불가리아 주요경제뉴스 (12 - 21 January 2011 )

BULGARIAN ECONOMIC TOP NEWS DIGEST

WEEKLY REPORT (12 - 21 January 2011 )

 

Sections/headline briefs:

 

 

 

MACROECONOMY:

• Current account gap narrows to EUR 9.8mn in Jan-Nov
• FDI falls more than three times to EUR 894.7mn in Jan-Nov
• Bulgaria to launch large scale privatisation in 2011

·         Bulgaria to face slow recovery, lending still subdued - EIU

 

INVESTMENTS:

• EBRD mulls EUR 31.95mn loan for Bulgarian transportation projects.
• Investment intermediaries enjoy better results in Jun-Nov 2010 - FSC

 

COMPANIES:

• EVN Bulgaria to invest EUR 57.8mn in infrastructure upgrades
• Mining complex Maritsa East to invest EUR 45.1mn in 2011

·         Food producer Bella Bulgaria to expand production capacity

 

 

 

 

 

 

 

 

 

Articles:

 

MACROECONOMY:

Current account gap narrows to EUR 9.8mn in Jan-Nov

Bulgaria’s current account deficit (C/A) narrowed to EUR 9.8mn in January to November from EUR 3.02bn a year earlier, accounting for 8.6% of the GDP, central bank preliminary data showed. The lower deficit was mainly a result of a fall in trade and income deficits and a rise in net current transfers and the services balance. The country’s foreign trade gap shrank to EUR 2.07bn in the first 11 months of 2010 from EUR 3.79bn in the same period of 2009, as the gap represented 5.7% of the GDP. Exports rose by 31.8% on the year to EUR 14.2bn, after decreasing by 24.7% to EUR 10.7bn a year ago. Imports increased by 11.7% to EUR 16.2bn, while in the same period in 2009, it fell by 34.6% to EUR 14.5bn. In November alone, the C/A deficit widened to EUR 337.6mn from EUR 267.4mn a year earlier, due to a higher trade gap, which rose by EUR161.6mn. 

 

FDI falls more than three times to EUR 894.7mn in Jan-Nov

Bulgaria attracted foreign direct investments (FDI) of EUR 894.7mn in January to November 2010, more than three times lower than the EUR 2.78bn in the same period of 2009, central bank preliminary data showed. FDI equalled 2.5% of the projected GDP, well below the 7.9% in Jan-Nov 2009. The Netherlands was the largest net FDI investor in the country with EUR 1.23bn, followed by Cyprus with EUR 109.9mn and Russia with EUR 108.2mn. In November alone, FDI fell to EUR 49.2mn from EUR 256mn in the same month a year earlier. 

 

Bulgaria to launch large scale privatisation in 2011

Bulgaria will start a large scale campaign to sell off state-owned companies and minority stakes, econ.bg reported. The privatisation programme for 2011 includes tourist company VMT Orbita and Bulgarian Rose State Laboratory, which will be removed from the list of state run companies not slated for privatisation. Arms producer VMZ will also be removed from this list and put up for sale, once the parliament adopts a privatization strategy for the company, representatives of the economy ministry said as cited by econ.bg. The 2011 privatisation strategy also includes local tobacco producer Bulgartabak Holding, the Svilengrad Free Trade Zone and possibly the Rousse Free Trade Zone. Construction company Montazhi will be sold through the stock exchange. The state also plans to sell off its minority stakes in a number of companies, among which Nestle Ice Cream Bulgaria and several electricity distributing companies. 

 

Bulgaria to face slow recovery, lending still subdued - EIU

Bulgaria's economy will continue to recover but the growth rate will be slower than government expectations, the Economist Intelligence Unit (EIU) said in a new report. According to the EIU, lending will most probably remain subdued, which will in turn dampen consumption. In addition, investment activity is also expected to be modest because of narrower access to credit resources, the report said. The EIU projects a fragile 2.6 per cent economic growth in 2011, in line with the forecasts by the International Monetary Fund and the World Bank. Bulgaria's gross domestic product (GDP) is seen to expand at an average rate of three per cent by 2015. Consumption is also anticipated to start perking up gradually, but it will continue to weigh on prices, although at a much more moderate level than pre-crisis years. According to the experts, inflation will make up 3.3 per cent in 2011. EIU is sceptical when it comes to the country's plans to join the eurozone under the current government, projecting this will happen in 2015, but at the same time the service praises the state's decision not to make changes to the currency board mechanism.

 

 

 

INVESTMENTS:

 

EBRD mulls EUR 31.95mn loan for Bulgarian transportation projects.

The EBRD mulls extending a loan of up to EUR 91.95mn to support a series of urban transportation projects in Sofia, the bank said in a project description on its website. The project consists of four separate agreements, which will be extended to the urban transport project (EUR 12.95mn), the centre for public mobility’s e-ticketing system (EUR 7mn), the electric transport company (EUR 6mn) and the underground company Metropolitan (EUR 6mn). 

 

Investment intermediaries enjoy better results in Jun-Nov 2010 - FSC

(ADPnews) - Jan 20, 2011 - Bulgarian investment intermediaries saw an improvement in their financial results for June to November 2010, according to a report of the Financial Supervision Commission (FSC) published on Tuesday. However, the number of companies active in the segment declined to 55 in November from 61 in June, as the stagnation on the capital markets forced 11 non-banking entities to file for voluntary liquidation, with some of the permits already invalidated by the financial regulator.

Among the troubled intermediaries were Astra Investment, BulFin Invest, Eurodealing, EFG Securities Bulgaria, Capital Engineer Project, Capital Finance, Leader Invest, Makler 2002, Rock Ridge Investment, CEE Securities and Sofia Invest Brokerage. Sector player TBI Invest asked the financial watchdog to amend its licence to the limited version, which will restrict its trading rights but will allow it to reduce its capital from BGN 1.5 million (USD 1m/EUR 767,000) to BGN 250,000, a request that was cleared in early January.

Most of the intermediaries that expressed willingness to exit the market were minor companies, which experienced a harsher decline in their equity. Nevertheless, all sector players managed to comply with the requirements for capital adequacy and liquidity as at end-November, the watchdog noted. Furthermore, the intermediaries witnessed a 3% rise in funds under management to BGN 48 million, as well as an increase of almost 6% in customer assets to BGN 3.6 billion, according to the report. Their combined trade and investment portfolio registered a decline in August in October, which was, however, offset by the growth recorded in September and November, making up a total BGN 42 million at the end of the reported period.

 

COMPANIES:

 

EVN Bulgaria to invest EUR 57.8mn in infrastructure upgrades

EVN Bulgaria will invest BGN 113.1mn (EUR 57.8mn) in infrastructure upgrades, econ.bg reported, quoting company executive Jorg Sollfelner. Two-thirds will be spent on modernisation of the company's network. Investments will be made in improving the security of electricity supply. In case electricity prices rise, the company vowed to invest more. EVN Bulgaria, wholly-owned by Austrian regional energy utility EVN AG, started operations in 2005, following the acquisition of Elektrorazpredelenie - Plovdiv (Electricity Distribution Company-Plovdiv) and Elektrorazpredelenie Stara Zagora (Electricity Distribution Company-Stara Zagora). Thus, EVN supplies electricity to 1.6mn customers in southeastern Bulgaria. As of December 2007, it also started heating distribution in Plovdiv and Assenovgrad. EVN Bulgaria has poured in BGN 620mn in the period 2005-2009. Its investment programme for 2010 was planned at BGN 146mn. 

 

Mining complex Maritsa East to invest EUR 45.1mn in 2011

The largest domestic coal mining complex Maritsa East plans to invest BGN 88.2mn (EUR 45.1mn) in 2011, the company said in a statement on its website. The investment programme will back the company’s output target of some 27.3mn tonnes of coal. The investment priorities include the construction of a loading terminal for coal supply to the new 670 MW coal-fired power plant, AES Galabovo, built by U.S. power firm AES for EUR 1.3bn; and rehabilitation of the company’s mining equipment. According to previous media reports, Maritsa East beat its output target by 8%, extracting over 26.1mn tonnes of coal in 2010. 

 

Food producer Bella Bulgaria to expand production capacity

Food producer Bella Bulgaria plans to open a second frozen pastry production unit in Svilengrad, the company said in a statement on its website. The company already operates another facility there, thus concentrating production and logistics in the area. Bella Bulgaria is the biggest frozen pastry producer in the country, and also occupies a 40% share on the Romanian market segment.