site.btaMedia Review: October 19

ECONOMY

24 Chasa’s front-page articles reads that Economy Minister Bogdan Bogdanov Wednesday proposed a reduction of the prices of 15 basic foods before the winter as a means to reduce inflation and thus meet the criteria for entry in the eurozone. This will not be achieved through a ceiling on food prices but a voluntary introduction of lower prices by supermarket chains that is being negotiated with them. The chains that opt to participate will have to put in their stores information boards about the products discounted for a period of their choosing.

Trud quotes Eurostat data showing Bulgaria continues to be among the EU countries with the highest inflation. As at end-September, prices in Bulgaria increased by 6.4% year on year, compared to 4.9% in the Union on average. That makes Bulgaria the Member State with the eight highest inflation rate. One of the criteria for Bulgaria to join the eurozone is an inflation rate higher by no more than 1.5% from that in the three Member States with the lowest inflation, and Bulgaria does not meet that criteria, but the situation was similar in Croatia last year, and that country was allowed to introduce the euro. However, the data show that nine months later, Croatia’s inflation rate has not dropped significantly, remaining higher than in Bulgaria and the EU-average at 7.4% (compared to 9.6% at end-April 2022). That is why part of the economists in Bulgaria worry that entry in the eurozone may lead to lasting high inflation. 

In its front-page story, Trud quotes National Statistical Institute data showing Bulgaria’s population has been shrinking for 35 years now, standing at 6,447,000 last year, similarly to the figure in 1940. This is the result of the low birth rate and the high mortality in the country. The low birth rate, in turn, appears to be linked to the economic situation in Bulgaria. After the hyperinflation in 1996-1997, for two years the number of births dropped significantly, from 72,200 in 1996 to 64,100 in 1997 and 65,400 in 1998. After the world financial crisis of 2008, which hit Bulgaria in 2009, the number of births decreased from 80,900 in 2009 to 75,500 in 2010 and has been dropping steadily ever since. In 2022, a total of 56,596 children were born, down by 3.5% from 2021. It remains to be seen how the record-high inflation of 2022 will affect the birth rate in 2023 and 2024.

Duma quotes data showing that Bulgaria is first in the EU for the number of abortions, and one in three pregnancies here is terminated. Half of the abortions are at the woman’s request and the rest, for medical reasons or miscarriage. Last year, there were nearly 19,000 abortions, which is a decrease from before but still the highest number in the EU. Abortions are most often chosen as an option by women aged over 30. The average age of first-time mothers in Bulgaria is 27.5 years.

Darik.bg quotes National Society Security Institute data showing that pensions and salaries in Bulgaria have doubled in the 2013-2022 period, but the high inflation rate has “eaten” the pay raise in 2022. During the ten years under review, the average salary here grew by 127% and the minimum wage, by 124%, but there was no actual increase in 2022 when accounting for inflation (the nominal increase was 9.23% and the real one, minus 5.29%).  That is not the case with pensions, where the minimum pension grew by 39.50% last year compared to 2021 and in real terms, by 21%. From 2013 to 2022, the average pension in Bulgaria went up by 130%. The downward trend in the number of pensioners continues, dropping by 160,000 in ten years to 2,036,543 pensioners in 2022. 

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Trud has an interview with Engineer Ivan Ayolov, former deputy minister in charge of the energy sector, who argues that ruining the Belene N-plant project is madness and betrayal to Bulgaria’s energy sector. In the 2014-2023 period, Bulgaria was betrayed in terms of energy, because a national energy strategy was not drafted. The expert explains that the short-term strategy should cover a period of 10 to 15 years, because that is how long it takes to build a base-load energy unit, and a long-term strategy should cover the period until 2050. The lack of an energy strategy and national political will to implement it by taking decisions piece by piece, under external pressure, defending foreign lobbyist and economic interests, is taking the Bulgarian energy system towards destruction, Ayolov argues. The expansion of the Kozloduy nuclear power plant is as vital as the construction of Belene, but the former is in the field of wishful thinking, somewhat experimental due to the fact that the United States’ AP 1000 technology has never been used before, and very expensive. Until new base-load capacities are built, the Maritsa East complex is vital for Bulgaria. Indeed, the thermal power plants are no longer competitive, but that is because the EU is using a purely administrative and political lever: the price for carbon emissions, which is purely speculative - it cannot be explained how it is determined and where it comes from – and adds at least BGN 200 to that of electricity produced by coal-fired plants, Ayolov tells the daily.

Capital.bg writes that it appears the project for expanding the Kozloduy N-plant is moving forward and Bulgaria will have a new nuclear unit with the AP 1000 technology, because the US’ Westinghouse and several Bulgarian companies are expected to sign a memorandum on Thursday. Still, several more steps lie ahead before the first sod can be turned, including Bulgaria having to provide some EUR 200 million for the design and licensing of the project and having to decide how it will participate in the construction. That means the construction works can start no earlier than 2026. 

On Bulgarian National Television’s morning show, energy expert Ivan Hinovski commented that the Lukoil company’s claim that it is not looking for a buyer for the Neftochim oil refinery near Burgas is worrisome and suggests that the company will make the deal non-transparently. At some point, Lukoil will simply announce who the new owner is, he commented. “A non-transparent sale of Neftochim will sweep a series of deals unclear for the Bulgarian government. That is why we have been proposing for years that the Council of Ministers introduce a special regime for Neftochim’s management, following the example of Italy with Lukoil’s refineries. That would have allowed light to be shed on their entire policy over the years,” the expert argued. According to him, whether Neftochim’s sale will affect fuel prices depends on the new owner. “If he observes the European transparency standards and the profitability norms without excess profits, that [fuel prices getting affected] should not happen. The future of oil prices after the war in the Middle East is unclear, but I think there is no reason for fuels in Bulgaria to appreciate,” Hinkov told Bulgarian National Television.

On bTV’s morning show, energy expert Martin Vladimirov of the Center for the Study of Democracy commented that for ten years now, Lukoil has been conducting a large-scale strategy in Europe for the sale of its assets, particularly those related to the procession of crude oil or the retail sale of fuels. Lukoil used to get preferential treatment from the Bulgarian authorities and that led to monopoly on the fuel market in Bulgaria, mostly on the wholesale market. At present, various groups are bidding for the Neftochim refinery, which is at a very beneficial position because of the derogation from the EU-wide ban on the imports of Russian crude oil, Vladimirov argued.

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On Bulgarian National Radio, parliamentary Health Committee Deputy Chairperson Vasil Pandov (Continue the Change-Democratic Bulgaria) commented on the shortage of medicinal products in Bulgaria. He believes that handling the shortage requires a series of measures, one of which is to limit the vertical integration. Provisions on the matter have been proposed by the pharmaceutical union more than 10 times in the last 15 years, but thus far there has been no will to introduce them. The current legislation has loopholes through which that can be avoided. Pandov noted that the problem with medicine shortage exists in the entire EU; the other Member States too are looking for various approaches to solve this problem. Discussions on the matter began as early as 15 years ago, and the first attempts at regulation date back to 2014.  Undeclared exports of medicinal products pose another problem, Pandov said. According to him, the recently introduced e-prescription can reduce the illegal export.

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Telegraf’s front-page article reads that in a single year, 800 Bulgarian drivers were fined abroad. 

POLITICS

24 Chasa has an interview with sociologist Dimitar Ganev from the Trend polling agency about the forthcoming local elections. According to Ganev, the vote “against”, and not “in favour”, will be decisive for the winners in the runoff elections.  Compared to the previous local elections, fewer mayors will be elected in the first round and the voter turnout will be lower; it will drop sharply in the runoffs. The election campaign is entering its decisive phase; 20% of the voters are yet to decide who they will cast their votes for on October 29, he tells the daily. Ganev does not expect revolutionary changes in the map of local authorities. While in 2019 the debate in Sofia was focused on scoring a hit against the government of GERB leader Boyko Borissov, now it is focused on parks and sidewalks. Socialist candidate Vanya Grigorova is managing to attract voters outside of those supporting the Bulgarian Socialist Party (BSP) and the Left, because she represents the opposition to the incumbent, but she will hardly overcome the big difference with the two top parties, Ganev believes.

Segabg.com presents the results of a Mediana opinion poll, according to which the top three candidates for mayor of Sofia, Vassil Terziev (Continue the Change-Democratic Bulgaria/ Save Sofia), Anton Hekimyan (GERB), and Vanya Grigorova (BSP) are only 20,000 votes (3%) apart, so the runoffs are guaranteed. The poll was conducted between October 10 and 17 among 710 adults through a standardized interview as part of Mediana’s self-funded research project. The pollsters note that nearly 120,000 (one-fourth) of the people expected to vote are yet to decide who they will support.

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Duma’s front-page article quotes BSP leader Korneliya Ninova as saying in Yambol (Southeastern Bulgaria) on Wednesday that a brutal migrant wave expects Bulgaria, and the Government is inadequate to that danger. Defence Minister Tagarev’s statement that he will send 50 service persons to the border is hypocrisy towards the Bulgarian national security and defence, she said. “No one answers [the question] what position Bulgaria expressed in Brussels on October 4, when a decision was taken on a new migration regulation. It envisages the introduction of quotas for migrats by all Member States,” Ninova explained. She insisted that the 2024 state budget include resources and specific actions to stop the migrant influx.

SITUATION IN MIDDLE EAST

The latest developments in the Middle East are in the focus of attention of Thursday’s media. On the morning shows of Bulgarian National Television, bTV, and Nova TV, experts commented on what is happening in Gaza. 

On bTV’s morning show, former Israeli ambassador to Bulgaria Shaul Kamisa Raz commented via video conference that Hamas’ terrifying attack surprised Israel. “We were developing relations through which we were constantly improving the quality of life of the citizens in the Gaza Strip. Hamas took advantage of that,” he said. Hamas cannot exist independently as a military organization; it is supported strongly by various factors in Iran. “Their attack was done in cooperation. They also received professional support,” the former ambassador to Bulgaria noted. He said Israel is preparing to hit Hamas’ command centres with the goal to entirely destroy Hamas’ presence in the Gaza Strip.