불가리아 주요 경제뉴스 (7 - 14 October 2011)

BULGARIAN ECONOMIC TOP NEWS DIGEST

WEEKLY REPORT (7 - 14 October 2011)

 

Sections/headline briefs:

 

 

MACROECONOMY:

Ø  Bulgaria's retail sales continued to lose ground in August 2011

Ø  Bulgaria's Export Increases by 34%

Ø  Bulgaria's Foreign Trade Deficit Down 64% in Jan-Aug 2011

Ø  Bulgaria Slashes 2012 Growth Forecast Down to 2.5%

 

 

INVESTMENTS:

Ø  Canada-based Park Energy Corp To Invest 356,000 Euro in Gas Exploration in Bulgaria

Ø  Bulgarian Airport Operator To Invest 20 Mln Euro in Varna Airport Upgrade Project

 

COMPANIES AND INDUSTRIES:

Ø  Bulgaria's IT Domestic Trade in Doldrums as Global Changes Loom – Report  

Ø  Delhaize to open at least 15 Piccadilly stores per year   

Ø  New car sales rise 23.2% y/y in Jan-Sep 2011

Ø  Only Three Percent of Bulgarians Have Tablets or Smart-phones

Ø  Telecoms commission prepares two tenders for cell-phone, internet licenses

 

 

 

 

 

 

 

 

Articles:

 

MACROECONOMY:

 

Bulgaria's retail sales continued to lose ground in August 2011

Bulgaria's retail sales contracted by 2.9 per cent year-on-year and by 0.5 per cent month-on-month in August 2011, the National Statistics Institute (NSI) said on October 6. August was the third consecutive month to see a decline in retail sales in annual terms and the sixth month in a row to observe a drop on a monthly basis. Food and medicines were the single products to record a monthly improvement in sales in August, rising by 7.5 per cent and 6.8 per cent, respectively. Retail trade in clothing and footwear went down by nine per cent, while sales of household appliances dipped 5.9 per cent. Sales of computers and handsets recorded a decline for the second consecutive month despite their strong growth in the first months of the year. on October 7, NSI also published a report on the developments in the country's construction sector in August, which showed an annual drop in output of 9.4 per cent. In monthly terms, the country's construction output recorded a rise of 0.4 per cent.

 

Bulgaria's Export Increases by 34%

Bulgaria's export increased by 34% in the first eight months of 2011, shows the data of the National Statistical Institute. For the period January-August, Bulgaria's export amounted to 25,7 billion levs. Import in Bulgaria also increase -by 13% for the period August 2010-August 2011 and reached 3.2 billion levs. From the beginning of 2011, import in Bulgaria increased by 20% to total to 26.9 billion levs. Bulgaria registers a positive trade balance of 37 million levs in August 2011. But if the expenditures on transport and insurances are included, the gap in Bulgaria's foreign trade for August is 132 million levs. From the beginning of 2011, the trade balance has been negative in the size of 1.13 billion levs as it decreased by 64% at an annual basis compared to 3.14 billion levs for the first eight months of 2010.

 

Bulgaria's Foreign Trade Deficit Down 64% in Jan-Aug 2011

Bulgaria's foreign trade deficit decreased by nearly 64% in the first eight months of 2011 year-on-year. The deficit amount for the months January-August is BGN 1.13 B, compared to BGN 3.13 M for the same period of 2010. The narrower gap is due to the fastest increase of Bulgaria's total exports (to bothEU and non-EU countries), which in January-August 2011 amounted to BGN 26.9 B, an increase of 20.3% compared with the same period of 2010. Foreign trade has been nearly the sole way Bulgaria used to benefit from the global economy's recovery in the last two years. Bulgarian exporter companies have now reached the pre-crisis levels of sales and some firms even upped wages. However, the increase of both exports and imports can be attributed mostly to higher pricesof raw materials and of industrial products, experts, cited by the Bulgarian Dnevnik daily, say. Meanwhile, data from the National Statistics Institute, NSI, released Friday, shows that retail sales remain low, meaning imports are also on the rise over higher pricesof raw materials processed in Bulgaria, along with higher confidence of the households which leads to increased demand. Retail trade is down by 3% in August on annual basis, and 0.5% on monthly basis, making it the third consecutive month of decrease. Even sales of cell phones and computers, which were up in the spring, are going down. There is also a decrease in the sales of appliances, furniture, clothing and shoes.

 

 

Bulgaria Slashes 2012 Growth Forecast Down to 2.5%

Bulgaria's government has sharply revised downwards its economic growthforecast for next year from 4.2% to 2.5%, citing the slow-down in Western Europe. "My preliminary estimates for next year's growth are around 2.5%," FinanceMinister Simeon Djankov said, adding that obviously the previous forecast for 4.2% was unrealistic given "the current events abroad". Germany, Bulgaria's biggest trading partner, is recording a slow-down in itseconomic growth for the second quarter and has cut its forecast for the next one, the minister specified. The Finance Ministry is expected to submit the budget draft for next year to the government next week. After the cabinet gives it the green light, it will be tabled for debates in parliament. Driven by strong exports, as well as the good performance of the industry and services sectors, the Bulgarian economy has started to expand, but too weakly and unsteadily. The economy expanded by 2% in the second quarter on an annual basis, down by 1.4% in comparison with the previous quarter, which marked the first considerable increase in economic growth since the country plunged into a recession. The seasonally adjusted GDP edged up by 0.3%. The International Monetary Fund recently downgraded its forecast for the 2011growth of the Bulgarian economy to 2.5% from a projected 3% estimate made at the beginning of the year. Meanwhile the European bank for Reconstruction and Development (EBRD) lowered its annual economic growth forecast for Bulgaria from 3.1% to 2.3% in 2011. All forecasts for the Bulgarian economy in 2011 are below the 3.6% growthprojected by the Bulgarian government in its 2011 budget.

INVESTMENTS:

 

Canada-based Park Energy Corp To Invest 356,000 Euro in Gas Exploration in Bulgaria

Canada-based Park Energy Corporation said it has reserved 500,000 Canadian dollars (356,000 euro) of the proceeds of a private placement of shares to be used in its gas exploration project Vranino 1-11 in northeastern Bulgaria. on September 30, Park Energy issued 9,975,000 shares pursuant to private placement subscription agreements for aggregate proceeds of 748,125 Canadian dollars, the company said in a statement on its website (http://parkplaceenergy.com/). The company also issued 3,288,600 shares pursuant to the conversion of a promissory note in the amount of $157,500 (115,000 euro). In October 2010 the Bulgarian government awarded Park Place the oil and gas concession of the Vranino 1-11 block, located in the hydrocarbon Dobroudja basin in the northeastern part of the country. The project's exploration programme will start in 2012 as the total claim size is 39,742 hectares.

 

Bulgarian Airport Operator To Invest 20 Mln Euro in Varna Airport Upgrade Project

Bulgarian airport operator Fraport Twin Star Airport Management said on Wednesday it will launch a 20-million euro rehabilitation project of Varna Airport's runaway. Fraport Twin Star Airport Management signed a contract with German construction company Max Bogl Bauunternehmung (www.max-boegl.de) in order to complete the project, it said in a statement. Due to the construction works, scheduled to start on October 15, Varna Airport will be closed till the end of February 2012, with Burgas Airport servicing all its scheduled flights. In 2006, Fraport Twin Star Airport Management, a 60/40 joint venture of Fraport and Bulgarian company BM Star, won a 35-year concession to manage the airports in the Black Sea cities of Varna and Burgas Varna, located on the northern Black Sea coast, is a major gateway to the local seaside resorts for millions of tourists.

 

 

COMPANIES AND INDUSTRIES:

Bulgaria's IT Domestic Trade in Doldrums as Global Changes Loom - Report

Bulgaria's domestic trade and distribution of hardware and software are at a crucial junction after sales declined for a second consecutive year, according to a consultancy report. The combined turnover of 27 hardware and software distributers in Bulgaria reached a total of USD 362.4 M in 2010, reveals Business Ranks & Analytics Bulgaria:Distribution Business in IT Sector in Bulgaria in 2007-2012, a report of independent consultancy "CBN - Pannoff, Stoytcheff & Co." Of the surveyed 27 companies in question, 12 are multifaceted distributors ofhardware and software (including five that are among the largest corporate taxpayers in Bulgaria), and 15 are niche suppliers. The survey focused on ten most important business indicators, including revenue, employers, debts, salary spending, gross margins, etc. Even though the combined sales of the surveyed companies are described as "impressive" for the scope of the Bulgarian market, as in 2009, they are below the peak level of 2008. The report points out as a surprise the fact that even though the total turnover of the IT distribution sector in Bulgaria is down by several dozen million of USD, the number of employees in the sector remains unchanged. However, the problems have translated into lower productivity for a third year in a row as well as the first ever double-digit percentage point decline of salaries in the sector in Bulgaria. The survey has found that the amounts of hardware equipment on storage have increased, as have the amounts of debt of the distribution companies. "The challenges before the IT distribution sector in Bulgaria are extremely challenging. In addition to the crisis, the gray market, the pressure on vendors for unsustainable sales growth, weakening marketing, and hardly any PR activity, as well as the contracts for direct supplies with the retail chains, the distributors are faced with historic changes. After a 20-year model based on desktop computers, bothhardware and software services are faced with a global technological changes stemming from smartphones and tablets," the CBN report states. At the same time, the consultancy has found a certain sustainability of the ITdistribution sector in Bulgaria. Compared with the 2005 level, the sector currently has 240 jobs and USD 134.4 M more in revenue, even though the number of companies had declined by 8.

Delhaize to open at least 15 Piccadilly stores per year

Belgium's Delhaize Group, the new owner of Bulgaria-based supermarket chain Piccadilly, plans to increase the number of its stores in the country by about 15 a year, Erikjan Lantink, Piccadilly's newly-appointed chief operating officer, said on October 7 2011, Lantink made the statement at the opening of the chain's new supermarket, in Sofia's office and retail complex Sopharma Business Towers. Piccadilly plans to open several more supermarkets in Sofia of its Piccadilly and Piccadilly Express brands by the end of 2011, of which three have already been contracted. Delhaize entered Bulgaria's market several months ago through the purchase of the Piccadilly, Piccadilly Express and Tempo hypermarket chains as part of a larger deal with Serbia's Delta Maxi group. Apart from its planned chain expansion, the Belgian company also aims to add more local products to its portfolio and to increase the share of its own product brands.

New car sales rise 23.2% y/y in Jan-Sep 2011

New car sales increased by 23.2% y/y to 16,950 units in Jan-Sep, according to data of the local car importers association quoted by investor.bg. The upward trend continued for an eleventh month in a row accelerating from 21.3% y/y in Jan-Aug. The sales of new passenger cars went up by 21.2% y/y to 15,983 units in Jan-Sep. The market leader was Volkswagen with a share of 11.56% in Jan-Sep, followed by Ford (8.7%) and Toyota (8.6%). The car dealers have sold a total of 967 new trucks and buses (up by 70.2% y/y) since the beginning of the year. Sales of new cars, buses and trucks in Bulgaria fell by 25% on the year to 20,085 in 2010, as the market was still facing a slump in demand due to the financial crisis. Sales in the last two years plummeted 65.3%, after rising for nine straight years. 

 

Only Three Percent of Bulgarians Have Tablets or Smart-phones

A recent survey by M-Tel reveals that 32% of the Bulgarian people who use mobile communication services are interest in the latest technologic developments on the market. However, about 20% of the Bulgarians say they rarely use high-tech gadgets in their everyday life. And while 19% of the Bulgarians say they have a laptop, only 3.5% have a smart-phone or a tablet. The survey also shows that 69% of the Bulgarians use social networks.

Telecoms commission prepares two tenders for cell-phone, internet licenses

The state telecoms commission intends to issue a new license in the 1,800 MHz range, which can be used for GSM, UMTS, LTE and WiMAX mobile networks, investor.bg informs. The procedure responds to requests for operations in the said range of local leading satellite TV provider Bulsatcom and local alternative telecom operator Max Telecom. Also, the commission intends to award a permit for the use of radio spectrum for electronic communications network through broadband wireless access in the 40 MHz band in the 3,5 GHz. The local Bulgaria Connect has asked for the permit. Usually, the companies use the WiMAX technology for that range. The regulator says that those services should aim to provide broadband access to end users.

 

Reported by:

Georgi Iliev

KOTRA Sofia

Korea Trade-Investment Promotion Agency

Commercial Section of the Embassy of the Republic of Korea