Financial news

BNB will punish banks that do not give loans and keep their money. From January 4, 2016, the first working day of the New Year, BNB introduced a negative interest rate on excess reserves of commercial banks in Bulgaria. This will happen thanks to the new Ordinance 21 on the minimum required reserves maintained by banks with the BNB, adopted yesterday by the Board of the Central Bank. BNB will impose negative interest on excess reserves, when the interest rate on the deposit facility of the European Central Bank (ECB) is negative. So actually, BNB will charge banks that maintain reserves above the minimum required. Zero interest on excess reserves of banks is maintained, where interest for the deposit facility of the ECB is positive or zero. Currently, the interest rate on the deposit facility of the ECB is -0.2%, as it was last updated in September 2014. ECB introduced negative interest rates to encourage banks to grant more loans for the purpose of revival of economy and overcoming deflation in the euro area. Perhaps that is the goal of BNB as well.

An online platform on which administrative information will be accessible to the public is one of the steps that Bulgaria is taking to further ease public access to information which is now only held by administrative authorities and public-sector organizations. The responsibility to create and maintain the platform was placed on the Council of Ministers by amendments to the Access to Public Information Act, which Parliament passed conclusively and without a debate on Thursday. The platform already exists at opendata.government.bg. The information available there will be gradually expanded according to a schedule which will be set annually by the Government. Access to all information in this platform is free of charge. Another revision of the Act requires wholly State- or municipal-owned companies to make their information public. They will no longer have the option of withholding information. No fees will be charged for repeated use of information from a public authority for which a person has already paid once. The initial fee may not exceed the cost of retrieving and reproducing the information requested. Alternatively, such information may to be provided by email.

Excessive accumulations in the regulations never lead to qualitative changes in the Bulgarian business environment Zhechko Dimitrov Bulgarian economy constantly faces challenges that limit the opportunities for its development. Fears of escalating debt spiral of public finances increase, which will quickly lead to a significant hike in taxes and a real danger of permanent deterioration in the business environment. Bulgarian politicians conceal the lack of determination for conducting the necessary and difficult reforms in key social systems with excessive and often ill-considered legislative activity. Bulgarian manifestation of this "rulemaking" reaches absolutely unacceptable levels. Full text of the analysis You may send your comments to: bic@bia-bg.com

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Companies

For the first time Bulgarian company was chosen as “outsourcing service supplier of the year” by the National Outsourcing Association of Great Britain (NOA). The award was given to the Bulgarian company ScaleFocus, which experienced strong business growth and investment in the UK in 2015. The company competes for the prestigious award with companies from Britain, India and the US. At the same ceremony Bulgaria was chosen for “Outsourcing Destination of the Year” for 2015 by the National Outsourcing Association of Great Britain (NOA). Our country won the highest award in competition with Slovakia, South Africa and Sri Lanka. The UK is the second largest market for Bulgarian companies in the field of high technologies. High-tech IT outsourcing is one of the potential sectors where there is an opportunity to strengthen economic relations between the two countries. ScaleFocus is Bulgarian high-tech IT company with offices in Sofia, London, Munich and Plovdiv, and clients in 16 countries from Europe, North America and Asia. The company employs nearly 250 IT professionals.

One of the large companies in the field of grain production and ownership of agricultural plots in Bulgaria is expanding its portfolio. Agria group holding is buying completely a company named Agra, which has 8820 acres own land and right for rent for more than 7700 acres in the region of Provadia and Avren. The ownership of the land is assessed at nearly BGN 12 million, which makes BGN 1350 per acre. It’s the second large deal for Agria group. Last year Agria group holding acquired two companies in the same region for BGN 11.5 million. They were owned by Dutch investors who cultivated 24.5 thousand acres of own and rented land. With the deal for Agra the holding company is completing its set aim its arable land this year to reach 200 thousand acres, 60-70 thousand of which own. Besides the land the company owns agricultural premises, which will aid the holding to organize its own territory subsidiary with a center Plovdiv. The deal for takeover is concluded on the 24th of November. Sole owner of Agra is Todor Gubratov. For Agria group the deal is part of its plans to extend its activity via acquisition of business and assets of companies operating in the sphere of agricultural production. Agria group holding’s strategic aim is to strengthen its processing and exports focus.

Telenor Bulgaria announced on Thursday that it will offer fourth-generation (4G) mobile technology services under the Long Term Evolution (LTE) standard in the 1800 MHz band to its customers starting on December 1. Telenor 4G network will offer maximum speed of 75 Мbps in mobile data exchange and will ensure a vastly improved user mobile app experience, faster browsing and video streaming and higher download and upload, the company said in a news release. The 4G service will be initially available in Sofia, Plovdiv, Varna, Burgas, Ruse as well as most of southern Bulgaria, including the ski resorts of Bansko, Pamporovo and Borovetz. By the middle of next month Telenor 4G service will extend into northern Bulgaria and will cover all Bulgarian cities with population of more than 20,000, thus providing outdoor coverage to 56.73% of the country’s population.

Bulstrad Vienna Insurance Group AD received a loan of EUR 3.2 mln from the parent company after the deal was approved with the voice of the minority shareholder Somat AD. Vienna Insurance Group AG Wiener Versicherung Gruppe (VIG), which as of September 30, 2015 held 14.03% of the capital of Bulstrad, provides unsecured loan of EUR 3.2 million at a fixed annual interest rate of 5% for a period of 10 years. This EUR 3.2 million loan is the principal and interests amounted to EUR 1.6 million. The total obligation amounts to EUR 4.8 million. The aim of the subordinated debt is to "strengthen the capital base and liquidity position of Bulstrad Vienna Insurance Group AD," according to the minutes of the General Assembly of the insurance company.

Radio and TV transmission services provider NURTS Bulgaria said it turned to consolidated net loss of BGN 12.6 million in the first nine months of 2015 from consolidated net profit of BGN 13.6 million in the like period a year earlier. Consolidated revenues edged down to BGN 37.4 million in the nine months ending September, from BGN 37.8 million in the same period last year. In July, NURTS Bulgaria said it was fully re-acquired by local telecommunications group BTC. NURTS used to be a wholly-owned unit of BTC until 2010 when the telecoms group sold 50% to Cyprus-based company Mancelord. A year later, BTC sold the remaining 50% of NURTS Bulgaria to Bluesat Partners, a UAE-based company. NURTS Bulgaria, which provides terrestrial broadcasting for all national and regional television in Bulgaria, said in July its digital TV network coverage reached 96.2% of Bulgaria's population.

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Europe

Spain's economy grew by 0.8 percent in the third quarter of the year, according to data released on Thursday by Spain's National Statistical Institute (INE). The figure meant a 0.2-percent fall compared to the growth rate of the second quarter when the economy had grown by 1.0 percent, while the country's gross domestic product (GDP) rose by 3.4 percent in comparison with the third quarter in 2014, reaching 2007 levels. The INE attributed the rise to household consumption which rose by 1.0 percent from the second quarter to the third one. In the third quarter of the year, exports rose by 2.8 percent compared to the 1.4 percent of the second quarter, while imports increased by 4.0 percent. Meanwhile, investment rose by 1.1 from the second quarter to the third one. Employment increased by 0.7 percent in the third quarter of the year, while on a year-on-year basis employment rose by 3.1 percent.

America

President Barack Obama signed a sweeping defense policy bill into law, legislation that authorizes $607 billion in defense spending but also includes provisions that make it harder to close the military prison at Guantanamo Bay, Cuba. The White House had made it clear earlier this month that Obama would sign the bill despite the Guantanamo provisions. Obama has long promised to close the prison, but has faced objections from lawmakers who do not want detainees to be transferred to U.S. prisons. "As I have said before, the continued operation of this facility weakens our national security by draining resources, damaging our relationships with key allies and partners, and emboldening violent extremists. It is imperative that we take responsible steps to reduce the population at this facility to the greatest extent possible and close the facility," Obama said in a separate White House statement.

Asia

South Korea has fined Volkswagen Won14.1bn ($12.3m) for rigging emissions tests and ordered a recall of more than 125,000 diesel vehicles in the latest setback to the German carmaker. The environment ministry said on Thursday, after a two-month investigation of several models made by Volkswagen and its premium brand Audi, that the world’s second-largest carmaker had fitted “defeat devices” to bypass environmental standards. A total of 15 models with older engines, including Volkswagen’s Tiguan and Beetle models and the Audi A4, will be subject to the recall, while the group’s unsold vehicles will be suspended. The ministry said it would continue investigating Volkswagen’s other models with newer engines to determine whether they had also cheated emissions tests. “We have not found yet that other tested models also used the defeat device but will keep looking into the suspicion by reviewing all related data,” the ministry said.

Neuilly Peace Treaty

The Neuilly Peace Treaty was signed on November 27, 1919 in Paris between Bulgaria and the Allied and Associated Powers, following our country’s defeat in World War I (1914-1918). The treaty enters into force on August 9 1920. Under its clauses, Eastern and Western Thrace are ceded to Greece, a big part of Dobrudja becomes Romanian territory, and the Western Outlying Parts spreading on a territory of 1545 sq.m. with a population of 64 500 people were also detached from Bulgaria and became a part of Serbia through an annex, signed a year after the signing of the treaty. Our country agreed to pay reparations to the total value of 2 250 000 000 golden franks, due payable over a period of 37 years with 5 per cent annual interest. Bulgaria is deprived of the right to support its own army, military fleet and aviation. Its armed formations were not allowed to exceed 20 000 men, who had to be volunteers. In 1996, under the initiative of the Mati Bolgaria national union, November 27 was proclaimed National Memory Day.

On that day:  The town of Klisura