Mladenov in an interview "Banker". He attributes the crisis in the banking system to the interconnection between banks and real sector clients who run up mostly bad debts. In these circumstances commercial banks had to dramatically cut back corporate loans, Mladenov says. The state took all monetarist steps to financial rehabilitation and even stopped subsidies to real economy companies until commercial banks did their job, Mladenov says.

Banks finance money-losing ventures, going so far as to use loans from international institutions, in the hope that companies will regain their productivity, says "Continent" quoting former BNB Vice Governor Emil Hursev. He said blaming the BNB for the bank crisis was the same as blaming the National Geodetic Institute for earthquakes in Bulgaria. Banks are in such a plight because some companies have defaulted on their loans, but also because creditors have not asked for guarantees, "Continent" quotes opposition MP Edvin Sougarev as saying.

[06] CONSULTATIVE COUNCIL ON NATIONAL SECURITY MEETS

Sofia, March 18 (BTA) - Participants in today's meeting of the Consultative Council on National Security have made recommendations for the rehabilitation of Bulgaria's defence industry to the legislature and the executive. That was what journalists were told after the end of the meeting. The nature of the recommendations was not specified because of the "specific character of the problems discussed", as Ivailo Trifonov, Head of the Office of the President, said.

The participants rallied behind the idea of working out a long-term strategy "for the place and the role of the military industrial complex in the national economy", mass media reporters were told.

This morning President Zhelyu Zhelev called a meeting of the Consultative Council on the present and future of the military industrial complex. The materials drawn up at the Office of the President after his meetings with chief executive officers of trading and production companies operating in the defence industry and with leaders of its trade- union organizations, Ivailo Trifonov said as spokesman for the Consultative Council.

Reports on the problems of Bulgaria's military industry were presented by Minister of Defence Dimiter Pavlov, Minister of Industry Kliment Vouchev and Minister of Trade and Foreign Economic Cooperation Atanas Paparizov.

"The members of the Consultative Council agreed that efforts should be undertaked for Bulgaria's admission to the New Forum, the successor of COCOM," Trifonov said.

The participants in the meeting denied to disclose any details, stating the topic discussed was a secret. Georgi Dilkov, MP of the Bulgarian Business Block, was the only one who made some commentary. "Today's ascertainment of the disastrous condition of the defence industry is rather late, the industry has actually been in this situation for five years now," he said.

The meeting was attended by Prime Minister Zhan Videnov, members of the Cabinet and representatives of the parliamentary political forces.

[07] GOVERNMENT COMMITTEE ON EUROPEAN INTEGRATION MEETS

Sofia, March 18 (BTA) - The Government Committee on European Integration, chaired by Prime Minister Zhan Videnov, met today, the government press office said.

Bulgaria will focus its attention on problems of the associated countries subject to visa requirements at the March 19-20 meeting in Brussels of ministers of justice and the interior of the EU members states and the associated countries, Justice Minister Mladen Chervenyakov and Interior Minister Lyubomir Nachev said in a report. Bulgaria will raise the issue of EU assistance to it in legislation and information.

The Committee discussed and approved a report by Foreign Minister Georgi Pirinski and Defence Minister Dimiter Pavlov, which will form a basis for Bulgaria's position on enhanced dialogue with NATO in the future. Various departments will make additions and revisions to the document in the process of the dialogue.

Bulgaria was praised for its good economic indicators in 1995 at a March 6 meeting in Brussels of ministers of the economy and finance of the EU countries and the associated countries of Central and Eastern Europe. This country is expected to achieve sustainable economic growth, Deputy Minister of Economic Development Gancho Ganchev told the Committee. He added that if Bulgaria reached an agreement with the World Bank and the IMF, the EU would also provide assistance to it.

The Committee approved Bulgaria's position on the March 19-20 Sofia technical consultations with European Commission representatives on adjusting the section of the Europe Agreement concerning trade in agricultural products. The document was drafted by Deputy Prime Minister and Agriculture Minister Svetoslav Shivarov and Minister of Trade and Foreign Economic Cooperation Atanas Paparizov.

The Committee discussed Foreign Minister Pirinski's report on the participation of a Bulgarian delegation in the meeting of foreign ministers of the EU and the associated countries in Brussels in late February. A report on administrative reform strategy by Deputy Prime Minister and Minister of Regional Development and Construction Doncho Konakchiev was approved. The Committee also approved a report by Transport Minister Stamen Stamenov on a draft intergovernmental agreement on the building of a new crossing on the Bulgarian-Greek border at Kulata-Promachon.

Energy Committee Chairman Konstantin Roussinov informed the Committee of the outcome of talks between the Energy Committee and the European Commission on the short- and long-term prospects of Bulgaria's energy sector between the year 2010 and 2020.

The Committee adopted a report by Environment Minister Georgi Georgiev on Bulgaria's position on the March 4 meeting in Brussels of the environment ministers of the EU and the associated countries of Central and Eastern Europe. The participants discussed the implementation of the agreements reached at the Sofia Ministerial Conference "Environment for Europe" and aspects of the approximation of legislation on environmental protection.

[08] BULGARIA TO CALL MEETING OF BALKAN TELECOMMUNICATIONS MINISTERS

Mr Kolarov familiarized the guests with the idea to set up a Balkan council for cooperation in telecommunications. The idea has already been backed by several countries. It is planned that a Balkan telecommunications pool be formed in the framework of the council. This organisation of Balkan telecommunications administrations and operators will support the promotion of regional cooperation and coordination of activities in telecommunications.

Harmonization of standards and bringing them in line with the European requirements, inspection of telecommunications network in the individual countries and of international projects in which they participate are but part of the common problems which Mr Kolarov identified.

It emerged that the meeting, which will be held in Sofia on April 25 and 26 has also attracted the interest of some central and eastern European states. To the meeting have been invited heads of international and world institutions in the field of telecommunications, of the Organisation for Black Sea Economic Cooperation and some others.

The heads of the telecommunications companies of Greece, Yugoslavia and Bulgaria start tomorrow talks in Thessaloniki, the reporters were told.

[09] 20 PERCENT INCREASE OF WAGES PLANNED

Sofia, March 18 (BTA) - At today's extraordinary meeting, the Government adopted two decrees on increasing the minimum wage, the minimum pension and the salaries in state-financed organizations in 1996. The increase becomes effective as of April 1. The minimum wage is raised from 2,760 to 3,040 leva; the minimum old-age non-contributory pension becomes 1,800 leva, the monthly child benefit is set at 510 leva. There will be yet another rise in these payments, so that by the end of 1996 the increase will be about 21 percent in nominal terms.

The Cabinet agreed with the proposal of the Minister of Labour and Social Affairs to increase the salaries in the state-financed sector by 10 percent as of April 1 and by another 10 percent as of October 1. The funds necessary for the increase were budgeted. The decree on raising the wages in the state-financed sector will make it possible to increase the pay of medical workers and teachers, which is lower than the average wage in the country. Teachers' salaries will rise by about 40 percent, and those paid to physicians - by 40-50 percent, according to Deputy Prime Minister Doncho Konakchiev. The real increase in the salaries paid to physicians and teachers is the first serious step towards the restructuring of incomes depending on the place and role of these cadres in the society, and depending on the possibilities of the State, it is said in the reasonings for the decree.

The social partners quarrelled over salaries in the state-financed sector. After a heated debate at today's meeting of the National Council for Tripartite Cooperation (comprising representatives of the Government, employers and trade unions), the trade unions broke off negotiations on income policy in the sector. Since last autumn, representatives of the two major trade-union amalgamations, the Confederation of Independent Trade Unions in Bulgaria and the Podkrepa Labour Confederation, had warned several times that they would walk off the talks on the policy of incomes in the state-financed sector.

The three trade unions represented in the National Council for Tripartite Cooperation insisted on the establishment of new starting levels for wages in the state-financed sector and on their adjustment to actual inflation at every three months. According to the trade unions, indexing incomes twice a year to projected inflation instead to the actual one will lead to further impoverishment of the population.