Банкеръ Weekly



The nightmarish summer of Bulgarian administration, which was subjected to 27 vigilant partner inspections on the part of the European Union (EU) will end in early September for when the last two monitoring missions of experts from the EU member countries are scheduled. They will examine the state of air transport and our readiness for reciprocal recognition of medical workers' diplomas - those issued in Bulgaria and in the EU. Anyway, our officials can heave a sigh of relief now as the most serious inspections have already passed. The first inspections of the environmental sector and the judicial system were in the end of July. The supervision is under the so-called monitoring clause in the agreement of June 2004 between Bulgaria and the European Commission (EC), marking the technical completion of pre-accession negotiations. Although publications in press say that the subjects of the 27 inspections fully coincide with the negotiations chapters that we know, the truth is somewhat different. Experts from the Council of Ministers' department for European Integration and Relations with International Financial Institutions told the BANKER weekly that the monitoring was only in specific problematic sectors. For instance, 13 of all the 25 completed missions were in the sphere of agriculture. This is hardly surprising having in mind that the Agriculture Chapter is one of the most voluminous. EU experts examined in detail the readiness of our administration to effect quality control on the market of foods, wine, fodders, etc. Another object of interest on the part of the EU was the observation of hygienic standards in Bulgarian farms and slaughterhouses, as well as the humane treatment of animals. Another misguided opinion that is often met in newspapers and also in the statements of official persons is that the above-mentioned partner inspections are conducted by the EC. In fact they are only financed by it. The experts are chosen by the governments of the EU member countries and their reports in the end of each inspection do not directly engage commissioners in Brussels. But that doesn't mean the Government can twist and turn and not observe the recommendations. Something of the kind happened with the report of the mission on the reform in the judicial system, for which the BANKER wrote. One way or the other, after the expert analyses are prepared, they will be filed in the beginning of September to the EC Enlargement general directorate and will be the basis for the preparation of the regular report on Bulgaria's progress. According to preliminary information, the important document for our future membership in the EU will be published on October 6, 2004. Romano Prodi's commission, whose mandate will be completed several weeks later, is expected to recommend to the state and government leaders of the 25 EU members to make a political decision for declaring the end of negotiations with Bulgaria and Romania. The strategic document that will accompany the report will specify the future form for control on the part of Brussels for the fulfilment of undertaken commitments. The optimistic scenario (for us) projects that this will be done through exchange of information and filling in of detailed questionnaires. This option will be probably chosen if the assessment for Bulgaria is positive as a whole. The second option, which presently seems less likely, is to continue the practice of partner inspections. The prevailing opinion of Bulgarian institutions, directly engaged with the preparation of the EU commissioners' report, is that the key phrase in it will refer to the ability of the country's economy to endure the pressure of the competitive unified internal market after 2007. Informed sources claim it is quite likely that the EC (whose term in office ends in November 2004) makes a curtsy to Bulgaria by a forecast that the country will be able to cope shortly with the active market forces in the EU. That would practically eliminate even the theoretical apprehension for postponement of Bulgaria's membership till the year 2008. Such a negative development should not be completely ruled out as an option in the above-mentioned monitoring clause. The other important moment in the October report of the EC will be the assessment of the country's business climate. Government officials who took part in the partner inspections point out that the most frequently asked question by EU experts referred to the business climate. The representatives of EU members wanted to know what the real effect of applying the Government's programme for limiting administrative regulation was. In May 2002 the Council of Ministers approved a programme for elimination of or making easier a total of 192 leasing and registration regimes. According to data of the Ministry of Economy, about 74% of them are no more applied in Bulgaria. Nevertheless, a representative study of the sociological agency Vitosha Research was published in the beginning of June 2004, according which almost two thirds of the polled companies 23 had not felt any change in the business environment. It can be certainly predicted that in the October analysis of the EC the Bulgarian Government would be praised for its fiscal policy and for the recently negotiated new two-year agreement with the International Monetary Fund. Criticism for the growing negative foreign trade balance and increasing deficit in the current account of the balance of payment will hardly surprise anyone in Bulgaria. The conclusion of EU commissioners for the eventual shortening of the term for registration in court of newly-established commercial firms, for liquidation of those that have already stopped operation, and for declaring insolvent companies bankrupt, is expected with interest. According to pundits, however, forecasts in that respect are not optimistic. The most recent achievements in the economic sphere will be presented in the EC by the Minister of European Affairs Meglena Kuneva during her forthcoming visit in Brussels on September 2. Regretfully, that cannot be said about what Bulgaria has made regarding the introduction of European legislation in Bulgaria. The reason is that Ms. Kuneva's visit is before the start of the National Assemby's autumn session. And the talks in Belgium's capital are our country's last opportunity to present additional information for the report's preparation. The recently promulgated Healthcare Act, the amendments to the law on small and medium-sized enterprises, and to the law on anti-social acts on the part of under age and juvenile individuals, are expected to be praised. However, MPs will be hardly spared criticism for failing to adopt the Act on Genetically Modified Structures, for non-observing the legislatively set term for the choice of ombudsman, and for setting up a commission against discrimination. According to Zinaida Veleva, head of the Council of Ministers' department for European Integration and Relations with International Financial Institutions, the recently introduced electronic system, monitoring the fulfilment of undertaken commitments under the negotiation process on the part of individual institutions, had a mobilizing effect. The new software allows to prepare any time a detailed report about ministries that are lagging behind with the realization of projected measures under the working plan for speeding up negotiations with the EU. Thus, despite the criticism for the lack of capacity, Bulgaria's administration seems to be slowly and smoothly stepping into the European track of operation.

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