Банкеръ Weekly

Briefs

PENSION FUNDS MANAGEMENT MET PRIME MINISTER KOSTOV

On February 12, 2001 managers of the pension funds licenced in Bulgaria met Prime Minister Kostov and other members of the cabinet. Generally our suggestion were received with due attention, said they. Ivan Nejkov, Minister of Labour and Welfare said that government places private pension funds among the most important economic operators. Accoridng to him, pension funds will be the ones to agitate local investment market.
The most important question, discussed at the meeting, was the opening of new possibilities for investing the money attracted by the pension funds. The mandatory social insurance code stipulates them quite rigidly. State has to invest not less than 50% of attracted pension provisions in state securities. At the same time the code allows not more than 10% of accumilated amounts to be invested abroad.
However, terms and volumes of state securities issued now by the Ministry of Finance are inadequate to satisfy investment needs. Most probably demand at this market will grow extremely high within the next three months, after the pension funds join it. Pension funds managers said also that Prime Minister Kostov promised support for the urgent issuing of new state securities, which will satisfy the need for additional investment possibilities for the pension funds.
Pension funds are expected to attract BGL250MN till the end of 2001, said Minister Nejkov. In the following years accumulated means are expected to quickly grow, and by the beginning of 2004 they are expected to reach BGL1BN. Long term plans show that by 2015 the amount is expected to reach BGL5BN. At the moment 410,000 people have made voluntary pension provisions.
At the meeting cabinet members offered the funds to participate in the big infrastructure projects, which will be carried out during the next couple of years, to make investments in high-tech industry and agriculture.

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