Bulgarian Telegraph Agency (BTA), 97-01-03

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From: Embassy of Bulgaria <bulgaria@access1.digex.net>

EMBASSY OF BULGARIA - WASHINGTON D.C.

BTA - BULGARIAN TELEGRAPH AGENCY

3 January, 1997

CONTENTS

[01] PRESIDENT ZHELEV'S NEW YEAR'S ADDRESS TO THE NATION

[02] BULGARIAN-MACEDONIAN POLITICAL CONSULTATIONS

[03] PRESIDENT ZHELEV AND RULING LEFT DISCUSS NEW CABINET

[04] CONSULTATIONS ON NEW CABINET

[05] SOCIALIST PARTY'S PRACTICAL ACTION PROGRAM

[06] NEW BULGARIAN-RUSSIAN ENERGY COMPANY

[07] BULGARIA'S 1997 BETTER THAN 1996?

[01] PRESIDENT ZHELEV'S NEW YEAR'S ADDRESS TO THE NATION

"Since none of the politicians is likely to offer an apology to the Bulgarians - they will instead put the blame on other people, I will make one," Zhelev said in his address. It is a tradition for Bulgarian heads of state to address the nation on New Year's Eve. "Citizens of the Republic of Bulgaria, please accept my apology. I, who have never had direct rights in the economic and social field so as to assume any blame, offer my apology. "I am doing this because I am ashamed of the Bulgarian political class, of its callous attitude to the people's fate. "I feel ashamed that the Bulgarian state has been driven to this miserable situation," the President said. Under the Constitution, the President has limited powers.

"It is New Year's Eve. This is neither the time nor the place to talk about politics. "The most important thing in these hard times is for the people to survive. This is why I appeal to everyone who can help to do it. "Show mercy to the children in the social establishments and to the homeless kids. They are not nobody's kids. They are our children, Bulgaria's children. "Show mercy to the children of poor families," Zhelev said. "Show mercy to the old and lonely people, to the sick and the helpless. These are our fathers and mothers, grandparents, brothers and sisters who have been working all their lives to create this country's material wealth. Support the young people and families who, in these hard times, have to resolve the most important problems of their lives: to receive education, professional qualification, to create families, raise children. "This is why the most important thing now is to save the people. Let us all support and understand each other," Zhelev said.

"However, in addition to this, a sweeping analysis and a public debate about the past seven years should begin; an analysis to find the answer to the question why the Bulgarian transition failed and the other countries succeeded? Which is the path that will lead us out of this woe? Despite all this, I believe in the intellectual and moral stamina of the Bulgarians, of the working people, of the young and of the intelligentsia. I am sure that the right path will be found and that Bulgaria will become a worthy nation, " Zhelev said, wishing the Bulgarians good health and a lot of strength in the new year.

[02] BULGARIAN-MACEDONIAN POLITICAL CONSULTATIONS

On December 27 Bulgaria and Macedonia conducted a second round of consultations on the text of a draft declaration on the principles of developing goodneighbourly relations and all-round cooperation.

The consultations were held under an agreement reached on Bulgaria's initiative at the 51st session of the General Assembly of the United Nations between the foreign ministers of Bulgaria and Macedonia.

The first round of consultations, at which most of the text was specified, took place in Sofia on October 31 and November 1. However, some key issues involving historical and linguistic differences and Bulgaria's concern over some Macedonian constitutional provisions opening a way for intervention in Bulgaria's internal affairs remained to be considered later, Sotirov said.

"We base ourselves on the understanding that it is states and not linguistic categories that are subject to recognition under the international law; we would not like that historical and linguistic issues be used as a pretext to stipulate preconditions for the development of bilateral relations," Sotirov pointed out. "Bulgaria initiated all major compromising formulations on which it is worked now. Bulgaria made four vital proposals which were subsequently improved. Now there are about 15 variants aimed to help reaching a compromise and overcome the standstill in providing bilateral cooperation with a legal framework. Some of the proposals which are still valid are to conclude the agreements without adding a final clause about the languages they are signed in; that they be concluded in some of the internationally accepted languages; that they be concluded in the 'official languages' of the two countries," Sotirov said. He noted, however, that after the second round the Macedonian side is still not ready to show flexibility and constructiveness in seeking a way out of the situation but respecting Bulgaria's interests.

"Undoubtedly, both sides have got to go their way to reaching the desired promotion of goodneighbourly relations. In this hope we look forward to the continuation of consultations, the date for which would be fixed through diplomatic channels.

[03] PRESIDENT ZHELEV AND RULING LEFT DISCUSS NEW CABINET

After the meeting floor leader Krassimir Premyanov said the new prime minister would be nominated about January 10 and the new cabinet members would be announced in mid-January.

Zhan Videnov resigned his positions as prime minister and Socialist leader at a special congress on December 21-23. The Cabinet's resignation was accepted by Parliament on December 28. Under the Constitution the President must ask the Socialist Party, the political force currently holding a majority in Parliament, to form a cabinet.

Premyanov said the Socialist Party needed time to canvass opinion in and outside Parliament and suggest the optimum formula for a cabinet. He did not say which political forces would be approached about the cabinet, but did not rule out participation of parties outside the Socialist- dominated Democratic Left.

Parliament should reach a responsible consensus without refusals from government presented as an ultimatum at an extraordinary sitting in early January, Premyanov said, asked if the Left's efforts would become pointless if, on January 3, Parliament adopted a declaration "For Bulgaria's Salvation" issued by the United Democratic Forces (UDFs). The UDFs is a broad-based opposition coalition of the Union of Democratic Forces, Popular Union and Movement for Rights and Freedoms.

Pseudo-initiatives for putting off reform for seven months cannot form a basis for national consensus, Premyanov said. He referred to the UDFs' declaration issued on December 19 which called for Parliament's immediate dissolution, early parliamentary elections and consensus for an IMF proposal to introduce a currency board in Bulgaria and for restructuring as a whole.

Socialist leader Georgi Purvanov is optimistic about the outcome of the consultations and is confident that the Left will form a new cabinet. He said Parliament Chairman Blagovest Sendov was being considered for the premiership but declined to give more details on the party debate about the new prime minister.

After the holidays President Zhelev will hold consultations with the four other parliamentary groups.

[04] CONSULTATIONS ON NEW CABINET

Asked whether the new cabinet may include former ministers, Petkov said that interior minister Nikolai Dobrev, trade and foreign economic cooperation minister Atanas Paparizov and agriculture minister Krustyo Trendafilov are three very likely members of a new government of a broad coalition.

[05] SOCIALIST PARTY'S PRACTICAL ACTION PROGRAM

The programs sets forth the following main goals: prompt measures to stabilize the lev and the financial system through a fixed exchange rate, restructuring the economy and providing a realistic social protection for the most disadvantaged groups and at the same time preventing an unbearably high social cost while implementing the reforms.

The program provides that a realistic national budget for 1997 be drafted, adopted and implemented so as to attain these goals. Under the program, parallel to the realization of the budget and the curbing of money siphoning the country should proceed with the negotiations with the International Monetary Fund and renew talks with the World Bank to provide the due servicing of the country's internal and external debts.

In the program the Socialists propose that the parliamentary and extraparliamentary forces reach a consensus on the introduction of a currency board in Bulgaria. Based on the realistic budget the pensions, grants and social welfare payments should be duly paid. The program recommends that the government guarantees the normal operation of the power system and meeting of the population's demands for bread in 1997.

The program gives priority to privatization in the sphere of structural adjustment. The document says that the Government should draw up and adopt the basic parameters of its privatization policy. This policy should involve signing of large privatization deals with Bulgaria's strategic partners and accelerating the employee-manager buy-outs. The program recommends that the government stimulates foreign investments in certain branches.

The restructuring and stabilization of the banking system is a priority task of the incumbents, the program says. This presupposes liquidation of all bad-performing banks.

The program envisages a reform in the fiscal policy as well. The budget should no longer rely on broad financing by the central bank and this is why the stabilization of the tax system attains even larger importance. The program proposes to introduce a new system on charging an income tax.

In the field of agriculture the document envisages completing the land reform and issuing title deeds for the restituted land.

As pointed in the program, the increase of exports is of vital importance for the restoration of the economic growth. The Government is obliged to immediately create effective mechanisms to finance exports and lift all existing barriers to exporters. Construction abroad, exploitation and development of the infrastructure systems and international tourism should be stimulated, the program says.

The document envisages that a long-term economic program for growth, competitiveness and gradual improving of living standards should be drafted and coordinated already by mid-1997.

The Government should update its income policy and specify the goals in the area of salaries, pensions and welfare benefits. The program envisages that the reform of the social safety system should also be accelerated.

The need to enlarge the public and political basis for the policy of the inevitable reforms and the consolidation of the Bulgarian Socialists are among the most topical problems. The program recommends to activate the ideological discussions within BSP. A need is pointed to strengthen the party's organizational structures as a principal intra-party task. The document recommends that BSP intensifies its contacts with the trade unions in Bulgaria. The document also says that the BSP should change its information policy by enriching the forms and means of informational impact.

The program sets the priorities in the BSP foreign policy in the next two years. A major priority for the Bulgarian Socialists is to be admitted to the Socialist International. The program recommends to seek new forms of interaction of BSP with leading European leftist parties and enlarge the cooperation with similar parties from Eastern Europe.

[06] NEW BULGARIAN-RUSSIAN ENERGY COMPANY

"We are planning to redress the balance and to optimize electricity consumption on the Balkan Peninsula," Mr Dyakov said. The fifty-fifty joint venture will seek to eliminate the estimated 4,000 - 4,500 million kW energy imbalance in the Balkans. Russia has a reserve of 40,000 MW annually, Mr Dyakov said. The company will target the development of a Black Sea Energy Ring, including Russia, Bulgaria, Belarus, Georgia, Armenia, Azerbaijan, Turkey, Greece, Albania, Serbia, Romania and Moldova.

The Energy Systems Russian Joint-Stock Company is 60 per cent privately owned and 40 per cent state-controlled, like Gazprom. The Bulgarian portion of the Bulgarian Energy Centre is wholly privately owned. "We learnt from mistakes," commented Multigroup Vice President Nikolai Vulkanov, asked to compare the potentials of the Bulgarian-Russian gas joint venture Topenergy, formed in May 1995, and the new bilateral joint undertaking in the energy sector. The Bulgarian partners in Topenergy include one stateowned and several private companies. Half of the profit of the new JV will remain in Bulgaria and will be invested in the national energy system, Mr Vulkanov said. He stressed the need to complete the transmission network to Serbia and Macedonia. The partners will unveil their specific plans at the end of Mr Dyakov's working visit.

[07] BULGARIA'S 1997 BETTER THAN 1996?

Bulgaria's 1997 state budget is yet to be drafted. This should have been done in December but the cabinet and Parliament were busy with the second revision of the 1996 budget. A currency board is to be introduced in Bulgaria, after the International Monetary Fund proposed it as the only way out of the crisis. Privatization and reforms were very slow to get implemented; crime and corruption assumed critical proportions.

Many insist that the Bulgarian people should turn to the values of the Orthodox Church for salvation, while others claim that this country could be saved if exiled Bulgarian monarch Simeon II returns. However, many people, including among the opposition, want Bulgaria to remain a republic.

Politicians and representatives of the intelligentsia, claim that Bulgaria has reached the bottom and that from now on it will see stabilization and positive growth. "Let us believe in our abilities and preserve our hope that the Bulgarian people can find the way out of the crisis, that it can regain its values and find new ones," Ivan Kostov, leader of this country's biggest opposition formation, the Union of Democratic Forces, said on New Year's Eve, quoted by the "Standart News" daily. According to Kostov, the crisis destroyed people's models and standards of living, leaving an imprint on all of them. "Only with love and understanding, and only after we have driven away hatred, aggressiveness and enmity, can we become the positive force needed by our country and our children," Kostov said.

In his projections for 1997 Krassimir Premyanov, floor leader of the BSP- dominated Democratic Left coalition, listed the critical attitude and the ability for self-criticism as the key factors for resolving the problems of 1996. Premyanov has big hopes for 1997, based on the fact that health and resilience have been accompanying the Bulgarians for more than 1,300 years since Bulgaria's establishment in 681 A.D.

Stefan Savov, Chairman of the Democratic Party, said that better days are in store for Bulgaria in 1997. The Democratic Party and Anastasia Moser's Bulgarian Agrarian National Union form the parliamentary Popular Union coalition. Savov said that all things that oppress the Bulgarian spirit will pass because the Bulgarian people has survived more difficult times.

Ahmed Dogan, leader of the parliamentary Movement for Rights and Freedoms (mostly of the ethnic Turks), appealed to the people not to tolerate social injustice and poverty. Dogan said that each Bulgarian citizen should express the rebellion inside them so as not to get used to poverty. According to Dogan, only after the people find the values to unite the nation will Bulgaria emerge out of the crisis.

George Ganchev, leader of the parliamentary Bulgarian Business Block, supported the idea that the Bulgarians should find their values. He said that people's losing faith in the future may destroy the country. Ganchev emerged the third strongest candidate at the last presidential election held in late October and early November 1996.

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