Банкеръ Weekly



BULGARIA TO AGREE LIBERALIZATION OF TRADE IN AGRICULTURAL PRODUCTS WITH CEFTA MEMBERS COUNTRIESThe member countries of the Central European Free Trade Agreement (CEFTA) are starting bilateral negotiations for liberalization of trade in agricultural products. This was the main result of the countries' MPs summit which took place on November 16 in Bucharest. In the past couple of years CEFTA confronted serious problems when trying to impose multilateral customs duties' control. Additional protocol N10 was voted at Bucharest summit to join the presently enforced regulation and it practically gives green light to further liberalization of aricultural products' trading which duties are being reduced following special scheme. In this way bilateral agreement of additional discounts on agricultural products' trading will be made possible as of 2002. Protocol N10 reflects reached by far agreements between Hungary, the Czech Republic and Slovakia. Deputy Premier and Minister of Economy Nikolai Vassilev, leader of the Bulgarian delegation in Bucharest, underlined the necessity CEFTA-countries to agree on elimination of export subsidies concerning agricultural products with agreed zero import duty. Due to its lack of financial resource Bulgaria is the only member country of CEFTA which does not provide sibsidies for its agricultural export, said Diana Naydenova, Head of the Regional Integration and Technical Cooperation Directorate of the Ministry of Economy, to the BANKER weekly. In comparison, the Czech Republic, Poland and Hungary, recently joined by Romaina, provide direct subsidies. This topic was the center of discussions at the 2001 World Trade Organisation's summit in Doha as well. Bulgaria was forced to back EU's position for state defence of the agricultural sector for simply regional and political reasons. The Doha-signed declaration for gradual decrease and elimination of export subsidies can turn out to be serious argument in favour of Bulgarian interests in CEFTA, insiders commented.However, it remains unclear whether deeper liberalization will exert expected positive influence on turnover between Bulgaria and its partners from CEFTA and whether this will improve our trade balance. In 2000 agricultural goods formed only 6.14% of the country's import and 17.1% of its export to the other six members. CEFTA countries' trading formed 6.7% of 2000 overall turnover and experts project it would remain the same in 2001. Calculations show that since 1999 when Bulgaria joined CEFTA our country has not made proper use of opened opportunity for improved goods' access to other members' markets. On the other hand, larger amount of import if compared to export should not make us underestimate Bulgarian firms' competitiveness, commented Deputy Prime Minister Nikolai Vassilev. He added that our companies had still not won stable positions on the Central European markets because of their small size and domestic consumption orientated structure.Very often CEFTA is being regarded as EU's threshold as it is preparing its members' economies for the hidden risks of the free goods' circulation on the united European market. The question is how can Bulgaria enter EU after being tripled still on its threshold.

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