News from Bulgaria / Mar 15, 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

15 March, 1996

CONTENTS

[01] POLITICALLY, BULGARIA ALREADY LARGELY QUALIFIES FOR FULL EU MEMBERSHIP

Berlin, March 14 (BTA exclusive by Borislav Kostourkov) - "Bulgaria's Strategy for EU Integration: Challenges and Answers," was the topic of a lecture, which Deputy Foreign Minister and Council of Minister's Secretary on European Integration Irina Bokova gave in Berlin. The lecture is part of a series of discussions: "Europe: the Next Step," organised by the diplomatic missions in Berlin of different European countries.

Mrs Bokova focused on Bulgaria's efforts to meet the political and economic criteria for EU membership, defined by the European Council in Copenhagen. According to Irina Bokova, politically Bulgaria already largely qualifies for EU membership.

During the discussion after the lecture the German participants expressed understanding about Bulgaria's justified discontent with the Schengen agreement. It was pointed out that the agreement undeservedly discriminates this country and creates additional impediments to its integration with the European Union.

[02] BULGARIA STRICTLY OBSERVES OBLIGATIONS ON CONVENTIONAL ARMED FORCES TREATY

CFE was signed on November 19, 1990 by 22 states, Bulgaria included. The treaty imposes quantity restrictions for five main categories of conventional arms and equipment: combat tanks, armoured combat vehicles, artillery systems of over 100 mm calibre, combat aircraft and attack helicopters. Under the Treaty each country was supposed to bring its armed force in line with the specified quantity quotas within a period of 40 months. This period expired on November 17, 1995. On that date Bulgaria announced that it has satisfied the CFE requirements. In compliance with the Treaty Bulgaria destroyed 794 tanks, 332 armoured combat vehicles, 410 artillery systems and 100 war planes, General Gechev recalled for BTA.

[03] PRESIDENT ZHELEV BECOMES HONORARY ROTARY MEMBER

Sofia, March 14 (BTA) - President Zhelyu Zhelev became an honorary member of Rotary International after a ceremony in which the organization's President Herbert Brown awarded Zhelev with a badge, a crystal ball bearing an inscription of Rotary's motto, "Serve Selflessly and with Love and Work for Peace". The President also received an honorary plaquette in token of the children who were inoculated against polio. Last year's campaign Polio-free Bulgaria, financed by Rotary International, was carried out under Zhelev's auspices.

Thanks to our efforts, 1,000 million children across the world were vaccinated against the disease, Brown, 73, said at the ceremony. Polio is practically eliminated until the end of the 20th century, he said. Rotary International, the largest nongovernmental organization in the world which is also a U.N. observer, donated US$ 400 million for the campaign, Brown said. He and his wife Diana arrived in Sofia late last night. This is Brown's first visit to an East-European country.

In his speech at the ceremony, Zhelev said that he is glad that the Rotary movement has been revived in Bulgaria. The movement has always been a sign of democracy and civil society; it is no coincide that it was banned in Bulgaria immediately after the military coup de'etat in 1934, Zhelev said. Rotary International has a worldwide network of clubs; through them we have a real opportunity to send signals and seek support for this country, Zhelev said. The Bulgarian Head of State expressed a hope that Rotary International will soon register a separate district for Bulgaria.

The actual reason for Brown's visit to Sofia is the forthcoming separation of the Bulgarian Rotary members from the Greek club to which they are subordinated, BTA learned from members of the organization. The 12 Bulgarian Rotary clubs have so far been subordinated to the Salonika-based District 2480.

[04] PRESIDENT ZHELEV CRITICISES BANKING SUPERVISION

At the meeting Filipov recalled that "the term of the Governing Board expires on June 29 and under the law no one may force any of its members submit its resignation by then".

Velcheva voiced Zhelev's position that the central bank's independence should be protected against any attempt for political or other pressure. The new members of the Governing Board should not only be professionals, but also honest and morally responsible people, the President noted.

As reasons for the crisis Zhelyu Zhelev quoted problems with the banks' licensing, continuing oversight of their operation and lack of clear criteria in their re-financing.

"There is no financial discipline in the enterprises and a number of state-owned companies should be isolated, so as to stop "infecting"," Filipov said during the meeting. He urged the President to support the banking system stabilization program.

President Zhelev's assessment on his meetings with representatives of the banking community and the condition of the banking system will be made public tomorrow, Velcheva said.

Today the President met with representatives of Elitbank and the Bulgarian-Russian Investment Bank. Last week he held talks with representatives of the Association of Commercial Banks and the Bulgarian Consolidation Company.

[05] PM VIDENOV LEAVES ON TWO-DAY FORMAL VISIT TO RUSSIA

Sofia, March 14 (Ekaterina Kazassova of BTA) - Prime Minister Zhan Videnov today left on a two-day official visit to Moscow, heading a governmental delegation. He returns a visit by Russian Prime Minister Viktor Chernomyrdin to Sofia last May. The visit is another important step for the strengthening of relations with Bulgaria's traditional partners to the East, the Prime Minister said before his departure.

The sides are expected to sign seven intergovernmental and interdepartmental accords, continuing the development of a new legal framework of bilateral relations in the changed conditions. The agreements include a declaration on cooperation in labour, an accord on cooperation in forestry, a veterinary convention, an agreement on the supply of special-purpose goods from Russia, and an accord on cooperation in industrial property. Most importantly, the sides will sign an agreement making the existing intergovernmental agreements effective. This would complete the development of the new legal framework of bilateral relations, said Prime Minister Videnov.

Official meetings with President Boris Yeltsin, Prime Minister Viktor Chernomyrdin and the Chair of the Russian Duma Gennady Seleznyov will focus on a wide scope of issues including the liberalization and intensification of business and commercial ties, the future of joint ventures and joint participation in international projects, particularly in communications, the situation in the Balkans, Europe and the world, said the Bulgarian Prime Minister. The future of the project for building an oil pipeline from the Bulgarian port of Bourgas to Alexandroupolis in Northern Greece will also be on the agenda. "We hope to get the support of the Russian side for holding a trilateral meeting of representatives of Bulgaria, Greece and Russia for the setting up of a joint venture to implement the project," Videnov also said.

The sides are expected to sign an agreement between Bulbank of Bulgaria and Vnesheconombank of Russia, the absence of which was the major stumbling block for implementing an agreement signed last year for settling the 100 million Russian rubls debt to Bulgaria.

The Bulgarian delegation includes Minister of Trade and Foreign Economic Cooperation Atanas Paparizov, of Finance Dimiter Kostov, of Labour and Social Affairs Mincho Koralski, of Culture Georgi Kostov and other heads of major Bulgarian establishments. Accompanying the delegation are experts, businessmen and cultural figures. Days of Bulgaria in Russia are scheduled to open this evening in Moscow to continue until the end of May.

[06] BULGARIAN DAYS IN RUSSIA OPENED

Moscow, March (BTA special correspondent Vesselin Konstantinov) - The Bulgarian Days in Russia were officially opened today in the Hall of Columns in Moscow's House of Soviets. The ceremony was attended by Bulgarian Prime Minister Zhan Videnov, who arrived on an official two-day visit at the head of a Bulgarian governmental delegation.

"It is almost a decade since the last culture days of Bulgaria in Russia were held," Bulgarian Minister of Culture recalled in his address. In his view the current dialogue between the two cultures is a bridge in the bilateral relations and is in compliance with the development of the political and economic relations.

Culture Minister of the Russian Federation Yevgeny Sidorov read a greeting address on behalf of the Russian President Boris Yeltsin.

The Bulgarian Days in Russia will last until the end of May. On the culture programme are the exhibitions "Contemporary Bulgarian Painting and Graphic Art," "Russian Emigrant Artists to Bulgaria," "Bulgarian Ethnography Exposition", a photo exhibition of Ivo Hadjimishev, poetic recitals and a week of Bulgarian cinema.

The film festival includes seven Bulgarian feature films, four documentaries and three cartoons.

In addition to Moscow, the Bulgarian culture will be presented in St Petersburg, Nijni Novgorod, Samara, Volgograd, Stavropol, Tula, Tver etc. Organisators of the event are the ministries of culture of the two states.

[07] I.M.F. EXPECTS STRONG SPECIFIC PROGRAMME FOR REFORMS

Sofia, March 14 (Iva Toncheva of BTA) - A delegation of the International Monetary Fund, which came to Sofia to make arrangements for negotiations on a new stand-by agreement with Bulgaria, ended its two-week mission.

The IMF and the World Bank are ready for talks on new arrangements with Bulgaria provided they are presented an acceptable, strong and specific programme for structural adjustment of the economy, officlas of the two financial institutions told a news conference today. The IMF hopes to receive such a programme from the Bulgarian Government by the end of March this year.

According to Anne McGuirk, IMF Mission Leader for Bulgaria, there has been no special difference between the mission and the Bulgarian Government as to what should be done. However, she stressed that the Bulgarian Government would have to make several difficult decisions in connection with the structural reform. In her words, the Government said the issue would be given careful consideration and would advise the IMF of the details and its decisions by the end of March.

Anne McGuirk let it be understood that having received the programme, the IMF would respond immediately. The decisions should be reasoned and should inspire confidence, she said repeating several times that the mission had been given such assurances.

Drawing attention to last year's good economic results, Deputy Prime Minister and Minister of Economic Development Roumen Gechev said that in 1996 the Government should make yet another step forward by carrying out decisive measures for the structural adjustment of real economy and for the stabilization and restructuring of the banking system. According to him, there is no difference between what the Government intends to do and what the IMF expects. The most important thing about the months-long talks is the shared conviction that the decisive steps in the area of structural reform can be made on the basis of close cooperation and on condition that the specific measures be provided with Bulgaria's own resources and resources extended by the IMF and the World Bank.

The news conference was told that the programme for structural reforms the IMF expects from the Bulgarian Government concerns losing enterprises and the banking system which is in bad condition.

The chances are increasing and Bulgaria is drawing nearer to an agreement with the IMF and the World Bank, which will be probably concluded in the middle of 1996, Deputy Prime Minister Gechev said. Receiving 200 or 250 million US dollars is not the most important for Bulgaria though it really needs them; what matters is that this would be a strong signal to the international financial community that the business environment in Bulgaria is improving, Gechev stated.

If the IMF receives the programme of action of the Bulgarian Government and approves it in March-April, the negotiations on a stand-by agreement may open in May, Anne McGuirk told BTA.

The list of the first 45 loss-makers which are to be closed down has already been gazetted, the announcement about the liquidation of another 30 or 40 companies will appear in the "Official Gazette" soon, Gechev said. The question is about the legal closure of enterprises which have actually stopped to operate. These 80 companies employ between 8,000 and 10,000 people. Part of a possible new loan from the IMF will be used for their retraining and social assistance, Deputy Prime Minister said.

Over the last three years the losses of inefficient enterprises have come up to 20 percent of the gross domestic product, or about 2,000 million dollars a year, said Alberto Musalem, Resident Representative of the World Bank in Bulgaria. He confirmed the readiness of the World Bank to support Bulgaria's social programmes and its balance of payments, specifically towards foreign debt servicing provided the implementation of a restructuring programme be started.

The Government has been given to understand that we are ready to accept a larger budget deficit if the funds are designed for structural reform, Anne McGuirk said. Privatization should be accelerated, especially the cash one, because in this way the management of companies will pass into private hands sooner, she said.

[08] IN PARLIAMENT TODAY

Sofia, March 14 (BTA) - Today the National Assembly adopted on first reading amendments to the Local Election Act, moved by Krassimir Premyanov, Floor Leader of the Democratic Left, and a group of MPs. According to the sponsors of the amendments, the purpose is to fill gaps which prevent the normal proceeding of the balloting process. The amendments pertain to cases, such as appointment of provisional mayors, holding of election following invalidation of balloting and election holding in newly-established municipalities. The drafting of the amendments was prompted by the voiding of the local government elections in Kurdjali (Southern Bulgaria), conducted late last year.

The MPs adopted at first reading a bill on profits tax, taxes on the yearn of juristic persons and contributions from profits to the municipalities.

Parliament adopted on first reading two bills amending the National Bank of Bulgaria (BNB) Act. The first was moved by Krassimir Premyanov and a group of MPs and the second, by National Assembly Deputy Chairman Nora Ananieva, MP of the Bulgarian Socialist Party. Both bills concern BNB management and its term in office.

[09] NATIONAL ASSEMBLY CHAIRMAN

Sofia, March 14 (BTA) - National Assembly Chairman Blagovest Sendov and Germany's Ambassador Peter Metzger discussed the forthcoming visit of German President Roman Herzog, the National Assembly press centre said. Responding to the diplomat's interest, Sendov informed him about the visit of the Bulgarian delegation he led to Yugoslavia and about the talks it had with Slovenian President Milan Kucan.

Sendov discussed the results of the Yugoslav visit and Bulgaria's position on the problems of the Balkans with Paul Charalambous, Head of the Regional Centre of the EU Monitor Mission in Sofia, and with his deputy Aldert Hazenberg.

Sendov confirmed Bulgaria's desire to participate actively in the programme for the post-war reconstruction of Bosnia and Herzegovina not as a donor but through the implementation of specific projects.

The problems of Bulgarians in Yugoslavia should be resolved in the spirit of goodwill and realism, which will be useful for the development of bilateral relations, Sendov said in reply to the diplomats' question about the situation of the Bulgarian minority in Yugoslavia.

[10] BULGARIAN MILITARY OFFICIAL VISITS U.S.

Washington, March 14 (BTA) - Commander of the Bulgarian Naval Forces Vice Admiral Hristo Kontrov is on a visit to the U.S. from March 11 to 20 at the invitation of the Chief of the U.S. Naval Operations Admiral Jeremy Boorda.

Vice Admiral Kontrov met in Washington with Admiral Boorda and with his deputy Paul Rizen, as well as with other senior officials of the US Naval Forces. They discussed issues concerning the navy-to- navy relations between the two states.

At a special ceremony Admiral Jeremy Boorda, on behalf of US Defence Minister William Perry decorated Vice Admiral Kontrov with a medal, which is the highest military award presented to a foreign senior military representative.

Vice Admiral Kontrov also visited the United States Naval Academy in Annapolis, MD. The Bulgarian delegation was familiarized with the procedures of selecting and training personnel for the US naval forces.

The delegation is scheduled to visit the Staff of the Atlantic Command of the US Naval Forces in Norfolk and other naval installations.

[11] ELECTRICITY PRICES TO GO UP

The Energy Committee demanded a 38 per cent price rise for electricity and 33 per cent for coal, "Troud" says. The CSER Chairman, Prime Minister Zhan Videnov, ordered that energy price estimates be kept secret, the daily says.

Recently the average electricity price went down to 2.2 cents/kWh from 2.5 to 2.6 cents/kWh as the dollar rose to 78 leva from 68 leva in September 1995, "Troud" says. Before the rise in energy prices from September 1, 1995, the Government agreed with the World Bank and the European Bank for Reconstruction and Development that electricity in Bulgaria will rise gradually. Its average price was to reach 3 cents/kWh this spring and climb up to the region's minimum level of 3.5 cents/kWh by September 1, "Troud" says.

A rise in electricity prices will push up the inflationary spiral, the daily learned from Milcho Mladenov, Vice President of the National Statistical Institute. The inflation rate may be predicted once a decision is made about the mark-up, Mladenov said.

[12] CONSTRUCTION CORPS TO WIN A $100-MILLION CONTRACT

The Construction Corps is negotiating for a 100-million-dollar contract to build blocks of flats in Belgrade and a residential district in Vranecka Banja, the Corps Commander, Major General Radoslav Peshleevski, told "Douma".

The Construction Corps has had an offer from a U.S. firm to take part in the reconstruction of Bosnia-Herzegovina, the daily says. General Peshleevski said the troops would build bridges and prefabs using Bulgarian materials.

In the past few years the Construction Corps built settlements in Russia and Ukraine for troops returning from Germany. In 1996 the Corps will expand its presence in the Russian market on the basis of a joint protocol between the Russian Union of Industrialists and Entrepreneurs, the Union of Bulgarian Industrialists, Bulgaria's industrial-truck maker Balkancar and the Construction Corps, "Douma" says. The signing of a contract to build five filling stations on the Samara-Moscow highway is forthcoming.

The Corps will send builders to Bogochan hydroelectric power plant on the Angara River in Siberia. A Bulgarian-Russian joint venture for wood-processing will be set up. The Construction Corps expects support from its biggest Russian partner, Transstroy, for the building of a new Danube River bridge, General Peshleevski said. In 1996 the Corps will start work on projects in Zimbabwe, South Africa, Mozambique and Angola.