Financial news

The World Bank said faster economic growth is possible in Bulgaria with an improved business environment, better transport infrastructure, and a labour force with adequate skills. Inclusive growth also requires more mobility and economic participation of the bottom 40% of the population, as well as more effective health care, social safety net, and pension systems, the World Bank said in a press release quoting the preliminary findings of the World Bank's Bulgaria Systematic Country Diagnostic report, currently under preparation."Sustainable growth could be achieved by safeguarding macroeconomic stability, but mainly by ensuring social stability in the country," the lender said in the press release issued after a meeting between Bulgarian prime minister Boyko Borisov and Mamta Murthi, World Bank Regional Director for Central Europe and the Baltic Countries. According to World Bank's Global Economic Prospects report released last week, Bulgaria's economic growth is seen at 1.1% in 2015, growing to 2% in 2016 and reaching 2.7% in 2017.

Bulgaria's Finance Ministry announced that each year around 1.2 million tonnes of diesel are not declared to the revenue agencies, which amounts to 36.2 % of the fuel consumption in the country. The Ministry estimates that the losses to the budget from tax evasion and avoidance of excise duties amount to BGN 1.1 – 1.2 bln. In order to tackle these problems, Bulgaria established a connection between the National Revenue Agency (NAP) and the customs and introduced a system monitoring the fuel quantities at petrol stations. However these measures, which were introduced in the beginning of 2013, have decreased the sales of fuels with unpaid excise duties and Value Added Tax (VAT) with only 6-7 %. Around 30 % of consumed fuels continue to be sold without being taxed. The supplies to recipients from the sectors of agriculture and transport, which are the largest consumers of diesel, remain most susceptible to such malpractices.

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Companies

Bulgarian company Kate Ltd. received the "Innovative Company" for 2014 award of the Bulgarian Patent Office, said the Ministry of Economy. The award is given to the company for its patents in the field of high and nanotechnology security and protection of a wide range of products, goods and documents. The services of the company are used in many countries such as USA, Germany, Switzerland, Oman and Tanzania.

Bulgarian fuel station maker Promodul will expand its activities and will invest between BGN 2.5 million and BGN 3 million in a plant for conservation of fruit and vegetables in the city of Pavlikeni, the company's owner and manager said. The company will renovate an existing non-operational plant and will start processing, storing, canning and freezing fruit and vegetables, Ivan Ivanov said. “[The investment] can be even bigger as I have not calculated the technological process and how much equipment I will need,“ he said, adding that there are some details that need to be taken into account before calculating the overall investment in the new plant. The core activities of the company are the production and equipment of gas stations. According to the owner, reconstruction works on the building have been completed, but the plant is not expected to start operating within the next year because the project is still at the draft phase and a lot more needs to be done.

The Board of Directors of Agro Finance REIT decided that the company would prematurely repay the entire principal on its corporate bond in the amount of EUR 5,000,000. An advance payment fee amounting to 1% of the principal applies according to the Document for the Offered Securities. Company officials said the reason for their move was the hefty price of borrowed resources, existing cash surpluses and stagnation in their investment activity due to buoyant land prices. Funding will be entirely by equity capital. Towards the end of 2014 Agro Finance has 141 thousand acres of agricultural land. Most of it is located in Montana and Pleven and a smaller part in Vidin, Shumen and Burgas. The average price for acquisition is BGN 307 per acre. Agro Finance REIT is a public company. Its main shareholder with a 99.07% stake is Agrion Invest. Agro Finance REIT used to work with Corporate Commercial Bank, but ever since its collapse, the fund uses the services of United Bulgarian Bank (UBB).

Bulgarian lender Unicredit Bulbank will lend up to BGN 92.7 million to local company Sofia Tech Park for project funding, a notice in the EU’s procurement journal indicated. Unicredit Bulbank was the only bidder in a BGN 2.6 million tender for two loans of up to BGN 77.8 million and BGN 14.9 million, respectively. The indicative value of the deal does not include value added tax. State-run company Sofia Tech Park is in charge of a project to build a high-tech park in the Bulgarian capital, estimated to cost BGN 100 million.

Europe

Finland’s prime minister opened the door to a renegotiation of the terms of Greek debt short of a writedown in the face value owed, ahead of elections on Sunday. Speaking at the World Economic Forum in Davos, Alexander Stubb said that his country could consider extensions to the maturity of the debt and changes in the conditions attached to the debt, but no debt forgiveness. His Irish counterpart, Enda Kenny, the Taoiseach, agreed. The moves are significant since Finland has been one of the countries most hostile to any softening of position on debt and reflect a widespread expectation that the leftwing Syriza party will win elections on Sunday.Insisting that he was not trying to intervene in the Greek election, Mr Stubb laid out the likely negotiating position Finland would take in the event of a Syriza victory. Mr Stubb said: “The Finnish position is that we will deal with any democratically elected government that Greece has and that it will be very difficult for us to forgive any loans or restructure debt at this particular moment.

America

Foreign investors, no longer content paying top price for U.S. trophy properties, are increasingly getting in on the ground floor of development projects they hope will become the next Rockefeller Center or Chrysler Building. Japanese developer Mitsui Fudosan Co. last month wrapped up a deal to fund a planned $1.4 billion office tower on Manhattan’s far West Side, company officials said. As part of Mitsui’s broader push into the U.S., it paid New York-based Related Cos. $259 million for a 92% stake in the site known as 55 Hudson Yards. The deal illustrates a shift in the development landscapes of New York and other major U.S. cities, which for decades were dominated by local property tycoons, pension funds and private-equity firms. Now, development of many of the most prominent towers is being funded by foreign developers, as well as Middle Eastern sovereign-wealth funds and Asian investors, which are outbidding traditional U.S. players as they search for higher investment returns and new places to expand.

Asia

The Huawei juggernaut is showing no signs of slowing down. Having recently announced that it's on course to announce a near 20% year-on-year increase in revenues for 2014, to about $46.5 billion, the vendor's founder told the World Economic Forum in Davos that Huawei expects its revenues to grow by a further 20% this year to $56 billion. In his first public appearance in the West, Ren Zhengfei, the company's founder, deputy chairman and CEO, told the Forum during an on-stage interview with BBC correspondent Linda Yueh that Huawei Technologies Co. Ltd. is confident of reaching total revenues of $56 billion this year, despite forecasts of slower economic growth in China, still the most important single market for Huawei. Such rapid growth comes with major challenges, though, he noted. The main pressures on Huawei come from "growing so fast," and corporate governance is a major issue at the company.

Petko Karavelov (24.III.1843 – 24.1.1903)

Petko Karavelov is one of the most prominent Bulgarian political and public figures of his time. He is the brother of the great Bulgarian writer and revolutionary Lyuben Karavelov. Throughout his life, he occupied many important posts in the state – he was prime minister, minister (of finance, justice, agriculture, trade and home affairs), chair of the National Assembly, deputy, regent. As a prime minister, he contributed greatly to the Union of Eastern Rumelia with the Bulgarian Principality and for the diplomatic acknowledgment of this act. He was repeatedly victim of political repression, and was forced to emigrate during the “full powers regime” (1881-1883) when the Tarnovo constitution was defied. He was a political prisoner and moral leader of the opposition during the Stambolov regime. He died on January 24 1903 and was buried in the yard of the Black mosque (nowadays the church St. Cyril and Methodius and Their Five Disciples), where he spent more than four years as a prisoner.