Financial news

Bulgaria's economy is set to resume growth this year, but large private sector external debt and possible spillover from the euro zone debt crisis pose risks to the outlook, the International Monetary Fund said on Wednesday. After the Balkan country's economy shrunk 5 percent last year, the IMF projected it will reverse course this year, to expand by 0.2 percent, led by increased exports. The IMF outlook exceeds the government's forecast for economic growth this year of 1 percent. Private sector external debt stood at 102.7 percent of gross domestic product at the end of 2009, while gross foreign currency debt of the non-financial private sector amounts to 80 percent of GDP, the IMF said. It said capital inflows are likely to remain low and domestic demand is expected to fall further, requiring adjustments by both the private and public sectors.

“The deficit in the budget amounts to BGN 75-80 million in May,” Deputy PM and Finance Minister Simeon Dyankov said. Part of this deficit has accumulated as a result of the transfer of BGN 46 million to the Black Sea Trade and Development Bank. The deficit for the same period of last year was BGN 120 million. “The final data about the past trimester will be more optimistic, because the EU will reimburse us with the money that we paid off for implemented EU projects in January and February,” the minister added. “The fiscal reserve at the end of May is BGN 6.548 billion. However, the additional savings are mandatory and I will insist that the government should pursue a more prudent fiscal policy and further belt-tightening,” Dyankov said further.

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

Companies

Trade on BSE reduced the finance of the richest Bulgarian Vasil Bozhkov by over BGN 100 million. Bozhkov has direct interests in three listed companies on the stock exchange - Holding Roads, Moststroy and Railway Infrastructure-Holding company (RIH). In September 2007, when the stock was a record high, Bozhkov’s share in them was assessed on BGN 324 million. Yesterday, nearly 32 months later, shares were worth BGN 213 million, or a loss of BGN 111 million. Holding Roads loss was BGN 62.7 million, Moststroy – BGN 55.59 million, but his shares in RIH reported growth of BGN 7 million. According to the Polish magazine Wprost, Vasil Bozhkov is the 61st richest European. His finances at the end of 2008 were estimated at BGN 1.35 billion, compared to BGN 1.5 billion a year earlier.

The owner of hotels along the Black Sea and of the Bourgas-based producer of confectionery Pobeda, Sava Choroleev became CEO of one of the largest property funds which shares are traded on the Bulgarian Stock Exchange - Prime Property BG. The other new executive director is the lawyer and former independent member of the Board of Directors Svetoslav Kiossev. The former executive members - Balkan Advisory Company (BAC) and Redston became only members of the Board of Directors.

The Chief Executive Director of Bulgarian Posts, Milen Keremedchiev was dismissed by the Minister of Transport, Alexander Tsvetkov by mutual agreement, announced the company. Bulgarian Posts is to follow its original action plan, agreed upon 7 months ago," said Keremedchiev. Most likely, the new Head of Bulgarian Posts will be the outgoing postal chief of Executive Agency Electronic Communication Network and Information Systems, Deyan Daneshki. The entire management of the Port of Burgas was dismissed, reported the Transport Ministry. The official reason for the removal of the port director, Ruslan Petkov, is inability to handle the job.

The Bulgarian National Bank (BNB) has issued a permit to the new payment system operator BORICA—Bankservice, which is being set up through the synergy between national card operator BORICA and payment system operator Bankservice. The permit will be valid from entering the merger into the trade registry. The consolidated entity will continue to perform the same operations provided by the two separate companies. Both BORICA and Bankservice are owned by commercial banks, with the BNB holding approximately 35% in each. The central bank will remain shareholder in the new company. License were also awarded to four companies – Diners Club Bulgaria, Interdcard Finance, TBI Credit and Transcard Financial Services.

Most of the carriages within the two recently launched fast trains – Burgas Express and Varna Express – have been set into operation for the first time after their recycling, Bulgarian State Railways (BDZ) Executive Director Pencho Popov said. He highlights recycling is a common method in the European practice. Recycling includes an overhaul of all main systems in a carriage and replacement of its main elements with new ones. In compliance with the European regulations, a passenger carriage can operate at least 15 years after recycling.

Turkish company Dedeman Hotels and Resorts International is considering the opening of new hotels in Bulgaria. Dedeman already owns and operates two hotels in Bulgaria – Sofia Princess Hotel and Plovdiv Trimontium Princess. It is now considering the opportunities for opening new hotels in destinations such as Varna on the Black Sea and the mountain resort Bansko, and is even conducting negotiations with local investors. “Our first goal is to turn Plovdiv and Sofia into key destinations for meetings and congresses of Turkish companies. Turkish citizens come to Bulgaria mainly to do business.

Europe

TNK-BP, a joint venture between Britain's BP and a group of Russian billionaires, said that its unit which holds the license to the vast Kovykta gas field had filed for bankruptcy. TNK-BP said the RUSIA Petroleum unit is unable to pay off debts to its parent company. "The current financial situation precludes RUSIA Petroleum from timely repayment of its loans to TNK-BP Group," the company said in a statement. The loans were made to the subsidiary to finance the development of the vast Kovykta gas field, it said. "TNK-BP announced its original decision to withdraw from the Kovykta project back in 2007," the statement said. "As the major shareholder and creditor of RUSIA Petroleum, TNK-BP is determined to recover its investments and minimize its financial losses."

America

The U.S. private employers added 55 thousand jobs in May, further evidence the labour market was improving. The data on Thursday came ahead of the government's closely watched employment report on Friday, which is expected to show non-farm payrolls increased 513,000 in May, buoyed by hiring for the decennial census, after a 290,000 increase in April. That would mark five straight months of job gains. Initial claims for state unemployment benefits dropped 10,000 to a seasonally adjusted 453,000, the Labour Department said. That was a touch above market expectations for 450,000. Separately, private employers added 55,000 jobs in May after increasing payrolls by 65,000 the prior month, an ADP Employer Services report showed.

Asia

India’s central bank needs to consider a credit crunch while setting interest rates after payment of license fees for third-generation phone services drained cash, said Kaushik Basu, chief economic adviser in the finance ministry. “With the 3G auction and demand for credit having picked up, there is a credit hunger now,” Basu, 58, said in an interview in New Delhi yesterday. “The Reserve Bank of India will need to take stock of it as it balances inflation management and growth in deciding actions on policy rates.” Governor Duvvuri Subbarao is facing headwinds to tighten monetary policy and slow the fastest inflation rate among Group of 20 nations. Last week, the RBI eased rules to boost liquidity as operators including Bharti Airtel Ltd. prepared to pay $14.5 billion for wireless permits.

Obedinenie Mineral Springs

The Obedinenie mineral water spring – village of Obedinenie, Polski Trambesh municipality, Veliko Tarnovo district, is included in the list of mineral water springs – exclusive state ownership. The first drilling happened in 1971. The water springs out from a depth of 1250m, and has a hyper-thermal origin and temperature of 43ºC with a slight alkaline reaction. The local people voluntary cast concrete basins for open air water procedures. The official opening was performed in 1986. The water has a very favorable mineralization and is preferred when healing a number of diseases of the bones and joints; of the peripheral nervous system; of the digestive system; for immune system strengthening.

On that day:  Asenova fortress The Blue Stones - Sliven