News from Bulgaria / Dec 18, 95

From: bulgaria@access1.digex.net (Embassy of Bulgaria)

Bulgarian Telegraph Agency Directory

EMBASSY OF BULGARIA - WASHINGTON D.C.

BTA - BULGARIAN TELEGRAPH AGENCY

BULLETIN OF NEWS FROM BULGARIA

CONTENTS

[01] PRESIDENT ZHELYU ZHELEV RECEIVES US PRESIDENT SPECIAL ENVOY

Sofia, December 15 (BTA) - The restitution of Jewish properties in Bulgaria and Central and Eastern European nations, and Bulgaria's bid to join the European Union were high on the agenda of today's meeting of President Zhelyu Zhelev and US President Bill Clinton's special envoy on matters of Jewish property, Stuart Eisenstadt. Eisenstadt is also US Ambassador to the European Union.

Eisenstadt expressed satisfaction a large part of Jewish properties in Bulgaria have been returned to former owners under the restitution law, with only buildings housing public institutions, remaining, Mihail Ivanov, adviser to the Bulgarian President, told reporters after the meeting. The properties not yet returned are in big cities, such as Sofia and Varna, and are valued at around 1,000 million leva, Eisenstadt learned from his meetings with Prime Minister Zhan Videnov and Sofia mayor Stefan Sofiyanski. In turn, President Zhelev said he will do his best to speed up the process.

Nonresident Jews born in Bulgaria who have lost their citizenship for various reasons, can always get it back, Zhelev said.

As an US Ambassador to the EU, Eisenstadt reiterated his country's support for Bulgaria's bid to join the Union, Ivanov also said. The sooner the better, was his comment.

The procedure in the US for granting Bulgaria a most favoured nation status, is gaining speed, Eisenstadt told the President. The amendment to that effect has passed in the House of Representatives and awaits passage in the Senate, the envoy said.

[02] PRESIDENT ZHELEV AGAINST CONSTITUTIONAL COURT'S

Sofia, December 15 (BTA) - President Zhelyu Zhelev is against the Constitutional Court's ruling on a petition by 56 Socialist MPs challenging the constitutionality of public statements by the President calling on voters to support certain candidate or party.

The case was opened after President Zhelev's statement calling on Sofianites to vote for Union of Democratic Forces candidate Stefan Sofiyanski in Sofia mayoral elections. The statement was made in the run-up to the second ballot. MPs of the ruling Bulgarian Socialist Party then announced they will approach the Constitutional Court after the elections are over.

The Socialist MPs demand that the Court rule whether the President's public statements indicating his preferences or negative attitude to certain political figure or party violate the Constitution. The MPs invoke a provision in the Constitution which says that the President "shall embody the unity of the nation". Parliament and the President were constituted as parties in the case, who are legally bound to submit their statements before the Constitutional Court.

"The President shall embody the unity of the nation, but each head of state has their political functions as well. As such, the President is entitled to express his political attitudes and make political statements," reads Zhelev's statement to the Constitutional Court. "This is why the Constitution entitles the President to address the people and Parliament and to express his views, political ones including, on various issues of state government," Zhelev says.

Another argument against the Constitutional Court's hearing of the case is included in Zhelev's view that "it is absurd to argue and harmful to the Constitution itself to spread the view that the head of state is something different, separate, 'above' or 'below' this country's political life and state institutions".

Zhelev also stresses that "the Constitution cannot be violated by words". "The Constitution can be violated by action or inaction, but not verbally," he says.

[03] PERFORMANCE FORMS BASIS FOR IMPLEMENTING CABINET

Sofia, December 15 (Ekaterina Kazassova of BTA) Today, two weeks before the end of 1995, Parliament started debating the 1996 National Budget Bill introduced by the Council of Ministers. Prime Minister Zhan Videnov familiarized the MPs with the Cabinet's achievements in 1995 and the main goals of the Government in the economic, social and financial spheres.

"In 1995 all macroeconomic and social indicators have improved from the previous year," the Prime Minister said. "Data show that the Government met its commitments to stop the collapse and the persistent slump in production and start lasting economic growth. This was proved by the fact that GDP doubled from 1994," Videnov stated. Another goal of the Government is to curb inflation which stood at 122 percent in 1994. "In 1995 it is expected to be four times lower," he noted. In his view, this is one of the clearest proofs of economic recovery.

Base rate cuts, made possible by lower inflation, created favourable conditions for economic recovery. The latter was sustained by a stable lev-dollar exchange rate and the Government's balanced economic policy, the Prime Minister said.

At the beginning of the year the Cabinet committed to intensify Bulgaria's foreign economic relations so as to improve its balance of payments and accelerate its integration into the EU. "Compared to 1994, there has been an improvement in exports, the trade balance, the balance of payments and foreign exchange reserves, which confirms that this commitment has been met," Zhan Videnov said. According to him, the most difficult task is to be performed in 1996: to prepare the economic, political, social and other conditions for full EU membership. This will be one of the Government's strategic goals in 1996.

The Prime Minister said that in 1995 the seven-year trend towards impoverishment of the people was checked. The drop in the average real wage is expected to be three times lower than in 1994. The average real pension was practically stabilized, he said. For the first time in years unemployment has dropped sharply to less than 400,000. In 1996 the Government will try to reduce the unemployment figure by a further 60,000, Videnov said.

Faster cash and voucher privatization will allow the Government to launch the real restructuring of the Bulgarian economy. Speaking about economic setbacks, Videnov mentioned the large number of loss-makers, poor tax and financial discipline, serious problems in the banking system and the unsatisfactory pace of privatization.

In 1996 the Cabinet will seek to stabilize economic recovery and turn it into lasting growth. The Cabinet projects GDP growth of at least 3 per cent.

The Cabinet will pursue its anti-inflationary policy, setting the target for inflation at some 20 per cent in 1996. This process will be aided by the comparatively low budget deficit, set at 4 per cent of GDP. The base rate will be cut from an annualized average of 50 per cent in 1995 to 25 per cent in 1996. The lev will depreciate gradually. To this end, the foreign exchange reserve will have to be large enough despite the upcoming sizeable debt service payments in 1996. The foreign exchange regulations will remain unchanged but will be enforced more strictly, Videnov said. The cabinet will pursue a more flexible tax policy and will introduce uniform taxation for private and state-owned companies. Part of the dividends payable to the state will be turned over to corporate investors.

The Cabinet will pursue an ambitious foreign trade policy. It is taking steps to increase exports, aiming at a trade surplus of 500 million dollars. To this end, it will step up trade with the European Union, Central and Eastern Europe. The lifting of the embargo is expected to further improve the economic outlook, Videnov said.

Given the foreign exchange reserve, the projected foreign trade surplus and the balance of payments, the Cabinet expects that Bulgaria will continue to service its foreign debt regularly in 1996. The Cabinet is taking steps to collect receivables from other countries.

In 1996 the Cabinet will take a proactive approach to attracting foreign investment, including contracts for the sale of large Bulgarian enterprises, joint projects on Bulgarian territory and concessions.

[04] BULGARIAN FOREIGN MINISTER RETURNS FROM PARIS

Sofia, December 15 (BTA) - Last night Foreign Minister Pirinski returned from Paris where he attended the signing of peace accords for Bosnia and Herzegovina. "What is most important is that Bulgaria participated actively in the discussions on the whole range of issues, especially the civil ones, pertaining to peace protection in Bosnia and Herzegovina and to confidence- building measures for lasting stabilization and security in the whole region," Minister Pirnski told the press at the airport.

"Undoubtedly, this event will have lasting importance for our region and Europe. The peace accords were signed by the three leaders of the countries, involved in the conflict. Everyone at the Elysee had the feeling that the war ended," Minister Pirinski stated. According to him, it is not at all certain that peace is guaranteed. In his view the observation of the agreements which begins from now on is very complex.

"The sanctions' lifting produced an effect which was felt immediately: it will give a chance to realize even more clearly the advantages of Bulgaria's policy in the past few years," Bulgaria's chief diplomat said. "Bulgaria is recognized as a factor of peace and stability in Southeastern Europe by all countries," Pirinski said.

[05] BUSINESS NEWS BRIEFS

Sofia, December 16 (BTA) - A Black Sea regional power centre will be officially opened in Sofia on December 18, reads an Energy Committee press release. The centre will play a key role in cooperation among the EU, the Balkan countries and the Black Sea Economic Zone member-countries. A conference on the implementation of the European Energy Charter in the Black Sea Economic Zone countries will start simultaneously with the centre's opening. At the conference more than 200 representatives of the power sector will discuss problems of trade, investments, environment and technology transfer in the region. A team of experts studying the prospects to link up power systems in the region will also convene. The Medical department specialized laboratory at the Thracian University invented an antitumorigenic medicine, Zichlomin, Zahari Raikov, Chief of the laboratory said. A mass production of the medicine has already began. It costs ten times less than the analogous foreign medicines. A contract for the joint production of the medicine is to be signed with a French pharmaceutical company.

[06] BULGARIA FILES ITS APPLICATION FOR FULL EU MEMBERSHIP

Madrid, December 16 (BTA Special Correspondent Atanas Matev) - "On behalf of the Bulgarian Government I have the honour to present Bulgaria's application for full membership in the European Union," reads a letter, signed by Bulgarian Prime Minister Zhan Videnov, which Bulgarian Foreign Minister Georgi Pirinski handed his Spanish counterpart Javier Solana, a current Chairman of the EU Council of Ministers, in Madrid today.

Today is the second day of the regular summit of the EU member-countries held in Madrid. Representatives of the East European associated countries were invited to attend the summit.

Bulgarian President Zhelyu Zhelev was present at the ceremony. According to insiders, visiting Madrid he wanted to show that regardless of some differences between the President's Office and the Cabinet on other foreign policy issues, there is a consensus between them as far as the country's EU membership is concerned. Today Minister Pirinski and President Zhelev flew to Madrid from the Varna Airport (on the Black Sea) due to the bad weather in Sofia. Prime Minister Zhan Videnov cancelled his visit to Madrid because of the debates on the 1996 national budget which opened in Parliament on Friday. This prompted different reactions in the national media, which highlighted the controversies between the ruling Socialists and President Zhelev.

"I am very glad that Mr Pirinski just presented officially Bulgaria's application. This is a great event for us. The most important thing is the consensus on this issue among all political forces, state institutions and, I think, all Bulgarian people. May it please God to reach such a consensus on Bulgaria's NATO membership and file our application in the nearest future," President Zhelev said after the ceremony.

Together with the letter Minister Pirinski handed a Government memorandum containing eight page reasonings behind Bulgaria's desire for EU membership. "There is a full consensus in the country on its willingness to join the EU, stated already in 1990 by the Grand National Assembly, and confirmed during the ratification of the agreement on Bulgaria's association with the EU two years later and at other occasions," the memorandum says.

"No new commitments are taken with this document, it is a formal statement of the decision which has already been repeatedly reached in principle," Georgi Pirinski said before Bulgarian journalists. He expects that negotiations on Bulgaria's application start in late 1997 or early 1998. "However, these negotiations are not likely to start before the end of the EU Intergovernmental Conference due in the end of March 1996 in Italy. At this conference the EU is to discuss and adopt its policy on enlargement through admission of East European countries," Pirinski said.

Bulgaria's chief diplomat recalled recent suggestions to divide the East European countries, which want to associate with EU, in groups prior to starting the negotiations. "Our position is quite clear and it is written in the memorandum: we insist that negotiations start simultaneously with all countries," he noted.

During the ceremony Javier Solana said he shares this view. He stated that the European Commission will come up with a statement for a simultaneous start of negotiations and a simultaneous presentation of the Commission's stand on the applications of the countries which want to become EU members.

Minister Pirinski rejected allegations that Bulgaria was late submitting its application. "We made this step after we were sure and confident enough that we may fully participate in the negotiations for association," he stated.

President Zhelev and Minister Pirinski were invited to lunches by the hosts: Zhelev with the other head of states and Pirinski with the foreign ministers. Before his opposite numbers Pirinski reiterated the reasonings behind Bulgaria's application for EU membership. Bulgaria's stabilizing role in the Balkans makes it a partner which will resolve and not create problems, he said.

[07] BULGARIA AND THE CZECH REPUBLIC SIGN FREE TRADE AGREEMENT

Prague, December 16 (BTA) Bulgarian Deputy Prime Minister Kiril Tsochev and Vladimir Dlouhy, Minister of Industry and Trade of the Czech Republic, signed a bilateral agreement for free trade in Prague yesterday. It takes preliminary effect as of January 1, 1996.

The agreement is complied with the Europe Agreement and the Central European Free Trade Association agreement and is analogous to the agreement signed with Slovakia on December 8, 1995. It provides the establishment of a free trade zone for industrial goods with almost full lifting of duties for a term of two years. Most industrial goods will be exempted from duty as of January 1, 1996 and duty will be lifted from the rest at three stages, from January 1, 1996 to January 1, 1998. Special regulations, complied with international agreements, will be applied to goods subject to a special trade regime: weapons, toxic and other hazardous substances and dual use goods.

The two sides agreed on comparatively low concessions for farm products. However preferences are expected to be increased as early as next year.

Bulgaria and the Czech Republic plan to establish a joint committee which will monitor the implementation of the agreement.

Deputy Prime Minister Tsochev, who is also a Minister of Trade and Foreign Economic Cooperation, is on a short visit to the Czech Republic. There he conferred with Deputy Prime Minister and Minister of Finances Ivan Kocarnik and Minister of Economic Competition Stanislav Belehradek.

In the talks Kiril Tsochev and the Czech Government representatives exchanged opinions on a wide range of economic issues. They agreed that the current state of bilateral commodity exchange does not correspond to the two countries' potentials. The two sides expressed their confidence that the signed agreement will create favourable conditions to reach the commodity exchange level of previous years. They expressed their willingness to accelerate the signing of the agreement on avoidance of double taxation and stimulation and reciprocal protection of investments which will define the legal framework for intensifying bilateral business contacts.

The first real step to promoting business partnership between companies was the establishment of a Bulgarian-Czech association for economic cooperation under the auspices of Mr Tsochev and Mr Belehradek.

The Czech side expressed its willingness to provide information and know-how about the system for export stimulation, crediting and guarantees applied in the Czech Republic. The hosts reiterated their readiness to offer experience and consultancy aid in the sphere of privatization. Bulgaria was promised assistance in its willingness to join the COCOM successor organization, New Forum.

[08] PRESIDENT ZHELEV TO VISIT PORTUGAL MONDAY

Sofia, December 17 (BTA) - Bulgarian President Zhelyu Zhelev opens a two-day official visit to Portugal on Monday. This is the first visit of a Bulgarian head of state there. Bulgaria established diplomatic relations with Portugal in 1925. In 1945 they were broken and then restored in 1974. Portuguese President Mario Soares was on an official visit to Bulgaria in September 1994.

European integration and Bulgarian-Portuguese relations will be high on the agenda of the talks between the two countries' presidents. They are also expected to discuss Bulgaria's commitments to the European organizations and its official application for full EU membership.

"Portugal's 21-year experience in transition from totalitarianism to democracy interests greatly Bulgaria," President's Advisor on Foreign Policy Kamen Velichkov said. Because of the fact that these two small European states are almost identical in many respects, the two heads of state are expected to discuss a wide range of issues.

President Zhelev's program envisages a visit to the Portuguese industrial association. The purpose is to promote bilateral trade and economic relations. During his visit the Bulgarian President will deliver a lecture at Universidade Moderna in Lisbon where he is expected to be elected honorary chairman of the university board.

Portugal is one of the few European countries with which Bulgaria has not yet signed bilateral treaty of friendship and cooperation.

The two countries signed a long-term trade agreement, long- term agreement on economic, industrial, scientific and cultural cooperation and agreements for interaction in transport and tourism. These agreements are effective. According to Bulgarian experts, regardless of the comparatively good legal framework, the level of bilateral commodity exchange is still low. This month's figures show that the 1995 commodity exchange is expected to be of the worth of some 12 million US dollars.

In May 1993 the then Bulgarian deputy prime minister and minister of trade Valentin Karabashev visited Portugal . During his visit the two sides signed a bilateral agreement on stimulation and reciprocal protection of investments. The drafting of a bilateral agreement on avoidance of double taxation is near completion, the Bulgarian Foreign Ministry said.

In the past few years the two countries have intensified bilateral dialogue in different spheres.

Portuguese Foreign Minister Jose Manuel Durao Barroso visited Bulgaria in June 1995.

Bulgarian Defence Minister Dimiter Pavlov was on an official visit to Lisbon in July 1995. In 1994 during the visit of Portuguese State Secretary for Defence Antonio Lopes the two sides signed a joined declaration on promotion of relations and cooperation in the filed of defence.

[09] PRESIDENT ZHELEV AND FOREIGN MINISTER PIRINSKI RETURN FROM MADRID

Sofia, December 17 (BTA) - Late last night President Zhelyu Zhelev and Foreign Minister Georgi Pirinski returned from the Madrid summit. There Minister Pirinski presented Bulgaria's official application for EU membership to Spanish Foreign Minister Javier Solana, who is the current European Council President. President Zhelev was present at the ceremony.

The Bulgarian President met with his Romanian counterpart, Ion Iliescu. The two of them discussed the construction of a new bridge across the Danube connecting Bulgaria and Romania.

The fact that the accord was frozen over a disagreement on the location of the bridge presents difficulties to the project's financing by the EU, Zhelev said. The Romanian President expressed the view that the end of the conflict in former Yugoslavia makes it unnecessary to build the bridge at Vidin- Calafat. This stand does not promise a quick settlement of the controversy.

President Zhelev also met with Lithuanian President Algirdas Brazauskas.

Bulgarian Foreign Minister Georgi Pirinski conferred with his counterparts from Romania, Tiodor Viorel Melescanu, Great Britain, Malcolm Rifkind and Sweden, Mats Hellstrom.

[10] FRENCH MINISTER BARNIER ARRIVES IN SOFIA

Sofia, December 17 (BTA) - Michel Barnier, French Minister Delegate for European Affairs arrived on a two-day visit here today. His program envisages meetings with President Zhelyu Zhelev, Prime Minister Zhan Videnov, National Assembly Chairman Blagovest Sendov, Foreign Minister Georgi Pirinski, a Bulgarian government delegation and Nikolai Kamov, Chairman of the Parliamentary Committee on Foreign Policy.

French support for Bulgaria on the road to European integration will figure on the agenda of the forthcoming talks. The issues about the EU enlargement and the assistance which may be rendered to the associated countries were discussed in details by President Zhelev and French President Jacques Chirac in Madrid, Barnier said upon arrival. He stated that his talks with Bulgaria's government officials will also focus on these topics. Security in the region will be in the highlights of the discussions, the French guest said.

Since the establishment of diplomatic relations between Bulgaria and France in 1879 the past five years saw an unprecedented activation of bilateral political contacts. Former French president Francois Mitternad visited Bulgaria twice: in 1989 and 1994. Apart from his official visits to France in 1992 and 1994, Bulgarian President Zhelyu Zhelev attended the Paris summit of Francophone states, the celebrations of the anniversary of the rescue of the Bulgarian Jews in 1994 under the UNESCO auspices and the 50th anniversary of the end of WW II in 1995. In May 1995 the Bulgarian President was in Cannes for the summit of the EU member and associated countries.

This year Bulgarian Foreign Minister Georgi Pirinski paid two visits to France: in March he took part in the International Conference for Stability in Europe and on December 13 and 14, in the Paris peace conference for Bosnia and Herzegovina.

This is the second visit of a French minister delegate to Bulgaria. In 1993 the then French minister delegate for European affairs Allain Lamassoure visited Bulgaria. Then he made the suggestion for equal treatment of the countries willing to integrate into the European and Euro-Atlantic structures.