Bulgarian Telegraph Agency (BTA), 96-11-22

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

EMBASSY OF BULGARIA - WASHINGTON D.C.

BTA - BULGARIAN TELEGRAPH AGENCY

22 November, 1996

CONTENTS

[01] CEI, BLACK SEA COUNTRIES' TRANSPORT MINISTERS MEET

[02] U.N.D.P. CONSIDERS 1997 HUMAN DEVELOPMENT REPORT ON BULGARIA

[03] BULGARIAN DEFENCE MINISTER ENDS AUSTRIAN VISIT

[04] INCOME TAX CHANGES

[05] NOTARIES ACT PASSED

[06] SOFIA AND MOSCOW CITIES STRENGTHEN COOPERATION

[07] THREE NEW BORDER CROSSING POINTS WITH GREECE

[08] IAEA SEES PROGRESS AT KOZLODOUI N-PLANT

[09] FIVE MINISTRIES REPORT PRIVATIZATION PERFORMANCE

[10] INTERNATIONAL COOPERATION IN INDUSTRY

[11] NEW BUDGET UPDATE?

[12] GDP SLUMPS BY 8%

[13] PUBLIC-SECTOR ENTERPRISES SHOW PROFIT

[14] BULGARIAN LEV SLUMPS FURTHER

[15] BULGARIAN FOREX MARKET ON VERGE OF COLLAPSE?

[16] BULGARIA - FREEMASONS

[01] CEI, BLACK SEA COUNTRIES' TRANSPORT MINISTERS MEET

In his address to the forum this morning Prime Minister Zhan Videnov said the Central and Eastern European countries are gaining importance as a transit region for travellers, goods, energy sources and information exchanged between the powerful economic potentials of Western Europe and the Middle East, between the Mediterranean and Russia, Ukraine and the Caucasus. Videnov stressed that integration in Europe is a key priority of Bulgarian politics. In his view the Sofia forum opens up new prospects for multilateral economic cooperation among the BSEC and CEI countries, as well as for modernization and infrastructural links between the region, its adjacent regions and trans-European infrastructure.

The participants will discuss the development of transport infrastructure in the context of European and regional integration and cooperation under the PHARE and TACIS programmes. Other subjects for discussion are the planning and construction of international transport corridors in the BSEC and CEI regions, the financing of transport projects and private sector participation in them.

A Sofia-based trans-regional centre for transport infrastructure is expected to be set up at the end of the conference. It will be instrumental in promoting peaceful integration and facilitating the exchange of people, goods and information through coordinated construction of infrastructure networks and systems.

[02] U.N.D.P. CONSIDERS 1997 HUMAN DEVELOPMENT REPORT ON BULGARIA

"Economic reforms do not concern the economy only," UNDP Resident Representative to Bulgaria Antonio Vigilante said. In his view, the question Bulgaria should find the answer to is whether the reforms will help evolve more efficient forms for achieving social integrity. "Bulgaria's bitter experience of inadequate, untimely and often badly implemented economic reforms shows that their social aspect can be frustrating," Vigilante said. Using social integrity as a starting point, the 1997 Human Development Report on Bulgaria will focus on the social context and the effects of the social reforms, according to Vigilante.

The seminar was attended by representatives of the UNDP, the Food and Agriculture Organization, the UN Economic Commission for Europe, UNESCO, the International Labour Organization, Bulgarian Government officials, representatives of the Bulgarian academic circles and non-governmental organizations.

[03] BULGARIAN DEFENCE MINISTER ENDS AUSTRIAN VISIT

"Bulgaria wants to take part in a follow-up peace implementation force (IFOR) in Bosnia and hopes that Austria will give it political support," Defence Minister Pavlov said at yesterday's talks with his Austrian counterpart. He was on a two-day visit to Austria at the head of a Bulgarian military delegation. "Bulgaria's possible participation in IFOR2 will be consistent with its principled position on the crisis in former Yugoslavia," he said. If Bulgaria receives the financial support it needs, it may send a company as part of the Austrian contingent which will be under British command along with Belgian and Dutch troops. If the initiative is approved, Bulgarian troops will train at Austrian centres prior to participating in international peacekeeping operations. Minister Pavlov expressed his satisfaction with Austria's readiness to provide support and described his visit to Vienna as "very successful".

[04] INCOME TAX CHANGES

Implementing Regulations for the Profits Tax Act, which the Council of Ministers adopted today, provide for tax concessions for privatized enterprises, foreign juristic persons and national cooperative unions.

To qualify for tax breaks, privatized enterprises must be more than 67 per cent privately owned and must reinvest 50 per cent of their profit in tangible fixed assets, Mr Slavkov said.

Concessions will also be available to foreign investors which contribute at least 5 million dollars to joint ventures and plough back 50 per cent of their profit in fixed tangible assets used for production. Purchase of motor cars, stationery etc. will no longer be treated as tax- deductible costs, Mr Slavkov said.

[05] NOTARIES ACT PASSED

The Notaries Act decentralizes notarial services in Bulgaria and eliminates red tape and sloppy services in this sphere. The passage of this legislation updates the regulations for notarial proceedings. It is expected to improve the legal security and efficiency of notarial services and to stabilize the real estate market.

Under the Act, a notary position may be established within an area of 25, 000 population. If there is no notary in the area, notarization will be effected by the recording judge with the competent district court. If there is no district court, either, documents will be authenticated by the mayor of the population centre. Bulgarian diplomatic and consular agents will also be vested with such powers. The rates of notarial fees will be set by a schedule proposed by the Notarial Chamber and approved by the Government. Notaries will incur pecuniary liability under the Obligations and Contracts Act for loss or injury inflicted through failure to discharge their duties.

[06] SOFIA AND MOSCOW CITIES STRENGTHEN COOPERATION

[07] THREE NEW BORDER CROSSING POINTS WITH GREECE

Crete Corridor Number Nine will pass through Alexandroupolis and Komotene on Greek territory and through Makaza, Momchilgrad, Kurdjali, Haskovo and Dimitrovgrad on Bulgarian territory.

Corridor Number Two will run via Drama (Greece) to Sadovo and Gotse Delchev (Bulgaria).

Corridor Number Three will pass through Xanthe on Greek territory and through Roudozem, Smolyan and Plovdiv on Bulgaria territory, experts said.

A 1,080-meter tunnel will cross the Bulgarian-Greek border near Makaza. The tunnel will have four lanes. The Bulgarian section will be 540 meters long and its construction will cost 17 million US dollars. The Greek section will cost 20 million US dollars.

The projects on the building of Corridor 2 and 3 are of the worth of 7 and 10 million US dollars, respectively.

[08] IAEA SEES PROGRESS AT KOZLODOUI N-PLANT

Kozlodoui Manager Kiril Nikolov made a review of the condition of the plant's nuclear capacities and their readiness to operate in the winter period. The implementation of the program on the enhancement of the reactors' safety was high on the agenda of the talks, the correspondent said referring to Kozlodoui's press office. The guest expressed satisfaction with the obvious progress of the operational culture of the N- plant.

[09] FIVE MINISTRIES REPORT PRIVATIZATION PERFORMANCE

During the same period, the Ministry of Agriculture has effected 64 privatization transactions in crop and animal husbandry, meat packing, canning, animal-feed production, dairy processing, wine-making and agricultural engineering services. Thirteen of the entities were privatized through employee-manager buyouts. The transactions brought nearly 2,000 million leva to the public purse. The new owners undertook to repay 874 million leva owed by the enterprises and to invest 3,652 million leva.

The Ministry of Regional Development and Construction reported 66 concluded privatization deals. Of 26 whole enterprises that passed into private hands, 22 were sold to their own workers and managers. The proceeds from the transactions brought the Treasury 317,678,000 leva last year and 180,000, 000 leva by November 15, 1996.

The Ministry of Trade has made 163 privatization contracts since the start of last year. Of 15 whole enterprises sold, nine went to their employees. Another 20 privatization transactions are expected to be closed before the end of the year, to an overall value of 300 million leva.

Between January 1995 and October 30, 1996, the Ministry of Industry sold to private investors 65 whole enterprises in the light, mechanical engineering, electrical engineering, woodworking, furniture- making and chemical industries worth 2,643,000,000 leva in all.

[10] INTERNATIONAL COOPERATION IN INDUSTRY

Bulgarian pharmaceuticals, fertilizers, oil products and ferrous metals sell very well on the European and international markets. As the Bulgarian ferrous metals are a highly competitive commodity, the European Union (EU) imposed protective quotas for export of such metals, as for instance the limit of 560,000 t of steel exports.

One of the priority objectives in the international activities of the Industry Ministry is to regain the Bulgarian position on the markets of the former Socialist countries, Dachev said. The signing of an agreement establishing free trade zones between Bulgaria and Slovenia, and the drafting of similar agreements with the Czech Republic, Slovakia, Poland and Hungary, are some of the tangible results of the efforts of the Bulgarian Industry Ministry in this respect. Bulgarian and Russian officials are holding negotiations to increase the joint production of electronic cash registers. Russia is also interested in privatization deals in the pharmaceuticals sector, the mining and machine engineering industries.

The sides are working on granting customs duties reliefs to Bulgarian goods imported in Russia. The major problems in this respect arise from the fact that Russia places Bulgaria in the group of developed countries whereas states such as Turkey, Macedonia and Romania are included in the group of developing countries thus granting lower customs duties to their goods, Dimitrov said.

Liberalizing of import customs duties on EU products is another major task of the Industry Ministry in international aspect. Under agreements concluded in the early 1994, most of the Bulgarian goods imported in EU member states are exempt from customs duties. Bulgaria for its part has committed itself to liberalize the import of European commodities here, Dimitrov said. Raw materials and components imported from the EU are exempt from customs duties. Customs duties on imported cars will be lifted by 1998. Customs duties will continue to be imposed on European knitwear products and household appliances so as to provide maximum protection to the Bulgarian producers of such goods. Under the agreements, all duties on the import of EU industrial products will be lifted by the year 2002.

The Bulgarian Information Industry Association asked the Industry Ministry to submit a proposal to the Council of Ministers to limit the import of computers and TV sets in Bulgaria and to encourage the assembly of such appliances here through granting customs duties reliefs on imported components, Dimitrov said.

[11] NEW BUDGET UPDATE?

[12] GDP SLUMPS BY 8%

The GDP is expected to reach 1,700,000-1,750,000 million leva in current prices by the end of the year. This is between 8% and 10.5% down from 1995. Production has dropped in all sectors, the drop in agriculture being the steepest - by around 25%, Karamfilov said.

The NSI projections for 1997 are a GDP of 3,800,000- 3,900,000 million leva. The drop in production is expected to continue but to be considerably less than this year - between 2% and 4%.

[13] PUBLIC-SECTOR ENTERPRISES SHOW PROFIT

[14] BULGARIAN LEV SLUMPS FURTHER

The BNB Governing Board had a several-hour-long meeting without adopting any decision concerning the emergency on the currency market. The Governing Board will meet tomorrow again. "Obviously some measures must be taken and they will become known on Friday," a high-ranking BNB official told reporters. The Governing Board will meet tomorrow morning, and the Plenary Council will gather in the afternoon to accept the report of the auditors Deloitte & Touche.

Today 10,124,435 US dollars were bought and 16,141,487 US dollars were sold on the interbank market, the BNB said.

Dealers say that today the forex market was characterised by uncertainty and emotions. The market opened at 320 leva/US dollar 1 "buy" and 350 leva/US dollar 1 "sell". By noon the dollar rallied further, reaching 360- 390 leva. According to dealers, BNB did not intervene on the market. The reason for the further strengthening of the dollar is probably the fact that people have been drawing huge amounts from their bank accounts to exchange them for US dollars.

[15] BULGARIAN FOREX MARKET ON VERGE OF COLLAPSE?

Difficulties on the Bulgarian forex market began with the drastic hike of the base interest rate from 108% to an unprecedented 300% in late September aimed at boosting confidence in the national currency. The subsequent reductions of the base interest rate to 240% and to its present level of 180% sent the dollar soaring. The movement of the US exchange rate was restricted by central bank interventions.

Greenbacks became a stronghold for ordinary Bulgarians, "Standart News" writes. Lack of sufficient information on the currency board and contradictions between politicians made thousands of Bulgarians withdraw their savings even from state guaranteed deposits and to convert them into dollars. Some 40,000 million leva were withdrawn from the commercial banks over the past six weeks and used to buy US dollars. Strong demand on the cash market pushed up the dollar bringing the interbank trade to a standstill. Foreign exchange bureaux broadened their margins taking advantage of the fact that dollars are in demand at any price as people try to salvage at least part of their savings.

[16] BULGARIA - FREEMASONS

The first Bulgarian Freemason was archimandrite Efrem, who was admitted to the French Grand Orient in Chishinau, Romania, in 1820. The first Bulgarian masonic lodge was set up in Bitolja. On March 2, 1914, the lodge, called Zarya (Dawn), joined the Grande Loge Nationale Francaise. That April it moved to Sofia. On November 27, 1917 it was separated and transformed into a grand lodge, uniting Zarya and Svetlina.

BTA's Varya Bozhkova spoke with Echouat about Freemasonry in Bulgaria. "Freemasonry here was banned by the Law on the Defence on the Nation in 1940" Echouat said. "After nearly 50 years, it came back to life." Echouat compared Freemasonry to a laboratory of thought which functions on principles traceable in the Bible. Every year, Bulgarian Masonry goes to the Grand Orient convention in London. Since 1992 this country's two lodges have operated regularly, organizing various events for the public good. Some sources say Bulgarian Masons most probably number 500. Around 15 to 20 Bulgarians are members of foreign lodges.

"In 1992 the society organized training in France for Bulgarian anesthesiologists. They had a chance to work at French hospitals. In 1994 it sponsored a charity concert for orphans, the Magic Flute, raising a substantial amount of money," Echouat also said. Another, larger-scale campaign was organized with help from a French teachers' union: donating 20, 000 volumes of French textbooks and other literature to Bulgarian students.

"Now we are organizing the student competition [on the Declaration of the Rights of the Person]. We chose this subject for several reasons," Echouat said.

"As your know, the Declaration of the Rights of Man was adopted in 1789 by the National Convention. It had 1,200 members, of which 500 Masons. The declaration influenced many subsequent developments. It a great achievement. Also, Bulgaria has applied for membership in the European Union and is a member of the Council of Europe. Students are Bulgaria's future. They are motivated to participate by the big prizes (140,000 leva for the winner). We think Bulgarian students are this country's most objective intellectuals. We think the competition is a way to inform Bulgarian society of the future of the European Union. There is no better way than doing it through students. Some journalists attacked us for 'buying students'. This is not true. We think these are normal European prizes and there is no sense in underrating Bulgarian intellect just because Bulgaria is going through an economic crisis."

"Clearly, the competition promotes Masonry is some way, but taking into account all the libel against us, I think this is a good answer to the spiteful books flooding Bulgarian stalls." According to Echouat, Masonry in Bulgaria is not developing as fast as in other Eastern European countries. Its development here is chaotic, whereas it is doing very well in the Czech republic and never ceased to exist in Hungary. "Bulgarians are cautious, they think issues over for a long time, but Bulgarian masonry will be solid and good, like it was in the past. We are very careful not become part of a political trend, because Masonry stands higher than politics and philosophy."

"What are your main goals?"

"You know that you cannot apply for membership, you have to be invited. The lodge is a place where people of different beliefs who respect each other can discuss issues and seek solutions. We are officially recognized in Bulgaria and in this sense have a freedom of action," Echouat said. Svetlina was officially registered in a Sofia court in 1992 as a philosophical society.

"We are planning to set up groups where people can ask all kinds of questions about Masonry. Answers will be based on facts alone, and if interest persists, a decision to accept a person will be taken on the basis of their worth to the organization and its worth to them."

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