Bulgarian Telegraph Agency (BTA), 97-03-14

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

EMBASSY OF BULGARIA - WASHINGTON D.C.

BTA - BULGARIAN TELEGRAPH AGENCY

14 March, 1997

CONTENTS

[01] CABINET ENDORSES PROGRAMME FOR INTEGRATION IN NATO

[02] BULGARIANS IN TIRANA TO BE EVACUATED

[03] BULGARIA CLOSES 12 OVERSEAS TRADE MISSIONS

[04] IMF SEEKS REITERATED SUPPORT FOR FUTURE DEAL FROM POLITICAL FORCES

[05] INTRODUCTION OF CURRENCY BOARD CERTAIN

[06] NGO FINDS NO PROGRESS ON HUMAN RIGHTS IN 1996

[07] IN BRIEF

[08] SUMMER TIME FROM MARCH 30

[09] SOCIAL SERVICES GET WORLD BANK SUPPORT

[10] GRAIN SUPPLIES KEEP ARRIVING

[11] HUMANITARIAN AID FOR BULGARIA

[01] CABINET ENDORSES PROGRAMME FOR INTEGRATION IN NATO

The national programme for integration with NATO envisages intensified political dialogue with the organization, political preparation of the country for NATO membership, accelerated adoption of NATO standards in the field of security and defence and a massive education campaign about the nature of NATO.

It is planned to implement special measures for improving the interoperability of the armed forces of Bulgaria and NATO and developing military industrial cooperation with the members of NATO. "NATO does not require rearmament of applicant countries," the Defence Minister said pointing out, however, that Bulgaria should start to introduce the standards of NATO in its military industry.

[02] BULGARIANS IN TIRANA TO BE EVACUATED

Tirana Airport may be closed, the Foreign Minister fears. Three aircraft of the Hemus Air Bulgarian Aviation Company are there, ready to fly the Bulgarian citizens home. The Foreign Ministry has issued directions to seek the assistance of other embassies as well if necessary, Mr Stalev said.

[03] BULGARIA CLOSES 12 OVERSEAS TRADE MISSIONS

The trade and economic services slated for closure are in Santiago, Chile; Caracas, Venezuela; Manila, the Philippines; Bangkok, Thailand; Kabul, Afghanistan; Dhaka, Bangladesh; Khartoum, Sudan; Sana'a, Yemen; Lusaka, Zambia; Kinshasa, Zaire; and Accra, Ghana.

Bulgaria will have a single trade representative in Vienna, London, Bonn, Washington D.C., Warsaw, Prague, Budapest, Istanbul and Tripoli. A total of ten trade representatives will represent Bulgaria in the Commonwealth of Independent States.

Last week the Ministry of Foreign Affairs made reduced the staff of its missions in Ethiopia, Uruguay, Peru, Colombia, North Korea, Nicaragua and Cambodia without affecting diplomatic relations with those countries or altering the status of the Bulgarian missions there. These staff cuts were also motivated by the need to reduce public spending. Last week Foreign Ministry Spokesman Radko Vlaikov said the Ministry will shed 30 per cent of its jobs on financial considerations.

[04] IMF SEEKS REITERATED SUPPORT FOR FUTURE DEAL FROM POLITICAL FORCES

The IMF official told reporters that his talks with representatives of the political forces so far have led him to believe that everybody wants an early achievement of agreement with the IMF. "There is concern over what will be agreed, and we are trying to sort out these matters," Mr Deppler said. He does not think political leaders have serious objections to the agreement but the process of its finalization "is not yet nearing an end."

The leader of the until recently ruling Bulgarian Socialist Party Purvanov and former trade minister Paparizov expressed to the IMF mission support in principle for the agreement and stabilization programme which are in preparation. Whatever the results of the forthcoming early general elections, success of the reforms will require consensus, the BSP leaders confirmed. The BSP leader reiterated the position that the Socialist Party will support all efforts of the caretaker cabinet towards reaching an agreement with the IMF covering stabilization as well as structural adjustment. Mr Paparizov asked whether banks will be recapitalized in addition to financial stabilization, whether the problem of the public debt will be solved before or after the introduction of a currency board, and whether the structural reform will be sufficiently comprehensive.

After seeing Wednesday evening the leader of the Union of Democratic Forces (UDF) Ivan Kostov, both Mr Deppler and Mr Kostov declined to comment on the content of their conversation. Public opinion polls suggest that the UDF will hold a majroity in the future parliament. In a lecture delivered at the Technical University here Tuesday, Mr Kostov declared himself in favour of the introduction of a currency board. He stressed that what matters most now is to regain the international financial institutions' confidence in Bulgaria. The currency board will eliminate the insecurity, and foreign investors will definitely come, the UDF leader said in his lecture. He stressed that it is inadmissible to talk of a suspension of payments on Bulgaria's foreign debt. In his view, in order to service its debt Bulgaria needs refinancing and partial rescheduling of payments in 1998.

"We asked for relaxation of some of the harsh clauses in the agreement, arguing that the situation in Bulgaria is improving," the leader of the Democratic Party Stefan Savov said after conferring with Mr Deppler. The IMF officials were hardly persuaded but Mr Savov hopes that the facts speak for themselves, he told reporters. He cited the stabilization of the exchange rate and the appreciation of the Bulgarian Brady bonds. He also sees rising confidence in the government, which is essential for economic reform. "I was glad to hear that Bulgaria may feel the change in a couple of years' time," Mr Savov said.

Michael Deppler explained the IMF positions on the future agreement, stressing that a currency board alone can improve things in Bulgaria. He did not discuss any specific parameters of the programme with the political leaders. The IMF will be discussing the details with the government, and it if the government so decides it can discuss them at a broader forum.

[05] INTRODUCTION OF CURRENCY BOARD CERTAIN

In spite of the lev's edging up against the US dollar in the past few weeks the country has not yet achieved the financial stabilization needed, Sofiyanski says. According to him, the lev's levelling up at rates of about 1,500-1,800 leva/US dollar 1, down from 3,000 leva/US dollar 1 in early February, was due to two factors. First, the expectations for external financing and the establishment of relative public peace and trust owing to the beginning of the structural reforms. In Sofiyanski's view the liberalization of prices also influences the foreign exchange market.

Further financial stabilization depends on what agreements will be reached with the international financial institutions and on the privatization deals, Sofiyanski says. The cornerstone will be the realization of the deal on the privatization of the Sodi chemical works in Devnya (Northeastern Bulgaria). The Prime Minister recalled that the deal on the sale of Sodi to the Solvay company should have been completed by the end of the month but there is still no decision of the Italian anti-trust commission. "We cannot influence the Italians. We can only be sorry that in such a moment when all countries are assisting us this decisions has been twice postponed," says Sofiyanski.

The Prime Minister says there have been certain differences between the Government and the central bank and this influenced the negotiations with the International Monetary Fund. He specifies that the differences concern the ideas how to rehabilitate the banking sector.

In his interview for "24 Chassa" Sofiyanski also motivates the decision not to grant concessions on the gas pipelines. In order to grant a concession the Bulgarian side should guarantee that there will be gas going through the pipelines, Sofiyanski says. "However, to do so we need to clarify the position of the gas supplier- the Gazprom Russian company. This is why we decided that it is better to sign a bilateral agreement, under which the Bulgarian side will undertake to fund the construction of the gas pipeline and the Russian - to provide the gas," he adds. Sofiyanski is categorical that the Government decision will not violate the Constitution or the Concessions Act.

[06] NGO FINDS NO PROGRESS ON HUMAN RIGHTS IN 1996

Despite the independence of the judiciary, the BHC finds certain departures from European human rights standards, such as the lack of judicial control over the dismissals of certain categories of office holders, the lack of legal guarantees of the admission of a lawyer at the preliminary investigation stage, and the denial of access to legal counsel upon committal to reform school. Still, certain sources connected to the judiciary suggest that this cannot apply to 100 per cent of cases in these three categories.

Bulgarian laws regulating freedom of speech, including the Constitution, are stricter than the standards set by the European human rights conventions, the report notes. The national media came under tightened control in 1996. The report details cases of dismissal of journalists from National Radio and National Television and several cases of penalties against journalists who criticized public prosecutors.

There is discriminatory intervention of central and local authorities in the internal life of religious communities, the report claims. Cases of denial of custody to members of specified religious communities and criminal prosecution of conscientious objectors are cited as instances of discrimination. The report criticizes also excessive use of force by the law-enforcement authorities, the prison conditions, invasions of privacy and violations of domicile and of the confidentiality of correspondence.

[07] IN BRIEF

THE DEMOCRACY NETWORK PROGRAM, financed by the U.S. Agency for International Development, will present its Third Grant Round at a one-day seminar on March 22. Bulgarian organizations working in environmental protection, economic development, democratic development and social protection will be informed about opportunities to get financial support. In the first two rounds direct project financing totalled 550,000 dollars, with an additional 50,000-plus dollars for training and technical assistance to over 70 NGOs.

THE SOFIA CITY COUNCIL voted on Thursday a threefold rise in water charges to 149 leva/cu m from 50 leva/cu m. Kindergarten fees were increased nearly tenfold and were linked to the minimum wage. The monthly kindergarten fee was raised to 5,280 leva, or 30 per cent of the minimum wage.

[08] SUMMER TIME FROM MARCH 30

[09] SOCIAL SERVICES GET WORLD BANK SUPPORT

Revenues in the state-financed sector before the introduction of a currency board were discussed last week by Neikov and IMF Mission Leader Anne McGuirk. Income protection is part of the framework of a forthcoming agreement with the IMF, said Neikov. The sides largely agreed on all estimates in the draft agreement, he said.

[10] GRAIN SUPPLIES KEEP ARRIVING

Bulgaria is getting this grain on rather liberal terms, the Commercial Counsellor said. It has to be returned in a one-to-one ratio from the new harvest.The Cabinet set the selling price of Polish grain at 150 US dollars/tonne.

France will also provide 3,650 t of flour in grant aid, meeting the transportation costs.

A total of 29.6 million US dollars of the unutilized 39.6 million dollars of the Private Investment and Export Finance (PIEF) Loan extended by the World Bank in 1993 will be spent on import of bread wheat, the Government decided Thursday.

Despite the difficulties caused by the higher prices of fertilizer, Bulgaria expects to be able to export 250,000 t of grain in 1997, said the Secretary to the President for Agricultural Affairs Vassil Tsakov.

[11] HUMANITARIAN AID FOR BULGARIA

The "Der Bundt" newspaper on Thursday ran a pageful of articles on the crisis in Bulgaria. It said the country, a former major wheat producer, is faced with starvation.

Mesdra, Montana, March 13 (BTA) - The chairman of the Bulgarian-German Forum and former MP Valentin Vassilev today delivered to hospitals in Mezdra and Montana (western Bulgaria) medicines and consumables worth 5 million leva. The humanitarian assistance from Germany, which arrived with help from the German embassy in Sofia, includes blood transfusion systems, surgical thread, needles and other lifesaving materials.

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