The Bulgarian Interior Ministry have launched a police operation codenamed "Border", which is currently aimed at ending corrupt police practices on the Kapitan Andreevo border frontier checkpoint with Turkey, Bulgarian Interior Minister Tsvetan Tsvetanov was quoted as saying by Dnevnik daily on June 30 2010.
According to Tsvetanov, authorities observed that people crossing the border had been harassed and coerced into paying bribes by Bulgarian border police.
Several companies that frequented the border crossing were "tagged" by Bulgarian police in order to collect evidence. "The systematic abuse has been going on for years. We have received numerous complaints in the past from EC countries and no one did anything about it. We will put an end to it," Tsvetanov said at a press conference.
The investigation revealed that some officers regularly took small bribes ranging from five to 20 euro from people crossing the border. During the investigation controlled checks were administered on certain transport companies, drivers and tourists, while all bribes were meticulously documented, the report said.
The operation is being conducted by units from the Internal Police department along with the Interior Ministry and the chief directorate for combating organised crime CDCOC.
Wednesday, 30 June 2010
Tuesday, 29 June 2010
Bargains
British holidaymakers would be far better off financially if they went on holiday in Bulgaria rather than Brighton - on the south coast of England - according to a survey by Tesco Travel Money, even once the cost of flights is factored into the overall price.
The survey includes the costs of accommodation, car hire, meals and expenses but not air fares.
The survey reveals that a week in Sofia would cost a family of four 1221 pounds, while a seven-night break in Brighton would set them back 2209 pounds.
Bulgaria works out cheaper than any other country quoted in the survey which, ironically, placed Iceland as the most expensive destination, ahead of Italy, Spain, Croatia, France, Portugal, Greece and the UK - in that order.
Poland, Hungary, Cyprus and Slovenia are all ranked as considerably more expensive than Bulgaria.
Holidays in Turkey and Cyprus would also be cheaper for a British family of four than a stay in Brighton, according to the survey. The figure for Brighton came out at between 390 to 2209 pounds more than buying the equivalent items in Bodrum in Turkey, currently a popular resort for British holidaymakers.
The survey includes the costs of accommodation, car hire, meals and expenses but not air fares.
The survey reveals that a week in Sofia would cost a family of four 1221 pounds, while a seven-night break in Brighton would set them back 2209 pounds.
Bulgaria works out cheaper than any other country quoted in the survey which, ironically, placed Iceland as the most expensive destination, ahead of Italy, Spain, Croatia, France, Portugal, Greece and the UK - in that order.
Poland, Hungary, Cyprus and Slovenia are all ranked as considerably more expensive than Bulgaria.
Holidays in Turkey and Cyprus would also be cheaper for a British family of four than a stay in Brighton, according to the survey. The figure for Brighton came out at between 390 to 2209 pounds more than buying the equivalent items in Bodrum in Turkey, currently a popular resort for British holidaymakers.
Bulgarian surprise at Wimbledon
Bulgaria's best tennis player Tsvetana Pironkova won 6:2, 6:3 against Venus Williams of the US during their quarter final match for the Wimbledon Championships at the All England Lawn Tennis Club, in London.
There will be no all-Williams final at Wimbledon after the No. 2 seed Venus Williams lost to the unseeded Bulgarian player.
The Court One crowd gave Pironkova a standing ovation as she went off - but the 22-year-old actually walked off ahead of the beaten Venus Williams.
"It seems like a dream. Coming here, I never thought I'd play this well and reach this part of the tournament. I'm very happy, “ Pironkova told BBC.
“I think I played pretty well. I'm happy with my game. She also did well, but I have one win over her and I actually thought I could win and I was going for it. I love this tournament. Every time I come here I enjoy it, the atmosphere and everything. I can imagine people are really happy in Bulgaria and maybe I'm on the news there…"
“This is a fabulous effort by Tsvetana Pironkova. Venus struggled to keep the ball in court, but the American has been rattled by the bravery of her opponent,“ BBC commented.
Four years ago Pironkova, aged then 18, kicked out Wimbledon champion Venus Williams out of the prestigious Australian Open. Williams, seeded 10th, fell 2-6, 6-0, 9- 7 to Pironkova, appearing in her first Grand Slam tennis tournament and ranked 94th.
Sofia Property bottoms out
Sofia Residential Property Prices Mark Negligible Decrease in H1
Properties
The average asking sales prices for residential property in the Bulgarian capital Sofia continued to fall, though slightly, in the first part of 2010, data of realtors shows.
Prime neighborhoods have a negligible, average decrease of 3% for the first half of the year, while the year-on-year comparison shows an average decrease of 17%, according to a report of Colliers International.
The average asking sales prices in prime neighborhoods such as the Doctor's Garden, Lozenets, Ivan Vazov and Iztok stabilize in the beginning of the year. On year-on-year basis, the average decrease is around 15%.
The emerging areas Vitosha, Bukston and Manastirski Livadi saw a decrease in the average asking prices of 5-6%, with an average 19% year-on-year decrease.
The fall in prices is due to soft demand, Colliers experts say.
Developers remain flexible; willing to offerattractive schemes for installment payment, finishing works or parking spaces as well as rent-to-buy opportunity.
Buyers are careful and have high expectations from the developers. Few, if any, transactions are closed on the asking sales prices.
Buyers' budgets remain limited – buyers are rarely willing to exceed prices above EUR 1,000/sqm. The average threshold of a one bedroom apartment is EUR 40-50,000 with EUR 70-90,000 for two bedroom apartments, depending on the neighborhood.
Experts point out that the positive development in macroeconomic indicators such as unemployment and GDP give ground for moderate optimism in terms of the demand.
"Encouraging development in consumer confidence, together with the availability of mortgage financing further creates the prerequisites for a recovery of the residential market,“ reads Colliers report, adding that the light at the end of the tunnel is certainly visible.
The supply in the first half of 2010 grows very moderately, according to Colliers report.
According to data from the National Statistics Institute, the number of construction permits issued for Sofia for Q1 2010 fell with 26% compared to the same quarter in 2009. The average number of units per residential building is 2.6 for Q1 2010, compared to 4.2 in 2009 as developers ambitions dwindle. O
The number of newly completed units in Sofia almost halved in Q1 compared to the first quarter of 2009. Meanwhile, no large-scale projects were started during the first six months of the year, but some residential projects have obtained fresh injection of financing, and have resumed construction.
Properties
The average asking sales prices for residential property in the Bulgarian capital Sofia continued to fall, though slightly, in the first part of 2010, data of realtors shows.
Prime neighborhoods have a negligible, average decrease of 3% for the first half of the year, while the year-on-year comparison shows an average decrease of 17%, according to a report of Colliers International.
The average asking sales prices in prime neighborhoods such as the Doctor's Garden, Lozenets, Ivan Vazov and Iztok stabilize in the beginning of the year. On year-on-year basis, the average decrease is around 15%.
The emerging areas Vitosha, Bukston and Manastirski Livadi saw a decrease in the average asking prices of 5-6%, with an average 19% year-on-year decrease.
The fall in prices is due to soft demand, Colliers experts say.
Developers remain flexible; willing to offerattractive schemes for installment payment, finishing works or parking spaces as well as rent-to-buy opportunity.
Buyers are careful and have high expectations from the developers. Few, if any, transactions are closed on the asking sales prices.
Buyers' budgets remain limited – buyers are rarely willing to exceed prices above EUR 1,000/sqm. The average threshold of a one bedroom apartment is EUR 40-50,000 with EUR 70-90,000 for two bedroom apartments, depending on the neighborhood.
Experts point out that the positive development in macroeconomic indicators such as unemployment and GDP give ground for moderate optimism in terms of the demand.
"Encouraging development in consumer confidence, together with the availability of mortgage financing further creates the prerequisites for a recovery of the residential market,“ reads Colliers report, adding that the light at the end of the tunnel is certainly visible.
The supply in the first half of 2010 grows very moderately, according to Colliers report.
According to data from the National Statistics Institute, the number of construction permits issued for Sofia for Q1 2010 fell with 26% compared to the same quarter in 2009. The average number of units per residential building is 2.6 for Q1 2010, compared to 4.2 in 2009 as developers ambitions dwindle. O
The number of newly completed units in Sofia almost halved in Q1 compared to the first quarter of 2009. Meanwhile, no large-scale projects were started during the first six months of the year, but some residential projects have obtained fresh injection of financing, and have resumed construction.
On a happier footballing note..
WEST HAM are lining up a £6million bid for Mexico's highly-rated midfielder Efrain Juarez.
The 22-year-old, who can play in central midfield and at right-back, is keen on a switch to the Premier League.West Ham officials are trying to keep the move under wraps, but boss Avram Grant is keen to wrap up a deal quickly.
Now the Hammers are hoping to finalise the switch in the next few weeks following Mexico's exit from the World Cup.
Meanwhile, the club has launched an ambitious £10m bid to sign prolific Nice striker Loic Remy, 23, a target for Arsenal.
PC News
BULGARIA, ROMANIA INK POLICE COOPERATION DEAL TO PROTECT TOURISTS
The Interior Ministries of Bulgaria and Romania have signed a cooperation agreement providing for the transfer of police officers from one country to the other.
The deal was signed Monday in the Romanian Danube town of Giurgiu by the Chief Secretary of the Bulgarian Interior Kalin Georgiev and his Romanian counterpart Petre Toba. It was initially announced earlier in June.
The document provides for joint traffic police activities in the border regions and for joint patrolling to ensure the keeping of public order.
The major rationale for the Bulgarian-Romanian agreement is the large number of Romanian tourists visiting the Bulgarian Black Sea coast where some of them have been the victims of crimes such as car theft. According to the Bulgarian government data, about 1 million Romanian tourists visited Bulgaria in 2009.
Thus, the police cooperate deal will allow Romanian police officers to help their Bulgarian partners primarily with respect to cases whether Romanian visitors are involved. The document also provides an opportunity for sending Bulgarian policemen to Romania but the scale of such a measure will likely be much smaller because of the fewer Bulgarian visitors to Romania.
The Interior Ministries of Bulgaria and Romania have signed a cooperation agreement providing for the transfer of police officers from one country to the other.
The deal was signed Monday in the Romanian Danube town of Giurgiu by the Chief Secretary of the Bulgarian Interior Kalin Georgiev and his Romanian counterpart Petre Toba. It was initially announced earlier in June.
The document provides for joint traffic police activities in the border regions and for joint patrolling to ensure the keeping of public order.
The major rationale for the Bulgarian-Romanian agreement is the large number of Romanian tourists visiting the Bulgarian Black Sea coast where some of them have been the victims of crimes such as car theft. According to the Bulgarian government data, about 1 million Romanian tourists visited Bulgaria in 2009.
Thus, the police cooperate deal will allow Romanian police officers to help their Bulgarian partners primarily with respect to cases whether Romanian visitors are involved. The document also provides an opportunity for sending Bulgarian policemen to Romania but the scale of such a measure will likely be much smaller because of the fewer Bulgarian visitors to Romania.
Monday, 28 June 2010
Russian News Part 2
A big rise of Russian investment in Bulgarian real estate along the Black Sea coast has been reported by private Bulgarian television channel bTV on June 25 2010.
About 100 000 Russians have purchased property along the Bulgarian coast. According to Yuri Salovyov, Russian general secretary to the Russian embassy in Varna, this means that more than 300 000 Russians regularly spend their holidays in the country, given that they normally arrive with their families.
"Multiply that by the amount of money invested in real estate itself, and the tax collected by the state, in addition to the fact that many Russians don't simply spend their holidays here, but they live here, and one can see the contribution to the Bulgarian economy," Salovyov said.
Russians generally tend to choose property along large resorts on the coast, or the Bulgarian mountains, but they also settle occasionally for a quiet, rural way of life in small villages, the report said.
"The great demand for real estate, which initially came from the UK and other English-speaking countries, is being steadily replaced by Russian-speakers," said municipal mayor Avren Todorov.
"Many Russians are seeking to buy single family homes facing the seafront or flats in the cities, as many of them have decided to outsource their business to Bulgaria and move here permanently," real estate agent Stefan Atanassov told the bTV.
About 100 000 Russians have purchased property along the Bulgarian coast. According to Yuri Salovyov, Russian general secretary to the Russian embassy in Varna, this means that more than 300 000 Russians regularly spend their holidays in the country, given that they normally arrive with their families.
"Multiply that by the amount of money invested in real estate itself, and the tax collected by the state, in addition to the fact that many Russians don't simply spend their holidays here, but they live here, and one can see the contribution to the Bulgarian economy," Salovyov said.
Russians generally tend to choose property along large resorts on the coast, or the Bulgarian mountains, but they also settle occasionally for a quiet, rural way of life in small villages, the report said.
"The great demand for real estate, which initially came from the UK and other English-speaking countries, is being steadily replaced by Russian-speakers," said municipal mayor Avren Todorov.
"Many Russians are seeking to buy single family homes facing the seafront or flats in the cities, as many of them have decided to outsource their business to Bulgaria and move here permanently," real estate agent Stefan Atanassov told the bTV.
Friday, 25 June 2010
Russian news
RUSSIAN REAL ESTATE OWNERS IN BULGARIA UNITE TO FORM OWN NGO
Russian owners of properties in Bulgaria have registered a non-governmental organization to protect their interests as a staggering number of Russians have acquired real estate in the country in recent years.
The new “Association of the Russian-Speaking Owners of Real Estate in Bulgaria” named “Alyosha” has been registered in the Black Sea city of Burgas but also has a branch in Varna, announced Thursday its Chair Alexander Anisimov.
Anisimov presented the new NGO together with the Russian Federation consul in Varna, Yury Solovyov, who said that even though there is no precise statistical information about the number of Russian property owners in Bulgaria but that they are estimated to be at least 300 000. Many of them own properties along the Bulgarian Black Sea coast.
A number of “the Russian-speaking” property owners are from other former Soviet Union republics such as Ukraine or Armenia.
Several days ago Russian Ambassador to Bulgaria, Yury Isakov said the Russian property investments in Bulgaria amounted to more than EUR 1 B.
According to the founders of the NGO of Russian-speaking property of owners in Bulgaria, its goal is to defend the property and social rights of its members and to assist them with various legal procedure when acquiring or selling Bulgarian real estate.
Its Chair Anisimov announced that five Russia citizens have already filed suits over problems with Bulgarian construction companies. The future owners made advance payment but did not receive their completed apartments within the deadline.
The NGO is going to help investigate whether the Russians have been defrauded or whether the construction companies went bankrupt. It is also starting to compile a list of unfair construction firms and of other providing high-quality services.
“Medical help is a huge issue for the Russians residing in Bulgaria. Most of them don’t know whom to turn to when they get sick,” Anisimov explained saying that the NGO will also employ two doctors which will work on call for its members.
At the same time, Bulgaria’s Foreign Ministry has announced that the number of Russian tourists in Bulgaria is on the rise as the Bulgarian consular offices issued 10 000 more visas to Russians in the first have months of the year compared to same period of 2009.
The 100 000th Bulgarian tourist visa for a Russian citizen was issued on June 22. In comparison, in 2009 this number was not reached until July 13.
Russian owners of properties in Bulgaria have registered a non-governmental organization to protect their interests as a staggering number of Russians have acquired real estate in the country in recent years.
The new “Association of the Russian-Speaking Owners of Real Estate in Bulgaria” named “Alyosha” has been registered in the Black Sea city of Burgas but also has a branch in Varna, announced Thursday its Chair Alexander Anisimov.
Anisimov presented the new NGO together with the Russian Federation consul in Varna, Yury Solovyov, who said that even though there is no precise statistical information about the number of Russian property owners in Bulgaria but that they are estimated to be at least 300 000. Many of them own properties along the Bulgarian Black Sea coast.
A number of “the Russian-speaking” property owners are from other former Soviet Union republics such as Ukraine or Armenia.
Several days ago Russian Ambassador to Bulgaria, Yury Isakov said the Russian property investments in Bulgaria amounted to more than EUR 1 B.
According to the founders of the NGO of Russian-speaking property of owners in Bulgaria, its goal is to defend the property and social rights of its members and to assist them with various legal procedure when acquiring or selling Bulgarian real estate.
Its Chair Anisimov announced that five Russia citizens have already filed suits over problems with Bulgarian construction companies. The future owners made advance payment but did not receive their completed apartments within the deadline.
The NGO is going to help investigate whether the Russians have been defrauded or whether the construction companies went bankrupt. It is also starting to compile a list of unfair construction firms and of other providing high-quality services.
“Medical help is a huge issue for the Russians residing in Bulgaria. Most of them don’t know whom to turn to when they get sick,” Anisimov explained saying that the NGO will also employ two doctors which will work on call for its members.
At the same time, Bulgaria’s Foreign Ministry has announced that the number of Russian tourists in Bulgaria is on the rise as the Bulgarian consular offices issued 10 000 more visas to Russians in the first have months of the year compared to same period of 2009.
The 100 000th Bulgarian tourist visa for a Russian citizen was issued on June 22. In comparison, in 2009 this number was not reached until July 13.
Thursday, 24 June 2010
We did it !
Well my cynicism was too cynical !.Well done Defoe and a markedly improved side.There were still a few rough edges, but it was so much better.Now though the hard matches begin !.
Wednesday, 23 June 2010
Fingers Crossed
Well 17.00 EET is the witching hour for the English football team.Defeat by Slovenia is unthinkable and to salvage any national pride they must win convincingly.
I hope they win, it will be a pleasant surprise, but I cannot see any indication that these 11 players currently constitute a team.The addition of Joe Cole will probably help and Upson is a good addition to the team (my West Ham bias).They have, lately, shown more discipline than, for example, the absolutely shameful French side, and it appears that the so called crisis meeting seemed to offer direction.
One thing is for sure at 18.45 EET there will be one of two emotions: euphoria or despair.
Editors Note: My euphoria or despair will be in Stara Kushta (Old House) Bar in Obrochishte, where they have a wide screen tv and draught Kamenitza at 1.50lv a pint (0.64p).So if there are any readers in Albena out there, tired of paying 4lv for a pint, please feel free to join my good self and my partners in crime Mark the Builder and Golfer Steve.
I hope they win, it will be a pleasant surprise, but I cannot see any indication that these 11 players currently constitute a team.The addition of Joe Cole will probably help and Upson is a good addition to the team (my West Ham bias).They have, lately, shown more discipline than, for example, the absolutely shameful French side, and it appears that the so called crisis meeting seemed to offer direction.
One thing is for sure at 18.45 EET there will be one of two emotions: euphoria or despair.
Editors Note: My euphoria or despair will be in Stara Kushta (Old House) Bar in Obrochishte, where they have a wide screen tv and draught Kamenitza at 1.50lv a pint (0.64p).So if there are any readers in Albena out there, tired of paying 4lv for a pint, please feel free to join my good self and my partners in crime Mark the Builder and Golfer Steve.
Sunday, 20 June 2010
007
BUCHAREST, Romania -- A court in Bucharest on Friday (June 18th) sentenced a Romanian and a Bulgarian to 12.5 years in prison each for passing classified information to Ukraine. Floricel Achim and Petar Marinov Zikolov were arrested in March 2009 in Bucharest on charges of having delivered confidential Romanian military files to a country that is not a member of NATO. According to the prosecution, between 2002 and 2008, Achim gave Zikolov "documents that might have threatened the security of Romania". Zikolov passed the documents to Ukrainian officials. Achim admitted to the charges saying he did it because he was in a grave financial situation
Saturday, 19 June 2010
What a load of rubbish !
I sat through Englands 'performance' last night, if you can call it that, with mounting anger.The best paid footballers and manager in the world drawing to possibly the worst side in the World Cup.
I suppose the pre tournamnet hype of 'we are going to win the world cup' should of told you that ..er..we obviously weren't, but two crap performances, which should have been wins, tell you that something is seriously wrong with the England team.
I think that most of the nation are approaching the Slovenia game with dread !.
I suppose the pre tournamnet hype of 'we are going to win the world cup' should of told you that ..er..we obviously weren't, but two crap performances, which should have been wins, tell you that something is seriously wrong with the England team.
I think that most of the nation are approaching the Slovenia game with dread !.
Friday, 11 June 2010
More tourists..
ISRAELI TOURISTS DESERT TURKEY FOR BULGARIA OVER GAZA CONFLICT
Israel will redirect 400 000 of its tourists from Turkey to Bulgaria, as a direct result from the flaring Gaza conflict, Israeli Social Minister announced Thursday.
“After the deterioration of our relations with Turkey, which was a main destination for about 400 000 of our tourists, naturally Bulgaria will be the best alternative for them,” Minister Isaac Herzog said at an official meeting with his Bulgarian counterpart, Totyu Mladenov.
Herzog called upon the Bulgarian government to make efforts to advertise the country in Israel.
“There are many retired people who go to spa resorts in Greece and Romania. The most natural thing for them would be to visit Bulgaria afterwards. Varna is a very popular tourist destination,” the Israel minister said and added many Israelis visit ski resorts as well.
Herzog met with his Bulgarian counterpart to discuss cooperation on social issues; Israel and Bulgaria are going to update a social issues convention they signed in 2009.
The two countries work together on integrating orphans and people with disabilities in the society, and on attracting NGOs that have experience in Israel for building nursing homes in Bulgaria.
The recent conflict at the Gaza strip, where Israeli commandos stormed an aid ship and killed 9 Turkish citizens, deteriorated the traditionally good relations between the two countries.
Israel will redirect 400 000 of its tourists from Turkey to Bulgaria, as a direct result from the flaring Gaza conflict, Israeli Social Minister announced Thursday.
“After the deterioration of our relations with Turkey, which was a main destination for about 400 000 of our tourists, naturally Bulgaria will be the best alternative for them,” Minister Isaac Herzog said at an official meeting with his Bulgarian counterpart, Totyu Mladenov.
Herzog called upon the Bulgarian government to make efforts to advertise the country in Israel.
“There are many retired people who go to spa resorts in Greece and Romania. The most natural thing for them would be to visit Bulgaria afterwards. Varna is a very popular tourist destination,” the Israel minister said and added many Israelis visit ski resorts as well.
Herzog met with his Bulgarian counterpart to discuss cooperation on social issues; Israel and Bulgaria are going to update a social issues convention they signed in 2009.
The two countries work together on integrating orphans and people with disabilities in the society, and on attracting NGOs that have experience in Israel for building nursing homes in Bulgaria.
The recent conflict at the Gaza strip, where Israeli commandos stormed an aid ship and killed 9 Turkish citizens, deteriorated the traditionally good relations between the two countries.
The smoking gun !
Why Bulgaria Is the Next Big Worry for the Eurozone
Views on BG
From MoneyWeek
By David Stevenson
Greece was the founder member of the 'Erode the euro' club. Ireland, Portugal, Spain and Italy have also been in from the start, although everyone pretended not to notice at the time.
There have since been mutterings about Belgium and even France. Last week there were jitters about Hungary. And now it's Bulgaria's turn.
Hang on, you say. Hungary and Bulgaria aren't even in the euro. Why should our continental cousins worry about them?
Well, there are plenty of reasons for the eurozone countries to worry about their neighbours to the east. Here's what's spooking them, and what it means for the euro...
Hungary and Bulgaria are worrying investors
Greece's troubles are almost old hat now for veteran eurozone watchers. That's because a whole string of other countries with dodgy finances is now giving the financial markets sleepless nights.
In a nutshell, investors who lent them money in happier days are worried they won't get their money back now that times are tougher.
That's bad enough for those with loads of cash tied up in the eurozone. But now those concerns are spreading beyond the single currency area, too.
There's always been an agenda to expand the eurozone. Several other countries were meant to join the single currency at some future stage, once they'd knocked their finances into shape. But even although these potential newcomers haven't yet met the EU criteria, they're still scaring the horses.
Last week, Hungary said it was facing a Greek-style debt crisis, as we mentioned in Monday's Money Morning. The Hungarian government later backtracked, saying things weren't so bad after all. But in the meantime the Hungarian forint plunged against the US dollar and sent shockwaves across other global markets.
Now Bulgaria is having its turn in the spotlight. Auditors from Eurostat – the EU's statistics office – are likely to be "parachuted in" to Bulgaria to cast a critical eye over the country's public sector accounts, says EU Economics and Monetary Commissioner Olli Rehn.
So what's going on? And why is this spooking the eurozone?
There are two main reasons.
Firstly, news that the EU's accountants have turned up on a country's doorstep can get the rumour mill working overtime. Ever since Greece admitted that Goldman Sachs had helped it fiddle its deficit numbers, everyone's on the alert for a repeat.
"The timing of Rehn's statement was unfortunate given the last week's focus on the veracity of historical budget data in Hungary, and comparisons made to Greece's chequered track record on the data quality front", says Timothy Ash at RBS. "The EC is eager to expose any potential skeletons in the fiscal cupboard, and Bulgaria seems to be next in line in this 'cleansing' process".
In other words, senior eurocrats want to make sure Bulgaria isn't cooking its books. And that's because of the second reason. There's a big debt problem in Bulgaria.
The irony is that government borrowing is fine. The annual budget deficit – how much the government is spending over and above what it receives in taxes – is forecast to be 'only' 3% this year. And the national debt – the government's total debt pile – is likely to be just 17% of GDP by the end of this year. That compares very favourably with the EU average of 80%, and well over 100% for Greece. So Bulgaria should be able to pay its interest bills for now.
The cause for concern lies elsewhere. Bulgaria has a total external debt/GDP ratio of around 108%. That means that as a group, Bulgarian citizens owe more than they produce each year.
And because Bulgaria's currency, the lev, is pegged to the euro, this creates a rather different problem to Hungary. As John Stepek explained on Monday, many European banks made euro loans to Hungarian homeowners. When the forint dives against the euro, payments shoot up and some borrowers can't service their debts.
In contrast, lenders to Bulgaria – including Hungarian banks, incidentally – have to cope with the same issue that eurozone countries such as Greece, Ireland and Spain are suffering.
Because Bulgaria is keeping the lev pegged to the euro, the country hasn't been able to devalue its way out of trouble. That means its exports simply haven't been able to compete on the world stage.
And that's "caused a brutal and extended recession", says Ash. Real GDP shrank by 5% in 2009, and fell a further 4% in the first quarter of 2010. Unemployment has doubled in the past year to just below 10%. The economy is likely to take a long time to turn around.
Even worse, Bulgaria's growth over the past four to five years has largely been driven by a credit-based property boom. That boom is over, leaving Bulgarians with lots of debts backed by properties which aren't worth what they paid for them. Throw in a weak economy and high unemployment, and the reality is that lots of those loans simply can't and won't be repaid.
Bulgaria's finance minister says he's not worried about the EU audit. And he has no reason to be. But European banks who've lent to the country's citizens should be worrying about the risks that all that external debt poses. It's yet another potential danger to their balance sheets. It's likely to require more asset write-downs. And they've plenty of dodgy debt in their own countries to sort out without having to fret about the likes of Bulgaria.
Add it all up, and it's yet another nail in the euro's coffin. Because if European banks suffer another crisis, their governments will be under pressure to bail them out again. That means even heavier public sector debts, weaker economies and possibly even money printing, which in turn means a weaker currency.
Views on BG
From MoneyWeek
By David Stevenson
Greece was the founder member of the 'Erode the euro' club. Ireland, Portugal, Spain and Italy have also been in from the start, although everyone pretended not to notice at the time.
There have since been mutterings about Belgium and even France. Last week there were jitters about Hungary. And now it's Bulgaria's turn.
Hang on, you say. Hungary and Bulgaria aren't even in the euro. Why should our continental cousins worry about them?
Well, there are plenty of reasons for the eurozone countries to worry about their neighbours to the east. Here's what's spooking them, and what it means for the euro...
Hungary and Bulgaria are worrying investors
Greece's troubles are almost old hat now for veteran eurozone watchers. That's because a whole string of other countries with dodgy finances is now giving the financial markets sleepless nights.
In a nutshell, investors who lent them money in happier days are worried they won't get their money back now that times are tougher.
That's bad enough for those with loads of cash tied up in the eurozone. But now those concerns are spreading beyond the single currency area, too.
There's always been an agenda to expand the eurozone. Several other countries were meant to join the single currency at some future stage, once they'd knocked their finances into shape. But even although these potential newcomers haven't yet met the EU criteria, they're still scaring the horses.
Last week, Hungary said it was facing a Greek-style debt crisis, as we mentioned in Monday's Money Morning. The Hungarian government later backtracked, saying things weren't so bad after all. But in the meantime the Hungarian forint plunged against the US dollar and sent shockwaves across other global markets.
Now Bulgaria is having its turn in the spotlight. Auditors from Eurostat – the EU's statistics office – are likely to be "parachuted in" to Bulgaria to cast a critical eye over the country's public sector accounts, says EU Economics and Monetary Commissioner Olli Rehn.
So what's going on? And why is this spooking the eurozone?
There are two main reasons.
Firstly, news that the EU's accountants have turned up on a country's doorstep can get the rumour mill working overtime. Ever since Greece admitted that Goldman Sachs had helped it fiddle its deficit numbers, everyone's on the alert for a repeat.
"The timing of Rehn's statement was unfortunate given the last week's focus on the veracity of historical budget data in Hungary, and comparisons made to Greece's chequered track record on the data quality front", says Timothy Ash at RBS. "The EC is eager to expose any potential skeletons in the fiscal cupboard, and Bulgaria seems to be next in line in this 'cleansing' process".
In other words, senior eurocrats want to make sure Bulgaria isn't cooking its books. And that's because of the second reason. There's a big debt problem in Bulgaria.
The irony is that government borrowing is fine. The annual budget deficit – how much the government is spending over and above what it receives in taxes – is forecast to be 'only' 3% this year. And the national debt – the government's total debt pile – is likely to be just 17% of GDP by the end of this year. That compares very favourably with the EU average of 80%, and well over 100% for Greece. So Bulgaria should be able to pay its interest bills for now.
The cause for concern lies elsewhere. Bulgaria has a total external debt/GDP ratio of around 108%. That means that as a group, Bulgarian citizens owe more than they produce each year.
And because Bulgaria's currency, the lev, is pegged to the euro, this creates a rather different problem to Hungary. As John Stepek explained on Monday, many European banks made euro loans to Hungarian homeowners. When the forint dives against the euro, payments shoot up and some borrowers can't service their debts.
In contrast, lenders to Bulgaria – including Hungarian banks, incidentally – have to cope with the same issue that eurozone countries such as Greece, Ireland and Spain are suffering.
Because Bulgaria is keeping the lev pegged to the euro, the country hasn't been able to devalue its way out of trouble. That means its exports simply haven't been able to compete on the world stage.
And that's "caused a brutal and extended recession", says Ash. Real GDP shrank by 5% in 2009, and fell a further 4% in the first quarter of 2010. Unemployment has doubled in the past year to just below 10%. The economy is likely to take a long time to turn around.
Even worse, Bulgaria's growth over the past four to five years has largely been driven by a credit-based property boom. That boom is over, leaving Bulgarians with lots of debts backed by properties which aren't worth what they paid for them. Throw in a weak economy and high unemployment, and the reality is that lots of those loans simply can't and won't be repaid.
Bulgaria's finance minister says he's not worried about the EU audit. And he has no reason to be. But European banks who've lent to the country's citizens should be worrying about the risks that all that external debt poses. It's yet another potential danger to their balance sheets. It's likely to require more asset write-downs. And they've plenty of dodgy debt in their own countries to sort out without having to fret about the likes of Bulgaria.
Add it all up, and it's yet another nail in the euro's coffin. Because if European banks suffer another crisis, their governments will be under pressure to bail them out again. That means even heavier public sector debts, weaker economies and possibly even money printing, which in turn means a weaker currency.
Saturday, 5 June 2010
Cheap Holiday Deals in Bulgaria
These deals are for Sunny Beach for Varna and Northern Bulgaria e mail or comment here.
Varna Fest is here !
Check this out !, our wonderful Varna Fest which began with two nights of Riverdance !.Click the post title !.
Pound soars against Lev/Euro
2.36 leva to the pound is the pretty impressive latest set of figures from the currency markets.Remember a few months ago it was nearly 2lv to the pound.This means that tourist money will stretch further this year, but not as far as the dizzy heights of 2.94lv which was the pounds high point.
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