Банкеръ Weekly



RECORD HIGH UTILIZATION OF FUNDS UNDER 2001 PHARE PROGRAMMEBulgaria's dream of becoming a member of the European Union has grown more real lately. Optimism that Brussels would soon welcome the country as part of Europe's elite club increased at the end of the session of the EU Council of Ministers, held last week. The EU member countries' foreign ministers adopted the promising phrasing that Bulgaria and Romania would be accepted in the union in January 2007. Still, that promise was accompanied by quite a Jesuitical condition - if only they were ready for this step.That is why extreme optimism is not so well-judged. There's hardly anyone in Bulgaria who deceives himself that Bulgarian economy is getting closer even to the average EU standards. It's also unclear whether attaching Romania to Bulgaria will appear a millstone sending the country to the bottom of the Balkans. Hopes that these fears will not come true are kept up by EU's declared readiness to finish negotiations with Sofia and Bucharest by the end of 2004. Should this happen, the general integration agreement will be signed in 2005.Regardless of all comments being made at present, most of the questions about Bulgaria's European perspectives will only be answered at the end of next January. That's when the European Commission has to propose a three-year financial framework for the talks within the Agriculture, Regional Policy, and Budget and Finance chapters. According to the EU enlargement commissioner Guenter Verheugen, if there are no particular problems about these chapters, Bulgaria could finalize negotiations within the mandate of the present commission, expring next May.One trump on which Bulgaria's negotiating team can rely in the so called financial chapters is the improved administrative utilization of money launched under the EU 2001 PHARE programme.The funds amounting to EUR82.823MN were negotiated in November 2001. The Ministry of Finance and the Ministry of Regional Development and Public Works had 24 months at their disposal to conduct tenders and to sign agreements with companies that will execute the projects. The money that had not been utilized within the deadline had to be sent back to the budget of the EU. How far the two ministries have gone in fulfilling their task was reported on a special ceremony held on December 10 and attended by Dimitris Kourkoulas, head of the Delegation of the EU to Bulgaria. According to Bulgaria's Finance Minister Milen Velchev, coordinator of the EU assistance, Bulgaria has achieved record high utilization of the European funds - over 95% of the financial assistance launched under the PHARE programme two years ago.The EUR43MN launched for the purposes of the institutional development has been utilized most efficiently. Minister Velchev announced that, in practice, 100% of this amount has been settled in advance. He said that the most precious project was the one for training magistrates within which contracts worth EUR2MN have been signed.According to the Minister, praise is also due to the officers in the EU Funds Management Directorate, headed by Boryana Pencheva, who are responsible for the implementation of the six grant schemes in the 2001 PHARE programme. 423 agreements have been signed within these schemes for development of small and medium-sized enterprises and for strenghtening of the civil society totaling EUR27.5MN.The concrete figures of the financial friendship between Bulgaria and the EU were also discussed by the Joint Monitoring Committee for PHARE, ISPA, and SAPARD on December 11.Later, it became clear that Bulgaria will probably be supported with EUR368MN in 2004. In 2005 the assistance will grow to EUR399MN. In the last year before the country joins the EU, Brussels will provide another EUR430MN.

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