Financial news

Bulgaria's revenue from tourism (without transportation) has reached EUR 646.3 million for the first half of the year, a 25.1% year-on-year rise, according to preliminary data of the Bulgarian National Bank (BNB). The improvement is associated with the prolonged winter season as well as with the early start of the summer tourist period, which commenced yet in April this year. Other reasons are the good proportion of the services to prices, as well as the development of ecological, cultural and historical tourism. The tourist revenue this year is the highest since 1989 on. 

Insurers paid BGN 237 mln of damages in 2003, the National Statistical Institute announced. Companies’ revenue from the sale of insurance policies rose by BGN 48 mln up to BGN 667 mln, according to the NSI data. BGN 74.78 mln of the revenues came from life-insurance policies, and BGN 592 mln were from property insurance policies.

Bulgaria's fiscal reserve has shrunk from BGN 5.185 billion for the first half of 2004 to BGN 4.096 billion at the end of July, following the redemption of the DISC bonds, budget performance data for the first seven months of the year show. The item of operations in securities and financial assets in the consolidated programme shows minus BGN 1.286 billion. The DISC buy-back operation was carried out in July and exceeded USD 670 million.

Privatization

PA announced a public open-bid auction for the sale of the Plant for medical products, Ihtiman – a self-contained part of Medical Equipment SP JSC – Sofia. The initial auction price is BGN 300 000, and the bidding tick – BGN 20 000. The deposit for participation in the auction is BGN 60 000.

Companies

Revenue at Bulgartabac Holding Group declined in the first half of 2004 but expenses fell sharper still to allow Bulgaria's tobacco monopoly to turn in a net profit of BGN 7.584 mln, shows the consolidated balance sheet of the company. H1 net sales fell 13.93 percent to BGN 181.06 mln versus BGN 210.36 mln a year earlier. Expenditures were down 18.45 percent to BGN 163.7 mln versus BGN 200.75 mln in the first half of 2003. The value of warehoused stocks decreased from BGN 222.7 mln in late June 2003 to BGN 173.65 mln towards the end of the first half of 2004.

The Bulgarian Export Insurance Agency (BAEZ) will start employing a preset factor number that will free the company from the limit on its insurance capacity imposed by the amount of money it receives from the state budget. The change is part of the bill on export insurance that was approved tentatively by the MPs on Thursday. The 2004 export insurance budget of the company is BGN 10 mln. Economy minister Ms. Lidia Shuleva said that the factor likely to be set for 2005 is 10, so if the budget amount remains the same, the actual resource at the disposal of the agency will be BGN 100 mln. Insurance experts interpreted the move as an attempt to mould BAEZ into a more traditional insurance company and improve its revenue performance. 

Urgent investments will be made in the electricity system of Bulgaria's Bansko mountain resort to increase the capacity of ski lifts. The current capacity of 13 mW is insufficient to meet the power needs of the resort; besides, several new hotels are currently under construction, which also have to be supplied with electricity, deputy energy minister Ilko Yotsev said. The problem was discussed at a meeting among representatives of the energy ministry, lift concessionaire Yulen JSC and the electricity distribution company (EDC) of Sofia region. 

Sweden's SKF, which bought the bearing operations of Sopot-based VMZ in 2002, said it had invested BGN 10 mln in the Bulgarian plant so far. SKF Bearings Bulgaria turned out to be one of our most successful projects in recent years, said SKFCEO Tom Johnstone who is currently visiting the local plant. SKF Bearings Bulgaria received an ISO 9001 certificate in 2003 and plans to expand its presence abroad and double its product range.

The revenues of Eurofootball have increased by 115 percent for the first half of 2004 due to the introduction of the on-line betting network and the growing popularity of the lottery, the Greece-based Intralot – the owner of 49 percent of the Bulgarian bookmaker – announced yesterday. The pre-tax profit of Intralot till July this year is EUR 60.5 million. 

Hungarian real estate major TriGranit intends to build an EUR 300-mln retail center in Bulgaria, transport minister Nikolai Vassilev said on Thursday. TriGranit, which plans to invest in both business and residential construction in Bulgaria, is expected to present its investment pitch to the InvestBulgaria Agency (IBA) within a couple of weeks. The scale of the TriGranit project would qualify the company as Category 1 investor under the recently adopted Investment Promotion Act. Under the law, Category 1 investors, with projects worth in excess of BGN 100 mln, are entitled to on-site infrastructure which will be build free of charge by the Bulgarian state

Above BGN 20 million will be invested under a project for improvement of the conduit system in Vratsa, northwestern Bulgaria, head of the local water management company, Angel Prestoyski said. The project, which is aimed at reducing the large losses of water in the town's conduit system, should start in 2005. Vratsa is also in talks with the government of Switzerland over BGN 15 million financing for three water treatment plants.

Bulgaria's Financial Supervision Commission (FSC) has delisted Technotrade JSC of Varna from the public register. The company's capital is below BGN 500,000 and its shareholders are less than 300. In late March the supervisor refused to remove the troubled company from the public register.

We are pleased to inform you that will be carried out during the period 8th – 10th October 2004 in the town of Panagyurishte, Bulgaria, the Third International Forum "Invest In Panagyurishte" and a Trade exposition. The Forum is expected to be under the auspice of Mrs. Lidya Shuleva, Vice Prime Minister of Republic of Bulgaria an Minister of Economy.

BULGARREKLAMA Agency and the Association of apparel and textile exporters in Bulgaria have the pleasure to invite you to “BGate 2004” – Balkan Gate Apparel and Textile Exhibition (08-10 October 2004, Inter Expo Center, Sofia)

Europe

Yukos, the Russian oil giant, could be forced to halt production because of a new court order, the company has said. Reports said a court had agreed to a request from prosecutors that would prevent the company from accessing its bank accounts. Yukos faces a demand for billions of dollars in back taxes and has said the bill could push it into bankruptcy. The latest reports have reignited world oil prices, with New York light crude up 42 cents at USD44.42 (GBP24) per barrel.

USA

U.S. retailers reported worse-than-expected August sales on Thursday and Wal-Mart Stores Inc. scaled back its financial forecasts as soaring fuel prices cut into back-to-school spending. The poor retail sales figures – which came one day after top U.S. automakers posted weaker sales and announced production cuts – deepened worries about consumer spending and the overall health of the U.S. economy. The back-to-school selling season usually peaks in August and is considered the second most important period behind the Thanksgiving-to-Christmas holiday sales season.

Asia

China will seek bids from overseas nuclear-equipment makers to build reactors in the country, said Shen Lixin, an official at China National Nuclear Corp. Westinghouse Electric Co., a U.S. unit of state-owned British Nuclear Fuels Plc, may be among the bidders, said Shen, deputy division director at China's biggest operator of reactors. The U.S may allow American companies to sell nuclear reactors to China, ending a ban imposed after the Tiananmen Square massacre in 1989, the Asian Wall Street Journal said, citing an unidentified State Department official. 

The Union of the Principality of Bulgaria and Eastern Rumelia

The Congress of Berlin, July 1 (13), 1878, partitioned the independent Kingdom of Bulgaria into three parts – the Principality of Bulgaria; the autonomous province of Eastern Rumelia; and Macedonia and Eastern Trace that were handed back to the Ottoman Empire. After years of struggle for liberation the Bulgarian people was disappointed with the division and started preparing the coalescence of Bulgaria torn to pieces. On September 6, 1885, a coup d’etat was carried out in Eastern Rumelia and the union of the province with the Principality of Bulgaria was proclaimed. Prince Alexander Batenberg validated the act by the issue of the Union Edict. The Union provoked different repercussions in Europe and was an occasion for Serbia to declare war to Bulgaria in which the Serbian army was badly mauled. This forced the Great Powers and the Ottoman Empire to acknowledge the Union at the Tsarigrad Conference (October 24, 1885). The act of the Union was a manifestation of the independent Bulgarian spirit and an important step to the consolidation of the Third Bulgarian State.