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BULGARIA


  
  

 

In-depth Business Intelligence

Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
Millions of US $ 19,859 15,608 13,600 69
         
GNI per capita
 US $ 2,130 1,790 1,650 106
Ranking is given out of 208 nations - (data from the World Bank)

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Update No: 122 - (26/07/07)

Bulgarian 'Scapegoat' nurses freed by Libya
Gaddafi is not renowned for his common sense. What conceivable point there can be to trying foreign nurses as killers of children is quite unclear, except to divert attention away from the lamentable failings of his hospital and health system. In the extremely implausible case of the five Bulgarian nurses being guilty, why would they have hung around to be charged. The signal to all other foreign medical staff and aid workers, indeed foreign managerial and technical contract staff in general, is whatever else, to keep out of Libya and the clutches of the fickle dictator, with his dangerous whims.

Bulgarian President Georgi Puvanov met his German counterpart, Horst Koehler, on July 3rd during the German president's visit to Bulgaria. President Purvanov praised the German EU presidency for including the trial of the five Bulgarian nurses sentenced to death in Libya on the EU agenda, according to the Bulgarian news agency BTA. They now of course have been released and returned to Bulgaria.

Libya Benefited from Deal with EU over Bulgarian Nurses 
In a press conference on July 25th, Libya's Secretary of Foreign Liaison and International Cooperation, Abudlrahman Shalgham, said that Libya has achieved most of its objectives from the deal of releasing the convicted Bulgarian nurses, about whom he repeated the grotesque claim that they deliberately infected 438 innocent children with HIV in a Benghazi hospital.

Six foreign medics jailed for life in Libya were freed during the early hours on July 24th and flown to Bulgaria, after the European Union pledged to improve ties with Libya.

Despite the fact that he said that Libyan public opinion is rather disappointed that these six "criminals" have got away with what has been represented as the "mass killing of innocent children", the Libyan top diplomat sounded upbeat as to the results of the deal that was finally reached after day-long negotiations on July 23rd.

He said one of the gains is guaranteeing the life-long treatment of the infected children in European hospitals; another the payment of one million dollars to each family of the victims in compensation from a fund that is financed by European countries including the Czech Republic, France, Bulgaria, Slovakia and others, and a third the rehabilitation of the three medical centres in Benghazi by European countries.

A relative of one of the already dead children who they claimed was deliberately infected by the Bulgarian nurses, told The Tripoli Post "the reception of these criminals with flowers at their arrival in Sofia makes an indentation in our hearts and reveals that Europeans are not sensitive to the suffering of our children and families."

" It reveals the double standards according to which Westerners are dealing with Muslims and Arabs," the victim's relative added, who declined to be named.

When told by a reporter that the French President Nicolas Sarkozy said that neither the European Union nor France paid money to Libya to win the group's release, Shalgham said that European countries, the Czech Republic, France, Bulgaria, Slovakia and others, have paid for all financial compensations made to the families' victims.

In fact, he said, the funds made by these countries have surpassed those made to the families by some extra number of millions, without revealing who had got the rest.

Answering a question on what has Libya gained from the release of the medics, Shalgham said "what would we gain if we kept the medics in jail for ever?"

Shalgham also pointed to closer political ties and cooperation between Libya and the European Union as a result of the signing of the memorandum of understanding only hours before the six medics had left Libya.

This agreement, according to Shalgham was signed by Mr. Abdul Atti Al-Abaidi, together with the Secretary of European Affairs and EU External Relations Commissioner, Benita Ferrero-Waldner.

Asked whether the agreement with EU has to do with the case of Abdelbaset Ali Mohmed Al-Megarahi who is spending a life sentence in a prison in Scotland for the alleged bombing of Pan AM flight 108 in 1988, Shalgham said we do not have an exchange of prisoners' agreement with Britain although we are working on it. He also said that the case of Al-Megarahi has been referred to the Appeal Court in Edinburgh, Scotland's highest court.

In Brussels, European Commission chief Jose Manuel Barroso confirmed that a deal on improving ties had been struck in order to secure the medics' release. "I told (the Libyan leader) that if this matter were settled we would do our best to further normalise these relations," he said.

Ferrero-Waldner said the release had cleared the way for "new and enhanced" EU ties with Tripoli, but did not go into details.

However, French President Nicolas Sarkozy said on July 24th that neither the European Union nor France paid money to Libya to win the group's release. However, he said Qatar mediated the release and hinted the Gulf country may have had a broader role in resolving the crisis. He did not elaborate.

"Neither Europe nor France has made the smallest financial contribution to Libya," Sarkozy said at a news conference in Paris shortly after a French plane carrying the medics touched down in Sofia.

Shalgham told reporters that Libya and Bulgaria have an exchange of prisoners' agreement that was signed in 1984 and went into effect in 1985. According to this agreement, he said, Libya released the nurses whose death sentence was commuted to life in prison. He also said the Bulgarian president had the right to pardon the six medics, (which given the denial of justice they have experienced for so long, surely may be soon expected).

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The fight against crime and corruption
Responding to a question about the omission of safety clauses from the latest European Commission report about Bulgaria, Purvanov said that this is an acknowledgement of progress made by Bulgaria over the past six months.

"The report is rather encouraging for Bulgaria," Purvanov said. 

He said that Bulgarian institutions are very concerned with crime and corruption and to continue to fight against them. Bulgaria's Parliament is expected to approve a motion calling for reinvigoration of the campaign against corruption and organised crime. Bulgaria was making "insufficient progress" here.

The European Commission gave Bulgaria and Romania 12 months to meet basic EU membership rules on justice and home affairs.

The shooting in Sofia in early July of Manol Velev, a businessman who helped to fund the 2006 re-election campaign of President Purvanov, a former leader of the Bulgarian Socialist Party, called attention to a failure by authorities to deal with organised crime. Local criminal groups have been held responsible for more than 100 unsolved contract killings in Bulgarian cities over the past decade. Investigators, prosecutors and judges have said they have encountered political pressure to delay, or even drop such cases.

Prime Minister Sergei Stanishev was setting up a national security agency to combat corruption and crime. The agency would be answerable to him. The aim of the agency was to unify intelligence operations among the defence, interior and finance ministries.

According to analysts, progress may be slow, given the socialists' weak position after a poor showing at the European Parliament elections and a lack of popular pressure to implement judicial reform. 

US Military Bases in Bulgaria Ready Until Spring 2008
Bulgaria may not be in the good books of the Europeans, but it is very much in favour in Washington. Bush came to town in June and praised Bulgaria as a stalwart US ally. 

Bulgarian military bases, which are to be used by US troops, will be ready for living and training until the spring of 2008, Defence Minister Vesselin Bliznakov said at a June 12th meeting with intellectuals. US military officials could come to Bulgaria for conducting short training programmes even this summer, the minister explained.

He underlined that the US President George Bush highly appreciates Bulgaria's army contribution to the process of strengthening the relations between the two countries as the head of state thanked the troops in Iraq during his two-day official visit to Sofia. 

Bliznakov explained to the intellectuals that the country relies on them for helping the popularisation of the soldier's profession and the army's history by making documentaries and writing books on the issues. In return, they will be allowed to use the military holiday home in the seaside resort of Sozopol as well as the military publishing house and TV channel.

Bulgaria's Ousted Energy Minister Remains at Head of Sofia's Socialists
Rumen Ovcharov, Bulgaria's former Energy and Economy Minister, who left the government in the wake of a corruption scandal, will remain at the head of the Socialist Party's representation in Sofia.

Ovcharov enjoyed the confidence of the Sofia's party members and they let him continue leading the local organization.

"I have taken many responsibilities bearing in mind that you would support me. If it continues to be so, we will be able to participate in the local elections in the capital," Ovcharov said at the party's plenum in June. "If you decide to remove me from the position, you will have to elect new leadership, while all the rest are voting for a new mayor," the socialist leader added.

At the plenum also discussed was the work of the socialist representatives in the Capital's Municipal Council and the future of the ruling three-way coalition. The resignation of the ex-Economy Minister Rumen Ovcharov was accepted by the Prime Minister Sergey Stanishev after the corruption scandal, which involved the head of the national investigative service Anguel Alexandrov.

Ovcharov decided to resign even after a prosecutor probe did not find any evidence whatsoever to prove adverse allegations, such as that he was involved with Alexandrov over the Sofia heating utility case or the activities of country's tobacco monopoly, Bulgartabac. Despite the absence of evidence on the main accusations against them, the two will nevertheless be investigated on charges that they tried to interfere with the judiciary system by influencing the probe into the alleged corruption at Sofia heating firm, Toplofikatsia.

Unique Thracian Symbol of Royalty Discovered in Bulgaria
Archaeologists have discovered the most ancient ruler's symbol on Bulgarian territory, what was once the kingdom of the Thracian tribes. 

The Bulgarian archaeologists Daniela Agre and Deyan Dichev, who are leading the Strandzha expedition, made the announcement for the exceptional finding on the Bulgarian National Radio on June 11th. 

The artefact was unearthed near the village of Golyam Dervent. Dichev and Agre were researching a dolmen (dolmens were the first Thracian tombs) when they noticed a frieze of intertwined zoomorphic and geometrical elements carved on the entrance of the tomb. The most interesting part of the discovery is the double-axe (labris) - a symbol of power in the Thracian society - placed inside a circle. The labris has lots of additional ornamentation on it, Dichev said. The frieze includes the images of snakes, which were the symbol of the king in the Thracian religious beliefs. 

This is the first time when such an artefact is found on the territory, where Thracian tribes have lived in the 9-8 BC. 

The ladris had later become the symbol of the royal dynasty of the Odris tribes, which had the most powerful state organization in the second half of the first millennium before Christ. 
The appearance of this symbol three centuries earlier shows that organizing a state started on this territory first. 

Two years ago archaeologists found similar symbols of royalty on the entrance of a neighbouring dolmen. There is no doubt that these two dolmens were the tombs of an important clan of rulers and priests, who lived around the end of the 9th and the end of 8th century BCE.

Unique Cybele Temple Findings Exhibited in Bulgaria
Antique archaeology findings, that were unearthed in the temple of the Phrygian Goddess Cybele in Bulgaria, will be exhibited in the seaside town of Balchik. 

Recently the archaeologists working there found a third marble statue of the goddess - a deification of the Earth Mother. One of the most precious findings in the temple of Cybele is a 50-centimeter-high Doric column with a well-preserved inscription addressed to the Roman emperor Valerius Licinianus Licinius.

Originally a Phrygian goddess, Cybele was a deification of the Earth Mother who was worshiped in Anatolia from Neolithic times. Like Gaia (the "Earth") or her Minoan equivalent Rhea, Cybele embodies the fertile earth, a goddess of caverns and mountains, walls and fortresses, nature, wild animals. Her title "potnia theron", which is also associated with the Minoan Great Mother, alludes to her ancient Neolithic roots as "Mistress of the Animals". She becomes a life-death-rebirth deity in connection with her consort, her son Attis.

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AVIATION

CAA revokes licences from 4 Bulgarian airlines


The Civil Aviation Administration (CAA) in Sofia revoked the operator licences of Air Sofia, Bright Aviation Services, Scorpion Air and Vega Airlines after safety deficiencies were confirmed in services provided by the four Bulgarian carriers, the Bulgarian Transport Ministry was cited as saying by Sofia News Agency. 
The decision was made in accordance with the Civil Aviation Act. The decision for stripping the companies' licence came in the wake of the review that experts from the European Aviation Safety Agency carried out in May. 
The experts argued that there are substantial lapses in the area of aviation safety. Air Scorpio, one of five associated companies in the group of Scorpion Air, is allowed to continue its flight training services, but may not operate commercial flights until its business is brought into compliance with Regulation 20-42 and the operating standards of Europe's Joint Aviation Authorities. Yet another Bulgarian company, Heli Air, retains its right to fly to any non-EU countries. 
The above-listed carriers underwent checks between May 28 and June 1 in accordance with European Commission rules. The checks showed systematic deficiencies in terms of civil aviation safety, the Bulgarian Transport Ministry was cited by the news agency as saying. Representatives from the five companies had estimated the costs of upgrading each AN-12 cargo plane used by the companies at US$150,000-180,000.
The grave problems in Bulgaria's aviation struck out in December last year when the European Commission decided to invoke a safeguard clause over "grave deficiencies" in safety procedures. The safeguard clause excluded Bulgarian air carriers from the benefit of being considered a "community carrier" The EU's air space includes all member states, but also Switzerland, Iceland and Norway, countries that are not part of the bloc.
The companies have been under special supervision from the European Aviation Safety Agency (EASA) and the CAA. The checks were carried out by a team of inspectors from CAA, the European Commission, EASA and the national aviation authorities of EU members Romania, Germany and Italy.

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BANKING

EBRD extends 5-mln-Euro credit line to Unionbank

The European Bank for Reconstruction and Development (EBRD) recently inked a five million Euro deal to extend Bulgarian bank MKB Unionbank a credit line to help local industries reduce emission levels and boost energy efficiency, reads a press release. The loan builds up on a previous three million Euro loan, which was extended to MKB Unionbank in 2004 to help nine private industrial businesses cut energy waste significantly or produce energy more efficiently, the banks recently said in a joint statement, New Europe reported.
The loans are provided under the Industrial Energy Efficiency and Renewable Energy Framework, set up in 2004 by the EBRD together with the Kozloduy International Decommissioning Support Fund (KIDSF) and the Ministry of Economy and Energy through the Energy Efficiency Agency. EBRD Director for Bulgaria, James Hyslop, said the loan is building on the success of the first issued to MKB Unionbank, which has helped promote the efficient use of energy, helping to cut pollution levels through reduced carbon emissions. 
This project reflects the EBRD's strong emphasis on supporting Bulgaria's efforts in the development of an energy efficiency programme, which was one of the conditions for Bulgaria's accession to the European Union and remains a strategic priority for the country now as an EU member. Furthermore, by cutting energy wastage, businesses are saving costs and contributing to improved competitiveness, Hyslop was cited as saying. 
MKB Unionbank CEO and Chairman, Maria Ilieva, said lending of this kind is very important for private industrial businesses in improving their energy efficiency. With this EBRD loan, MKB Unionbank will help Bulgarian businesses compete within the EU, while also enabling them to operate on a more environmentally-friendly basis. Just recently, the EU member countries, including Bulgaria, decided to lower harmful emissions 20 per cent by 2020. This energy efficiency loan to MKB Unionbank contributes to meeting this target, she added. Under the framework, participating banks such as MKB Unionbank receive funds from the EBRD that they then lend to private-sector industrial enterprises. Businesses use the finance to improve energy efficiency by, for example, introducing better energy consumption, automation, control and heat recovery systems, and promote the use of renewable energy technologies.

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CREDIT RATINGS

Commercial Bank Allianz gets stable outlook from Fitch

Bulgaria's Commercial Bank Allianz Bulgaria AD received an A- issuer default rating, a short-term F2 rating and a D individual rating, with a stable outlook, by Fitch Ratings, according to a recent press release, New Europe reported. 
The IDR and short-term ratings reflect the extremely high probability of support from Allianz SE, which controls the bank via a 66.16 per cent stake in Allianz Bulgaria Holding, in case of need, it was reported. The individual rating reflects the bank's small size and short history, but also its adequate profitability and capitalisation and prudent risk appetite, Fitch said.

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ENERGY

LUKoil targets 30% of Bulgarian retail market for oil products

Bulgarian economic magazine Capital quoted LUKoil-Bulgaria Deputy General Director, Nikolai Ivchikov, as saying that Russia's LUKoil plans to corner 30 per cent of the retail market for oil products in Bulgaria by 2010. He was cited as saying that in the period 2007-2009, LUKoil-Bulgaria would build or acquire 200 new filling stations in the country, Interfax News Agency reported. 
Investment in expanding the company's retail network will amount to over US$300 million. There are currently 170 filling stations operating under the LUKoil brand in Bulgaria. The company also plans that by 2010 about US$700 million will be used to modernise the LUKoil Neftokhim Burgas oil refinery, it was reported. It is planned that this refinery will start to produce Euro-5 standard fuel in 2009.
Ivchikov said that in 2006 the refinery in Burgas had throughput of 7.1 million tonnes, and in addition, last year, the company launched a system for the subsequent transportation of oil products through the Burgas-Stara-Zagora pipeline, and acquired a complex to tranship liquid hydrocarbon gasses at the port of Russe, Interfax reported. "A favourable investment climate for Russian investors has been created in Bulgaria and the case of LUKoil in Bulgaria is paradigmatic," he was quoted as saying.

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FOREIGN INVESTMENT

Germany to invest 4m Euro for entrepreneurship 

Germany will provide four million Euro to encourage entrepreneurship and professional education in Bulgaria, it was announced at a regular parliamentary sitting, Sofia News Agency reported. 
The funds will be provided as a result of an agreement for technical cooperation signed between the two countries in 2006, and will be used for the execution of four projects, including a programme for encouraging employment, for professional education and for the development of the Rhodope Mountains region. Conditions for each project will be specified in separate agreements. Each country will appoint an institution responsible for the specific programme and for its funding and execution.

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FOREIGN LOANS

World Bank lends 15m Euro for social policies

The World Bank has agreed to lend Bulgaria 15 million Euro to put towards its social inclusion policies and infrastructure, Ready2Invest reported. 
Bulgaria is working to improve its social inclusion as it continues to open up trade with other EU nations - a process that could be of benefit to property investors in the area because of the associated economic benefits, it was reported. The Novinite.com Sofia-based news agency said that the loan has a 17-year maturity, as well as a 5-year period of grace. Shigeo Katsu, the World Bank's regional vice-president for Europe and central Asia, was quoted as saying: "Building up the institutional capacity is of key importance for Bulgaria now when the country has to utilise EU accession funds and this project will help in that respect."
Recent statistics from the Bulgarian National Bank revealed that foreign property investment in the country has increased rapidly over the first three months of 2007. The Sofia Echo quoted Prian.ru as saying that foreign property investment in Bulgaria reached 1.13 billion Euro in 2006. 

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TELECOMMUNICATIONS

BTC to invest big in mobile arm, Vivatel

BTC shareholders approved on June 19th the plans for a Bulgarian 240-million-lev cash injection in the company's mobile arm, which operates under the Vivatel brand name, Sofia News Agency reported. 
BTC is Bulgaria's dominant fixed-line operator. The telecom's executives will decide on the timing and size of the cash transfers, the shareholders agreed at their annual meeting, it was reported. They also approved a gross dividend of 0.55 levs per share, payable to BTC shareholders as of June 29th. US insurance giant AIG agreed to pay US$108 billion for the majority 65 per cent stake, owned by Viva Ventures, an investment vehicle of US equity fund Advent, Sofia News Agency reported. AIG beat off competition from Dubai-based Oger Telecom and Turkey's largest mobile operator Turkcell, the early favourites to buy the first option on the stake, held by Icelandic mogul Thor Bjorgolffson. AIG has the option to buy another 25 per cent from Bjorgolfsson for US$580 million and plans to make a buy-out offer to the minority shareholders, taking the company private. The insurer has already announced plans to contract up to 585 million Euro in syndicated loans from four banks to refinance BTC's existing debt and stimulate further growth. BTC is the main telecom operator in Bulgaria with a payroll of 20,000 and has 2.9 million phone lines, which account for 97 per cent of the fixed-line segment of the market.

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