Books on Bulgaria
% of GDP
Update No: 102 - (27/10/05)
The Turkish question
The idea of Turkish accession to the EU is very important for the Bulgarians.
They share a frontier! Turkey is now a candidate country for EU entry, which
started talks with Brussels to that end on October 3rd.
Cooperation with Bulgaria is likely to be in its favour. The Bulgarians were
ruled by the Turks for centuries and have a large minority of Turks in their
population -nearly 10%, or 800,000 out of a total population of 8.4 million.
They may not amount to so many; but they count at election time all right. One
in ten can hold the balance. The Movement for Rights and Freedoms, their party,
held the balance in the previous parliament and supported the National Movement
of Simeon 11.
Turks against communism
At this historic moment it is worth recapitulating the role of the Turkish
minority in Bulgaria's history, which has been immense, including in the
overthrow of communism no less.
The Ottomans occupied Bulgaria in 1396 and were not evicted until 1878, when
fellow Orthodox Tsarist Russia came to its rescue after a series of appalling
massacres of Bulgarian Christians from 1876 onwards, that aroused William
Gladstone in Britain to some of his highest flights of oratory in condemnation.
But it was his arch-rival Disraeli, who was in power at the time who joined
forces with Bismarck at the Congress of Berlin in1878 to give international
recognition to Bulgarian independence.
Bulgaria sided with the Central Powers in the First World War; and then under
Tsar Boris III sided with Hitler from 1941. He died in 1943, being succeeded by
the infant Simeon II of recent fame as premier. The communists took over in the
wake of yet another Russian 'liberation.' Communism and Islam have always been
ill bed-fellows. The only instance of an Islamic country going communist is
Albania, which is 70% Moslem, and that happened in most peculiar circumstances.
The clash between the Bulgarian Communist Party(BCP) and the Turks came to a
head in 1984 when it began a most ill-advised policy of 'regeneration' of them
by 'forced bulgarisation.' They were obliged to change their names to Bulgar or
Slav ones, while their religious and other practices were increasingly harassed.
This could not have come at a worse time. Gorbachev came to power in Moscow, the
ultimate guarantor of the regime in Sofia. He was determined to see changes in
the Warsaw Pact zone, a new Prague Spring so he thought (he had been an ardent
supporter of it in 1968, totally opposed to its suppression). He was now in
favour of liberalization and a renunciation of the use of force by Moscow in its
imperial reach. The Turks were emboldened to fight back against discrimination,
but were brutally suppressed in early1989, the fatal year that upset everyone's
Bulgaria had a particularly anachronistic apparatchick in charge in the shape of
Todor Zhikvov, a dinosaur from way back, 1954 no less, who had been throttling
his country's politics for three and a half decades. He was completely out of
touch with reality, as much so as Ceaucecu next door in Romania. 300, 000 Turks
fled to Turkey in mid-1989 to international outrage at their treatment by the
regime, Credits were cut off and an already feeble economy was devastated.
His own colleagues realized that he had to go, especially with the remarkable
events unfolding in Poland, East Germany, Czechoslovakia an Hungary. On November
10th he was deposed and the CBP began a dialogue with the newly-formed Union of
Democratic Forces, congeries of oppositionists inspired by Solidarity and the
downfall of the Berlin Wall. History was on the march.
On December 29th the government revoked the anti-Turkish legislation, the
burning issue of the day. This provoked chauvinist and pro-Zhikvov elements to
mount a demonstration against the revocation in Sofia. At this key juncture the
liberals in the UDF found a common cause with those pro-Gorbachev elements in
the CBP to mount a counter-demonstration a week later, backing the revocation of
December 29th. Within a few days the UDF and the CBP were in round-table
discussions to set up a post-communist government, which duly emerged. The
Turkish issue had precipitated, along of course with Gorbachev, the collapse of
Bulgarian communism. QED.
The Bulgarians have not forgotten this remarkable chain of events. They know how
crucial was the role played by the Turks in bringing about the downfall of the
old order. The MRF is a key player in Bulgarian politics and the new question of
Turkish entry could have a big impact, given that Turkish immigration is always
likely to be greater into countries in the EU in which a large Turkish
population already lives. Bulgaria is aspiring to EU entry itself shortly, say
2007, well before Turkey.
Bulgaria, Turkey: Turkish investors eye Bulgaria's unused EU funds
Turkish businessmen are coming to town before Turkish immigrant workers, as
it so happens. Turkish investors aim at getting their hands on EU funds
allocated to Bulgaria in the areas of meat, dairy and wine production that
Bulgaria still has not utilized, Sofia News Agency reports. Long-sighted Turkish
investors were setting up in Bulgaria as long as ten and more years ago, when it
seemed that Turkey might never gain membership of the EU.
These funds are suitable for acquiring credits, and Bulgaria provides terrains
and tax reliefs. Even better is the right for the Turkish goods to carry the
label "Made in EU" upon Bulgaria's accession in 2007. A lot of
business sectors in Bulgaria, mainly in agriculture, offer opportunities for
cooperation and co-production.
The Turkish investors could acquire the funds left unused for infrastructure and
agriculture through collaboration with Bulgaria or through direct investments.
The Bulgarian Central Bank and the Turkish Council of Banking Control have
signed an agreement for cooperation, and the TBBC planned a meeting in October
in Sofia in order to discuss further the opportunities available for Turkish
Bulgaria-Turkey trade doubles
Trade between Bulgaria and Turkey for 2005 is expected to be worth US$2bn.
That would mean a 100% increase over the last two and a half years, data show.
Turkish entrepreneurs held a meeting with partners from the region of Haskovo,
south Bulgaria. The Turks have shown interest for investments in Haskovo-based
meat, milk and wine businesses.
Bulgaria's President meets Bush in Washington
The official visit of Bulgaria's President Georgi Parvanov to the US took
place on October 17th with a meeting with his host George Bush.
During the meeting Parvanov expressed Bulgaria's hope for a quick solution to
the talks on US military bases at Bulgaria's coasts. Bush was officially
informed of Bulgaria's decision to pull out its troops from Iraq at the end of
the year, as well as of the country's will to remain in the antiterrorist
coalition and the plans for supporting the democratic processes in Iraq from the
beginning of 2006.
Ways of boosting US investments in Bulgaria were discussed. "I can make a
comparison with other visits of mine. The attitude during this meeting was
different - as between allies and between friends", the Bulgarian President
Georgi Parvanov said after the end of his visit to the U.S. in an informal talk
with Bulgarian journalists. Parvanov invited media representatives in the
"Cheers" bar in Boston, the place where the well-known TV series were
shot. When asked whether the good relations between Bulgaria and the U.S. would
affect negatively the Bulgarian relations with European states, Parvanov said:
"We are conducting European policy to the U.S. There is nothing different
in our policy than that of other European states".
New low-cost Wizz Air flies to Sofia
Wizz Air, a new European low-cost airline which flies Sofia-Budapest route four
times a week, completed its first flight with Sofia as its destination,
Bulgarian News Agency reported recently.
The tickets for this flight started selling in Bulgaria three months before and
155 passengers were on board for this flight, which amounts to 86 per cent of
the plane's capacity. The airline took off at the end of May from the southern
Polish city of Katowice, initially flying to Budapest, London's Luton airport,
Rome, Milan, Venice and Berlin. Wizz Air focus on the markets of central and
eastern Europe and currently works on expanding the number of flights out of
other Bulgarian airports and increase the destination sites throughout Europe.
New low-cost airline enters Bulgarian market
SkyEurope Airlines, central Europe's largest low cost airline group, announced
recently that it had gained traffic rights to open services to Sofia and
Bucharest. SkyEurope obtained traffic rights from the Bulgarian and Romanian
authorities. SkyEurope was established in 2001 and pioneered low-cost aviation
in central Europe by becoming the first low-cost airline to open bases in
Slovakia, Hungary and Poland. In order to further build on its first mover
advantage, SkyEurope is now expanding eastwards, with the first low-fare flights
between Bratislava, conveniently located only 50 kilometres away from Vienna,
and the Bulgarian and Romanian capitals. CEO, Christian Mandl, said that his
company is expecting to bring low fares to Bulgaria and Romanian travellers and
also position Sofia and Bucharest on the map of trendy tourism destinations.
Flights to and from the Bulgarian and Romanian capitals will begin on December 9
and 12, with fares starting from 25 Euro one-way, excluding taxes, Sofia News
Banks launch SMS service for transactions
Five Bulgarian banks - Hebros Bank, Bulbank, Raiffeisenbank (Bulgaria), first
Investment Bank and DZI Bank - started offering card balance alerts via SMS
messages, Bulgarian News Agency reported recently.
The information provided to the clients by the banks via cell phones are usually
related to recent transactions performed with their cards. Bulbank informs its
clients about all transactions with their cards via POS terminals and ATMs
within 10 minutes, quoting the time and location of the operation and the
transacted amount. Raiffeisenbank (Bulgaria) and DZI banks offer immediate
notification about any movement on their clients' cards. This option makes it
possible to curb losses stemming from lost or stolen cards to a single
transaction, of up to 400 levs in the case of cash withdrawals from ATM. Another
popular type of text message informs clients that their electricity, phone,
central heating and cable TV bills have arrived, stating the amount of money to
be paid by them. This option is available to Raiffeisenbank (Bulgaria) and
Transcard holders. Holders of Credo and Hebros cards, as well as cards issued by
Raiffeisenbank (Bulgaria), receive reminders about forthcoming credit
S&P withdraws MobilTel's long-term credit rating
Standard & Poor's Ratings Services recently announced that it withdrew its
BB+ long-term corporate credit rating on Bulgaria-based leading mobile
telecommunications operator Mobiltel AD at the request of the company, New
The move followed the completion of Mobiltel's acquisition by Austria-based
integrated telecoms operator Telekom Austria AG and the early redemption of
Mobiltel Finance's 200m Euro notes due 2009. The telecom's obligations were
refinanced by an intercompany loan from Telekom Austria. Mobiltel is a leader on
the mobile telephony market in Bulgaria in terms of subscribers, revenues, and
EBITDA (with a 62.4 per cent subscriber market share at June 30, 2005). The
rating agency said that according to data, the Bulgarian mobile telephony market
offers opportunities for growth in subscribers and traffic given the moderate
penetration level of about 70 per cent.
Bulgaria to write off 80% of Iraqi debt
At the recent annual meetings of the International Monetary Fund (IMF) and the
World Bank in Washington, Bulgarian Finance Minister, Plamen Oresharski,
announced that his country plans to follow an agreement of the Paris Club of
creditors and write off 80 per cent of the US$1.7 billion in Iraqi debt, Sofia
News Agency reported.
"The Paris Club agreement provides for an 80 per cent wipe off (of the
money owed by Iraq) and a rescheduling of the remaining 20 per cent. We do not
have a much room for manoeuvre, as this is an international practice,"
Oresharski was quoted as saying.
Oresharski affirmed that an agreement was reached with Iraqi Finance Minister,
Ali Allawi, "to start consultations over the possibilities of settling the
debt." His response was positive when asked whether a 20 per cent
reimbursement would be discussed. Bulgaria, whose current account deficit stands
at 10 per cent of GDP despite an IMF imposed fiscal austerity policy, has until
now refused to follow the Paris Club policy of wiping off Iraqi debt.
FOREIGN ECONOMIC COOPERATION
Azerbaijan, Bulgaria to boost business ties
Azerbaijani President, Ilham Aliyev, on his recent visit to Bulgaria explored
the country's business opportunities. A meeting was held on September 24th
between Bulgaria's President, Georgi Parvanov, and Aliyev in the coastal capital
Varna, Sofia News Agency reported.
Both leaders agreed that infrastructure development would help to boost economic
relations. Aliyev met Bulgarian business representatives and was acquainted with
the peculiarities of the Bulgarian tourism sector. He urged Baku to consider
other energy projects besides Baku-Tbilisi-Ceyhan Pipeline, including
Burgas-Alexandrandroupolis and Burgas-Vlora pipelines. Bulgaria and Azerbaijan
vowed to strengthen their economic relations. Aliyev said both countries should
boost ties in power engineering, infrastructure, farming, food industry,
construction and pharmacy. The two heads of state signed a joint declaration,
calling for intensifying aid in EU integration.
Cabinet sets up state agency for IT creation
Bulgaria's cabinet has issued a decree creating a state agency for
Information Technologies and Communications, a secondary spending unit, Sofia
News Agency reported recently, citing the government's information service.
The agency is created pursuant to a parliament decision on August 16th. The
agency will guarantee the independent policy in the field of communications and
IT. The staff will comprise officials of the communications policy and
information society and IT directorates of the transport and communications
ministry. The cabinet picked Plamen Vachkov, 56, to be chairman of the new
agency. Vachkov graduated in electrical engineering and is a Doctor of Science
(Tech.). He specialised in micro-processor devices in France, in management in
the US and in quality management in Japan.
Viva-Ventures to launch third mobile operator in Bulgaria
Bulgaria's third GSM operator Viva-Tel, a subsidiary of the Austrian-based Viva-
Ventures, on September 8th announced that it will become the third mobile phone
operator in Bulgaria by the end of this year. Vivatel, owned by BTC Telecom,
presented its red-and-blue logo, which features a broad smile, painted on a
large banner at the foot of Mount Mousssala, the highest peak in Bulgaria, New
Local media reports claim that the existing operators keep prices among the
highest in Europe, though Bulgaria is among the poorer, with average monthly
wages of around 150 Euro. BTC Mobile CEO, Richard Shearer, said the operator
would offer "reasonable" and "highly competitive" prices.
Shearer added that Vivatel will face very low network expenses and will be able
to offer much lower prices. Viva said it would offer services at prices up to 20
per cent lower than the competition - Bulgaria's two existing mobile operators
Telekom Austria's MobilTel and the Greek Globul, BTC head, Dennis Wallach, said
Bulgarian customers are looking forward to finding out whether the increased
competition would bring down prices. MobilTel has more than 3.2 million
customers. According to Wallach, Vivatel would make the local market much more
dynamic. Officials selected the name Vivatel in August, after a nation-wide
BTC Mobile also announced it will invest more than 200 million Euro at its GSM
infrastructure over the next two years. Vivatel should start operating before
Plans were to launch the third mobile network last April, but a delay was
imposed because of auctions for UMTS licences and BTC Mobile negotiations with
MobilTel and Globul. Shearer said Vivatel will aim to make cellular service
affordable for all Bulgarians but stopped short of revealing the exact call
tariffs. Insiders said the main problem holding back the take-off of the new GSM
operator is the lack of a billing system. Vivatel, which will cover 90 per cent
of Bulgaria's eight million population at launch, will try to snatch customers
from MobilTel and GloBul.