Банкеръ Weekly

Briefs

EC GRANTS BULGARIA EUR95MN

A private company, a university or a research centre will carry out a preliminary evaluation of the national plan for Bulgaria's development after its accession to the European Union (EU), the BANKER weekly learnt. The drafting of such a document was envisioned in the strategy for the country's participation in the EU structural funds and cohesion fund, approved by Parliament in the spring of 2002. The national plan will summarize all economic measures, to be financed by funds from international donors after 2007 and will practically supersede the currently effective plan for econmic development in the period till 2006. One of the requirements of the European Commission (EC) is to carry out the so-called ex-ante control after the initial draft of the new document is ready. The idea is to find out if the projects proposed by state officials for financing by money of EU taxpayers are in compliance with Bulgaria's strategic interests. In the words of high-ranking representatives of the Finance Ministry, this difficult task will be most probably assigned to a leading foreign or Bulgarian consulting company, picked out in a tender under the Public Procurement Act. Higher universities of economics and reserch institutes will be almost certainly admitted to the contest as well. Work on the national plan for development which is also one of the requirements for closing the negotiations with the EU on the Regional Policy Chapter, is to start in the beginning of 2004. The Agency for Economic Analyses and Forecasts will be responisble for the draft. Fourteen new experts will be appointed to it for the purpose. At the present stage, however, concerns about the plan are only trifling worries. On Tuesday (October 28) champagne was drank to celebrate the signing of the memorandum between Bulgaria and the EC on the National 2003 PHARE Programme. The Finance Minister Milen Velchev and Dimitris Kourkoulas, Head of the EC's Delegation to Bulgaria, signed the agreement under which EUR94.9MN will be granted to Bulgaria. As the BANKER weekly already wrote, the money will be spent to finance projects in the sphere of state administration, for facilitation of the court reform, combating corruption, promotion of economic growth, integration of minorities, and harmonization of Bulgarian legislation with that of the EU. It is necessary to note that the memorandum between Sofia and Brussels was signed earlier than usual. Just for comparison, in 2002 the official ceremony where Mr. Velchev and Mr. Kourkoulas shook hands on the same occasion, was in December. In the words of the Finance Minister, the earlier date of signing the document was due to the good work of the directorate for management of EU funds, which is subordinate to Mr. Velchev. Mr. Kourkoulas did not spare his praises. He made public the results of the inspection, carried out in Bulgaria by the Commission for Budget Control with the European Parliament, in order to establish how the money from the EU funds were utilized. It turned out that its conclusions were quite positive, despite the Finance Ministry's data. According to them, in the 2000-2002 period we signed a memorandum under PHARE worth EUR242,443,000; contracts worth EUR70,688,000 were closed, and the really paid amounts for various projects totalled EUR38,212,000. Practically, this means that about 15% of the approved financial assistance was utilized. Judging from the financial annex to the Road Map for Bulgaria, approved during EU's meeting in Coppenhagen (December 12-13, 2002) the aid for Bulgaria in 2004 should be increased by 20% from the current EUR300MN. However, the money could be even more. A considerable part of the grant will come from the PHARE Programme. A political agreement for an indicative budget for 2004 of EUR157.3MN (60% up from 2003) has been reached between the Bulgarian Government and the EC. Boryana Pencheva, head of the directorate for management of EU money with the Finance Ministry, announced in front of journalists that next year EUR62MN would be allocated next year to projects, connected with the decommissioning of Kozlodui N-plant's units 3 and 4. The amount is part of the EUR200MN under the memorandum closed in November 1999 by Mr. Verheugen and Ms. Nadezhda Mihailova (as foreign minister).In 2004 the EU will also release EUR27MN under PHARE Transborder Cooperation for Promotion and Development of Border Regions. Another EUR104MN will come from the ISPA Programme. They will be spent mainly on the construction of water treatment plants and dumps. EUR55MN has been earmarked for assitance of agriculture in 2004.

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