불가리아 주요경제뉴스(25 - 30 APRIL 2008 )

BULGARIAN ECONOMIC TOP NEWS DIGEST

WEEKLY REPORT ( 25 - 30 APRIL 2008 )

 

 

Sections/headline briefs:

 

 

MACROECONOMY:

 

·        North Korea, Bulgaria party officials hold talks in Pyongyang

·        Denmark calls for more active business with Bulgaria

·        European lobby group BusinessEurope sees GDP growth, inflation in Bulgaria slowing in 2009

·        Ernst&Young survey shows Bulgaria has good investment prospects

·        Bulgaria’s economic growth must not be compared with that of EU

·        Bulgaria economic growth to remain among highest in EU

·        Bulgaria second in real estate price growth

·        Agricultural land in Bulgaria among the cheapest in EU

·        Sofia Stock Exchange ends the fiscal year in the red

·        NPP Kozloduy produced 4.5 TWh of electricity

·        Unit 3 in TPP Maritsa Iztok 3 put in service

·        Hristo Kovachki to build power plant in Serbia

·        Work on Belene NPP site to start before year's end

·        Bulgarian Engineers and Dentists in Demand Abroad

 

 

INVESTMENTS:

 

·        Turks build the biggest Mall in Sofia

·         Malls to be built in Stara Zagora, Kazanlak

·        Austrian, Dutch companies to develop shopping mall in Sofia

·         Bulgaria's tallest building to be erected in Sofia

·        Devnya Cement to invest � 250M in capacity upgrades

 

 

 

 

 

 

COMPANIES:

 

·        Eko Petroleum unit to turn vegetable oil into electricity

·        Insurer Eureko prepares big deal in Bulgaria

·        Sanoma magazines international to buy Netinfo.bg

·        Competition for Voestalpine is strong

·        State bank to support Bulgarian companies abroad

·        American AES and Bulgarian Government mark 2 years of successful partnership

 

 

ANALYSIS:

 

·        NSI: Total business climate indicator rises in fourth straight month in April

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Articles:

 

MACROECONOMY:

 

North Korea, Bulgaria party officials hold talks in Pyongyang

Talks between the delegations of the Korean Workers' Party and the Bulgarian Socialist Party were held on Monday [28 April]. Present at the talks from the Korean side were Choe Thae Bok [Choe t'ae-bok], secretary of the Central Committee of the KWP, and officials concerned and from the Bulgarian side members of the BSP delegation led by Dimitar Dabov, chief secretary of its Supreme Council, and Yordan Pamukov, Bulgarian charge d'affaires ad interim here. At the talks both sides exchanged views on developing the friendly and cooperative relations between the two parties and matters of mutual concern.

Denmark calls for more active business with Bulgaria

Especially for the needs of Danish tourists, which have increased with 65%, the sea capital of Bulgaria Varna received a Danish council. Round 60, 000 people have spend their vacation on Bulgarian Black sea coast last year, and during the upcoming season their amount is expected to reach 100, 000 people, the Danish ambassador claims. Danish diplomats have expressed their desire to stimulate the trade and business between Denmark and Bulgaria.The relations between both countries were in deadlock to 1990, but now significant increasing in the Danish interest towards Bulgaria is observed. one of the proves of the interest towards our country is the fact there are more and more Danish, willing to buy real estate in Bulgaria and the Danish banks give them credits to do it. This fact is an evidence of the international trust in the stability and development condition in Bulgaria.

European lobby group BusinessEurope sees GDP growth, inflation in Bulgaria slowing in 2009

 

European lobby group BusinessEurope expects real GDP growth and inflation in Bulgaria and Slovenia to slow down in 2009, although Bulgaria's real GDP growth will remain high, BusinessEurope said on Friday.Exceeding 6.0% per annum, high growth rates are forecast in particular for Lithuania, Bulgaria and Latvia," BusinessEurope said in its spring economic outlook posted on its website.BusinessEurope expects Bulgaria's real GDP growth to slow to 6.0% in 2009 from 6.5% projected for this year, while inflation is seen slowing to 7.0% from 8.0% in 2008. Slovenia's economy is expected to expand by 4.5% this year and by 4.2% in 2009 and inflation in the country is seen at 4.7% this year and 3.0% in 2009.Real GDP growth of the 27 European Union member states is seen at an average 2.0% in 2008 and 2.1% in 2009. BusinessEurope expects inflation in those countries to average 2.8% this year and 2.3% next year. Bulgaria joined the EU last year and Slovenia became a EU member in 2004. BusinessEurope (www.businesseurope.eu) members are 39 central industrial and employers' federations from 33 countries, representing 20 million small, medium-sized and large companies. It provides twice a year business insight into recent and projected economic developments in Europe, based on a survey of its member federations.

Ernst&Young survey shows Bulgaria has good investment prospects

Foreign investors believe Bulgaria has good prospects as a place in which to make direct 

investments. Its EU membership will lead to shifting the focus from industrial production to activities that generate higher value added.These conclusions are made on the basis of the second edition of a survey entitled "Southeast Europe: An Emergent FDI Destination in Europe." The survey was held among over 200 managers across the world, says a press release BTA received on Thursday.Over 68 per cent of respondents predict that in the next three years Bulgaria will become increasingly attractive for FDI. The reasons for this growing investor interest include low corporate tax rates, reasonable labour costs and flexible labour legislation. Investor interest is stronger than last year, the survey shows.The prospects for FDI would be even better if there is improvement in the telecommunication infrastructure, the quality of life, the access to financing, transport, logistic infrastructure and the social climate.Bulgaria is placed third among the Southeast European countries by attracted direct investments. Over 60 per cent of the money invested in 2007 was put mainly in industrial production (50 per cent) and logistics (7 per cent).One of the serious challenges Bulgaria faces is the rechanneling of investments to hi-tech activities, such as headquarter operation, outsourced services, research and development. It is placed third by these activities. An improvement in this respect will help along the population's  adaptation to the EU membership.Investors see Southeastern Europe as the most attractive region for direct investments: 33 per cent of respondents prefer it to Western Europe.Turkey and Romania enjoy the strongest investment image 

among investors, which explains their being placed first and, respectively, second by FDI amount in 2007.The interviewed recommend more work for reaching the standards and observing the regulations of the EU, eradication of corruption and bureaucracy, improvement of Bulgaria's image abroad, simplification of administrative procedures.The survey "Southeast Europe: An Emergent FDI Destination in Europe" was presented to Finance Minister Plamen Oresharski and the governor of the National Bank of Bulgaria, Ivan Iskrov, by Ernst&Young Bulgaria managing partner Panos Papazoglou, partner Diana Nikolaeva and other company officials.

Bulgaria’s economic growth must not be compared with that of EU

Bulgaria’s economic growth must not be compared with that of the EU because the union is not particularly developing in economics, the economic expert and a co-president of the Centre for economical development Alexander Bojkov reports for Focus News Agency. People have to make the parallel from the point of view where our country is now and what kind of growth our country registers to reach the other country members of the Union, Bojkov said and added that it is not correct to compare Bulgaria with the other countries in the EU because they are much more developed and even their slow economical increase puts them in front of us. Bulgaria’s economical increase of 5-6% for last year may seem significant to the west Europeans but they are at least 30-40 years in front of us in their economical development, the expert added. Compared to the other countries in EU Bulgaria has other problems. We are far from the major group in the EU and we can’t level even with them, Bojkov said and added that for a start our country has to reach the average values of economical development in the Union.

 

 

Bulgaria economic growth to remain among highest in EU

Bulgaria's economic growth will remain among the highest in the EU in the following year according to the prognosis of the European Commission, the Bulgarian National Radio reported. With a growth of 5,8% in 2008, and 5,6% in 2009, the Bulgaria economy is project to remain one of the fasting-growing together with those of Estonia, Lithuania, Slovakia, and Romania. The Commission expects, however, that the growth in all of the EU will slow down, including in Bulgaria. Compared to the fall prognosis, the predicted growth of Bulgaria's GDP is now 0,2% lower for 2008 to reach 2%, and 0,6% in 2009 to settle at 1,8%. The EU Commissioner for Finance and Monetary Affairs Joaquin Alumnia explained that the slowdown was mainly due to the global financial crisis, the growing petrol prices, the inflation, and the shrinking labor markets. The EC prognosis on Bulgaria points out that the country had coped relatively well with the global crisis so far but that its economy was going to slow down, and consumer demand would decrease. It emphasizes the high inflation and the really weak exports, and defines the GDP growth in Bulgaria as "unbalanced". The EC also expects that Bulgaria's unemployment rate would continue to decrease but at a slower pace.

Bulgaria second in real estate price growth

Bulgaria remained second in the world in terms of real estate price growth in 2007, the final ranking of Global Property Guide shows. According to the data, the annual price growth in Bulgaria has reached 34.6%. The Chinese city of Shanghai is first with 35.4% year on year growth. According to analysts from Global Property Guide, the holiday boom in Bulgaria is over, but the stable growth on the real estate market continues. Bulgaria was even first in the ranking last autumn. Slovakia ranked third with 32.5%, followed by Singapore with 31.1% and Hong Kong with 24.95%.

Agricultural land in Bulgaria among the cheapest in EU

The price of the agricultural land in Bulgaria remains among the cheapest in the European Union, shows the statistics of the Community. This announced Ognyan Kalev, executive director of “Agro Finance”. However, the trend since 2004 is the land in Bulgaria to get more expensive. The fragmentariness of the agricultural land in Bulgaria is among the main problems for its reduced value, explained Kalev. According to him, the market is however, dynamic and the proof is the 55% growth in the number of sales in 2006 and 36% growth in 2007.The demand is mainly targeting the bigger lots. There is a price difference depending on the land category and size. With Bulgaria's accession to the EU, the land market has become much more attractive, claimed Kalev. He pointed also out that Bulgaria is leader in the European Union in foreign investments and the ascending trend is expected to continue in the following years. The average growth of the GDP in the period 2000-2007 is 5.5% and on this criterion Bulgaria overtakes the Czech Republic, Slovenia and Poland.

 

 

 

Sofia Stock Exchange ends the fiscal year in the red

Market analysts and brokers say that Bulgaria's Stock Exchange Sofia will end the fiscal year in the red."I doubt that the accumulated losses will be compensated by the end of the year," Nadya Nedelcheva from the Karoll investment company says."The market lost 35% since January. A fifty-percent in crease in the current trade volume is needed so as the Sofia Stock Exchange to end the fiscal year without losses, but I don't think the factors that can trigger such an increase are present," she added."It is hardly probable that by the end of the year the trade volume at the Sofia Stock Exchange will increase to its level of last October," says Tamara Bechava, analyst from the Elana Trading Investment Company.At the end of last October, the BG40 index hit the record 616.58 points, then at the end of last year it went down to 518.06 points and on the last workday of it slumped to 333.13 points.The foreign investors' conduct depends on the condition of the foreign markets. They may become more active once they regain their confidence in the more risky investments."Some of the foreign investments are a little bit concerned with the global economic situation and they abstain from going for big investments," Nadya Nedelcheva says further.According to her, the soaring inflation and the big current account deficit further contribute to the stagnation on the Stock Exchange.

NPP Kozloduy produced 4.5 TWh of electricity

 

Nuclear power plant (NPP) Kozloduy produced some 4.5 TWh of electricity during the first quarter of the year, which was 6.5 % higher than planned. The electricity delivered to the customers amounted to 4.25 TWh (+6.7 %), out of which, 2.95 TWh was delivered to tariff customers in Bulgaria. During the same period, the remaining units in the NPP, the units 5 and 6 (1,000 MW each), operated at full power.

Unit 3 in TPP Maritsa Iztok 3 put in service

 

In the beginning of April, the management of the thermal power plant (TPP) Enel-Maritsa Iztok 3 confirmed that renewal of unit 3 was completed a month and a half before the deadline. The renewal included installation of new Flue Gas Desulphurization (FGD) unit. In this moment, TPP operates with three units and with two FGD units, which reduces emission of sulfur dioxide into the atmosphere by 94 %. During the renewal, which was carried by consortium Enel and E&Z, the boiler and the turbine were refurbished and modernized. The owner of the TPP, Italian Enel, said that power output of three revitalized units was increased from 210 MW up to 227 MW. In the same time, on March 10, unit 4 was disconnected from power grid in order to start the capital overhaul. This unit should be operational by the end of the year. TPP Maritsa Iztok 3 is the first lignite-fired TPP in Bulgaria and Southeastern Europe that has been operating in accordance to EU environmental standards, Enel said. According to earlier statement of Enel in March, the company has invested 160 million euros for environmental projects so far, while overall cost of the renewal of 840 MW plant should reach 600 million euros.

 

 

 

Hristo Kovachki to build power plant in Serbia

 

Bulgarian tycoon Hristo Kovachki plans to build 600 MW coal fired power plant in neighboring Serbia, Bulgarian media reported. The thermal power plant (TPP) should be build near the Kovin coalmine, which has minimum 250 million tons of estimated coal reserves. The cost of the project is estimated at 1 billion euros, and the construction works should last up to five years. Media reported that Kovachki is near acquiring necessary permits for the project. Kovachki bought the Kovin coalmine for 17 million euros in auction in April last year. He outbid EFT, Rundap and Montera. By purchasing the coalmine, Kovachki acquired a license for exploitation of five million tons of coal.

Work on Belene NPP site to start before year's end

 

Work on the site of the future Belene nuclear power plant will start before the year's end and preparation goes as scheduled, according to Genady Teltyan, Vice President of Atomstroyexport, which will build Belene. He was speaking in a Sofia-Moscow video conference with energy experts on Tuesday. He also said that the price of the project has not been adjusted. An agreement between Atomstroyexport and Bulgaria's National Electricity Company (NEK) for the design, construction and commissioning of unit 1 and 2 of the Belene N-plant was signed on January 18 during the Sofia visit of Russian President Vladimir Putin. The main foreign subcontractor of the Russian company is a consortium including the French nuclear energy group Areva and Siemens of Germany. The project is worth 3.9 billion euro. The two units will have a total capacity of 2,000 MW. The first of them will be commissioned in 2013 and the second in 2014. The two sides have not yet agreed on what to do with the spent nuclear fuel. Bulgaria and Russia do have an agreement on the handling of the spent nuclear fuel from Bulgaria's only N-plant, Kozloduy, and could discuss an agreement on the spent fuel from Belene, Teltyan said. Atomstroyexport has already sent 27 experts to Bulgaria. It will need a total of 6,000 employees in the course of construction, including 2,000 Russian experts. During the video conference, Leonid Grigoriev of the Institute of Energy and Finance in Moscow said that coal is going through a rennaissance on the backdrop of the steady increase of fuel prices. He does not expect any change in the structure of fuel consumption in the next 20-25 years: oil and natural gas will remain the prime energy sources because renewable energy sources are still too costly.

Bulgarian Engineers and Dentists in Demand Abroad

 

Bulgarian traditional dishes like Shopska salad and bean soup might become a good livelihood for many Bulgarians. Bulgarian chefs can earn 3000 euro a month in Norway cooking Bulgarian specialties. This is just one of the offers by foreign employers listed in the Employment Agency. Job offers for over a hundred vacancies of different types come from Norway, Cyprus, Malta, Hungary, Austria and Slovenia. Most of the employers are even ready to pay a 13th salary for Bulgarian immigrant workers.  Not only cooks are in the demand but also dentists, construction workers, engineers and carpenters. Many of the vacancies are in Cyprus.

 

 

 

 

INVESTMENTS:

 

Turks build the biggest Mall in Sofia

The Turkish construction company “Kaya” will be the implementor of the construction of the “Serdika Center” Mall in Sofia, informed citybuild.bg.The digging of the terrain has finished and the actual building is ready to start.“Serdika Center” will open in 2010. 70% of the trade areas are already taken and will be rented.The mall is being constructed in association with the Austrian investor "Sparkassen Immobilien AG" and the European market leader in the field of trade centers "ECE Projektmanagement". The total value of the investment in the modern trade complex is 210 M EUR.The mall will be situated on an area of 51 thousand sq. m, will have 3 levels, around 200 luxury shops and 35 thousand sq. m of offices. “Serdika Center” will be one of the biggest trade and business centers in Sofia.2000 new work places will be created within the project.

 

Malls to be built in Stara Zagora, Kazanlak

 

Two new malls will open by the autumn of 2009 in Stara Zagora and Kazanlak, investors said. The total value of the investment will exceed BGN 130 million.The Stara Zagora project will be built by Galeria Stara Zagora on 1.25 ha at the site of former Naslada factory. The trade area of the complex will amount to 30,000 sq. m. The mall will feature a casino, which will be run by an international company. The funding, BGN 100 million, will be provided by a bank loan, Evgeniy Spirov, co-owner in the project, said. Polish GTC is the majority owner of Galeria Stara Zagora. Some 15 companies from Austria, Italy, Belgium, Turkey and Bulgaria have been shortlisted in the tender for chief project executor.The first trade and entertainment complex in Kazanlak will be constructed by Trakia Trade, which purchased a plot of 0.6 ha from the local hospital. The size of the investment is EUR 15 million. The project envisages two underground levels with a floorage of 20,000 sq. m and a six-storey office building. The project will be completed 18 months after the company gets a construction licence, which will happen is about two months, managing director Todor Kolev said.

 

Austrian, Dutch companies to develop shopping mall in Sofia

Austrian property investor Meinl European Land and Dutch mall property developer Multi Development, part of Multi Corporation, will kick off in 2008 their first joint project in Bulgaria, the Dutch company said on its website. The two partners will develop the Forum Sofia Shopping Center. It is situated on a plot of 18 ha in the southern part of the city, near the ring road, opposite to the Business Park Sofia. Construction is expected to get underway this fall. The project has accessibility from the city center as well as from the ring road. The mall, due to open in the 3rd quarter of 2010, will have a build area of just over 85,000 sq m. The floor space is allocated as follows: hypermarket (13,700 sq m), DIY (17,000 sq m), anchors (11,350 sq m), retail/shops (34,030 sq m), restaurants (3,830 sq m), leisure (2,000 sq m), cinema (3,415 sq m). The car parking area will offer 3,800 spaces.

 

 

Bulgaria's tallest building to be erected in Sofia

 

Bulgarian arm of German developer ECE, will shortly launch construction on its 40-storey Europe Tower, company manager Plamen Ilchev reported.The 180m building is said to be the highest in Bulgaria and is due for completion in 2010. The investor, however, is yet to find a contractor to implement the project.The building will be a part of a mixed-purpose complex named Europe Park Sofia that will include office, retail and residential space.The project will cost EUR 500 M.

Devnya Cement to invest � 250M in capacity upgrades

 

The country’s largest cement maker Devnya Cement, part of Italy 's Italcementi Group, is planning to invest EUR 250mn in modernisation and production capacity upgrade. The company has already received a first-class investment certificate for project. It will launch a new clinker and cement unit with production capacity of 3mn tons per year as of 2010. The new installation will be designed for burning solid residuals that would potentially reduce the waste-processing expenditures of the municipalities in the region.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

COMPANIES:

 

 

Eko Petroleum unit to turn vegetable oil into electricity

Eco Bio Fuels Industry, 95%-owned by local fuel distributor Eko Petroleum, has applied for a 15-year permit to operate 51MW capacity for the production of electricity from refined vegetable oil. The company is in talks with several partners, including Italian engineering company Merloni Progetti, to acquire a 20% stake in exchange for investment in the vegetable oil project. Eco Bio Fuels Industry has already earned a top investor certificate from the Bulgarian investment promotion authority in recognition for its plans to spend BGN 200 M (EUR 102.3 M) on the refinery. The power production permit will have to be issued or else the project will not be eligible for loan-financing. The financing scheme will involve 75% of borrowed funds for the implementation of the project. In addition to electricity, the power facility will also generate heating energy.

Insurer Eureko prepares big deal in Bulgaria

 

Eureko is willing to acquire a bank, insurance company or pension fund in Bulgaria, the managing director of the Dutch financial group's European divisions, David Sanders, told the Pari daily. Eureko already owns a company in Bulgaria: insurer Interamerican.
Being one of the biggest groups in Europe, we have serious ambitions for business expansion to Bulgaria, Romania and Turkey, Sanders said. A team has been appointed already to find companies that could fit into the Dutch giant's expansion strategy.
Our operations in Bulgaria are very small, so we will try to find a way for growth by acquiring an insurer or bank, Sanders added. According to data as of end-November 2007, Interamerican was 15th in market share in Bulgaria with an income of nearly BGN 12 million.I do not know how it happened but we failed to set up a pension insurance company in Bulgaria, Philip Kilmartin, who coordinates Eureko's business in Bulgaria, said. The only way to enter the sector now is to acquire one of the existing companies. A few months ago we received a licence for a life insurance company in Bulgaria and it will start operating very soon, Kilmartin added.

 

Sanoma magazines international to buy Netinfo.bg

About 68 per cent of the biggest network of integrated websites in Bulgaria, Netinfo.bg, will be bought by Sanoma Magazines International (SMI), part of Sanoma Magazines of SanomaWSOY. SMI has signed an agreement for the deal, the company said in a media statement as reported by Bulgarian language Investor.bg. The buyers are a group of companies that invest in risk capital. SMI is planning to also invite other shareholders in Netinfo.bg to sell their stocks that currently have about 15 per cent of the shares. SMI has also reached an agreement with the remaining shareholders to buy their shares amounting to 17 per cent of the capital by 2011. SMI publishes in Bulgaria a series of magazines, among which National Geographic, Cosmopolitan, Elle and Story, along with a number of local titles. It also owns websites rozali.com, bliasak.bg and cosmopolitan.bgThe local Competition Protection Commission has to approve the deal. It is understood that Netinfo and the company Sinoma Blyasuk Bulgaria will remain separate enterprises. The current executive director of Netinfo, Viktor Panev, will continue to be its manager.

Competition for Voestalpine is strong

Competition between the states who wanted metallurgic giant Voestalpine to construct a plant on their territory was rather strong, Bulgarian ambassador to Austria Radi Naydenov said for Focus News Agency on occasion of the visit of Bulgarian Minister of Economy and Energy Petar Dimitrov in Austria. Bulgaria was also included as a possibility for investment by Voestalpine. The state would be evaluated for its economic parameters.

State bank to support Bulgarian companies abroad

The Bulgarian Bank for Development will start operating in early summer this year at the latest, as provided for in the law stipulating the establishment of the financial institution. The existing state-controlled Encouragement Bank will cease to operate and will be replaced by the new entity tasked with streamlining the export and technological capacity of local SMEs. The institution will also fund Bulgarian banks lending to SMEs, foreign banks loan-financing buyers of Bulgarian goods and services and will also manage EU funds. The latter option met with stern resistance on the part of some opposition MPs who fear it created opportunities for the mismanagement of EU funds. A controversial paragraph in the transitional and final provisions of the bill was not edited out despite claims it contravened EU regulations by assigning the new bank functions that will put it in charge of funds provided under JEREMIE, an initiative that uses EU financial know-how to support small businesses. The development bank will be eligible to apply for JEREMIE funding. It will then make those funds available to the local businesses through credit lines, through its guarantee fund or through its subsidiary fund for capital investments, said officials from the finance ministry. The capital investment fund itself will acquire equity in SMEs and will provide consulting service regarding their capital structure. The national guarantee fund will issue guarantees that will complement the collateral furnished on loans extended to SMEs.

American AES and Bulgarian Government mark 2 years of successful partnership

 

Two years after ground-breaking for the future thermo-electric power plant (TPP) near Gulubovo, the steel frame for Boiler 1 is ready. It is the result of successful patnership between the American company AES and the Bulgarian government, AES CEO for Bulgaria Peter Litgow and US Ambassador John Beyrle said. They were speaking at a news briefing at the site of the future facility in the presence of Bulgarian Economy Minister Peter Dimitrov, Stara Zagora Regional Governor Maria Neikova and Gulubovo Mayor Nikolai Tonev. AES is building what will become the fourth TPP in the 50-year-old Maritsa East energy complex. Maritza East 1 is owned by the Bulgarian company Brikel AD and a modernization project there is due for completion in 2012. Maritsa East 2, the biggest thermal power plant in Bulgaria, is 100 per cent state owned. Italy's Enel owns 73 per cent of Maritza East 3, and it, too, is undergoing extensive modernization. The energy complex also includes an open-pit mine which supplies the TPPs with coal. Speaking about AES' TPP, Dimitrov said he is "optimistic about one of Bulgaria's biggest and most expensive energy projects". The project is worth almost 1,400 million euro and is the biggest greenfield investment in all Central and Eastern Europe. The future TPP will have two power units of 335 MW each. The first is scheduled to be connected to the national power grid in June 2009 and the second - six months later. As many as 2,500 workers will be employed in the project at peak stages. There are 1,900 of them at the moment, including 90 per cent Bulgarians. AES, which owns the future TPP, provides 30 per cent of the total investment. The rest is provided by a consortium of investors. The contractor is Alstom Power of France, one of the world's two producers of boilers which burn Bulgarian lignite coal. TPP 4 is being built by a new method, has no smoke stacks and will bring down the air pollution levels. Some 12 per cent of the total investment will go for environmental equipment. TPP 4 is designed to operate for 40 years. Economy Minister Dimitrov thanked Ambassador Beyrle for his support for what he called "a successful American project" near Gulubovo. He said that Bulgarians never forget their friends and gave a gift to the outgoing Ambassador - a Bulgarian landscape - as a memento from his Bulgarian years. Ambassador Beyrle said in turn that he is confident about the success of the project and the support for it from the government of Bulgaria, Stara Zagora Region and Gulubovo Municipality. on behalf of AES, he promised Bulgaria a power plant that will run by the strictest standards of the European Union. Ambassador Beyrle mentioned three factors that determine the importance of the project: the size of investment, its potential to allow Bulgaria to reclaim its position as a major energy exporter, and its being an advertisement of Bulgaria as a good place to invest. Economy Minister Dimitrov also said that a project for building a fifth TPP in Maritza East will start to be implemented in the coming months.It has been known for some time that Enel, Brikel and AES are interested in the construction of TPP 5. Dimitrov said that the project was not launched earlier because the new investor needs a technology to collect and store carbon dioxide.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ANALYSIS:

 

 

 

NSI: Total business climate indicator rises in fourth straight month in April

Publication: Profit.bg

Тhe total business climate indicator in Bulgaria advanced by 0.5 percentage points in Apron on March to mark an increase for the fourth consecutive month, the National Statistical Institute (NSI) said. In April the economic conjuncture in the industry remained favorable. The composite business climate indicator declined by 2.4 percentage points in comparison with the previous month, but still has managed to maintain an extremely high level for more than 20 months. The assessments about the present production activity were also more optimistic compared to March, and the expectations for the next 3 months showed that it would retain the same level (according to 57.8% of the enterprises) or would increase (according to 38.8%). For the period January - April 2008 industry's surplus capacity decreased and the average capacity utilization was assessed at 75.7%. The figure represented an increase of 0.7 percentage points compared to January. There was certain deterioration in the competitive position of enterprises both on domestic and foreign market in the last three months, according to managers. The uncertain economic environment and the insufficient domestic demand remained the main problems for the enterprises in the sector. The shortage of labor was also pointed out by more than one fifth of the enterprises in April as a problem. As regards to the selling prices, most industrial enterprises (79.2%) expect them to remain unchanged, whereas 20.1% forecast an increase over the next 3 months. The high expectations about the business situation in construction enterprises over the next 6 months raised in April the composite indicator of business climate in construction by 2.7 percentage points, 2 percentage points below the long-term average. The entrepreneurs’ forecasts about the activity and personnel in the sector over the next 3 months were also optimistic. In the period from January to April the assessments about the production assurance with orders (measured in months) have improved, too - from 5.9 to 6.1, as the enterprises expected an inflow of new orders over the next 6 months. The competition, the uncertain economic environment and the labor shortage continued to be the main factors limiting the activity in the sector continued in April. The negative influence of the material prices also increased. The business inquires conducted by the NSI in the last six months registered a relatively steady share of construction enterprises (over one third) with intentions of hiking selling prices in the sector. The composite indicator of business climate in retail trade remained unchanged in April. Managers' assessments about the present business situation of retail trade enterprises were positive and their expectations for the next 6 months were that it would remain unchanged (according to 63.1% of the enterprises) or improve (according to 35.1%). At the same time retailers did not foresee reduction both in the volume of sales and orders placed with suppliers over the next 3 months. The insufficient demand, the competition in the branch and the uncertain economic environment continued to be the main factors limiting the activity in the branch. In April as compared to the previous month an increase of the relative share of enterprises with financial problems (from 6.8 to 12.1%) was observed. The retailers have been having high expectations concerning the selling prices since June 2007. For the last month the share of managers that expected a price hike stood at 34.9% The more optimistic assessments and expectations about the business situations in enterprises of service sector in April raised the level of the composite indicator of business climate by 4.9 percentage points compared to March. At the same time the managers forecast an increase in the demand for services and additional hiring of labor force over the next 3 months. The most serious problem limiting the activity of enterprises were the competition in the branch and the uncertain economic environment, pointed out by 59.7 and 20.8% of entrepreneurs, respectively. As regards to selling prices, the expectations of two thirds of the enterprises were for them to remain unchanged over the next 3 months.