Financial news

The state will grant 13th pension and wage but their amount is not clear yet. The Minister of Finance Mr. Milen Velchev confirmed that the distribution of Christmas bonuses for pensioners and state employees had already been discussed with the IMF mission in Bulgaria. The amount of the grants however depended on the treasury resources, Mr. Velchev said.

Bulgaria’s government decided to allocate BGN 3.0 million for setting up of Energy Efficiency Fund. The move is in line with the requirements of the Energy Efficiency Act, according to which the state should finance the setting up of such a separate legal entity with an initial contribution of BGN 3.0 million. The fund will manage financial assets to enhance energy-saving production projects. According to Energy Efficiency Act the fund has a board of directors of seven members.

State budget revenues amounted to BGN 5,912.6 mln as of end-July 2004, which equals 65.3 percent of the annual estimates, the government press office announced. Revenues are BGN 533.8 mln up or 9.9 percent more compared to the same period last year. So reads the state budget fulfillment report the cabinet discussed yesterday.

Privatization

The first deal for sale of two of Bulgaria's seven electricity distribution companies (EDCs) is now a fact. The negotiations between the Privatization Agency (PA) and E.ON Energi AG finished successfully with the signing of the privatization contract. The German company became owner of 67% of the power utilities in Varna and Gorna Oryahovitsa, grouped in the North Bulgaria package. Under the contract, E.ON has already paid at least 20% of the EUR 140.7 million price it offered for the two companies. The remainder has to be paid upon transfer of ownership. Until December 31, 2008 the buyer has no right to transfer its shares, or terminate the provision of the services stipulated in the companies' licences.

Toploremontstroy TRS 94, which a month ago bought the heating utility of Pravets in a public tender for BGN 670,000, is likely to abandon the deal, the Privatization Agency (PA) said on Thursday. A possible reason for the buyer's withdrawal could be that the Pravets mayor has passed on information that the gasification of the town, located north-west of Sofia, could get underway as early as January 2005. However, the energy regulator is yet to issue a licence for town's gasification. Toploremontstroy has notified the forthcoming gasification of Pravets to the PA without, however, stating explicitly that it plans to revise the deal. If Toploremontstroy ultimately does want out, the PA will keep its participation deposit and invite the second-ranked candidate buyer - Targovishte-based Finance Engineering, to acquire the heating utility.

Companies

Government imposed distraint on the steelmaker Kremikovtsi's shares, all bank accounts in local and foreign currency, movable and immovable property due to debts of BGN 146.142 million. This way the ministers are to ruin the negotiations with the Indian Ispat group over the prospective sale of the majority stake in Kremikovtsi. The company’s chief executive officer, Valentin Zahariev, was in Italy yesterday and was not available for comments. According to some sources, the main part of the debt is to the State Fund for Reconstruction and Development and an agreement for its payment has been signed. According to it, there is also a grace period which expires in 2005. The Indian company Global Infrastructure Holding is a part of ISPAT group and was willing to invest above EUR 300 million in the Bulgarian giant.

ING Bank will mark its 10th anniversary on the Bulgarian market with a series of events. Executive board member Eric Boyer and Piet van Santen, general manager for Central Europe, will arrive especially for the celebrations. They will also have meetings with BNB governor Ivan Iskrov, Prime Minister Simeon Saxe-Coburg-Gotha and members of the Bulgarian International Business Association (BIBA). The celebrations will start on September 13 with a business seminar for Bulgarian students. Dutch Introdance will make a ballet performance on September 16. On the following day Charles Robertson, head of the research department for the region, will make a presentation on Bulgaria: 2014.

Post Bank will improve the conditions on its housing crediting programme "My Home" as of September 18, 2004. Clients will be allowed to take credits yet in the phase of the rough construction. The extent of the credits may reach up to 100% of the amount of the deal. The term of the loans will be 20 years with a certain grace period. The lowest interest rate will be 7.5% on loans in euro. The term for preliminary approving of the documents will be reduced to one workday. Post Bank will offer to its clients who take housing credits also consumer credits of up to BGN 10,000 at preferential conditions.

The Sofia Airport reconstruction will be completed by the end-2006 at the earliest, forecast Prof. Yonko Penev from the University of Architecture, Construction and Geodesy. The deadline set for the completion of the new passenger terminal was set for December 5, this year and later on it was extended to August 31, 2005. It is the Deputy Minister of Transport and Telecommunications Ms. Sofia Kassidova to blame for the delay, as she was misleading Deputy PM and Minister of Transport and Telecommunications Mr. Nikolay Vassilev furnishing him with inaccurate and incompetent information, Prof. Penev said.

Italy-based holding set up third enterprise in Bulgaria. The Rigoni Da Asiago factory is placed in Pazardjik and is to deal in processing and preservation of bio-certified wood and cultivated fruit. BGN 4.5 million have been invested in the plant. The project has been implemented with the financial aid of the SAPARD program.

The Public Transport of Plovdiv is to go bankrupt if urgent action is not taken, deputy mayor in charge of the municipal economy Mr. Atanas Slavov said in connection with the two-month wage delay. The company has nearly BGN 1 mln of debts plus some BGN 400,000 to pay to its employees for June and July. Drivers threatened to go on strike.

The Bulgarian Industrial Association (BIA), BIBA and the Danish Environmental Protection Agency (DEPA) organize on 16 September a Seminar on emission reductions of Greenhouse Gases JI projects.

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

Santander Central Hispano, the Spanish bank, will sell almost half of its 5 per cent stake in Royal Bank of Scotland worth GBP 1.25bn as it moves into position for its planned GBP 8.7bn Abbey National takeover bid. Santander also confirmed that the cross-directorships held under the terms of the strategic alliance between the two banks would be terminated if the Abbey bid was successful. Rival bank HBOS last month asked the European Commission to force Santander and RBS to end their cross-directorships as a condition of the bid for Abbey.

USA

Procter&Gamble Co. on Thursday backed its quarterly profit outlook, helped by sales of new products and continued gains in developing markets. The maker of Charmin toilet paper and Iams pet food said it sees profit for the fiscal first quarter ending this month in line with analysts’ average estimate of 72 cents a share. The Cincinnati, Ohio-based company has seen its shares trading at their highest levels in almost five years with sales growth across most of its product lines and a boost from acquisitions like the Wella hair care business.

Asia

Indonesia's financial markets have reacted with shock to an explosion at the Australia embassy, with both shares and the currency sliding. Shortly after the blast, Jakarta's main stock index had fallen 4%, before recovery to close down 1%. The slide follows four months in which shares have risen amid hopes for a peaceful presidential poll. At least eight people are feared killed by what police say was a car bomb, with more than 130 injured.

Kleptuza Lake

Kleptuza Lake is the biggest Karst spring in Bulgaria – a symbol of the beautiful town of Velingrad in the Rhodope Mountains. This natural phenomenon wells up in the foot of an upright marble rock, covered with green moss. Depending on the season and the precipitation quantity, up to 1180 litres per second gush out on the surface, while the average capacity is 570 litres of freezing cold water, making two lakes running into Chepinska River. The lake’s name has a Greek origin and means “conceal in a secret place” and is most likely connected with the unexpected advent of the spring waters, as if they were locked in the subterranean Karst and released all of a sudden. Legends of this real miracle of nature tell that in times gone Orpheus lived on these places. The beauty divine of the surrounding nature and the picturesque springs of Kleptuza attract thousands of people each year.