불가리아 주요 경제뉴스 ( 18 - 25 APRIL 2008 )

BULGARIAN ECONOMIC TOP NEWS DIGEST

WEEKLY REPORT ( 18 - 25 APRIL 2008 )

 

 

Sections/headline briefs:

 

 

MACROECONOMY:

 

·        Brussels EC to raise compensations for Kozloduy nuke closure

·        Electricity hikes next on the agenda

·        French BNP-Paribas elected to manage funding of Belene NPP construction

·        Die Welt: RWE mulls withdrawal from Belene nuclear power plant

·        EU could bring food prices down with increased energy production

·        Price of diesel, petrol may increase if fuels are mixed with biofuels

·        Minister of Economy to discuss Nabucco gas pipeline project in Austria

·        95% of Bulgarian enterprises work with natural gas

·        NRIC to absorb �580 M EU funding for modernization

·        NRIC mulls solar parks

·        Soft drinks consumption in Bulgaria up 11% Y/Y in Q1

·        EU to provide �218 M for tourism

·        Bulgaria named cheapest holiday destination in Europe

·        100,000 Danish tourists expected in Bulgaria this summer

·        Passenger traffic at Sofia Airport rises 18% in Q1

·        Bulgaria 2007 PC sales top 330 000 units

·        Bulgarian web usage stats still worse than EU average

·        Bulgaria to have 4 exhibition centers

·        Spanish Pamplona city helps Varna in EU money absorbtion

·        Demand for trucks up 200% within a month

·        World financial crisis threatens Bulgaria

·        Bulgaria leasing market seen up 50% in 2008

·        Bulgarian - Serbian economical forum starts in Sofia

·        Bulgaria-Italy : �3 B trade

 

 

 

 

INVESTMENTS:

 

·        Investments in Bulgaria direct towards energetics in 2008

·        About �6-7 B in Direct Foreign Investment expected in Bulgaria in 2008

·        Metallurgical industry to invest BGN 1.7 B by 2010

·        Euromarket Group to invest �160 M in 8 retail and industrial parks

·        Sopharma to invest BGN 60 M in plant

·        Private companies decrease investments

·        Sozopol to attract solvent tourists with golf playgrounds

·        Sofia co to invest in elevator plant

·        UK developer unveils plans for Veliko Tarnovo mall

·        Poland's GTC to invest in malls

·        Rila Sport to invest � 460M in ski resort

·        Carlsberg Bulgaria invests �1.8 M to raise capacity

·        Deutsche Bank AG launches construction project in Gradoman

·        Schneider to invest BGN 35M in Bulgaria

·        E.ON to re-invest BGN 21M profit in improvements

·        Winslow targets � 600M-plus projects

·        Energy company BEWAG to invest � 80 M in wind-power parks

·        Foreign direct investment in Bulgaria for January – February 2008

 

 

COMPANIES:

 

·        Zhevago about to acquire Kremikovtsi

·        Construction companies compete with banks

·        How is the appreciation of the Euro affecting Bulgarian companies?

·        Aspis Bank plans to enter Bulgaria

·        The top 20 insurance brokers In Bulgaria

·        Lufthansa to repair airplanes in Bulgaria from October

·        Ukrainian firm to renovate security systems of Kozloduy NPP

·        Varna and Burgas airports leaders for Fraport Group

·        Siemens to beef up customer support center in Sofia

·        Wine&Tourism Expo open doors in Varna

·        Italian companies look for Bulgarian partners

 

ANALYSIS:

 

·        Bulgarians are getting poorer

·        Industry Watch: Bulgaria's wealth increasing

 

 

Articles:

 

 

MACROECONOMY:

 

Brussels EC to raise compensations for Kozloduy nuke closure

"The European Commission spoke on technical level with Bulgarian representatives regarding a possible increase of the compensations for the decommissioning of Units 3 and 4 of Kozloduy Nuclear Power Plant (NPP)," Spokesperson of Energy Commissioner Andris Piebalgs, Ferran Tarradellas, said in an interview for BTA. only a day earlier Bulgarian Minister of Economy and Energy Petar Dimitrov stated that Bulgaria would demand that the EC enlarges the recompense to 1.1 billion euro. "The European Commission is not against an increase, especially since there have been similar cases with Slovakia and Lithuania," Ferran Tarradellas pointed out. The contact on technical level regarding the issue was made to guarantee that Bulgaria's demands are well-grounded. Ferran Tarradellas also added that an exact size of the additional compensations would be discussed as soon as Bulgaria provided solid grounds for its demands. "A decision to raise the compensation amount can come into force only if approval by the EC, European Parliament and the Council of Europe," Ferran Tarradellas emphasized.

 

Electricity hikes next on the agenda

Bulgaria’s electricity utility and power grid operator, the National Electricity Company (NEC), announced plans to hike electricity fees as of July 1 this year, Dnevnik daily reported on April 21.The news comes shortly after heating utilities raised their prices as of January 1 and April 1 over increases in natural gas prices. Water supply and electricity distribution utilities have also requested an increase starting summer.NEC will request a hike by 20-25 per cent. The lofty increase is set to prompt utilities, who buy electricity from NEC, to add 10 per cent mark-ups to their previous hike requests. Earlier, they wanted an increase in the six to 12 per cent range for different consumer groups.Kozloduy nuclear power plant is yet to file its power hike request, but it it likely to ask for a 10 per cent hike, Kozloduy nuclear power plant chief executive Ivan Genov was quoted by Dnevnik as saying.

French BNP-Paribas elected to manage funding of Belene NPP construction

 

French BNP-Paribas will be the bank, which will manage the process of funding the construction of Belene Nuclear Power Plant, Economy and Energy Minister Peter Dimitrov said on Tuesday.He pointed out that the Board of Directors of the National Electric Company (NEK) made this decision on April 21, after appraising the proposals of the two French Banks, which submitted bids for the management of the project funding.Investors' interest to the construction of Belene N-Plant is so big that there would hardly be any problems with its financing, Dimitrov also said. NEK said on March 11 that its Board of Directors has approved the companies Electrabel of Belgium and RWE Power of Germany for further negotiations in the second phase of the procedure to grant a contract for the building of the Belene Nuclear Power Plant.Electrabel, RWE Power, CEZ, E.ON and ENEL have submitted offers in the second phase. They have bid to acquire directly or through a consortium up to 49 per cent of the future joint venture for the construction and operation of the Belene plant together with NEK.These companies were asked to sign a confidentiality agreement and were then presented with the information memorandum for the project to build the N-plant. The bidders had an opportunity to conduct legal and technical-economic studies of the project and to place initial offers to serve as a basis for negotiations with NEK.

Die Welt: RWE mulls withdrawal from Belene nuclear power plant

German energy giant RWE is considering withdrawal from the race to buy 49 per cent in the company that will build Bulgaria’s second nuclear power plant at Belene, German newspaper Die Welt reported on April 20.The newspaper quoted company sources as saying on April 18 that RWE would re-align the investments earmarked for buying the minority stake in the nuclear power plant to the acquisition of British Energy.The shift in the energy strategy was reported to have been put up at a meeting of the supervisory board of the company over project safety concerns and doubts regarding the Russian technology, regardless of the fact that it has gained the approval of the European Commission.Furthermore, German banks have reportedly given up on plans to finance the project because of environmental concerns and the technology’s potential threat. If RWE pulls out, this will be the second company after Electricite de France to withdraw from the tender.RWE and Belgian Electrabel were shortlisted by project manager – the National Electricity Company (NEC) – as the finalists in the tender to pick the buyer of 49 per cent of the company that will operate the nuclear power plant. The operator is yet to be set up.Sources close to the deal named RWE as the favourite because it offered to immediately invest 400 million euro and give a substantial premium for RWE’s preferred status. Currently, NEC is finalising negotiations with RWE and Electrabel, but runners-up are Germany’s E.ON, Italy’s Enel and the Czech CEZ.Bulgaria wants the 2000-MW plant in the Danube town of Belene to make the country a major electricity exporter in the Balkans again after it was forced to shut communist-era reactors as a condition of joining the European Union in January 2007.Nuclear energy accounts for one third of the country’s power needs and the local Government is among the EU countries, which believe nuclear energy is part of the solution to climate change, as proponents say atomic power emits almost no greenhouse gas emissions.NEC would retain 51 per cent of Belene,which would be built by Russia's Atomstroiexport, controlled by gas company Gazprom, with France's Areva and Germany's Siemens as subcontractors. The construction costs have been set at four billion euro, but the total outlay on the project is expected to be closer to seven billion euro.

 

EU could bring food prices down with increased energy production

 

Bulgarian MEP Filiz Hyusmenova demanded from her colleagues in Strasburg the full capacity of nuclear energy production units to be used as means of curbing food prices increase, which is caused by energy shortages. The food price jump is harder felt in Eastern Europe because of lower income levels, Hyusmenova said. Because of the instable international financial markets and the world economy crises more price uptakes are expected. According to the Bulgarian MEP food process could be tamed by regulating energy prices, which demands a revision of EU energy policy.

 

Price of diesel, petrol may increase if fuels are mixed with biofuels

 

The price of diesel and petrol may increase if the fuels start to be mixed with biofuels, Chairman of the Bulgarian Central Gas Association Andrei Delchev told reporters on Monday. The Association urges for lifting the obligation to mix petrol with bioethanol since the petrols produced at the moment in Bulgaria fall short of the standards required for this purpose. This and other problems were discussed at a roundtable attended by representatives of the Association, Economy and Energy Minister Peter Dimitrov, experts of the Economy and Energy Ministry, as well as of the ministries of finance, of the environment and waters, and other bodies. The indicative target for Bulgaria assumed before the European Commission, is for 2 per cent of biofuels used in transport in 2008. The Association is of the opinion that this target cannot be achieved and should be reduced to 1 per cent. Association members also spoke of many technical problems in using biofuels. They insisted on using a different method for denaturation of biofuels and for lifting the warranties due for it as for excisable goods.

Minister of Economy to discuss Nabucco gas pipeline project in Austria

The Bulgarian Energy and Economy Minister Petar Dimitrov discussed Wednesday the development of the Nabucco gas pipeline project with Austria's Minister of Economy and Labor Martin Bartenstein, the Bulgarian private Darik Radio reported.Dimitrov arrived Wednesday in the Austrian capital Vienna, where is on an official visit until April 25.
The Austrian Economy Minister announced that the construction of the Nabucco gas pipeline would be launched in 2009, and that in 2012 it should already be transporting Central Asian natural gas to Europe. In Bartenstein's words, the governments of the six participating countries (Turkey, Bulgaria, Romania, Hungary, Austria, and Germany) had to sign a special agreement so that the pipeline project could be realized more easily. He also announced that according to the statements by representatives of the Russian energy giant Gazprom, Nabucco and the Russian-sponsored South Stream pipeline were not competitive projects. The two ministers also discussed the situation around the large future investment in a steel plant at the Black Sea coast planned by the Austrian steel-maker Voestalpine. "The European Commission should not urge companies to outsource their manufacturing outside the EU because of its policy to reduce carbon dioxide emissions", the Austrian Minister said regarding the choice that Voelstalpine faces whether to invest in other Black Sea region states. Bartenstein also stated Bulgaria's position as a EU member state should not be turning into a disadvantage because of this. In his words, the production of one ton of steel in Bulgaria or Austria would emit a two times less carbon dioxide compared to its potential production in China. Dimitrov stressed Bulgaria could offer really good conditions to the investor, and that it was facing competition by the EC policy on carbon reduction rather than by other states in the region. The Bulgarian Minister is also going to discuss the potential investment at a meeting with representatives of the management of Voestalpine. Together with his delegation, Dimitrov is going to visit its steel plant in the city of Linz, which is one of the most modern steel factories in Europe. His program also includes meetings with representatives of the Austrian energy company OMV Gas, and with the Economy Minister of the Upper Austria province. The trade between Austria and Bulgaria reached the record EUR 1,180 B in 2007, a 87%-increase compared to the 2006 levels. Austria is the largest foreign investor in Bulgaria with a total of EUR 3,663 B invested between 1996 and 2007, which is 17,1% of all foreign investments in Bulgaria.

95% of Bulgarian enterprises work with natural gas

Curently more than 95% of Bulgarian enterprises, who have access to the gas distribution infrastructure, consume natural gas, informs the press center of Overgas.The natural gas is the best energy alternative for the industry and representatives from the sector have oriented towards use of the blue fuel. The reasons are two: high profitability of the production because of the low price of gas and the lack of expensive investments in purifying installations. Out of the reach of the gas distribution network are only 150 enterprises. Many of them are candidate-clients of Overgas under the project “Virtual gas pipeline” - for supply of compressed natural gas. Industry has the highest share of gas consumption in Bulgaria. In 2007 the total consumption of industrial, public-administrative and households consumers is 3.048 bln m3 with 3.2 bln being consumed by the industry.

NRIC to absorb �580 M EU funding for modernization

Bulgaria's National Railway Infrastructure Company (NRIC) will implement projects for 580 mln euros until 2013 under EU's Transport operational program, the company told Profit.bg. The funding will be extended for the development of the railway transport in Bulgaria and for the improvement of the railway infrastructure in the country. The railway infrastructure projects account for nearly 29% of the budget of the program, which makes NRIC the second biggest beneficiary under the program after the National Road Infrastructure Fund. The major priorities of the projects implemented under the program are the modernization of the Vidin-Sofia railway line, the electrification and the reconstruction of the railway line linking Sofia with Svilengrad and the Turkish border, the modernization of the Sofia-Plovdiv line and the upgrade of the Sofia-Pernik-Radomir line. A total of 320 mln euro have been allocated for modernization of the Vidin-Sofia line, which is the biggest project. The traveling time between Vidin and Sofia is expected to drop to under 2 hours after the project is completed. The duration of the traveling time exceeds 5 hours at present. A total of 120 mln euros will be invested in the modernization of the Sofia-Plovdiv railway line. The trains will able to move with up to 200 km per hour after the project is completed. Thus, the traveling time will be reduced by 60 min. to 1 hour an 30 min. NRIC will invest 100 mln euros in the upgrade of the Sofia-Pernik-Radomir line. Improvements in the infrastructure along the line and the establishing of proper conditions for the speed of the trains to be increased will help reduce by half the traveling time along the line to 35 min. The development of the Pernik-Sofia line is also crucial for easing car traffic into Sofia. The implementation of the project for the electrification and the reconstruction of the railway line linking Svilengrad with the Turkish border is also of extreme importance to Bulgaria. The investment is estimated at 35 mln euros. The implementation of the project will facilitate the railway transportation of passengers and cargo from Central Europe and Bulgaria to Turkey and Greece. NRIC's management has prepared four alternative projects under the Transport program, which can be implemented if unforeseen circumstances threaten the utilization of the funding earmarked for railway infrastructure. The total value of the alternative projects is estimated at 329 mln euros. These include: Upgrade of stretches along the Mezdra-Gorna Oryahovotsa line (160 mln euros), modernization of stretches along the Plovdiv-Burgas line (63 mln euros), electrification of the Parvomay-Yabalkovo line (23 mln euros) and modernization of the Sofia-Dragoman (83 mln euros). NRIC will also invest a total of 29 mln euros in the setting up of an intermodal terminal in Sofia. The first stage of the project is expected to be launched in 2009.

NRIC mulls solar parks

The National Railway Infrastructure Company (NRIC) said it is considering deploying photovoltaic panels on vacant company-owned land plots, disused railway routes and the rooftops of train stations. The company intends to install capacity of up to 5MW at a cost of around 25 mln euro. A feasibility study is in progress and funding opportunities are being explored. The first solar park is likely to be built on the site of the Varna ferry complex, said Stoyan Stoyanov, head of the energy department at NRIC. By mid-2008, NRIC will submit to the power regulator a request to be licensed as an electricity distributor, said the company's executive director Anton Ginev. NRIC intends to sell the electricity output to railway carrier BDZ and private hauliers and later to train stations and adjacent facilities which currently buy their power from the regional energy distributors. The transmission operations of the infrastructure company have already been unbundled for accounting purposes. In 2007, NRIC subsidiary Tren was issued a permit to operate as a power trader. In related news, NRIC said it is eyeing a state guarantee for a 360 mln lev loan in 2009. The resource will be spent on the renovation of railway route to accommodate faster train speeds. The loan will most probably be extended by the World Bank. The company already has the approval of the European Commission which ruled in 2006 that the government guarantee would not be considered as disallowed state aid. NRIC still has 75 mln levs outstanding on a $340 mln World Bank loan provided for the restructuring of the railways. In 2008 alone, NRIC will need 314 mln levs for railway repairs and construction. The state budget will stump up 120 mln levs of the necessary resource. Another 160 mln levs are seen as proceeds from the upcoming sale of the Pioneer train station.

Soft drinks consumption in Bulgaria up 11% Y/Y in Q1

Soft drinks consumption in Bulgaria continues to increase, the Bulgarian Soft Drinks Association (BSDA) said. Consumption of soft drinks went up by 32 mln liters, or 11%, in the first quarter of 2008, compared to the corresponding period of 2007.Bottled waters consumption rose by 12%, 14 mln liters, in the first three months of 2008, compared to the year-ago period. The consumption of natural mineral waters rose by 13%, while the consumption of waters offered in the public sector rose by 7%.Carbonated drink sales marked a 9-percent year on year increase in the first quarter of 2008. This is an increase of 10 mln liters. The demand for “light” beverages, which registered an 18-percent increase in sales was brisk. The sales of the “soda” type drinks rose by 12%, while the sales of “orange” type drinks marked a 7-percent rise. The share of sales of carbonated drinks in 2.0-liter PET bottles also increased in the first quarter of 2008. The consumption of non-carbonated drinks with low fruit content and of drinks that come in a powdered form rose by 6%. The number of companies offering products with fruit content, as well as drinks with added vitamins and fruit beverages for children is growing. The demand for natural fruit juices marked a 17-percent year on year increase in the first quarter of 2008. The increase represents nearly 3 mln liters and may be put down entirely to products manufactured domestically. The consumption of soft drinks of the “ice tea” and “energy & sports” types went up by 34% and 26%, respectively. The wide range of products and the attractive prices of Bulgarian producers sparked the increase in the consumption of soft drinks of these types. Based on the first quarter results, soft drinks consumption is estimated to reach 1,820 mln liters for the entire 2008. This would also mean that the per capita consumption will grow to 240 liters for 2008, up by 22 liters, compared to 2007.

EU to provide �218 M for tourism

The Sustainable Development of Tourism scheme within the Regional Development operative programme of the European Union will provide EUR 218 million for building tourism infrastructure in Bulgaria, Iskra Mihaylova, deputy minister of regional development and public works, said at the national conference Money for Infrastructure and Tourism. Three operations will be financed under the scheme. The first operation will entail the improvement of tourist attractions and related infrastructure and will be launched in May. It will involve 148 municipalities and will require EUR 152 million. The second operation will involve developing regional tourist product and marketing of destinations. It will encompass the whole territory of Bulgaria and will start in September. The sum under this operation is EUR 32 million. The same amount may be granted to the State Tourism Agency for national tourism marketing projects.

Bulgaria named cheapest holiday destination in Europe

Bulgaria is the cheapest holiday destination in Europe, a new study shows, as cited by the Independent.UK company Post Office carried out the research to compare relative prices across the world, as the British pound has recently got much weaker against other currencies.In the study Bulgaria is flagged up as highly affordable location and is said to be the cheapest destination in the whole of Europe, just ahead of Turkey.The results come out after a recent similar research by Teletext Holidays found the cost of food and drink in places such as Sofia is much less than in many other European cities.A pint of beer and a Big Mac costs just GBP 1.49 in Bulgaria, making it the world's best value holiday hotspot for Brits, the survey claimed.

100,000 Danish tourists expected in Bulgaria this summer

The number of Danish tourists in Bulgaria this summer will reach 100, 000 people, the Danish ambassador for Bulgaria Kore Erhard Janson prognosticated. Mr. Janson attends a official ceremony of the new honourable council of Denmark in Varna. Main demand of the tourists is security, the diplomat pointed out. In his words this problem will be main theme of discussion on the forthcoming meeting between Bulgarian Foreign Ministry representatives and the Scandinavian countries ambassadors. The interest of the Danes towards investments in property in Bulgaria is very big, ambassador Janson declared. According to him his compatriots buy mostly vacation estate on the Black Sea.   

Passenger traffic at Sofia Airport rises 18% in Q1

 

The number of passengers serviced by the country’s biggest airport located near the capital city of Sofia increased by 18% y/y to 724,170 in Q1. The growth of the traffic rose by 22% y/y to 262,418 passengers in March only. The airport narrowed its net profit by 8.6% to BGN 20.7mn (EUR 10.6mn) last year. Bad weather conditions have worsened the performance of the airport as profit would have been by BGN 1mn higher if no flights were cancelled because of the fog at the end of the year, according to the CEO of the facility Plamen Stanchev. The airport has capacity to service 2,500 passengers per hour.

 

 

Bulgaria 2007 PC sales top 330 000 units

 

Bulgarian PC sales totaled 330,000 units in '07, including 170 desktops, 156,000 laptops and 6,000 x86 servers, shows data of market research firm IDC. Hewlett-Packard, Asus and Toshiba make up the Top 3 best-selling brands here in the last quarter of last year. The three account for a third of the local computer market. Globally, HP leads with 19.1% in Q1 08, followed by Dell with a share of 15.7%, Acer with 9.9%. Lenovo with 6.9% and Toshiba with 4.4%.

 

Bulgarian web usage stats still worse than EU average

A total of 25 pct of Bulgarians use the Internet against 50 pct in the rest of EU, showed a survey of the European Commission released in mid-April 2008. The number of Bulgarians who have never used the Web is alarming and projects for electronic government, e-services and online financial services have been considerably delayed, the survey showed. Bulgarians use the Web mainly for free phone calls and video calls. one out of four Bulgarians uses the Net for email and 10 pct read online newspapers or news. only 2.0 pct of the Bulgarian population uses online banking services against the EU average of 25 pct. Bulgarians who cannot use the Internet are some 66 pct of the population, compared with 40 pct for the rest of EU. The good news is that their number is decreasing. Bulgarian households hooked up to the Web are some 20 pct versus 50 pct in the rest of EU.

Bulgaria to have 4 exhibition centers

Four mainstay fair and exhibition centers will take shape in Bulgaria, said Yordan Radev, chairman of the Bulgarian Association of Fair and Exhibition Organisers. He named Sofia, Plovdiv, Dobrich and especially Pleven which can benefit from an array of projects in the area like the planned Belene nuclear power station.

Spanish Pamplona city helps Varna in EU money absorbtion

The leadership of the Spanish city of Pamplona is ready to co-operate with Bulgarian seaside city of Varna for preparation of projects in absorption money from the EU funds. This was announced by the time of the meeting between Varna municipality chief peter Karandilov and the mayor of Pamplona professor Yolanda Angulo.In Navarre's government exists special department that works with EU projects, helping this way the drop in the unemployment rate.The most developed sectors in Pamplona are biomedicine and entering of renewable energy sources.Common projects in these spheres will be realized between the University in the Spanish city and the Technical University in Varna.

 

Demand for trucks up 200% within a month

 

The boom in the market of trucks and buses, predicted by the Banker weekly back a month ago, can now be considered a fact. In March alone sales went up by more than 200 per cent. By the end of Q1 the members of the Union of Car Importers in Bulgaria sold a total of 1,067 heavy-duty trucks - twice more than the same period of last year and almost 200 up from the entire 2004. The main factors for that record high growth are the boom in construction and some European requirements to international hauliers which Bulgarian companies are already obliged to observe. What makes an impression is that almost two thirds of the sold trucks were of the biggest class - over 18 tons (593 sales). The leaders in this segment are Iveco (197) and Volvo (192), followed by Mercedes (142). A total of 86 new buses were sold during the period. Japan's Isuzu with 56 sales was the most demanded model Man, Setra and Volvo sold only a few vehicles.

World financial crisis threatens Bulgaria

Bulgaria is among the most threatened countries by the world financial crisis. According to Mr. Michael Deppler, Director of the IMF's European Department, Bulgaria Estonia and Latvia are among the countries most threatened by a serious increase in the bank interests and a decrease in the economic growth as a consequence of the world financial crisis that has spread to Europe from the USA. "The new EU member states are too dependent on foreign investments and this is why their economies are very vulnerable in this situation; they may suffer soaring inflation, increase in the unemployment rate and a slowdown in the economic growth to 5.5%," Mr. Deppler said.

Bulgaria leasing market seen up 50% in 2008

 

The Bulgarian leasing market is headed for a growth of 40-50% in 2008 and should achieve further gains of 30% to 40% annually over the next 2-3 years, said the Bulgarian Association for Leasing (BAL). The leasing of real estate is primed for significant growth because it still has market share of less than 10%. BAL data shows that new leasing deals topped BGN 2.7 billion last year with leasing penetration reaching around 11%. Receivables under leasing contracts reached 7% of the nations GDP in 2007, as the online English edition of Dnevnik Daily reported.

Bulgarian - Serbian economical forum starts in Sofia

President Georgy Parvanov opens a Bulgarian - Serbian economical forum by initiative of Bulgarian investors in Serbia. The forum's aim is to support the future developing of business relations between both neighbour countries. Part of the reports' themes are ‘Challenges in front of business in the both countries' and ‘Opportunities of partnership between modern municipalities'. A program of Culture exchange in informational society will be presented and also the first media Bulgarian - Serbian exchange. After the recognition of Kosovo's Independence by Bulgaria, the operation in the region Bulgarian firms, 130 in common have shortly reduced to 90 already. The specialist Yavor Kuiumdhiev speaks of literal expansion of Bulgarian producers in Serbia. According to Bulgarian council in Nis Georgy Yurukov during the last 4 years the stock exchange between Bulgaria and Serbia has been increasing with almost 50% every year. Presently Bulgaria is in Top 10 of Serbian foreign - economical partners. Bulgarians have been privatized most of the privatized Serbian enterprises - more than 40. In the words of Bulgarian businessmen the investments from our country in Western neighbour is already round 500 million EUR.

 

 

 

 

 

 

Bulgaria-Italy : �3 B trade

 

Trade between Bulgaria and Italy amounts to over 3,000 million euro annually, it emerged at a Bulgaria-Italy round table on infrastructure, energy and the environment, organized by the Italian Institute for Foreign Trade (ICE) Thursday. The discussions were opened by Italian Ambassador to Bulgaria Gian-Batista Campagnola and ICE-Sofia director Fabrizio Camastra, accompanied by high-ranking officials of several ministries from both countries.Italian investments in Bulgaria exceed 2,000 million euro, and Italy has been a business partner in many Bulgarian-based projects, Ambassador Campagnola said. He added that the Bulgarian economy had been identified as well-functioning even before the country's EU accession, and that other, older-established EU members currently have greater economic problems.Despite Transparency International's criticisms of Bulgaria in Justice and Internal Order, one should not speculate based solely upon these, Campagnola continued. He noted the sacrifice made by Bulgaria to shut down the two units of the Kozloduy nuclear power station that the EU had requested, even before the deadline to do so had elapsed.Deputy Finance Minister Lyubomir Datsov said that Bulgarian-Italian relations were currently undergoing a "golden age", and that Bulgaria, through its attraction of foreign business, is setting an example to many European countries with its taxation legislation, which is "extremely straightforward and business-orientated", with a wide base and low stakes. No drastic changes are being planned for this, and the government does not plan on giving into pressure for social exceptions in its taxation policy.Around 7 per cent of Bulgaria's GDP is being set aside for public investments, hopefully to become one of the EU's highest at 8.5 per cent by 2010, Datsov said.The head of the Economy Ministry's Investment Projects unit Ventzislava Datcheva said that Bulgaria is the EU's fifth fastest-growing economy, and the world's ninth most-preferred destination for outsourcing.Bulgaria's strategic geographical position, qualified workforce, favourable business conditions and low taxes make the country an extremely attractive investment destination for Italian business, Fabrizio Camastra said. Furthermore, the financial support of Italy's Unicredit, which has firmly established itself in Bulgaria, will also be of great benefit to Italian investors, he added.Bulgarian and Italian companies will hold talks over the construction of filter stations, water mains, environmental monitoring, and rail and road infrastructures, among others.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INVESTMENTS:

 

Investments in Bulgaria direct towards energetics in 2008

According to yearly inquiry of National Statistic Institute (NSI), researching the investment plans of industry in 2008, a common nominal increasing of 1.4 % is expected during this year, compared to 2007. The inquiry is representative for the country as the observed enterprises form 90% of the industry yearly turnover. The share of private sector reaches 78.7% of the common capacity for 2008. The industry investments dynamics for 2008 points big differences between private and public sector. The private sector's managers preview 3.5% less investments than the made in 2007, as the public sector expects rise with 24.6%. The biggest relative share (38.8%) of the expected investments for 2008 goes to the energetic and water plants branches, second in previewed amount of investments (36.2%) come the branches, producing goods for medial consumption and the third one is the branch of food and drinks production and the investment goods.

About �6-7 B in Direct Foreign Investment expected in Bulgaria in 2008

 

About 6,000-7,000 million euros in direct foreign investment are expected in Bulgaria in 2008, Executive Director of the InvestBulgaria Agency Stoyan Stalev told a seminar, entitled "Bulgaria: A Good Place for Investment". Stalev said that in the next few years Bulgaria could become a centre for the production of auto parts since major auto manufacturers are operating in nearby Romania, Turkey and Russia. Stalev said that a particularly interesting niche for investment is the production of solar batteries and other facilities. InvestBulgaria seeks to attract investment also in wind parks and in the production of software. He recommended to the local powers to work more for the diversification of tourism since the bulk of the investment in the sector is now focused at the Black Sea and certain mountain resorts. InvestBulgaria supports 100 investment projects worth a total of 15,000 million euros. A total of 40,000 jobs have been opened in them, he said.

 

Metallurgical industry to invest BGN 1.7 B by 2010

The local and foreign investors are expected to pump 1.7 bln levs in Bulgaria's metallurgical industry through 2010, Politimi Paunova, chairperson of the Bulgarian Association of the Metallurgical Industry, told the general assembly of the organisation last week. Industry data shows that production of ferrous and non-ferrous metals like lead, zinc and copper rose 10% in '07. The industry manufactured products for 7.7 bln levs in terms of value last year or 15% of Bulgaria's total industrial output. The only laggard is ferrous metallurgy which posted an output that twice as low the relevant EU mark.

Euromarket Group to invest �160 M in 8 retail and industrial parks

Investra AD, a unit of local vendor of power tools and construction equipment Euromarket Group, said it will invest 160 mln euro over the next two years in the construction of eight retail and industrial parks across the country.The parks will integrate office retail, storage and exhibition premises and will range in floor space from 30,000 to 100,000 sq m.The investor is contemplating adding accommodation facilities to the parks as well.'This is a breakthrough concept for the Bulgarian market. The idea is to provide every tenant with the opportunity to have access to exhibition space, high-quality office premises and leasable storage capacity,' said company officials. The first retail and industrial park will be built in Plovdiv at a cost of 20 mln euro. It will be located on a road linking the city with the Trakia motorway. The park will have a build area of 50,000 sq m. The other selected locations are in Sofia, Varna, Burgas, Ruse, Pleven, Blagoevgrad and Stara Zagora. The Sofia park will be the biggest and will be situated at the ring road. Investra plans to get the construction of five of the parks underway by the end of 2008. The parks will have footprints of 4 to 15 ha. The investor said it has secured sites for almost all of the parks. The lettable space will be marketed to companies active in the manufacture and trade of industrial goods.

Sopharma to invest BGN 60 M in plant

Bulgaria's drug maker Sopharma will invest almost BGN 60 million in a new pharmaceutical plant in Sofia, executive director Ognyan Donev said. Another BGN 60 million has been earmarked for total renovation of Sopharma's production facilities in 2009. We cannot start construction immediately because of administrative barriers, Donev said. Sopharma received a first-class investment certificate for the project.
The pharmaceutical company owns production facilities in the Ukraine, Russia and Serbia. Sopharma plans to enter the markets of Macedonia and Romania, where it is about to purchase drug plants.

Private companies decrease investments

Industrial enterprises in Bulgaria's private sector will decrease their investments by 3.5% in 2008, a business survey by the National Statistical Institute, conducted in March, shows. However, planned investments for acquisition of long-term assets by state and municipal industrial enterprises have increased by 24% year on year, the survey shows.
The largest number of investments will be made in the energy and water-related sectors. Their share compared to the total size of planned investments is 38.8%, while the increase compared to the year before is by 20%. Nevertheless, managers from almost all remaining sectors will earmark less money for their investment programmes compared to 2007.

Sozopol to attract solvent tourists with golf playgrounds

Sozopol Municipality starts policy of stimulating golf tourism developing and attracting more solvent tourists to the region. one of the most significant steps in this direction is the construction of three golf grounds in the area between the municipality villages Ravna Gora and Izvor.Sozopol Municipality gives a chance of private partnership in the golf projects to serious investors as provides the investors terrains of 500 or 1000 decares with the readiness to minister about additional private terrains. The municipality strategy also previews building of big attraction park on the road Sozopol - Bourgas and the bay of camping ‘Gradina'. The three golf grounds will be served by an airport, which landing strip will be 1,800 meters long, enough for small airplanes.  The Sozopol airport is part of the municipality strategy and expects big investors' interest. In a year and a half the new waste water plant of Sozopol city will become a fact. The WWP will serve few towns and resorts in the region - Sozopol, Ravadinovo, Chernomorec, Atia, Diuni and Alepu. The upcoming golf complexes are previewed to have own local plants.

 

Sofia co to invest in elevator plant

Technos, the Bulgarian manufacturer of elevators and hoisting systems, said it will invest 5 mln levs in a new plant near Novo Selo, in the Veliko Tarnovo area. The company has bought for 104,000 levs a disused farmstead and an adjacent 1.7 ha lot. The plant, expected to create 200 jobs, will have access to the Sofia-Varna road. The bulk of the company's output is shipped abroad. It has major clients in the Ukraine.

UK developer unveils plans for Veliko Tarnovo mall

Parkridge, a British private investment and development company, has proposed to the local authorities in Veliko Tarnovo, Northern Bulgaria, to build a shopping mall. Company executives met last week here with city mayor Rumen Rashev. The UK company plans to develop a multi-functional retail center at a cost of around 30 mln euro. It emerged a month ago that John Cutts, the Parkridge executive chairman, was planning retail space investments in Bulgaria and the Ukraine. The entrepreneur intends to zero in on smaller regional cities with 100,000 to 200,000 residents and with undersupply of retail space. Cutts reportedly believes that the Bulgarian market has the potential for eight retail centers while that in the Ukraine could accommodate 20. There is no news concerning the upcoming sale of the city's exiting shopping center, Mall Veliko Tarnovo. It is owned by Britain's European Convergence Property Company.

Poland's GTC to invest in malls

Poland's investment company Globe Trade Centre (GTC) will develop an international chain of malls under the name Galleria, the company said. GTC projects target Romania, Poland, the Czech Republic and Bulgaria.  In Bulgaria, the company will build three hypermarkets: in Burgas, Varna and Stara Zagora. The trade areas will be rented by Forton International, the Bulgarian partner of Cushman & Wakefield, with executive director Sergey Koynov. The three projects were presented at the BalPEx real estate exhibition in Sofia.

Rila Sport to invest � 460M in ski resort

 

The local company Rila Sport looks for partners to finance a BGN 900mn (EUR 460mn) project to expand the mountain resort of Panichishte. Rila Sport is planning to cover 16% of the financing by own resources. The facility would comprise 100 kilometres of ski runs and accommodation facilities for up to 10,000 people. The project should be completed by the end of 2016. Rila Sport has not received approval from the environment authorities in the country. About three years ago, Rila Sport announced plans to invest EUR 30mn in construction of 14 new ski tracks and many ropeways in Panichishte. The project was to be run in a partnership with the municipality of Separeva Bania and aimed at turning the complex into one of the major ski resorts in the country along with the rapidly expanding ski facilities in Bankso, Borovets, and Pamporovo. The ski resort can benefit from its proximity to the capital city Sofia (some 70 km) and the thermal waters in Separeva Banya that create favourable conditions for combining spa and ski tourism.

 Carlsberg Bulgaria invests �1.8 M to raise capacity

 

Bulgarian unit of Danish brewery group Carlsberg said on Tuesday it has invested 3.5 million levs ($2.9 million/1.8 million euro) to increase by 40,000 hectolitres per month the capacity of its brewery in the southwestern city of Blagoevgrad. Apart from the brewery in Blagoevgrad, 110 kilometres south of Sofia, Carlsberg operates a brewery in Shumen, 90 kilometres west of Bulgaria's Black Sea coast. A Carlsberg spokeswoman declined to disclose the installed capacities of the company's two breweries when contacted by SeeNews. "This is the latest investment of Carlsberg Bulgaria, as a part of our consistent development policy - increasing the capacities of our plants, upgrading the production facilities and successful market strategy," Alexander Grancharov, executive director of Carlsberg Bulgaria, said in a statement. The company invested over 31 million levs in its two breweries in 2007, he added. Carlslberg ranked second among the Union of Brewers in Bulgaria (UBB) members with 267,134 hectolitres sold in the first quarter of the year, compared to the 258,000 hectolitres it sold in the first quarter of 2007. The brewery sells the Carlsberg, Shumensko, Pirinsko, Tuborg, Holsten and Budweiser brands. Its main rivals are Dutch group Heineken's Zagorka and InBev's Kamenitza. Bulgarian beer market grew by 9.0% to 5.69 million hectolitres in 2007. Carlsberg had a nearly 25% market share last year.

Deutsche Bank AG launches construction project in Gradoman

 

A new residential complex will be built in the footsteps of Luylin Mountain – at the Gradoman neighbourhood in Bankya, Sofia. This has been the third initiative of Winslow Development and RREEF – the investment unit of Deutsche Bank AG, as now they’re planning to pour some EUR 129 million in the project. The first sod on the construction of gated residential complex Winslow Gardens was turned on 25 April. Stage one should be completed by mid-2010. Glavbolgarstroy has been appointed chief constructor of stage 1.

Schneider to invest BGN 35M in Bulgaria

The investments of Schneider Electric in Bulgaria will reach more than BGN 35 million over the next three years, Andris Bariss, director of Schneider Electric Bulgaria and manager for the South Danube zone of Schneider Electric, said. The company has invested more than BGN 10 million in 2007, and the total sum of its investments in Bulgaria is BGN 23.8 million. The Bulgarian subdivision of Schneider posted a 37-percent rise in sales for 2007, while export has risen by 44%. The company plans to raise the capacity of its plant for contactors in the village of Radinovo, near Plovdiv, by 200% by 2009 compared to 2007. This year, Schneider Electric's Bulgarian subsidiary celebrates its tenth anniversary.

E.ON to re-invest BGN 21M profit in improvements

E.ON Bulgaria will re-invest its whole BGN 21 million profit for 2007 in improving services, the management board chairman of the electricity distribution utility, Manfred Paasch, said. The profit was achieved thanks to the BGN 20 million reduction in operating expenses without staff downsizing. The low-voltage grid in Bulgaria is in such a poor condition that it requires constant investment, Paash went on to say. The regulatory body, however, limits our investment plans with the low electricity prices it approves, he added. In 2008 E.ON Bulgaria will invest BGN 104 million.

Winslow targets � 600M-plus projects

The value of Winslow Developments' real estate projects will exceed EUR 600 million in the next few years, the manager of the construction and investment company, Ivan Mekushin, said. The company launched its first residential project in Sofia, Winslow Gardens, together with Deutsche Bank's property division, RREEF. Winslow Gardens will be built in the Manastirski Livadi residential district, the investment will amount to some BGN 200 million. The project includes construction of streets to the nearby boulevards. Some 60% of the apartments in the complex's first part have been sold already for about EUR 1,300 per sq. m. Winslow Developments and RREEF will start the construction of a gated residential development in Vitosha district by this year's end, another complex will be launched in Bankya next year. The company has so far built seven holiday complexes in the mountain resort of Bansko.

Energy company BEWAG to invest � 80 M in wind-power parks

 

Austria’s energy company BEWAG is to invest EUR 80M in the construction of wind-power generators in the north-eastern part of the country, economy and energy minister Petar Dimitrov informs. The Austrians have already invested EUR 10M in the country in alternative energy producing units. BEWEG has already contacted the National Electricity Company to tackle energy sales.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign direct investment in Bulgaria for January – February 2008

Publication: InvestBulgaria Agency

 

DIRECT INVESTMENT (January – February 2008)1

According to preliminary data, the Foreign direct investment in Bulgaria for January – February 2008 amounted to EUR 432.3 million (1.3% of GDP) compared to EUR 374.9 million (1.3% of GDP) attracted in January – February 2007.

Source: direct investment companies, Privatisation Agency, the National Statistical Institute, the Central Depository, banks.

*/ For assets, a minus sign denotes an increase in holdings, and a positive figure represents a decrease.

The attracted equity capital (acquisition/disposal of shares and equities in cash and contributions in kind by non-residents in/from the capital and reserves of Bulgarian enterprises and receipts/payments from/for real estate deals in the country) for January – February 2008 amounted to EUR 328.6 million, which was 85% of the foreign direct investment. It increased by EUR 25.9 million compared to that attracted in the same period of 2007 (EUR 302.6 million). The receipts from real estate investments of non-residents amounted to EUR 234.3 million compared to EUR 219.4 million for January – February 2007.

The attracted equity capital on privatisation deals with non-residents (that have acquired over 10% of the equity in a Bulgarian enterprise), reported in January – February 2008 did not increase, compared to an increase of EUR 1.4 million in January – February 2007. The attracted equity capital on non-privatisation deals totalled EUR 328.6 million in the reporting period, compared to EUR 301.3 million for the same period in 2007.

The other capital, net (the change in the net liabilities of the direct investment enterprise to the direct investor on financial loans, suppliers’ credits and debt securities) was positive, amounting to EUR 40.5 million in January – February 2008, compared to a net other capital, amounting to EUR 15.7 million for the same period of 2007.

According to preliminary data, the reinvested earnings2 (the share of non-residents in the undistributed earnings/ loss of the enterprise) in January – February 2008 are estimated at EUR 63.2 million compared to EUR 56.5 million in the same period of the previous year.

By country, the largest investments in Bulgaria for the reporting period were those of Greece (13.2% of the total foreign direct investment), the Germany (11.8%) and Austria (11%).

According to preliminary data in January – February 2008 Direct investment abroad increased by EUR 28.8 million compared to a decrease of EUR 19 million in January – February 2007. The invested in 2008 abroad equity capital amounted to EUR 28.8 million, compared to EUR 10 million in January – February 2007.

1 Preliminary data for 2007 and 2008. The 2008 data are subject to revisions with the quarterly reports to the BNB from foreign direct investment enterprises, as well as with the NSI annual data.  2 The 2007 and 2008 data include only banks’ data on reinvested earnings.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

COMPANIES:

 

Zhevago about to acquire Kremikovtsi

 

Ukraine's businessman, Kostyantin Zhevago is about to acquire Kremikovtsi steelworks. He has already bought twenty percent of the bonds, totaling about sixty-five million euro. He declared the deal before Bulgarian state officials on April 11, just after the no-confidence motion against the Cabinet. Zhevago's representatives were received at the Council of Ministers, The Standart was informed. Earlier, the businessman sent a letter to Prime Minister Sergey Stanishev, Minister of Economy and Energy Petar Dimitrov and Finance Minister Plamen Oresharski, in which he informed them of his acquisition of the bonds. The letter also reads that Zhevago is ready to immediately invest a hundred million US dollars in the plant. The Ukrainian businessman stands the biggest chance to acquire Kremikovtsi, well-informed sources from London told The Standart. Kremikovtsi owner, Pramod Mittal, has hired Merrill Lynch to consult him on the choice of investor in Kremikovtsi. It is expected that the plant will pass to a new owner by the beginning of next month. ArcelorMittal, owned by Pramod Mittal's senior brother, Lakshmi, is the second most serious candidate to acquire Kremikovtsi. However, he plans to rent and manage the plant, so as to circumvent the clause, which allows the bondholders to require immediate repayment of the bond loan, if the plant changes hands.

Construction companies compete with banks

 

The race for new clients among construction entrepreneurs spills over into the financial sector. one of the first examples was set by Alexandrov Group, which offers a 12-year financing plan upon the purchase of real estate. The offer was presented at the BalPEx real estate exhibition. At present, Alexandrov Group offers the scheme upon the purchase of an apartment in the Sunny Day holiday complex in the Sunny Beach resort. The prices are: EUR 640 per sq. m, compared to EUR 950 per sq. m for a 12-year leasing. The price goes up by almost 49% for the whole period of financing and the apartment remains property of the construction company until the last instalment. Tour operator Alma Tour is the new player on the real estate market with its subsidiary Alma Realty. The company sells and rents offices in its future business centre on Todor Alexandrov Blvd in Sofia. The 15-storey building will have a floorage of 14,000 sq. m.

How is the appreciation of the Euro affecting Bulgarian companies?

The euro advanced to a new record-high against the dollar today and was changing hands at 1.5975 dollars. The European currency has appreciated by 8.4% since the beginning of 2008 and by 17.5% in the last 12 months. The growing value of the euro in the recent months will definitely affect the financial results of the Bulgarian companies. on one hand the pegging of the local currency to the euro will result in a declining competitiveness of the Bulgarian products as they will become relatively more expensive on the international markets, compared to the products coming from the USA and the Asian countries, whose currencies are pegged to the dollar. Even on the European markets Bulgarian products are facing stiff competition by products from China, where the currency is appreciating at a considerably slower pace against the US dollar. Bulgarian-made products, however, are partially protected by the lack of customs tariffs and other measures imposed on Chinese, US and non-EU goods. The appreciation of the labor costs and the high inflation are another factor, which sends the price of Bulgarian products higher. The poor production efficiency in Bulgaria may also be put down to the outdated production equipment and the lack of investments in its upgrade. The competition from the other EU member countries from Central and Eastern Europe is intensifying and the prospects are not very bright. The negative effect for the Bulgarian companies from the appreciation of the local currency against the dollar could hardly be estimated at this point. Nevertheless, there is one thing clear. Consumers know what is better for them and more often purchase products of international companies producing in dollars. A typical example are recent TV reports showing that the purchase of a vehicle from the USA is considerably cheaper. Fortunately or not no vehicles are manufactured in Bulgaria. This is another sad fact stemming from the disbelief of the global companies that Bulgaria is incapable of manufacturing high value-added products. This holds value not only for vehicles but for many other products manufactured in the country. The real problem is that many Bulgarian-made products are more expensive than products imported from Western Europe, not to mention Central and Eastern Europe. one of the few advantages of the expensive Bulgarian currency is the fact that it partially offsets the the increase in commodity prices on the global markets. Partially, but not sufficiently, judging from the inflation rate. To a certain extent the local companies benefit from the fact that they are buying the raw materials mainly in dollars and are selling their products mainly in euro and leva in Bulgaria or in Europe. This, however, is one of the very few advantages of the expensive lev. We should also take into consideration the fact that the negative effect from the appreciation of the lev, which occurred mainly in the last few months, will transpire after a certain amount of time, which means that time will show how negative this effect will be.

Aspis Bank plans to enter Bulgaria

Aspis Bank is planning to set foothold in Bulgaria in what is the latest expansion of a Greek bank into Bulgaria, the bank's chief executive Constantinos Karatzas was quoted by Greek media as saying, Dnevnik daily reported.Speaking at the bank’s general meeting, Karatzas said that the bank planned to open 20 branches in Bulgaria within three years.The bank can launch operations in Bulgaria with a notification to the local financial watchdog under the single passport mechanism of the European Union. After Bulgaria’s accession to the EU, when Bulgaria joined the mechanism, any financial institution with a registration in the EU can operate in the country without the need to receive a licence from the Bulgarian National Bank.Recently, Greek bank Emporiki voiced its intentions to boost its presence in Bulgaria and Romania, hiring Christos Katsanis, long-time executive director of the United Bulgarian Bank (UBB), itself owned by the National Bank of Greece, to oversee the bank’s expansion abroad.Greek banks currently operating in Bulgaria are UBB, Emporiki, Eurobank EFG Bulgaria, Piraeus Bank and Alpha Bank.

The top 20 insurance brokers In Bulgaria

Marsh EOOD continues to be the leading Bulgarian insurance broker, according to statistics released by the Financial Supervision Commission, even though the company's market share has slipped from 12.84% to 7.51% at the end of 2007. Raiffeissen Insurance broker ranks second with a market share of 7.29% and ING Insurance Brokers is third with 6.21%. The top five also includes SDI Group, which boosted its share from 1.54% at the end of 2006 to 4.74% last year and Pfoe Agency. AVB Leasing Insurance and Delivery Broker also hold more than 3% of the market. There are six new entries in this year's top twenty list Total Ins, Petroins, Trakia Group 7, Porsche Insurance Broker, General Brokers and Balkan Insurance Brokerage. A total of 221 insurance brokers are included in the FSC's 2007 statistics, compared with 187 a year ago. The top 20 companies together hold 60.63% of the market, versus 54.99% in 2006.The premium income of Bulgaria-based insurance brokers amounted to 402.374 million leva (205.73 million euros), the FSC said. 370.239 million leva (180 mln euros) of it was accumulated in general insurance and 32.135 million leva (164 mln euros) on the life insurance segment. Premium income generated via insurance brokers is up 49.6% y/y.

 

№	Company	2007	2006
1	Marsh EOOD	7,51%	12,84%
2	Raiffeissen Insurance Broker	7,29%	2,72%
3	ING Insurance Brokers	6,21%	6,17%
4	SDI Group	4,74%	1,54%
5	Pfoe Agency	4,51%	5,43%
6	HVB Leasing	3,83%	4,44%
7	Delivery Broker	3,20%	1,96%
8	Tetra Ins	2,84%	3,86%
9	MM Insurance Broker	2,44%	2,05%
10	Velmar Broker	2,41%	2,72%
11	Broker Ins	2,26%	2,38%
12	Total Ins	1,76%	0,77%
13	Eurolife Bulgaria	1,58%	2,37%
14	Petroins	1.,7%	1,06%
15	Trakia Group	1,56%	0,51%
16	Porsche Insurance Broker	1,54%	0,00%
17	General Broker	1,53%	0,78%
18	Insurance Brokerage Balkan	1,52%	1,89%
19	Balkanska Insurance Brokerage	1,21%	1,30%
20	Piraeus Insurance Brokerage	1,12%	0,21%

 

Lufthansa to repair airplanes in Bulgaria from October

The repair center for airplanes in Sofia will start working in October, announced Andreas Heizner, vice-president of “Lufthansa technique”, informed Darik radio.The German giant received a certificate for a 1st class investor through its joint venture with 'Bulgarian aviation group”, “Lufthansa Technique-Sofia”. The first airplane to be repaired in Sofia is Airbus A 320 owned by Lufthansa. It will arrive on October, 27. Heitzner added that for “Lufthansa technique” as a world company the presence in Bulgaria through “Lufthansa technique – Sofia” is extremely important. This is a very important member of our world network. The company for repairs and maintenance of airplanes will invest more than 16 M EUR in buildings and equipment on the territory of hangar 3 at Sofia airport. The Bulgarian deputy minister of economy and energy Anna Yaneva handed in to Andreas Heitzner a certificate for a 1st class investor. The investment is highly technological and the employed people will be 360, explained Yaneva while handing in the certificate. The company has already hired 160 highly qualified people to work in the center. “Lufthansa technique” is ready to accept airplanes of other aviation carriers.

Ukrainian firm to renovate security systems of Kozloduy NPP

A contract on improving the safety systems at the Kozloduy nuclear power station's two remaining active units was signed on Tuesday by plant CEO Ivan Genov and Evgeniy Bakhmach, CEO of Ukrainian ICT firm Radiy Kirovohrad. The contract is to the amount of 67 million euro, for which six safety control systems will be replaced, Energy Minister Peter Dimitrov, present at the signing, said. Radiy is a certified firm working to EU standards, Dimitrov said. The contract was signed as part of Ukrainian Foreign Minister Volodymyr Ohryzko's official visit to Bulgaria.

Varna and Burgas airports leaders for Fraport Group

In the first three months of 2008, the airports govern by Fraport Group had serviced over 16 million people, or with 4,4% more than the previous period. Due to the loading during the Easter holidays, the tourism destinations towards South and South Eastern Europe, along with the North Africa ones, marked strong increase in the last month.The road traffic at the airports managed by Fraport Group had increased considerably in March. The biggest growth was marked by the two vacancy airports on local coast.Burgas airport registered 1,354 passengers last month which is an increase of almost 26%. Varna airport marked 22,751 passengers or growth of 17%.

 

Siemens to beef up customer support center in Sofia

Telecommunications company Siemens Enterprise Communications EOOD said it will expand the capacity of its global competence center in Bulgaria. The Sofia center is the biggest of the company's three such outposts in Central and Eastern Europe. The center in Bulgaria, which currently employs 130 staff, supports Siemens markets in Asia Pacific, the Americas, Europe and the Middle East. The center cost around 1.5 mln euro.

Wine&Tourism Expo open doors in Varna

Varna's Palace of Culture and Sports hosts a show for wine and tourism ‘Vinotur - Varna 2008'. The event starts on Wednesday, April 23 and will continue until Friday.Twenty-two Bulgarian wine-cellars will attend the expo, presenting best of their wines and wine tourism possibilities.The show aims to get together local cellars and producers with tour operators and hoteliers from the Black sea coast.The exchange of thoughts and ideas for wine and tourism may place the beginning of the wine tourism in Bulgaria.The visitors will be pleased to try famous Austrian and French wines.

 

 

 

 

 

ANALYSIS:

 

Bulgarians are getting poorer

Publication: Profit.bg

Bulgarians spent 36.2% of their income on food in February 2008, compared to 34.1% a year earlier, data published last week by the National Statistical Institute (NSI) showed.
This trend, which outlines the difficult situation households are in, may be put down to the considerable increase in the prices of agricultural products. The annual statistics in the last few years showed a certain decline in the share of expenses on food of the total expenditure of households, but it is still strikingly high for an EU member country. Unfortunately Bulgaria is nowhere near the western countries in this regard. The share of expenses on food in the USA stands at just 7.2% and the figure is similar in the EU countries as well. In terms of expenses on food Bulgaria rather falls in a group with Vietnam and Egypt where the expenses on food account for over 40% of the total expenditure of households. The increasing interests on loans are an additional burden for Bulgarians. This results in a considerable decline of the purchasing power and the disposable income of Bulgarians. Bulgaria saw the biggest growth in lending (62.5%) in 2007 among the EU member countries, a report of the International Monetary Fund (IMF) shows. Income growth in Bulgaria outpaced inflation last year, official data show. Judging from our wallets and the prices in the stores, however, NSI's statistics is not that convincing. Inflation rate stood at 12.5% last year, statistical data show. Nevertheless, the prices of food products such as oil and cheese went up more than two-fold, while gasoline and diesel prices grew by over 50%. For the first time in 2007 the household income in real terms exceeded by 2.0% the levels recorded in 1995, NSI data showed. And we are supposed to take a pride in this? This means that we have been marking time for the last 12 years.

Expenditure groups	Feb 2007	Feb 2008
	%	%
Monetary expenditure	100	100
Consumer monetary expenditure	86.4	87.1
Foods and non-alcoholic beverages	34.1	36.2
Alcoholic beverages and tobacco	4.9	4.2
Clothing and footwear	2.6	2.8
Housing, water, electricity, gas and other fuels	15	16.6
Furnishing and maintenance of the house	3.7	3.1
Health	6.6	5.7
Transport	5.9	6.1
Communication	5.9	5.4
Recreation, culture and education	3.8	3.2
Miscellaneous goods and services	3.9	3.7
Taxes	3.5	3.5
Other expenditures	10.1	9.5

*data by NSI

Industry Watch: Bulgaria's wealth increasing

Publication: BTA Daily News

The financial wealth of Bulgaria's population stands at 31,000 million leva (15,850 million euro) for the first quarter of 2008, according to Industry Watch's annual report, presented on Thursday in Sofia. The total amounts to 4,100 leva per cepita, or 2,100 euro.The new figure suggests that overall wealth is up by 28.5 per cent since this time last year, which is faster than both inflation and wage rises. Thus the financial assets of the average Bulgarian household are at around 55 per cent of Bulgaria's GDP.Bulgarians are "conservative" with their money, 85 per cent of households preferring to keep them in low-return forms of saving, such as bank accounts (60 per cent) and cash (around 25 per cent). While this does not generate profits, it does mean they will be less affected by the global financial crisis, Industry Watch says.Bank deposits are up in place of money invested in shares and mutual funds, compared to the previous quarter.Net wealth (not counting bank debts) has been going up by 20 per cent annually. However, debts owed to banks amount to 23,000 million leva, Industry Watch says. The share of cash as a percentage of the total wealth has decreased, suggesting citizens' greater confidence in the banking system, and perhaps even a shrinking of the grey economy.Bank deposits are 30 per cent up from 2007, and have doubled since 2001, equalling 35 per cent of the GDP.Housing continues to account for the most in assets. Prices were up by 32 per cent in the first quarter despite the effects of the global crisis, and the rise in prices in Bulgaria continues to be among the world's highest. The total worth of properties in Bulgaria's towns and cities was 68,500 million euro at the beginning of the year. Adding this to financial wealth, this makes the total wealth of Bulgarian households 165,000 million leva (84.5 million euro) as at the beginning of the year.Industry Watch expects financial wealth to continue to rise over the next two years, with households gradually orienting themselves towards forms of savings which promise greater returns.