불가리아 주요 경제뉴스 (31 August – September 5 2012)

BULGARIAN ECONOMIC TOP NEWS DIGEST WEEKLY REPORT(31 August – September 5 2012)

 

Sections/headline briefs:

 

MACROECONOMY:

Ø  Bulgaria’s public debt rises to 17.7% of GDP at end-July 2012

Ø  Bulgaria's unemployment rate flat at 12.4% in July – Eurostat

Ø  Bulgaria's Raw Material Exports Cause Concern

Ø  Wholesale prices of food in Bulgaria up 9% y/y in August

Ø  One Billion Cubic Meters of Natural Gas under Bulgaria's Svilengrad

Ø  Bulgaria's GDP Increases by 0.3% Q2 2012 Q/Q

Ø  Bulgaria Leapfrogs to 62nd in Global Competitiveness Ranking

 

INVESTMENTS:

Ø  Fraport to invest EUR 35.8mn in new passenger terminal at Burgas Airport

Ø  Bulgaria Seeks Investor for 49% of Kozloduy NPP

 

COMPANIES AND INDUSTRIES:

Ø  Bulgarian SMEs receive additional financing under EU competitiveness programme

Ø  EC President and Bulgarian prime minister open second Sofia Metro line

Ø  Bulgarian drug maker Sopharma 8-mo sales revenue rises 2.0%

Ø  Agreement Signed for Sale of State-owned International Contractor Technoexportstroy

Ø  China Interested in Importing Bulgarian Maize, Alfalfa

 

 

 

 

 

 

 

 

 

Articles:

 

MACROECONOMY

 

Bulgaria’s public debt rises to 17.7% of GDP at end-July 2012

Bulgaria’s general government debt, excluding state guarantees, rose by 16.9% (EUR 1.2bn) m/m to EUR 7.06bn at the end of July, due to the Eurobond issue placed by the government that month, according to preliminary finance ministry data. The monthly rise came after total public debt dropped 0.5% as of end-June. The growth in external debt (27.6% m/m and 37.1% y/y) resulted in public debt-to-GDP ratio rising to 17.7% in July, up from 15.2% in June and 13.7% a year earlier. Domestic government debt rose to EUR 2.52bn from EUR 2.48bn at end-June. It went up by 21% on the year. An additional 1.4% of GDP is booked as state guarantees. As per 2012 budget projections the government debt will reach 18.7% of GDP at the end of 2012. 

 

General government debt, EUR, mn	Dec-09	Dec-10	Dec-11	Jan-12	Feb-12	Mar-12	Apr-12	May-12	Jun-12	Jul-12
total	4,828.50	5385	5945.9	5,892.60	5972.4	6111.4	6136.7	6066.5	6036.9	7056.2
domestic	1,538.70	2011.5	2458.3	2,412.50	2516.7	2618.6	2616.1	2473.5	2482.9	2522.5
external	3,289.80	3373.5	3487.6	3,480.10	3455.7	3492.7	3520.7	3593.1	3554	4533.7
									705
m/m, %
total		2.00	5.91	-0.90	1.35	2.33	0.41	-1.14	-0.49	16.88
domestic		2.4	8.3	-1.9	4.3	4.0	-0.1	-5.5	0.4	1.6
external		1.78	4.28	-0.22	-0.70	1.07	0.80	2.06	-1.09	27.57
y/y, %
total		11.5	10.4	12.0	14.1	16.2	16.9	14.3	13.2	31.0
domestic		30.7	22.2	26.0	32.5	34.9	32.2	23.1	20.5	21.4
external		2.5	3.4	4.0	3.6	5.2	7.7	9.0	8.6	37.1
Source: Central bank

 

 

Bulgaria's unemployment rate flat at 12.4% in July - Eurostat

Bulgaria's unemployment rate was 12.4% in July 2012, unchanged from the previous month but considerably above the unemployment rate in the EU27 - 10.4% (down from 10.7% in June), Eurostat data showed. The unemployment rate followed a stable upward trend in H2 2011 and is above the rate, measured in terms of registrations with the Bulgaria's labour agency. The latter was 10.8% at the end of July, flat m/m. In July, the number of the unemployed increased slightly compared to June - up by 0.5%. In annual terms the number however increased by 13% - a higher growth than 11.5% y/y in June. 

 

Bulgaria's Raw Material Exports Cause Concern

Bulgaria's growing exports of raw materials appear to be causing concern about both the inefficiency and low value added of the Bulgarian economy, and the environmental situation in the country. "While Bulgaria's economy slowly but certainly is sinking, hundreds of tons of grain,scrap, and timber are being loaded on ships to be exported to other countries," the Bulgarian news agency BGNES writes in a report from the Black Sea port of Varna. The report stresses a recent statement by Bulgarian Agriculture Minister Miroslav Naydenov that there is a huge market for Bulgarian timber since a cubic meter oftimber costs EUR 100 in Greece. "However, he didn't even ponder over the matter why Greece isn't seeing such mass tree felling as the one in Bulgaria," the BGNES Varna correspondent comments. The critical article goes further to remind that in the recent years there has been large-scale forest clearing in Bulgaria because of the construction of ski tracks, vacation complexes, and residential quarters. "The destruction of a territory's "lungs" often leads to severe natural calamities," the report concludes. It also touches on another point – the fact that even though it has seen growth recently, Bulgaria's export seems to depend a lot on raw materials such as timber,grain, and as well as scrap, with high value-added industries showing little growth inexports.

 

Wholesale prices of food in Bulgaria up 9% y/y in August

Wholesale food prices have increased by 9% y/y in August, BNR reported. Food prices in the country have posted a rise during the summer, in contrast to the seasonal downward trend in June, July and August. The wholesale food price index climbed to 1.986 points in mid-August from 1,866 points in mid-January. The hike is due to bad weather conditions and energy prices hike. Vegetable prices are also above their year ago levels, which is not typical for the season. Rising utilities prices in the country pushed up consumer inflation to 3.1% y/y in July and we expect a further rise in inflation in the coming months due to higher prices of food and fuels. 

 

One Billion Cubic Meters of Natural Gas under Bulgaria's Svilengrad

The deposit in the Thrace Bloc could meet one-third of the country's demand for the fuel. The Bulgarian part of the so-called oil and gas basin spreading over the territory of Greece, Turkey and Bulgaria, may provide as much as one billion cubic meters of natural gas per year and thus meet a third of the country's demand for the fuel, preliminary explorations show. At present, Bulgaria consumes between three and 3.2 billion cubic meters of natural gas per year, of which only ten percent is home-extracted. If the Thrace bloc proves reliable, it can provide a third of the country's natural gas at prices 40% lower than these of the natural gas imported from Russia. The explorations in the region of Svilengrad, whose start was announced by economy minister Delyan Dobrev on Sunday, will be carried out with the so-called vibration method, which is absolutely harmless for the people and the environment. The activities start on September 15th and will last for about two and a half months.

 

Bulgaria's GDP Increases by 0.3% Q2 2012 Q/Q

Bulgaria's GDP increased by 0.3% on the quarter and expanded by 0.5% on the year in the three months through June, according to the Bulgarian Statistical institute's seasonally-adjusted data. In the second quarter of 2012, Bulgaria's GDP at current prices amounted to BGN 19.01 M (EUR 9.72 M/USD 12.23 M), or BGN 2 602 (EUR 1 330/USD 1 705)  per capita. Gross value added at current prices in the second quarter of 2012 amounted to BGN 16.408 M. As compared with the second quarter of 2011 the agricultural sector increased its share in the gross value added of the economy by 0.5 percentage points to 5.4% in the second quarter of 2012. The share of industrial sector reached 33.4%, down by 0.5 percentage points. The share of services remained at the level of 61.2%, as it was at the same period of the previous year.

 

Bulgaria Leapfrogs to 62nd in Global Competitiveness Ranking

Bulgaria's economy has jumped 12 places up in the World Economic Forum'scompetitiveness ranking and is now placed 62nd. Among all 144 countries included in the report, only Kazakhstan and Ecuador have moved more positions up the ranking. The Balkan country is no longer EU's least competitive member state, as it is followed by Slovakia (71st), Romania (78th) and Greece (96th). Bulgaria's previous best ranking was in 2010, when it was placed 71st. The most significant factor for the country's improvement in terms ofcompetitiveness is its macroeconomic environment, which is currently ranked 31st out of 144 countries. Corruption and the inefficient government bureaucracy remain the most problematic factors for doing business in the country, followed by the inadequate supply of infrastructure. Switzerland, for the fourth consecutive year, tops the overall rankings in The GlobalCompetitiveness Report 2012-2013, released Wednesday by the World Economic Forum. Singapore remains in second position and Finland in third position, overtaking Sweden (4th). These and other Northern and Western European countries dominate the top 10 with the Netherlands (5th), Germany (6th) and United Kingdom (8th). The United States (7th), Hong Kong (9th) and Japan (10th) complete the ranking of the top 10 most competitive economies.

 

 

INVESTMENTS:

Fraport to invest EUR 35.8mn in new passenger terminal at Burgas Airport

Fraport Twin Star Airport Management, the 60/40 joint company of Germany's Fraport and local BM Star, operating Bulgaria's two seaside airports, will invest BGN 70mn (EUR 35.8mn) in the construction of a new passenger terminal at Burgas Airport, the company said on its website. The new terminal will have a total area of 21,000 square metres and projected capacity of 2,700,000 passengers. The construction works are expected to be finalised by mid-2013. 
The number of passengers serviced by the airport in Burgas rose by 9.6% y/y in Jan-Jul. Fraport Twin Star Airport Management operates the airports in Varna and Burgas under a 35-year concession contract signed in 2006. 

 

Bulgaria Seeks Investor for 49% of Kozloduy NPP

"Bulgaria will seek a strategic investor for 49% of the capital of Kozloduy NPP - New Capacities," the director of the company Lyuben Marinov stated for economymagazine.bg. "The purpose is that Bulgaria keeps its majority share in Unit 7 of Kozloduy NPP," Mr Marinov commented. "The new unit 7 of the nuke will be protected with the most modern safety systems," Lyuben Marinov added. The new safety systems will become clear after the elaboration of the technical and economic analysis by the US company Westinghouse.

 

 

COMPANIES AND INDUSTRIES:

 

Bulgarian SMEs receive additional financing under EU competitiveness programme

Bulgarian small and medium enterprises (SMEs) will receive BGN 118mn (EUR 60.3mn) additional payments this year under the competitiveness operational programme of the EU for Bulgaria, the economy ministry announced. Some BGN 85.2mn of the extra funds will finance 121 projects for technological modernisation from the reserve list that comply with the technical and financial requirements. The remaining BGN 32.8mn will be allocated to 21 projects for innovations. 

 

EC President and Bulgarian prime minister open second Sofia Metro line

The newly opened line of Sofia subway is an example of what can be expected from Europe, Jose Barroso said. European Commission President Jose Barroso and Bulgarian Prime Minister Boyko Borisov have opened the second Sofia Metro line. "It is a pleasure to attend this opening. This is a great day for Bulgaria and Sofia, which is the result of the efforts of the European Commission", Mr. Barroso said, cited by FOCUS News Agency.  This project is a testimony to the fact that Bulgarian government and Sofia Municipality wish to invest in the future of the city and its citizens. The new metro-diameter will improve the transport system and will increase its potential", Jose Manuel Barroso stated. He said that with the opening of a new subway section will reduce pollution and will be shown historical landmarks in Bulgaria. "This is a good example of the integration of all transport systems in a city," the EU Commission President said. According to him, the planned expansion of the subway to the Sofia Airport will connect Bulgaria to Europe and the world. "The newly opened line of Sofia subway is an example of what can be expected from Europe. 50 percent or EUR 476 million of the cost of the subway is provided under the EU funds", European Commission President Jose Manuel Barroso said at the opening of a new line of Sofia subway. According to Mr. Barroso, the new line will make traffic in the city faster and more secure, would foster economic development and improve the living conditions of citizens. "This is the meaning that we give to the words" green growth "," sustainable development," Jose Barroso said. "It is that added value that will lead the development direction of EU cohesion policy in the future. We are currently in negotiations for future budget for the period 2014 – 2020. The European Commission launched a version that is very well balanced. It is very important to have projects like Sofia subway to show what the EU funds can build to ensure growth and prosperity," the EU Commission President said. In his words, cohesion policy is a cornerstone of European policy and namely projects like this for the subway can be given a specific dimension of the value of EU funds. Barroso expressed his delight that one of the stations in Sofia was named after the European Union. "This demonstrates that we stand side by side t - the European Union, Sofia, Bulgaria," he said. Barroso expressed his gratitude to all who have worked on the subway project. "Thanks to those who bequeathed four kilometers of tunnels in the 60s which we used. I would like to thank mayors, councilors, engineers, workers, deputy prime ministers, minister of transport and to all who have contributed to the construction of the subway", Prime Minister Boyko Borisov said. "I am delighted that EU Commission President Barroso wrote in his statement on the subway extension. I hope by this afternoon he to put down Business Park metro station and two other stations that showed him ", he said. Borisov said that the subway extension will be one of the priority projects. "Here comes the programming period 2014 - 2020, priority will be building on Lot 3 of Struma and Hemus motorways", he said. "We do not whimper for money in the European Union, we absorb many times more money from EU funds. I expect Barroso to continue writing "I Love Bulgaria" and to continue to work on that important infrastructure projects together. When there are such objects, it is high-spirits for the nation. That is democracy," Prime Minister Boyko Borisov said. "Today Sofia celebrates and Bulgaria is proud because of the Sofia subway and the spectacular success in its construction, is a symbol of modern, successful, able, European Bulgaria", Bulgaria President Rosen Plevneliev said at the opening of the second metro diameter of the Sofia subway. „The history of this project began 42 years ago, the idea of Trakiya motorway is 48 years old, and it is no by chance that the projects for which the Bulgarians dream of several generations found their total acceleration and successful realization in recent years," Rosen Plevneliev said. "The great success of the subway is the result of professional work, political will and European solidarity. Thousands of builders, designers, engineers and managers work double tides, make decisions and show by their actions that Bulgaria can manage projects for billions until the last day, the last euro cent - fair, transparent and observing the rules", the President said. New 11 km of subway lines will connect the residential districts of Lozenets and Nadezhda as of today, the mayor of the capital Yordanka Fandakova said at the official opening of the second Sofia Metro line. Every day 130,000 more people will commute to the city center in less than 10 minutes. In this way nearly one third of Sofia’s residents can use the most modern, fastest and most ecological public transport every day, she added. The second Sofia Metro line is not only the biggest infrastructure project in Bulgaria, but we can proudly say that Brussels assessed it as an example of transparent, modern and effective absorption of European funds, said Yordanka Fandakova. "In the recent years Sofia has been working hard to extend Sofia Metro and the efforts were worth it. In this way we ease the traffic in the city and reduce harmful emissions. The subway renovated and widened boulevards, the entire adjacent infrastructure, extended and built large underground parking lots, which we expected for 20 years. In addition, it reconstructed well-known buildings in the city center, such as the Military Club. It also created 500 jobs," said the mayor of Sofia. "While building the subway, we unearthed part of the history of ancient Serdika and Sredets. These are unique finds – part of Sofia’s historical and cultural heritage. on an area of 19,000 square meters we are building one of the biggest underground museums," added Yordanka Fandakova. After the official opening EC President Jose Barroso and Prime Minister Boyko Borisov unveiled a metal sculpture – a symbol of the EU – at European Union subway station. After that they visited the archeological excavations at the ancient complex above the subway station next to the Sheraton hotel.

 

Bulgarian drug maker Sopharma 8-mo sales revenue rises 2.0%

Bulgarian drug maker Sopharma [BUL:3JR] said on Tuesday its sales revenue rose 2.0% in the first eight months of 2012. Exports increased 8.0% through August while revenue from domestic sales dropped by 10%, Sopharma said in a statement to the Bulgarian Stock Exchange (BSE). In August alone, Sopharma's sales revenue fell by 6.0% year-on-year. Revenue from sales in Bulgaria increased by 1.0% while exports were down 8.0% year-on-year. Sopharma (www.sopharma.bg) exports to 28 countries. Blue chip Sopharma was trading 0.2% higher at 2.46 levs ($1.58/1.26 euro) in a volume of 13,147 shares by 1250 GMT on the BSE on Tuesday.

 

Agreement Signed for Sale of State-owned International Contractor Technoexportstroy

The Privatisation and Post-privatisation Control Agency and the AT Engineering 2000 building company have signed an agreement on the sale of 103,970 shares or 100 per cent of the capital of Technoexportstroy EAD, the Agency said on Wednesday. Technoexportstroy was sold for the amount of 51 million leva, which was paid by the buyer in total. The buyer is obliged to keep the activity of the company for at least three years after acquiring ownership over the shares. The buyer may not initiate or support, directly or indirectly, the liquidation or winding up of the company in the meaning of the Commercial Act, also for three years after obtaining ownership of the shares. Technoexportstroy is a Bulgarian company established in 1964 and registered as first class international contractor and consultant in more than 20 countries in Europe, the Middle East, Africa, as well as with international financial and investment institutions such as the World Bank and the Arab Fund. In the 45 years since its inception the company has completed over 650 prestigious projects as main contractor.

 

China Interested in Importing Bulgarian Maize, Alfalfa

Bulgarian Deputy Agriculture and Food Minister Tsvetan Dimitrov met with Pu Changcheng, Vice Minister of China's General Administration of Quality Supervision, Inspection and Quarantine, Dimitrov's Ministry said on Wednesday. The two considered the timeframe of authorization of the procedures for Bulgarian agricultural exports to China. The files for maize and alfalfa feed are at the most advanced stage. After Chinese experts complete their September 1-9 on-site checks in Bulgaria, the Chinese side will state its official position. Dimitrov and Pu agreed to make the authorization timeframe as short as possible. Bulgaria has a strong interest in a possible Chinese decision to allow the import of processed milk and meat products to China, Dimitrov said. The meeting was also attended by Bulgarian Ambassador to China Plamen Shoukyurliev, Bulgaria's Food Safety Agency Deputy Executive Director Anton Velichkov and the Executive Director of Bulgaria's Executive Agency on Vine and Wine, Krassimir Koev.

 

 

 

 

Reported by:

GeorgiIliev

KOTRA Sofia

Korea Trade-Investment Promotion Agency

Commercial Section of the Embassy of the Republic of Korea