Financial news

The European Commission has not been informed about the sharp revision upwards in Bulgaria's 2009 budget deficit caused by unaccounted procurement deals. Bulgaria's PM Boyko Borisov and Fin Min Simeon Djankov said the previous Socialist-led government had kept them in the dark over BGN 2.16 bln contracts, which pushed the deficit up from a projected 1.9% to 3.7% of GDP. The new figure raised the specter of Brussels sanctions, as it is above the three percent barrier set for euro area members and applicants. Asked whether the EC has been informed about Bulgaria's hidden 2009 budget deficit figure, considerably higher than the one presented to the European institutions, the spokesman of Olli Rehn, the EU's economic and monetary commissioner, answered in the negative. He specified that the Bulgarian authorities have not submitted any information concerning this problem to the EC.

The Bulgarian Ministry of Finance forecasts revenues fewer by some BGN 1 - 1.2 billion in the 2010 national budget. On the other hand however, the economy, and especially its export, is starting to develop quite actively, as we have forecast. We expect that it will soar in other sectors too, Finance Minister Djankov said. If the economy starts going up, in three to six months there will be changes in revenues, he added.

	Mineral Fuels, Tailoring Products, Canning, Perfumery and Cosmetics, Furniture, Meat Products, Wine, Wood-processing Industry

Companies

Investors have shown interest into acquiring shares of the troubled cosmetics company Alen Mak. According to Daniela Petkova, Doverie Pension Fund CEO, one of Alen Mak’s bond holders, negotiations with possible buyers are already under way. Petkova refused to give away the names of the future investor companies. Not long ago the Plovdiv District Court refused to announce Alen Mak bankrupt and ordered the company to settle its debts. Corporate Commercial Bank and United Bulgarian Bank, trustees of bond emissions, demanded pre-term payment of the emissions. Another option for the debts to be settled is sell off of company property. Other bond holders include UniCredit Bulbank, UniCredit Leasing and SG Expressbank.

Sofia will select six companies over the next four years to execute current repairs of the capital’s roads, according to the municipality’s public procurement announcement yesterday. The current contracts - awarded to Glavbolgarstroy, Patishta I Syorazhenia and Road Construction Equipment - expire in June. Each contractor has pocketed an average of BGN 30 million for the past three years for current and emergency repairs, according to municipal figures. In the new procedure, Sofia is divided into six zones encompassing three to five regions each. Candidates will be entitled to bid for just one lot in a bid to allow for stronger competition.

The allegations that traders have benefited from the purchase of electricity from the National Electric Company (NEK) are political interpretations that hurt companies, EFT Group managing director James Nye said. EFT is the only exporter of power from Bulgaria and our competitors may take advantage of that language, he added. The company is being investigated for having signed contracts without a public procedure and for allegations that NEK has sold it electricity at prices below the domestic market rates. EFT presented data refuting the price dumping claims. In 2007 for instance the regulated price in Bulgaria was EUR 31 per mWh, while EFT bought power for EUR 50 per mWh. The contracts closed on a non-competitive bases were in line with the Bulgarian law and the European practice. Bulgaria is becoming less and less competitive on the energy market, EFT said.

Two Bulgarian companies, Consortium BKS Centre – Balkanstroi and Metro Build 2010, have been selected for the construction of the north line of the Sofia Metro, a process which has to be completed inside 24 months. The excavation of the tunnel for the new Sofia Metro line commenced on April 6. The tunnel-boring machine (TBM), alternatively known as a mole, is tasked with digging the tunnel spanning from the Nadezdha interchange until the Patriarch Evtimii and Vitosha Boulevards junction. The mole will have to excavate a total of 3.8km of tunnel, and according to the Sofia municipality, the machine will process 9.4 metres of earth a day at an average depth of 15 metres under the surface.

Bulgarian wine and spirits producer Vinprom Peshtera and four advertising agencies have been fined by the Competition Protection Commission. The watchdog slapped on the five firms a combined fine of BGN 450 000 over TV ads of alcoholic beverages deluding the consumers by making them hard to distinguish from other very similar products of the same producer, Vinprom Peshtera. The fined advertising agencies are McCann Erickson Sofia, Archer Ideas, Camera, and SIA-Lovech.

Bulgarian Energy Holding (BEH), which manages eight state-owned companies, will be dissolved by the end of June, minister of economy and energy Traycho Traykov said after meeting members of AmCham in Bulgaria. The holding will be split into independent companies initially, though other forms are also being considered, Traykov pointed out. One of the options is uniting gas companies into one group. Alternatively, trade companies may be put under one umbrella and their assets, under another, he added. BEH includes Maritsa Iztok Mines, Maritsa Iztok 2 thermal power plant, Kozloduy nuclear power plant, National Electric Company (NEK), Bulgartransgaz and Bulgartel. All companies are 100% owned by the state. The holding was set up in September 2008 to manage, assess and sell interests in the eight trade firms.

Europe

The European Commission is under pressure to alter EU-wide agreed targets of replacing 10 percent of fossil fuels with renewable energy by 2020, as its own internal studies have proven that biofuels have a negative impact on the environment and food production. EU energy commissioner Guenther Oettinger is considering a re-think of policies towards spurring the use of biofuels gained from crops such as rapeseed and palm oil, as they can lead to mass deforestation and food supply disruptions. Parts of the internal study were published by the EU executive at the end of last month, amid growing pressure from MEPs and environmental groups. It continued to make the case for biofuels, but capped the "sustainability" level at 5.6 percent of traditional fossil fuels, suggesting that a higher percentage would harm the environment and endanger food crops, as they would compete for the same farm land.

America

The United States imposed anti-dumping duties ranging from 30 percent to 99 percent on imports of steel pipes used in oil and gas wells, a move that might escalate trade disputes between the two countries. The Commerce Department said in a statement that prices for the Chinese pipes are 29.94 percent to 99.14 percent lower than fair value when it is sold in the US market. According to the department, 37 Chinese firms will receive a final dumping rate of 29.94 percent, and all other Chinese exporters are subject to the final dumping rate of 99.14 percent. However, the US International Trade Commission (ITC) could still cancel the anti-dumping duties if its members find in a vote that US domestic steel producers suffer no harm from the imported Chinese products.

Asia

Japan Airlines Corp., restructuring under a 900 billion yen ($9.7 billion) state-backed plan, shouldn’t allow government aid to distort competition, the International Air Transport Association said. “Restructuring has to be fast and painful,” IATA Director General Giovanni Bisignani told reporters in Tokyo today. “They have to cut costs.” JAL, which was delisted from the Tokyo Stock Exchange in February, is planning to cut almost a third of its workforce, slash flights and retire older planes over three years to return to profit. All Nippon Airways Co. President Shinichiro Ito last month said he was concerned that JAL would distort competition if it used government funds to buy new planes. JAL plans to receive a 300 billion yen cash injection from state-backed Enterprise Turnaround Initiative Corp. of Japan and 600 billion yen in loans from ETIC and state-owned Development Bank of Japan, under a turnaround plan announced in January.

Khan Krum

Krum was a Khan of Bulgaria from 808 to 814. By defeating the Avar Thaganate, he expanded his territory to cover the lands between the Danube and the Carpathians. Before the end of 809, the Khan's soldiers had defeated the Byzantine army and Serdika, which was later to become Bulgaria's capital, was captured. In 811 the Byzantine Empire army captured Pliska, the capital of Bulgaria. After the palace was destroyed Krum sued for peace offering Nicephorus I anything he wanted. The Byzantine Emperor refused the proposal. In July Krum got his revenge, laying siege on the Byzantine army, killing the Emperor. It is said that Krum had the Emperor's skull lined with silver, using it as a drinking cup. Leading his army south, Krum seized Byzantine towns and strongholds. Krum's sudden death on April 13, 814 put an end to his plan to enter the Emperor's palace as a conqueror. He also made other important contributions. Bulgaria's first written laws. Applicable to all Bulgarians, his laws ensured subsistence to beggars and state protection to the poor. Through his laws he became known as a magnanimous ruler, bringing Slavs and Bulgars into a centralized state.

On that day:  Chertigrad fortress