Financial news

Bulgarian National Bank announced as of June 1, 2010, base interest rate (simple annual interest) is 0.20 per cent. The base rate is increased by 0.02 percentage points compared to May, when it was 0.18 per cent. Compared to June 2009 when the BIR was 2.35 per cent, the decline amounted to 2.15 percentage points. The base rate is formed by the average of the index LEONIA for the past month, which reflect transactions concluded and overnight deposits in BGN by a representative group of banks.

Higher price in the natural gas will sensibly affect the price of the heating energy as of October 1, deputy chairman of the Association of the Heating Utilities Valentin Terziyski said. According to in spite of the expected hike in the gas price as of July 1 and respectively in the heating energy price, it is hardly likely subscribes to cancel the heating service in the summer. Regarding the quotations of petrol derivates and the rate of the dollar against the Bulgarian lev there most likely will be new increase in the price as of October 1.

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

Privatization

The management of the Bulgarian Stock Exchange is expected to confer with the prime minister this week to discuss the privatization of shares in state-owned companies to enliven the local stock exchange and boost revenues. Fifty companies, currently managed by the economy ministry, will go into the recently set-up State Consolidation company, which bundles minority stakes in state-owned firms prior to sale, the government decided last month. These are operating companies, which are not on the “prohibited list” that features state-owned, banned from privatization companies, such as Bulgartransgas, the gas pipeline operator. The measure is part of an anti-crisis package the government adopted earlier in April and aims to raise some BGN 250 mln from the sale of its minority stakes on the Bulgarian Stock Exchange.

Companies

The profit of the banks in Bulgaria for the first quarter of 2010 has dropped by 34% to 218 million levs, the national bank informs. In April, the banks announced profit of 48 million levs, while the devaluation of credits and collections was 99 million levs. Since the beginning of 2010, the devaluation of bank credits and collections has reached 384 million levs, which is an increase by 50% from a year ago. The interests on bank deposits hit nineteen-month low in April to an average level of 4.96%, compared to 5.33% in March and 5.71% in February.

Economic police and auditors from the State Financial Inspection are trying to find BGN 200 million, which entered in Sunny Beach JSC after its privatization, but today there is no trace of them. Currently Sunny Beach has only BGN 8300 in bank accounts plus serious obligations. The Executive Director Maria Mihaleva claims that the company is deep in debt, unpaid acts and unprofitable contracts. To date, Sunny Beach has paid BGN 4.3 million for recurring tax offenses, but still owes BGN 1.4 million to the NRA. Additionally it has to pay another BGN 1.5 million to various companies. Sunny Beach is also being sued for illegally sold property worth BGN 3.5 million. Mihaleva noted that many documents relating to the work of the previous board are missing.

A total of over 800 building permits for small hydropower plants were issued in Bulgaria in the period from the beginning of 2005 until the end of last year, out of which some 100-120 projects have been implemented, said Minister of Environment and Water Nona Karadjova. According to her, some of the projects are intended to be built in areas of the Natura 2000 network, but the ministry cannot stop their implementation. The Ministry of Environment and Water cannot say whether all these permits were issued in accordance with a procedure for assessing the compatibility with the objectives of Natura 2000, and that they have environmental impact assessments (EIA). In most of the cases, it was considered that the EIA was not necessary for the authorization.

Bulgaria’s Bulyard Shipbuilding Industry (BSI) could clinch a major order from Russia, governor Dancho Simeonov said. Simeonov returned from a shipbuilding and ship repair conference in Saint Petersburg held on May 25-28. Russia plans to grow its national fleet by 1,400 units by 2020, of which 40 percent will be ordered from abroad. Svetlin Stoyanov, chair of the National Association of Shipbuilders and Ship Repairers, who also attended the forum, said Bulgaria could supply a major part of the imported ship as it could build larger vessels. A working group has been formed to negotiate with Russia on a possible order.

The government will waive to built the new container terminal near Varna district Maksuda. At the last meeting held with representatives of Japan Bank for International Cooperation, which must grant money for the project from our side is requested to allocate the funds for development of the railway transport, instead of building a new port. To double the capacity of port of Varna – West will cost much cheaper, than building entirely new one, said the head of the state enterprise Ports National Company Evgeniy Moskov.

Europe

Six months after the UN climate summit in Copenhagen ended in a shambles of mistrust and vitriol, the conversation restarts on Monday in Bonn under an atmosphere that has hardly improved since the winter. Going into the 12-day meeting, the half-way point between last year's summit and its follow-up in Cancun, Mexico, the outgoing chair of the UN Framework Convention on Climate Change (UNFCCC), Dutchman Yvo de Boer was frank about the likelihood of a major breakthrough not just in Boon, but in the central American city at the end of the year. Even those larger emerging states such as China and India who were architects of the Copenhagen Accord - which was never endorsed, only ‘noted, by the UN process - have since backed away from the three-page document.

America

US Federal Reserve Chairman Ben Bernanke called for the Group of 20 world powers to coordinate financial reforms more closely in order to strengthen the global economy. Addressing a Bank of Korea conference via video link, Bernanke said there was a need for "extensive international cooperation" as governments overhaul market rules in the wake of the global economic downturn. "On a global level, the leadership of the... G20 -- which Korea is currently chairing -- will be essential in ensuring that reforms are not only strong and effective but also consistent and coordinated across countries," he said. G20 finance ministers will meet in Busan, South Korea, later this week for talks likely to be dominated by the continued fallout from the global crisis.

Asia

PetroChina has overtaken Exxon Mobil to rank first in the latest Financial Times annual list of the world's 500 most valuable listed companies, with a market capitalization of $329.3 billion. It's the first time for a Chinese company to secure the top spot in this 14-year-old ranking. Last year it ranked second. Industrial & Commercial Bank of China retains its fourth position, with a market value of $246.4 billion, and China Mobile falls to No 10 from last year's No 5; its market value is $193 billion. Altogether 45 Chinese companies made the list, and 21 of them are from the mainland. FT Global 500, based on listed companies' market capitalization, gives an overview of the world's largest companies.

Kipilovo Kale

The Fortress Kipilovo Kale rises on the Hisarlaka summit, 3 km southeastern from the village of Kipilovo, and 24 km western from the town of Kotel (Central Bulgaria). The Fortress is an irregular trapezium and spreads on an area of 8,000 sq.m. There is a lot of protected from the 2.5-m thick fortified walls, reaching 8-10 m in height. Three of the gates of the fortress are protected nowadays. A 12-m deep well is found in the eastern part of the fortress, and it used to supply it with water. According to the archeologists Kipilovo Kale was constructed in the end of the 6th century by the Romans for defence against the invading from the north Barbarians. It is assumed that the fortress existed till the end of the Second Bulgarian Kingdom.

On that day:  Vratza Public Holiday