site.btaMedia Review: October 11

BULGARIA-GREECE-ROMANIA TRILATERAL MEETING IN CONTEXT OF UKRAINE WAR

“The Transport Corridor of the War Passes through Bulgaria,” reads the headline of Capital’s main online story. The article analyses Monday’s trilateral meeting between the government leaders of Bulgaria, Greece and Romania in the Euxinograd residence, located on the Bulgarian Black Sea coast. The event was recognized by the European Commission (EC), as it was attended by EC Vice-President Margaritis Schinas and Transport Commissioner Adina Valean. The goal of the meeting was not only to initiate a dialogue in the Balkans, but also to sign a memorandum between the three countries that would pave the way for the economic prosperity of the region, boost the region's readiness for a fast and smooth transfer of goods, cargo and even military equipment, if necessary - from the Aegean, through the Black Sea to the Baltic Sea. 

Road and rail links will finally connect the region instead of dividing it. All three prime ministers condemned both the attacks in Israel and the ongoing Russian invasion of Ukraine, now in its second year. Romanian Prime Minister Marcel Ciolacu mentioned that Russia is increasingly attacking infrastructure in Ukraine close to the border with Romania. "We need to find a common strategy within NATO to avoid such attacks," he said. "Together we will be able to change the speed at which things happen. We must not miss opportunities - the costs associated with war affect us all. We need to secure services, access to energy that is as cheap as possible for the region," Greek Prime Minister Kyriakos Mitsotakis added. 

It is only natural that this happens through the construction of quality infrastructure. The main focus of the talks was on regional connectivity, in particular the corridor project from Thessaloniki via Kavala, Alexandroupolis, Burgas and Varna to Constanta with the possibility of an extension to Moldova, as well as other joint initiatives. This corridor is also key from a military strategic point of view, as it would allow the rapid transfer of military equipment from Greece and Turkiye (respectively their ports) to Romania, which could be a possible point of conflict with Russia, if the war against Ukraine escalates.

"We discussed the development of the south-eastern European region in terms of energy, transport and digital connectivity, which is related to what is happening in Ukraine and Israel. Europe can no longer afford to be disconnected, to have no roads connecting neighbouring countries, to have no energy connectivity and thus to be dependent on external factors," Bulgarian Prime Minister Nikolay Denkov said. He stressed that the region needs an approach to reach out to more developed countries but also to be an example for developing countries outside the EU. 

Romania can also brag with efforts in that direction. The Romanian Government approved a EUR 300 million project to modernize the port of Constanta in September. The funds are coming from the EU, with 2026 as the implementation deadline. Prime Minister Ciolacu stressed the important role his country has played since the start of the Russian war against Ukraine in transporting goods and receiving refugees. He drew attention to the need to improve transport connectivity with Bulgaria through a third bridge over the Danube at Ruse and the widening of the riverbed (part of the Fast Danube programme). Ciolacu also mentioned that the Ruse-Giurgiu ferry is expected to be launched soon, and additional border crossings could be considered, similar to the ones being opened at the border with Ukraine. EU Transport Commissioner Valean added that the EU is funding such ventures, as well as the construction of car parks and buffer zones (a long-standing problem on the Bulgarian side of the Danube). 

Bulgaria was modest with its requests in view of this context. Bulgaria has one of the least developed rail networks and is far from meeting European transport connectivity targets. After the start of the Russian war against Ukraine, Romania managed to divert almost all Ukrainian grain cargo through the country, while Bulgaria did not react - it did not modernize and expand the port of Varna in time. However, Valean announced that the EC has already proposed a revision of the main trans-European corridors (Trans-European Transport Network (TEN-T)) and the inclusion of a new corridor - from the Baltic, through the Black Sea to the Aegean, which would include Bulgaria. "My dream is also for Bucharest, Sofia and Athens to have high-speed connections," Valean added. 

In the context of the EU's efforts to reduce dependence on Russian fuels, Europe's energy map has been changing very rapidly over the past year. Of the prime ministers' statements in that regard, the strongest seemed to be those of Greek Prime Minister Mitsotakis. "We discussed the crucial importance of our cooperation within NATO, as well as the development of the oil pipeline project between Bulgaria and Greece," said the Greek Prime Minister. He added that Greece has an ambition to play a central role in energy connectivity not only between the two neighbouring countries, but also to guarantee energy security for the whole of Eastern Europe (including the transmission of fuel to Moldova. "Soon the floating terminal in Alexandroupolis will be opened, we want to turn the whole region into a centre of connectivity and green energy transmission," Mitsotakis said, warning that this was linked to the development of the electricity grid in the neighbouring countries.

Greece has also embarked on a strategy to develop its ports (Igoumenitsa and Thessaloniki) to become a transit hub in Southeast Europe. For the time being, it will not proceed with the concession of the port of Alexandroupolis but will try to develop it on its own, looking for opportunities to export Ukrainian grain from there.

Expectedly, the Romanian Prime Minister, who unlike Bulgaria has a much more aggressive policy towards the Schengen blockade [to Bulgaria's and Romania's accession to the border-free area], raised the painful for his country topic of Schengen. "Romania has been fulfilling all the technical requirements for more than ten years now. Bulgaria's recent efforts to close all open cases regarding the rule of law are now concluded. The Commission also recognizes this, and we hope that in the next period we could discuss practically both with the Commission and the European Parliament, but also between the two countries involved," said Ciolacu.

EC Vice-President Schinas expressed hope that a positive decision on Schengen membership for Bulgaria and Romania would be taken by the end of 2023. He added that he was going to Vienna the same afternoon to meet Austrian Chancellor Karl Nehammer and was "keeping his fingers crossed" for positive progress. According to Schinas, this would improve the control of the EU's external borders as well as the collective security of the Union.

For the first time, Greek Prime Minister Mitsotakis also expressed a firm position that Greece is interested in this issue to be resolved, because it affects both the trade between the two countries and has an important role for tourism in his country. "I will try to argue to my colleagues who still have doubts," Mitsotakis said.

Asked whether Bulgaria and Romania are already discussing follow-up actions in case of a possible new Schengen rejection (including to Ciolacu's threats of lawsuits in the EU Court of Justice or demanding compensation for lost business benefits), both prime ministers said that they are currently working to achieve a positive outcome by the end of the year but will discuss further how they will proceed if needed.

POLITICS

Telegraph and 24 Chasa quote an excerpt from Prime Minister Denkov's Facebook Q&A session on Tuesday about the support from GERB and the Movement for Rights and Freedoms (MRF) that is necessary to have a governing majority. Denkov said: "Some of the changes - in the Constitution and the regulators - require a qualified majority. Without GERB and the MRF we cannot secure this majority. I would accept support from the other parties, but they have adopted the stance of being a rigid opposition, very often aggressively anti-European, which cannot bring us together in common decision-making. Many decisions can be made without the MRF, but the more support there is, the better". Denkov quoted a Chinese proverb, which says that the colour of the cat's fur is of no importance, as long as the cat itself can catch mice. He then addressed the Bulgarian Socialist Party (BSP) and There Is Such a People (TISP) from the opposition and asked them to consider whether they want new elections that may lead to a GERB- and MRF-dominated government.

UPCOMING MAYORAL ELECTIONS

An article in 24 Chasa reports on some of the biggest donors behind the Sofia mayoral candidates. The donors reported to the Bulgarian National Audit Office include former Google Vice President Bogomil Balkansky, who donated BGN 179,040 for Continue the Change - Democratic Bulgaria's (CC-DB) campaign, and Plamen Monovski, who contributed with another BGN 64,151. The largest single donation, BGN 200,000, was made to independent candidate Radostin Vasilev's campaign. GERB, the MRF and Vazrazhdane have reported no donations. The BSP and TISP reported donations worth BGN 16,500 and 47,850 respectively.

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The company Ciela Norma has submitted an offer that exceeds by almost BGN 3 million the maximum set by the Central Election Commission (CEC) on the public procurement related to the machine voting in the upcoming local elections, bTV said quoting the Bulgarian National Radio (BNR). Ciela Norma is the only company to submit a bid in the competitive procedure, and a CEC working group is leading the negotiations.

CEC Vice-chairperson Emil Voynov said: "The Commission did not accept the price offered. On two occasions the CEC requested new offers from Ciela Norma. As a result of the negotiations, the bidder reduced the original price by about BGN 200,000. The final proposal of Ciela Norma for the first round is BGN 7,397,975, and the price for the second round will be determined on the basis of the actual activities carried out in proportion to the number of polling stations that will hold a second round".

The CEC is expected to announce whether it will conclude a contract with Ciela Norma after the Committee's meeting on Wednesday.

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Independent mayoral candidate in Sofia, Radostin Vasilev, discussed his competition in Nova TV's morning talk show. Vasilev said: "My main motivation to run in the local elections came when I saw the candidate of CC-DB [Vasil Terziev], Vili Lilkov [raised by the Blue Sofia coalition] and Vanya Grigorova [raised by the BSP], because they do not represent a real alternative to the existing model of governance of the capital. I would support Grigorova and [Vazrazhdane's] Deyan Nikolov in a run-off. It would be much better for Sofia, if neither Hekimyan [raised by GERB-UDF] nor Terziev was mayor.

Vasilev believes that the election in Sofia will end in a run-off. If the candidates left there are Hekimyan and Terziev, that according to Vasilev would spell "a downfall for the city", and he would call on his supporters to skip voting. He described Bulgaria's capital as GERB's cesspool of corruption and vowed to never collaborate with GERB leader Boyko Borissov or Delyan Peevski MP of the MRF.

ECONOMY

Capital reported that the International Monetary Fund (IMF) is yet another institution that in the last few weeks has raised its inflation expectations in Bulgaria. In its latest macro forecast, the IMF puts the country's annual average inflation at 8.5% this year and 3% in 2024. The World Bank and other institutions have recently warned that it is high inflation that could derail Bulgaria on its path to euro adoption. Although inflation is gradually declining, this process is slower than expected. Inflation in Bulgaria has fallen from 15.6% at the end of last year to 7.5% as of this August, as measured by the European methodology, which is also used by most international institutions. This decline has largely come on the energy front, but the recent rise in oil and fuel prices has again increased price pressures, while food inflation also remains high.

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“Sofia and Plovdiv Already Make Up More than Half of Bulgaria's Economy,” reads 24 Chasa’s main story headline. Twenty-nine municipalities in Bulgaria are major drivers of the regional economy, and another 103, located nearby, provide the workforce for them. Together they form a total of 16 economic centres. Over 80% of the country's economic activity is concentrated in them and some 75% of the population lives in them, shows a new study of the Institute for Market Economics (IME) titled "The Economic Centers of Bulgaria - 2023", presented on Tuesday. The first two of these centres - Sofia-Pernik-Botevgrad and Plovdiv-Maritsa-Rakovski - already account for just over half of Bulgaria's economy, the data shows. These are both the largest and most powerful economic centres, the core of which are the two largest cities in the country. At the same time 42 of the settlements near them provide the workforce. In practice, the livelihood of the employees depends on the economies of Sofia and Plovdiv.

The 132 municipalities that make up all the economic centres are home to 4.8 million people, according to data from the last census in 2021, and employ some 2 million people. This is 77.8% of all employees in the country.

In 2021, they have produced an output of BGN 178 billion, i.e. 82.2% of the country's GDP that year. This is only from non-financial enterprises, i.e. the account does not include the money made by banks, insurers and other financial companies.

At the same time, the 16 economic centres attract 85.7% of all foreign investments in the Bulgarian economy. The previous IME study on the same topic in 2018 pointed to 20 economic centres. Their reduction now to 16 is explained by the fact that many of them, especially those in southern Bulgaria, have merged, explained one of the study's authors, Adrian Nikolov.

For example, 5-6 years ago there was an economic centre called Kazanlak, but now it is part of the economic centre around Stara Zagora, as more and more residents of the district - from Simeonovgrad and Galabovo all the way to Pavel Banya, travel every day to work in another municipality and practically depend on it.

Large economic centres have been increasing their periphery over the last ten years. 

Secondary nuclei are formed, to which people from the surrounding settlements also start commuting daily. A typical example of such a centre is the one around Sofia. The nearby towns of Pernik and Botevgrad used to be only workforce donors to the capital, but now they have become centres that attract workers from the surrounding municipalities.

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Telegraph's frontpage presents data from the National Revenue Agency, according to which the total revenue of 5.1 million employees and pensioners here in 2022 was BGN 100.5 billion. The average yearly salary was BGN 19,706 or just over BGN 1,642 per month.

FOREIGN AFFAIRS

Telegraph quotes an article by the BNR, which reports that the U.S. Permanent Representative to NATO Julianne Smith will visit Bulgaria on October 19 and 20. Smith is planning to meet with national security advisers and senior officials from the Bulgarian Ministry of Foreign Affairs and the Ministry of Defence. She will participate in a security forum in Sofia entitled Winning the Peace in Ukraine.

HOME AFFAIRS

Telegraph and 24 Chasa report on the assassination of a 17-year-old Syrian national in the Sofia district of Krasna Polyana on Monday. The victim was gunned down by two shooters, who then fled the scene of the crime. The victim was with temporary resident status in Bulgaria. A likely motive for the murder is unsettled business related to the victim's alleged participation in a human trafficking ring, the dailies write.