Financial news

The European Bank for Reconstruction and Development (EBRD) has raised its projection for Bulgaria's gross domestic product (GDP) growth to 1.8% in 2015 and to 2% in 2016. In May, the EBRD said it expects Bulgarian economy to expand by 1% this year and by 1.5% in 2016. The declining country risk premium and lower domestic lending rates, after credible steps to improve confidence in the financial sector, contributed to higher-than-expected domestic demand. Weakening of the euro, to which domestic currency is pegged, led to slight gains in competitiveness, contributing to Bulgaria's higher net exports. In the second half of 2015 and 2016, the EBRD expects domestic demand will continue to support growth, helped by higher disposable income on the back of low inflation, and a lower than previously expected country risk premium and thus cost of funding. Bulgaria's fiscal policy is expected to remain tight, while improving growth prospects in the Eurozone will help boost net exports. The Bulgarian economy expanded by 2.2% year-on-year in the first half of 2015, with net exports taking over as the main driver of growth.

This summer Bulgarians paid more often their accounts abroad with bank cards via POS terminals. Our nationals have spent over EUR 54 mln. which is 15 percent more as compared to last year's June, July and August. The largest growth compared to last year is recorded in payments to merchants in Greece - 50% growth. Italy leads in the number of purchases with bank cards issued in Bulgaria, as they increased by 20% yoy, which makes the country the most preferred destination for summer holidays and shopping in 2015. The payments to merchants in Germany are 16% more, in France the acceleration is by 15%. Purchases from Spain grew by 13% and in the UK - 9%. Use of Visa cards issued in Bulgaria was registered on unconventional places such as Angola, Aruba, Barbados, Bhutan Kingdom, Ivory Coast, Cook Islands, Madagascar, Rwanda, Nepal, Suriname and Swaziland

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Companies

The European Commission’s autumn forecast for the EU economy, released on November 5, raised the economic growth estimate in the 28-country bloc, saying that the economic recovery was resilient and widespread, but slow. In Bulgaria’s case, the Commission was more optimistic than in spring, revising its growth forecast to 1.7 per cent, compared to one per cent in the spring report. This is lower than the updated government target of two per cent, set in the macroeconomic framework document that was approved by Cabinet as part of the 2016 budget package. The EC said that growth-supporting factors including absorption of EU funds were expected to “lose strength” in 2016, resulting in 1.5 per cent GDP growth next year before picking up to two per cent in 2017. Bulgaria was seen benefitting from net exports, which was projected to outpace imports, helped both by the higher demand from the EU, but also the depreciating euro, to which the Bulgarian lev is pegged. Public investment was expected to decline because implementation of EU co-funded projects in the new programming period would take time, but net exports were expected to “contribute positively” to growth.

BGN 50 million will be poured put by American investors of Greek origin in the Plovdiv-based Mall Galeria. The investment is managed by the investment company Arceland Capital Management. The shopping center will be closed on the 15th of January 2016, as it is expected to open again in September 2017 completely renovated and basically repaired. With a cession agreement in November last year, Galeria AD transfer debts towards Raiffeissenbank to Alpha Mladost Development EAD, a company managed by Arceland Capital Management. Debts are assessed to more than EUR 47 million overdue principal, more than EUR 10 million overdue interests and 4.5 million penalty interest. The new mall will have at least six cinema halls. The investment company has purchased land around the mall, which will soon turn into two buildings with luxury offices for the needs of the outsourcing industry. At least 5,000 people are envisaged there to work. The offices will be located right behind the mall. Arceland Capital Management is a Greek investment company with a focus on real estate, which has been working for years in Bulgaria. So far, however, the projects were mainly in Sofia.

The first transaction for electricity on the free market, which will go through the new energy market, will take place on December 9. A day earlier premiere of exchange has to take place. All participants will be registered there- producers, traders, consumers. There will be clarity of the prices at which energy is traded at the time. "The introduction on the stock exchange is absolutely necessary. Otherwise, the contraction of the regulated market will lead to a change in the price of electricity," warned the head of the energy regulator Ivan Ivanov.

BGN 180 million will invest Aurubis Bulgaria so that it increases and modernize its production and optimizes environmental protection. Funds will be invested within the new programme of the company named Aurubis Bulgaria specter 2018. The investment is scheduled in five stages. The first one is assessed to EUR 2.5 million and is focused on social projects. EUR 20 million is envisaged for renovation of technical equipment and mechanisms for work, while EUR 25 million is detached for investment in warehouses and port infrastructure. EUR 55 million goes for protection of the company’s competitiveness, while EUR 75 million for sustainable operational activity and control. Aurubis Bulgaria’s annual turnover is assessed to EUR 2.1 billion. For the last ten years the company has invested EUR 550 million.

The Bulgarian state's total loss from the bankruptcy of the Corporate Commercial Bank is amounting to BGN 4.9 billion in total, BGN 3.9 billion of which were lost by state energy companies. This became clear from the reports of the bank guarantee examinations, focusing on preferential deposits. The list includes the names of those citizens and companies, who had preferential rates and conditions at the bank. For example, Sofia Airport has lost EUR 16.5 million when the bank went down. The list of the other unfortunate losers is long and includes ports, industrial zones and even the Bulgarian Stock Exchange.

Bulgarian Deputy Minister of Economy Lyuben Petrov attended a meeting between the Bulgarian company Bulgartehmin and Cuba’s Geominera at which it transpired the Bulgarian business was in an advanced phase of copper ore extraction and enrichment. The deposit will be developed with the help of Bulgarian specialists and is expected to start working next spring. Bulgartehmin is a company with exclusively state ownership and at present is in a process of bankruptcy. Bulgarian companies are beginning to develop a copper deposit and build hydro facilities in the Latin American country. The extraction of non-ferrous metals is being revived, the preparation of large-scale investments in the manufacture of home appliances is underway as well as in renewable energy sources, packaging materials, trade in shoes, agricultural products, polygraphy, hygienic materials, batteries, steel items, car tyres, aluminum boxes, and others. Joint ventures in the above-mentioned fields could be established. The opportunities the new economic zone of Mariel in Cuba provides were also presented.

IndustryMatchMaking 2016 - IMM2016, Business and technology matching event

Europe

The quarterly Inflation Report (IR) from the Bank of England (BoE) showed a lower short-term inflation outlook, with inflation set to hit the target slightly later than originally predicted, paving the way for even more gradual monetary tightening.  While the market has been pricing the first lift-off in the BoE's base rate in the second quarter of 2016, the even more gradual shift compared to August means the market now expects this hike in the first quarter of 2017. At the same time, the BoE sees softer GDP growth for the fourth quarter of 2015 as well as the first three quarters of 2016. The outlook for GDP beyond 2016 remained broadly unchanged, with the BoE forecasting annual GDP growth rate at around 2.5% from the fourth quarter of 2016 until the final quarter of 2018. The policymakers at the BoE sees China's slowdown effect on the UK's economy as moderate, with the 3% slowdown representing a 0.3% downward revision to growth in the UK according to model estimates. The outlook for the labor market also remained broadly unchanged, with the BoE forecasting a gradual fall in the unemployment rate from the current 5.4% to 4.8% projected for 2018, and the unemployment rate falling below 5% for the first time in the final quarter of 2017.

America

The U.S. trade deficit narrowed sharply in September as foreign buyers snapped up a range of American-made goods, but the rebound did little to change a gloomy outlook for factories. The trade gap shrank 15% from August to $40.81 billion, hitting the lowest level since February, the Commerce Department said Wednesday. Exports climbed 1.6%, the biggest jump since early 2014. Imports fell 1.8%. Trade figures are notoriously volatile month to month, and September’s report contradicted the underlying trend of a limping global economy that has weighed on trade. Through the first nine months of this year, the U.S. trade gap widened nearly 4% compared with the same period in 2014, with both exports and imports declining. Many economists expect the jump in exports in September to be short-lived. The increase was due to foreigners stepping up purchases of high-end products such as artwork, antiques and jewelry. Exports of capital goods—big-ticket business items like industrial engines and mechanical equipment—also climbed. But other data suggest factories continue to be walloped by the strong dollar, linked to economic-stimulus moves by global central banks. Those moves have driven up the price of American goods relative to foreign products priced in other currencies. Exports, which were a key driver of growth for the U.S. economy coming out of the recession, are expected to stagnate or decline in coming months, weighing on overall economic growth

Asia

General Motors Co said vehicle sales in China rose 15 percent to a record monthly high in October, underpinned by the Chinese government's decision to cut taxes for smaller cars. The company said retail sales in the first 10 months of 2015 climbed 2.9 percent from a year earlier to 2.8 million units, also a record. The result provides a bright spot for China's auto market which has struggled due to an economic slowdown in the world's second largest economy. The recently announced government incentive for vehicle purchases helped boost buying sentiment starting in October," Matt Tsien, GM's China President said in a press release published by the company on its website on Thursday. China has introduced a slew of supportive policies, including halving the sales tax to 5 percent on cars with 1.6-litre engines or smaller, to boost auto sales. The changes came into effect from Oct 1. Other major global automakers, including Japanese automotive manufacturer Honda also posted double-digit sales last month. Automobiles in the 1.6 liter and under category account for nearly 70 percent of total sales in the country.

Patriarch Maxim Perished

In the night of 5 November 2012 at the age of 98 died the Patriarch of the Bulgarian Orthodox Church (BOC) - Maxim of Bulgaria. Patriarch Maxim died shortly before 4 am in the Sofia Hospital Lozenets. His death was confirmed by the Holy Synod of the Bulgarian Orthodox Church. "God take and have mercy on his soul and our beloved and esteemed first hierarch, His Holiness the Bulgarian Patriarch Maxim," the statement said. The death of the patriarch was reported by Reuters, AFP, Washington Post and ITAR-TASS. AFP wrote that Patriarch Maxim was the longtime priest of the Orthodox Christians in Europe. Maxim was born on October 29, 1914 in Oreshak, Troyan, the son of Pena Bordzhukova and Nayden Minkov Rachev. He was baptized with the name Marin Naydenov Minkov. Received his primary education in his native village, and only twelve year-old was admitted a novice in the Troyan Monastery. On 13 December 1941, the final year of his studies, he became a monk by the Lovech Metropolitan Filaret. Maxim assumed the name in honor of St. Maxim the Confessor – a VII century saint, glorified with strong faith and Orthodox confession. On March 7, 1971 Patriarch Kirill died on July 4 Patriarch Maxim was elected as the new patriarch. Maxim is Honorary Doctor of the Theological Academy at St. Kliment Ohridski in Sofia and an honorary member of the Moscow Theological Academy. For his 90th birthday in 2004 President Georgi Parvanov awarded Patriarch Maxim with the Order of Stara Planina - first degree.

On that day:  Devetashka cave The Holy Mother Step