site.btaMedia Review: November 22

BUDGET AND FINANCE

Mediapool writes that the 2024 State Budget Bill is likely to be discussed at an extraordinary meeting of the Council of Ministers on Friday. Finance Minister Assen Vassilev said after the National Council for Tripartite Cooperation (NCTC) meeting held on Tuesday, that the NCTC had a number of notes on the state budget for next year, as well as on the 2024 State Social Insurance Budget Bill and the National Health Insurance Fund Budget Bill. Vassilev noted that the budgets will most likely be adopted by December 22.

Sega writes that in the midst of the discussions on the 2024 Budget Bill, Finance Minister Assen Vassilev made an impressive promise - to reveal the major projects that will be financed by the state next year. At the NCTC meeting, Vassilev said that "the capital programme, divided into two parts, will be published and visible", which has definitely not been the case so far. For many years, the annual capital programme was listed as an amount but lacked any form of transparency and accountability. 

Tuesday's NCTC meeting ended without unanimity, and the dispute between employers and unions continued on Wednesday morning in the studio of NOVA. A main issue was increasing the minimum wage to BGN 933, which, employees stressed is extremely insufficient, but businesses argued that it does not correspond to the revenues in the budget. But even with a 20% increase, the minimum wage in Bulgaria remains lower than that of its neighbours. Given that the living wage for 2024 was estimated at BGN 1,500, the minimum wage is well below this figure. 

Confederation of Independent Trade Unions President Plamen Dimitrov said Thursday morning on bTV that the proposed budget is strained, with hard-to-fulfill revenues that have been inflated significantly. Bulgarian Industrial Capital Association Executive Director Dobrin Ivanov commented that the main reason for not supporting the State Budget Bill was the macro framework. "Revenues are not only tight but hard to meet. This is because of the high forecasts for the growth of the Bulgarian economy next year and because of the high forecast for inflation", he said.

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24 Chasa quotes Economy Minister Bogdan Bogdanov, who said during a meeting with representatives of leading Bulgarian, British and international companies in Bulgaria, that only for the period January - September 2023, foreign direct investments in Bulgaria have reached over EUR 3.1 billion, according to preliminary BNB. The increase is over EUR 1 billion, or nearly 50%, compared to the same period last year. This is the highest growth in the last 15 years. The Minister of Economy stressed that Bulgaria is in the top 5 in the EU in terms of economic growth in the third quarter.

 Industrial Capital Association head Vasil Velev said on the air of Bulgarian National Television that Bulgarian capital is leaving the country to a greater extent than foreign capital is coming in because there is no good business climate. Velev predicts that public investments will not materialize for two reasons. The first is because there are no ready-made projects. And the second is that if they are implemented, the deficit will jump by more than 3%. He argued that the Industrial Capital Association said the proposed 2024 Budget Bill is considered unrealistic and takes Bulgaria away from the Eurozone because it contains the risk of an excessive deficit.

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Trud and 24 Chasa report that the European Commission approved  Bulgaria's revised Recovery and Resilience Plan. The plan is currently worth EUR 5.7 billion in grants under the Recovery and Resilience Mechanism, the EC reported. In the amended plan, Bulgaria proposed 22 measures to be removed, reduced, or amended. Bulgaria's amended plan continues to stimulate the ecological (57.5% of the funds allocated under the plan) and digital transition, and to strengthen the economic and social resilience of Bulgaria. Bulgaria's request was based on the reduction of grants for the country from EUR 6.3 billion to 5.7 billion. The revision takes into account Bulgaria's improved results in 2020 and 2021 compared to the original forecasts. In December 2022, Bulgaria received its first payment in the amount of EUR 1.37 billion. The EU Council now normally has four weeks to accept the Commission's proposal to approve the amended plan.

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Mediapool and Trud write that the Bulgarian National Bank (BNB) will undergo a major transformation from the date of introduction of the euro in Bulgaria, which the government hopes will be January 1, 2025. This is evident from the draft BNB Act published for public consideration. It will repeal the current BNB Act from 1997, which regulates the current currency board regime, and will include Bulgaria as one of the countries with the right to vote (by rotation) in determining the monetary policy of the Eurozone. Most of the provisions of the new law refer to the applicable European legislation so that there is no conflict. The BNB will continue to be guided by two main principles, independence and accountability. With the adoption of the euro, the Bulgarian central bank will lose part of its autonomy, but at the same time it will acquire a new type of authority arising from its participation in the EU system.

INTERNATIONAL AFFAIRS

Trud quotes the Ukrainian Embassy in Bulgaria, which issued a strong position against a speech by President Rumen Radev during a conference, titled "Wars and Peace: Will the time of diplomacy come?", where Radev stressed that Russia's aggression against Ukraine has unleashed the collapse of the global security system built over decades and that the great goal is the restoration of peace in both Europe and the Middle East, but achieving these goals requires an objective and impartial view. Radev argued again that armed conflict in Ukraine has no military solution and the only way is negotiations and the achievement of peace. The event was organised by the Institute of Economics and International Relations and the Friedrich Ebert Foundation. The Embassy of Ukraine noted "with great disappointment" that such messages do not support diplomacy, but rather serve the interests of the aggressor state. 

24 Chasa quotes Deputy Prime Minister and Foreign Minister Mariya Gabriel who stressed that  Bulgaria is consistent in its position to support Ukraine. Gabriel took part in a meeting of foreign ministers in the G-7+ format. The meeting, organized by the US Secretary of State Antony Blinken and Japanese Foreign Minister Yoko Kamikawa, rotating chair of the G-7 in 2023, focused on support for Ukraine's energy sector.

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Mediapool writes that Bulgarian authorities are working to free the two Bulgarian sailors from the Galaxy Leader ship hijacked by Yemeni rebels in the Red Sea, Prime Minister Nikolay Denkov said. The Foreign Ministry is in contact with the families of the two Bulgarian citizens and is working to clarify all the circumstances of the case in close coordination with the Bulgarian diplomatic missions in the region and with partner institutions.

24 Chasa writes that with the hijacking of the Galaxy Leadership, the captain and co-captain of which are Bulgarian citizens, the crisis in Gaza has already gone beyond Israel's borders, commented MEP Elena Yoncheva on Darik Radio. There are Bulgarians and Romanians on this ship, they are EU citizens and Europe must find a mechanism to solve the problem, she added, noting that she will raise the issue before the European Commission during the main debate about the situation in the Middle East in the plenary hall of the European Parliament in Strasbourg. 

24 Chasa also quotes Muammar Al-Eryani, Minister of Information, Culture and Tourism of the Republic of Yemen, who said that the hijacking of the Galaxy Leader ship by Iran-backed Houthi militias is a piracy crime and an act of organized state terrorism by Iran. He recalled that the legitimate Yemeni government had repeatedly warned in recent years about the danger posed by the Tehran-backed Houthi militias controlling parts of the country's coastline. On his part, Charge d' Affairs of the Yemeni Embassy in Bulgaria, Ahmed Shamar, condemned the act of piracy and compared it to terrorism. He stressed that the safety of the two Bulgarian citizens from the crew of the hijacked ship is a top priority for the embassy and the Yemeni government, which are working on the issue.

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Mediapool reports that  North Macedonia's Deputy Prime Minister for European Affairs, Bojan Maricic, does not expect constitutional changes to be voted on in the near future, but said the ruling coalition will not give up and will continue to seek a solution. The main condition for North Macedonia to continue its European integration is to include Bulgarians in its constitution, but the largest opposition party VMRO-DPMNE is developing an anti-Bulgarian campaign and blocking any changes.

POLITICS

Sega, Trud, Telegraph, 24 Chasa report that Continue the Change leader Kiril Petkov and Interior Minister Kalin Stoyanov clashed head-on on Nova TV on the topics of police brutality and political interference in the work of the Ministry of the Interior. The two got into heated arguments about when and how many times they met, who launched Stoyanov, and whether Petkov was putting pressure on him. Finally, Petkov stated that Stoyanov is no longer his party's minister, but of GERB and of the Movements for Rights and Freedoms (MRF) while Stoyanov noted that everyone is still one team.

Sega, Medipool, 24 Chasa all write that after initially threatening to request his resignation, Prime Minister Nikolay Denkov is currently more satisfied with Interior Minister Kalin Stoyanov's work, after earlier on Tuesday the Interior Ministry held policemen accountable for their violent behavior during Thursday's protest against the Bulgarian Football Union in Sofia. On Monday, Denkov even said that he himself would resign if Stoyaniv did not condemn police brutality during the protest, but on Wednesday he finally called Stoyanov's actions "a step in the right direction".

NOVA hosted a discussion that focused on Petkov and Stoyanov's rift, as well as on the work of the Interior Ministry. Stoyanov's accusation that Petkov exerted political pressure on him comes months after a leaked recording of Petkov and Vassilev who planned to organize elections with "their own" Interior Ministry, political analyst Christian Shkvarek pointed out. On his part, Svetoslav Malinov argued that when people connected to the army and the Interior Ministry are asked to resign because of a mistake, they often start grumbling that it is for political reasons. He noted that there was no question that there was excessive police brutality during Thursday's protest, and added that that everyone agrees that the way the current government functions is not clear and stable. Prof. Rosen Stoyanov stressed that democracy also means separation of powers, which is currently not the case.

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Sega and Mediapool, as well as bTV, report that MRF local party structures from all over the country are supporting  Delyan Peevski as a leader of the party. Two weeks ago MRF Chair Mustafa Karadayi resigned from the leadership post. A national conference that will elect the new MRF leader will be held in February. Peevski announced a few days ago that he will run for the position.

HOME AFFAIRS

Telegraph reports that, in relation to Thursday's protest against the Bulgarian Football Union (BFU) and subsequent riots, disciplinary proceedings have been opened against three police officers so far for abuse of police authority and they are currently suspended. An investigation is underway against two others, which will determine their degree of guilt, said Sofia Directorate of Interior head Lyubomir Nikolov.

Telegraph and Sega stress that more and more cases of police brutality during Thursday's protest against the BFU are beginning to come to light. Victims claim that they did nothing to provoke the aggression of policemen. Telegraph Match reporter Nikolay Parashkevov said that he was at the protest with a press badge and was beaten up by plain-clothes police officers. 

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Trud and Telegraph report that the Sofia Philharmonic plans protests due to low salaries. The musicians are demanding that their remuneration be equal to the average salary for the capital, as currently it is significantly lower. They have been demanding an increase in their wages for four years now. 

Sega writes that the agriculture sector plans to hold another protest on Thursday. At a press conference, livestock breeders expressed dissatisfaction with the Agriculture Minister, and said that they expect the support of the GERB and MRF parties. The daily notes that this raises doubts about using the protest for political purposes.

Mediapool flat out calls the agriculture protest a "new demonstration of political blackmail in power, this time aimed at Agriculture Minister Kiril Vatev, against the background of the Interior Minister drama".

Trud quotes Agriculture Minister Kiril Vatev who said that payments to livestock breeders are either completed, or scheduled and that there should be no confusion on the matter. He recalled that when the government came to power in June, there was a big delay and everything possible was done to catch up. He stated that the desire of livestock breeders to return the rates of transitional national aid and support to last year's levels is not possible, because this is related to changes in EU policy.

In the NOVA studio on Thursday morning, Dimitar Zorov, who heads the National Union of Cattle Breeders, said that the main problem is that animal husbandry and arms production are suffering heavy losses. "We made several attempts, including the signing of the memorandum with the government, in which commitments were made that have not yet been fulfilled. For example, the commitment to pay the full amount of the Ukrainian aid - more than EUR 250,000. These are not aids, but compensations for war damage. If we raise the productivity, the cost of food also rises. The Minister of Agriculture is trying to divide us into small, medium and large enterprises", explained Zarov. National Grain Producer Association Chair Ilia Prodanov called on all animal breeders, greenhouse and agricultural producers to support the protest. If anyone should be dissatisfied with the implementation of the memorandum, it is the grain production sector, he said, adding that he fully agrees that the livestock sector is in dire straits. 

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Trud writes that after the devastation from Hurricane Frederick, three municipalities in the Varna region are no longer in a state of emergency, the municipalities of Devnya and Dulgopol, and Aksakovo. The main roads have already been cleared, the damage to the power transmission system has been repaired and the power supply has been restored. The municipality of Valchi Dol remains in a state of partial disaster because there are still people in the territory of the municipality who do not have electricity. In these areas, emergency teams continue to work to restore the electricity network.

ECONOMY

Telegraph reports that Bulgarians will spend an estimated BGN 237.1 million  for Christmas and New Year's trips. Rumen Draganov, Director of the Institute for Analysis and Assessment in Tourism, told Telegraph that BGN 143.5 million will be spent on travel within the country and another GBN 93.6 million will go for trips abroad. This year, Bulgarians traveling during the Christmas and New Year holidays will be about 30,000 more than in 2022. The average cost of celebrating in Bulgaria is almost unchanged compared to last year - BGN 350 per person.

24 Chasa quotes a Paysafe platform study, which found that 22% of Bulgarians plan to spend less on gifts this Christmas this year, 19%  will save on food and drinks, and 17% will spend less on entertainment. At the same time, 21% of respondents indicated that they plan to take advantage of seasonal offers, and, 20% said that thanks to bigger savings they were able to make during the year, they enter the holiday season prepared and the higher prices of products and services don't bother them.

Trud reports that apartments in Sofia increased in price to an average of EUR 1,545 per square metre. Over the past three years, housing prices in the capital have gone up by nearly 40%. Among the reasons for this are the high demand for real estate and the rising cost of construction as a result of rising material prices and labour costs. The average price of apartments in 2023 in Sofia has gone up to EUR 132,800, compared to EUR 115,500  in 2022. This shows that market activity has shifted to larger apartments against the background of the prevailing purchases of two-room apartments last year. The main reason for this is that most buyers are currently choosing a home for their family, while last year, transactions aimed at investment and protecting savings from high inflation prevailed.

Sega writes that Russian citizens continue to sell properties in Bulgaria because of the restrictions on their use after the war in Ukraine and the sanctions imposed by the EU. In the first nine months of the year, they sold Bulgarian real estate in the amount of EUR 12.7 million, BNB data show. Last year, sales were double, exceeding EUR 22 million. Russian citizens began to part with their Bulgarian properties long before the war in Ukraine, as early as 2018, because of problems with servicing the loans for their purchase. 

Telegraph reports that secondary schools in the country produce computer designers and advertisers, and businesses are looking for workers in the industry. Instead of engineers, the educational system turns out entrepreneurs and accountants. Bulgarian Industrial Capital Association head Vasil Vasilev argued that practical efforts need to be taken to tailor education to the needs of businesses.