site.btaMedia Review: December 18

Amendments to the Constitution, Bulgaria's economic prospects and the problematic election of a Sofia Municipal Council chairperson are some of the highlights in Monday's new media. The key constitutional revisions approved by the parliamentary Constitutional Affairs Committee on Sunday encompass judicial reform, dual citizenship for senior officials and the appointment of a caretaker prime minister.

AMENDMENTS TO THE CONSTITUTION

On bTV, the President's Legal Affairs Secretary Krum Zarkov said the amendments to the Constitution are far from completed. Zarkov, a former caretaker justice minister, said there are quite a few misconceived ideas in the proposal. Some of the core revisions - those concerning the judicial reform - are adequate, while others are ill-considered. One of the positive revisions is the split of the Supreme Judicial Council (SJC) into two independent councils - of judges and of prosecutors. However, the present SJC, whose term has expired, will stay for at least nine more months, Zarkov said.

Interviewed on the Bulgarian National Television (BNT), Stanislav Balabanov MP of There Is Such a People said his group of 11 MPs would foil Tuesday's sitting of Parliament with "a democratic protest in plenary". He called the proposed amendments "absurd", saying that they unacceptably merge the branches of power.

Stefan Stoyanov, MP of the 7th Grand National Assembly (July 1990 - October 1991), which adopted Bulgaria's new Constitution, told BNT some of the proposed amendments are purely political. When the Constitution was drafted, the Grand National Assembly was in contact with US, French and German consultants and the Basic Law was assessed quite favourable. "This is the Constitution with which Bulgaria joined the EU and NATO," he said.

ECONOMY AND FINANCE

In Trud, financial expert Petar Chobanov analyses the prospect of a recession in the eurozone and argues why Bulgaria may fall short of a budget projection for nearly 14% nominal GDP growth in 2023. To meet this target, the GDP should see a nominal increase of 20% in the last quarter, compared with 5.8% in the third quarter, while inflation is falling. The economy grew by 11.3% in nominal terms in the first three quarters of 2023. It is likely that official statistics in March 2024 will report a GDP of BGN 184 billion, BGN 7 billion less than projected in the 2023 budget. At 3.2% the deficit on a cash basis will break the eurozone requirement for a deficit of 3% of GDP. If the shortfall is that big, the GDP target of BGN 205 billion set in the 2024 budget will not be met, which will affect fiscal stability and will require considerable austerity, according to Chobanov.

Also in Trud, Prof Boyan Durankev too talks about a slowdown in Bulgaria's GDP growth in the third quarter against the backdrop of a recession in the EU, with seven countries - Denmark, Estonia, Ireland, Luxembourg, the Netherlands, Austria and Sweden - seeing lower GDP growth for two quarters in a row, and Germany, France, Portugal and Czechia reporting a drop in GDP growth in the third quarter.

Segabg.com says that while the Finance Ministry is delaying expenditures, it has speeded up the collection of revenues with disputable decisions. Some of the delayed expenditures are BGN 72 million for Easter pension supplements in 2023, which were approved in April but were transferred as late as December; grants to talented children, due for the whole of 2023; financial support for refugees for November 2022 to August 2023, which was transferred to the Tourism Ministry in November (though the delay was partly due to additional checks); and payments to agricultural producers, which are still due in December. At the same time, in early December the government approved the payment of the first instalment of USD 263 for the acquisition of 193 Stryker combat vehicles. Meanwhile, the cabinet stepped up revenue collection by obligating the National Electric Company (NEK) to transfer to the parent company Bulgarian Energy Holding (BEH) a dividend of 100% on its 2022 profits instead of the original 50%, which translates into an extra BGN 220 million. The cabinet claims the transaction is budget neutral because the amount will be deducted from BGN 800 million BEH paid in advance on the profit for the first half of 2023. It is neutral on paper only because NEK will still have to pay out that amount. It is not even budget neutral because on an accrued basis, the revenue from NEK will go towards the 2023 budget year, while BEH's advance payment of BGN 800 million is due in 2024. The Confederation of Independent Trade Unions argued that if NEK pays out 100% of its profit for 2022, power supplies will be put at risk as the company will not be able to implement its maintenance and investment programme for 2024.

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In a bTV interview, Transport Minister Georgi Gvozdeikov said the sailors on the hijacked Malta-flagged, Bulgarian-owned ship Ruen are fine. There are two ships patrolling it but they are not launching an attack because the situation is complicated. He assumed they were waiting for the ship to be moored first. Presumably, the hijackers are Somali pirates because the ship is bound for Somalia, the minister said.

On Nova TV, Ivan Tsonev of the Bulgarian Shipmasters Association said an attack would be quite risky and it was more likely to hold ransom negotiations with the hijackers.

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Telegraph.bg writes that banks are raising some fees again, including for ATM withdrawals.  Some banks are also raising the fees for the most affordable product - the basic settlement account. This transpires from changes in the tariffs of some banks announced before the Christmas holidays.

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24 Chasa reports that according to the final version of a new Water Supply and Sewerage Act proposed by the Regional Development Ministry in late November, each region should have a single water and sewerage company so that all population centres in that region will pay the same water price. The rationale behind the proposal is that this will facilitate access to EU funding for water supply projects. The Association of Municipalities objects on the grounds that settlements where water is cheaper now because it is derived by a cheaper method will see a price hike.

SOFIA MUNICIPAL COUNCIL

The Bulgarian National Radio (BNR) and mediapool.bg cover the quandary in the Sofia Municipal Council, which is to make the fifth attempt to end a stalemate and elect a chairperson on Monday. Mayor Vasil Terziev warned that big infrastructure projects and over BGN 200 million in funding for the city's water cycle are at risk. Vanya Grigorova, the runner-up in the mayoral election backed by the Bulgarian Socialist Party (BSP), told BNR the city's governance was sabotaged by the decision to take down the Soviet Army Monument in central Sofia and that in this situation BSP for Bulgaria cannot continue talking with the group of Continue the Change - Democratic Bulgaria (CC-DB) - Save Sofia. The latter falls short of a majority and a chairperson cannot be elected without support from GERB-UDF or BSP for Bulgaria.

Also on BNR, political analyst Petar Cholakov said that ultimately, CC-DB would form rather unprincipled floating coalitions both with GERB and with the BSP in the Municipal Council. Cholakov said the CC-DB project could get a fresh impetus and be revived around Vasil Terziev, who is new to politics. Without naming names, the analyst said some of the other CC-DB leaders seem to have other plans - one of them seems to be a candidate for the European Parliament, while another is more keen on surfing and snowboarding.

Interviewed by BNR, Carlos Contrera also said CC-DB should reach agreement with GERB because if Bulgaria can be governed by them, so can Sofia Municipality. Contrera, who is the only councillor from VMRO, said the mayor should find a way to deliver his promises to Sofia's residents. One temporary solution could be to have a chairperson nominated by one of the two smaller groups and backed by the other four groups. Even if a chairperson is elected, without a clear-cut majority the mayor can be obstructed at every session. Contrera said Save Sofia and its leader Boris Bonev posed the biggest problem because "they want their eight councillors to run the municipality". At this point, however, CC-DB is not ready "to shed the political burden named Save Sofia".

BULGARIA'S SCHENGEN ENTRY

Interviewed by the Bulgarian National Television, CC-DB Co-Floor Leader Atanas Atanasov said this week Bulgaria would reverse the legal amendments which introduced a BGN 20/MWh contribution on the transit of Russian gas in October and angered Hungary and Serbia. It emerged earlier in December that Hungary may veto the Schengen enlargement if Bulgaria keeps the contribution. Atanasov said that while it is Russia that must pay the contribution, not Hungary and Serbia, it will be cancelled in the name of the higher national goal - entry in the border-free Schengen area.

DEFENCE

In a BNT interview, Defence Minister Todor Tagarev said defence spending had increased steadily in line with a plan of 2018. The Denkov-Gabriel cabinet sticks to this plan and the target for 2023 and 2024 will be met and exceeded. With a planned defence budget of 2.05% of GDP in 2024, Bulgaria can invest heavily in forces and assets. Tagarev also noted the cabinet had approved an investment programme until 2032.