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News from Bulgaria, 96-10-09Bulgarian Telegraph Agency Directory - Previous Article - Next ArticleFrom: Embassy of Bulgaria <bulgaria@access1.digex.net>EMBASSY OF BULGARIA - WASHINGTON D.C.BTA - BULGARIAN TELEGRAPH AGENCY9 October, 1996CONTENTS
[01] MEETING OF EU AND ASSOCIATED COUNTRIES INDUSTRY MINISTERSSofia, October 8 (BTA) - A Bulgarian delegation, led by Ambassador Evgenii Ivanov, chief of the Bulgarian Mission to the EU, took part in a meeting of the EU industry ministers and their counterparts of the associated countries of Central and Eastern Europe in Luxembourg today, reads a Bulgarian Foreign Ministry press release. The meeting was attended by representatives of the EU presidency, the Council of the European Union and the European Commission.The participants discussed the problems of information society within the future accession of the associated countries from Central and Eastern Europe to the EU and measures for specifying the activities within the structured dialogue. Ambassador Ivanov familiarized the participants with the measures taken to fulfil the tasks set in this area focussing on the challenges of information society, the application of information and communication technologies and the production and social problems encountered when operating in this field. Evgenii Ivanov stated that cooperation in information and communication technologies should be among the priorities in the process of preparation of the associated countries from Central and Eastern Europe for full membership in the EU, the press release says. [02] BULGARIAN PRESIDENT MEETS AMBASSADORSSofia, October 8 (BTA) - "My policies have always been based on the desire for democratization and modernization of political, economic and social structures through their opening to the world," President Zhelyu Zhelev today told the ambassadors in Bulgaria of 23 countries. Today he invited to a working breakfast at his Boyana residence diplomats from European Union member and associated countries, the US, Russia, Switzerland and Turkey.In his address, Zhelev stressed that Bulgaria is now going through an economic and moral crisis because of the "incompetent rule of a Government elected by popular vote which I believe will be corrected". Zhelev's message to the diplomats was not to abandon Bulgaria at this difficult hour. "The democratic international community is the only source of rules of the game for a nation in a difficult situation," the President also said. During the breakfast, Zhelev answered questions of the foreign diplomats, European integration adviser Raina Karcheva told BTA. Spanish Ambassador Jorge Fuentes asked if the President saw a connection between the murder of Socialist MP Andrei Loukanov and the latest political and economic developments in Bulgaria. The President expressed his personal opinion this political murder will have no direct relation to the political situation in the country. He said it was too early for assessments, because the case has not been resolved, according to Karcheva. Asked whether a coalition government might be able to resolve Bulgaria's problems, Zhelev said that coalition cabinets are principally technocratic and can prove successful but the problem is that they cannot rely on a stable parliamentary majority. Zhelev sees the inappropriate, according to him, parliamentary form of government as being at the root of the slow progress of reforms in Bulgaria, Karcheva told BTA. According to Zhelev, Bulgaria's head of state should exert control and share responsibility with the executive power. Such a model is suitable for a country on the road to democracy, especially when it experiences difficulties in this transition, Zhelev is reported as saying. [03] DEPUTY PM ROUMEN GECHEV ON ECONOMIC SITUATION IN THIS COUNTRYSofia, October 8 (BTA) - "We have enough reasons to believe that we will receive the second tranche from the International Monetary Fund (IMF) this November, and that the proposal of the Bulgarian Government for implementing structural reforms will be approved by the Board of Directors of the World Bank," the Socialist Deputy Prime Minister and Minister of Economic Development Roumen Gechev last night told journalists in Pleven (northern Bulgaria). According to him, the World Bank Board of Directors will take a stand on Bulgarian reform measures by November 20.Gechev believes that IMF officials are waiting to see the first major privatization deal- most likely the selloff of Sodi in Devnya, a large chemical works in northeastern Bulgaria; the first centralized mass privatization auction and the efficiency of the Bulgarian judiciary in making decisions about the liquidation of money-losing state-owned companies. According to Gechev, these are the main reasons for the IMF not to vote the second tranche of the loan to Bulgaria now. Last July the Government signed the fourth standby agreement with the IMF worth $580 million. The first $116 million tranche was received at the end of that month. Last week a Bulgarian delegation including Finance Minister Dimiter Kostov and Bulgarian National Bank Governor Lyubomir Filipov took part in the annual meeting of the IMF and the World Bank. Upon his return Filipov announced that the second $115 million tranche will arrive in November at the earliest. According to Kostov, it will not be fatal for the tranche to arrive at the end of the year, because foreign debt payments are concentrated next January and July. Analyzing the economic situation in the country, Deputy Prime Minister Gechev also emphasized the necessary steps should be taken to make the names of credit millionaires in Bulgaria known, even if that involves legal amendments. The responsibility for the accumulation of large bad debts in the banking system is shared equally between lenders and borrowers, Gechev said. He also said the government has drawn up a second draft of its revised programme for economic development by the year 2005, with separate sections for the periods ending in 1996, 1997 and 1998. The 520-page programme has been handed out to all cabinet ministers and the chairpersons of the parliamentary budgetary and economic committees, and is likely to be put to discussion at an extraordinary sitting of the government in the coming two weeks. Then it will be offered to the attention of the parliamentary opposition. [04] DEPUTY PRIME MINISTER AND MINISTER OF ECONOMIC DEVELOPMENT ELECTED CHAIRMAN OF B.C.C.Sofia, October 8 (BTA) - Deputy Prime Minister and Minister of Economic Development Roumen Gechev headed the Bulgarian Bank Consolidation Company (BCC). He was elected at today's extraordinary general meeting of shareholders which had one item on its agenda, changes in the BCC Board of Directors.The shareholders voted for including the Ministry of Economic Development in the Board of Directors as a juristic person represented by Minister Roumen Gechev. In future the Government will have three representatives in the company's governing body, and the National Bank of Bulgaria (BNB) will have two. The Government will be represented by Minister of Economic Development Roumen Gechev, Minister of Finance Dimiter Kostov and BCC Executive Director Valentin Tsvetanov. Until now the Cabinet had two representatives in the Board of Directors and BNB had three. At the first meeting following the general meeting the new members of the Board of Directors elected Roumen Gechev Chairman and BNB Vice Governor Dimiter Dimitrov Deputy Chairman of the Board. Roumen Gechev assumes control over state lending institutions as a representative of the State which holds a majority interest in BCC. The changes indicate that the Government intends to manage directly all state-owned economic structures, particularly those involved in the privatization of the banking system, the "Banker" newspaper said commenting on the changes at BCC. BCC is a holding company established in 1992 for a period of three years and with an authorized capital of 930 million leva. Its basic task was defined as full restructuring and privatization of the banking system. Later on its term of operation was extended by two years, until February 1997. In June 1996 the BCC capital was 3,200 million leva, statistics show. Since its establishment, BCC reduced the number of state banks from 70 to 13, seven of which were consolidated. BCC worked out a programme for the stabilization of banking together with the Ministry of Economic Development. The decision whether the holding company will continue to operate or will be transformed into another institution is to be made in the next few months. Bankers say this would depend largely on the progress of privatization procedures. The sale of state banks will be the BCC major task in the coming months, members of the company's leadership said. The negotiations on the sale of Economic Bank and Balkanbank are at an advanced stage, Roumen Gechev said. In his words, the official stand of Bulbank on the BCC proposal to purchase Economic Bank will become known in a few days. The talks on the privatization of Balkanbank are going on; besides South Korea's Daewoo, local investors are also showing interest in it. [05] COMMENTS ON FINANCIAL SITUATION IN BULGARIASofia, October 8 (BTA) - Today's press runs extensive financial columns.The ruling Socialists' "Douma" daily quotes a statement of the Finance Ministry yesterday that budget deficit has overshot the parliament-approved target figure. Socialist Finance Minister Dimiter Kostov said in late September the budget proceeds totalled 200,704 million leva and expenditures 282,554 million leva adding up to a budget deficit that is up by 1,130 million leva from the target figure, "Douma" writes. It says the situation is attributable to the placing of nine banks under special supervision by the central bank two weeks ago which led to the blocking of sizable budget funds. A frontpage story in "Continent" says that a total of 7,000 million leva of state-owned and municipal companies are frozen in the nine troubled banks. The paper says the hike of the base interest rate from 108% to 300% about ten days ago is an additional burden for the budget. It goes on to quote Deputy Prime Minister Doncho Konakchiev saying yesterday that the government has already drafted the 1997 national budget and it can take effect from the very start of 1997. "Novinar" cites information of unnamed experts familiar with the Cabinet's draft budget for 1997 who say that the draft envisages 49% annual inflation and 280 leva to the dollar in 1997 (one dollar currently exchanges for 215.56 leva). According to "Standart News", if the base interest rate is not reduced soon and if tax revenues fail to increase, the 1996 budget needs to be updated for a second time, after its amendment this summer. The daily says that the budget allocations for payment of interest now stand at 230,000 million leva. "Troud" quotes yesterday's statement of central bank Governor Lyubomir Filipov who said that the bank's Board of Governors is not entitled to make decisions for the sale of part of the gold reserves since several years ago they were declared strategic. "This means that the central bank's management has no right to decide to sell or pledge it," Filipov told "Troud". The central bank Governor said that, according to him, it was a mistake to declare the gold reserves strategic because there are central banks which have sold 90 per cent of their gold reserves. [06] PARLIAMENT RETAINS STATE GUARANTY OF DEPOSITS WITH FAILING BANKSSofia, October 8 (BTA) - At an extraordinary sitting today, Bulgaria's Parliament passed conclusively on second reading amendments to the Act on State Protection of Deposits and Accounts with Commercial Banks in Respect Whereof the National Bank of Bulgaria Has Filed a Petition in Bankruptcy. The MPs kept the 100 per cent guaranty of the deposits held by private individuals and the 50 per cent guaranty of the money of business depositors. The legislation was amended a fortnight after the central National Bank of Bulgaria (BNB) placed nine banks under special supervision. The original Act was passed in late May 1996, after the first bankruptcy proceedings against insolvent banks sparked a severe crisis of confidence in the banking system. Under the Act as amended today, natural-person depositors will be able to withdraw their money 30 days after the entry into force of a court adjudication in bankruptcy for the bank. Under the previous version of the law, holders of accounts had access to their assets within 18 days after the date of the BNB decision to file a petition of bankruptcy. The new waiting time set for corporate depositors is 60 days. According to another amendment, the court has six months from the filing of the BNB petition to rule on the failure of a bank. This provision was fiercely attacked by opposition MPs. In practice, the new version implies that savers will be able to dispose of the first 25 per cent of their money not earlier than six months after the failure of a bank. The MPs repealed a provision which gave natural-person holders of foreign-currency accounts an option to sell their foreign exchange to the bank to which their account has been transferred instead of waiting for six months to access one quarter of the amount. The Act obligates the BNB to buy out government securities from the State Savings Bank. This gives the Savings Bank an extra source of funding apart from the three-month loans which the central bank extends against security of government securities. Interest will accrue on the assets deposited with banks placed under special supervision during the period until the delivery of the court adjudication. Opposition and government MPs clashed fiercely during the debates on the amendments. Nevertheless, several motions of opposition MPs were also carried. The privatization funds were granted 100 per cent protection of their accounts with failing banks. Twelve privatization funds keep their money with the nine banks which were recently placed under special supervision. The 100 per cent guaranty also applies to the unions of disabled persons. The MPs also resolved that when a bank is placed under special supervision or when a petition in bankruptcy is filed against it, the BNB Governing Board must obtain an injunction and distraint to secure the property of the members of the supervisory and management board or of the board of directors, as the case may be, as well as of the bank's managerial agents, even though a BNB official opposed the move. Once the adjudication in bankruptcy enters into force, the action to secure the property is deemed to have been taken by the trustee in bankruptcy and cannot be cancelled or revised by the BNB Governing Board, the MPs resolved. One new provision which was carried unanimously requires that by its decision to petition the court for the institution of bankruptcy procedures against a bank, the BNB Governing Board will request the Prosecutor General's Office to institute a preliminary inquiry into the possibility of the commission of a criminal offence. Left and opposition MPs concurred on this text which targets the "millionaires on credit."[07] INTERNATIONAL CONFERENCE CONDEMNS REVERSAL OF SENTENCES ISSUED BY 1945 PEOPLE'S COURTSofia, October 8 (BTA) - At the end of the two-day international conference the participants adopted a declaration and address to the Bulgarian and the international public in which it condemns the reversal by the Bulgarian Supreme Court of the sentences passed against war criminals of World War II by the so-called People's Court in 1994-1945.The conference, organised at the initiative of the Bulgarian Anti- Fascist Union (BAFU) was attended by delegates of anti-Fascist organisations from Greece, Macedonia, France, FR Yugoslavia and representatives of foreign diplomatic missions in Sofia. It was organised in connection with an April decision of the Constitutional Court repealing the People's Court sentences against politicians and statesmen from governments which were in office until September 9, 1994 (when a Communist-dominated coalition took power). "With its decision the justices of the Bulgarian Supreme Court acquitted also Bulgaria's prime war criminals who committed the most serious crimes against their own people and against the mankind... The decision of the Bulgarian Constitutional Court is a cynical challenge against the democratic Bulgarian public and the world conscience. Nobody will forgive a revision of the past, about which Bulgaria had to report at the Paris peace conference in 1946," the declaration says. The declaration goes on to say that the conference hails the suggestion of French delegate George Doussain, Chairman of the national union of participants in the Resistance and the wars, to set up an international committee for struggle against the attempts to rehabilitate Fascism and Fascists. "The conference was the first reaction of the Bulgarian Anti-fascists against the acquittal of the war criminals," Chairman of the Bulgarian Anti-Fascist Union, MP of the Left Velko Vulkanov said after the forum. The People's Court was established under a Statutory Ordinance of the Trial by People's Court of the Culprits for Involvement of Bulgaria in the War Against the Allied Powers and for the Related Crimes. The cases were considered between 1944 and 1945. Regents, royal advisors, ministers, MPs, senior statesmen and military officials were sued under the Statutory Ordinance. The People's Court considered 135 cases with 11,122 defendants. It passed capital punishments on 2,730 people and sentenced others to different prison terms. The Court acquitted 1,516 people and confiscated property and money. The sentences were unappealable. Bulgarian Telegraph Agency Directory - Previous Article - Next Article |
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