WHO IS TELLING THE TURTH
The forecast of Bulgarian and American analysts for the future of the real estate business in Bulgaria are absolutely different.
According to the National Revenue Agency, the business climate in Bulgaria has got worse by 1.1 points. According to 69% of the interviewed industrial and construction business managers, the sale prices will not change in the next three months, 20,5% of them expect a decrease, while only 10,5% predict an increase. The unstable business environment and the lack of qualified workers are the reasons for the decrease by 2.5 points of the business climate in the construction industry in July alone. The increasing competition and the rising prices of materials make the business more difficult. At the same time more clients delay their payments. Despite this developers expect price rise in the next three months.
According to the US analyst Nouriel Roubini, Bulgaria’s future is bright due to the good financial policy and the high level of the foreign investments in the country. However, he expects slowing down of the Central and Eastern European economies in 2008 which is in tune with Western Europe. The new EU-member states are tied to the West as 65% of their export is in the Euro zone. It is expected that Bulgaria and Romania will show steady but stable progress.
Having in mind the current account deficit of 20% of the GDP and the frozen EU funding it is difficult to predict Bulgaria’s future.
PROPERTY MARKET SLOWS DOWN
The number of planning permissions issued in the first half of the year have decreased by 6%. 4300 new buildings with total area of 2,8 million square metres have been approved for construction, 62% of them are new apartments. The number of the new office spaces have stayed the same, while there has been a sharp decrease in the number of all other types of buildings.
The highest number of planning permissions have been issued in Sofia, Plovdiv is in the second place, while Varna is in the third. Plovdiv heads the list with the highest number of planning permissions for new office buildings.
NEW SANCTIONS EXPECTED
A Bulgarian ecological organization informed the European Commission about scandalous swaps of property as result of which the energy boss Christo Kovachky has acquired s formerly state owned forests in Rila Mountain at prices 24 times lower than the market prices. These forests have been included in the regulation plan of the new ski resort Iskrovete-Govedartsy-Maliovitsa. The administraste of the State Agency for the Forests have accepted that the Rila forests should sell to Kovachky for 5 levs (2.50 Euros) per square metre, while at the same time the market price is 120 levs (60 Euros) per square metre. According to the ecologists, the agency has not protected the interest of the state and has not adhered to several EU directives by not making the necessary evaluation of the plans for the new ski resort and its suitability. The new ski slopes and lifts will cut deeply in the National Park Rila. Brussels has launched sanctions procedure against Bulgaria for illegal construction in the national park.
INTERESTS GO SKY HIGH
The Bulgarian banks have increased the mortgage interests in July by half percent. Some banks have increased their commissions. Out of 15 commercial banks, now not less than 9 banks have worse offers for their clients, an all time record. Among them are the largest commercial banks in the country – Raiffeisenbank, Postbank, DSK Bank and UniCredit Bulbank.
|
|
PROPERTY MARKET – GREECE
According to the Greek press, Bulgarians, Russians and Ukrainians buy property on Halkidiki in Northern Greece in great numbers, despite the slump of the property market in Greece. The construction has not slowed down. Currently there are 20 000 new apartments on the market. The prices of new properties on Halkidiki are similar to those in expensive parts of Salonika. Houses by the sea sell for 2500-3000 Euros per square metre, while those inside the peninsula sell between 750 and 1000 Euros.
DEPUTY MINISTER RESIGNS
The deputy minister of health Dr. Matey Mateev has handed his resignation in protest against “the campaign against leading Bulgarian neurologists in connection with the used by them methods for treatment with stem cells.”
Last Friday, the Ministry of Health announced that due to illegal transplantations of stem cells to patients suffering from complicated genetic and neurological disorders at St Ivan Rilsky Hostpital, the director of the hospital Assistant Professor Roumen Stoilov has been sacked.
“The problem with the stem cells is scientific, not administrative and it has to be resolved by the academics,” declared Dr. Mateev.
INFLATION
The inflation for July will show an increase of 1% in comparison to June, when there was a July of -0,2 %. The minister of the economy Dimitrov explained this with the increase of the price of energy. The foreign investment for the first six months of the year has reached 2.078 billion Euros which is the similar to the same period last year.
According to the Naitonal Statistics Institute, the expenses of the Bulgarian households have increased by 7,1%. At the same time the investments in the basic capital have increased by 21%.
PM: BORISSOV HAS TO ANSWER
“Locally, GERB are racketeering the voters and the Sofia Mayor Boyko Borissov has to give many answers before attempting to come in power,” said PM Sergey Stanishev in an interview for 24 Hours Daily. “The demands of the opposition do not aim at improving the work of the government but are political. Now the work on all operative programmes is intensive. We sign contracts and organize tenders. The delay can be fatal, because it is important that by the end 2009 Bulgaria signs as many as possible contracts.”
FOREIGN COMPETITION
German, Italian, Spanish and French companies are trying to push Bulgarian companies out of the big infrastructure projects because there is no enough of work in the European Union for them after the money for the improvement of infrastructure have been cut in half. Because of this, the companies from Western Europe focus on Bulgaria and other countries in Eastern Europe. Another market for them is South America but the opportunities there also decrease. Despite the suspended funding for infrastructure by the European Commission there are a few high value projects in Bulgaria: the modernization of the railway Plovdiv-Svilengrad, amounting to 340 million euros and the railway Vidin-Sofia (320 million euros), the Struma Highway (600 million euros), the Maritsa Highway (210 million euros) and E-79 Highway from Vratsa to Botevgrad (85 million euros).
STANISHEV DEMANDS ACTION
Prime Minister Sergey Stanishev has asked each minister to present urgent measures in response to the criticism from Brussels. They will be discussed at the meeting of the tri-partite coalition in Bansko this weekend. Stanishev has ordered each institution which has been critisised to work along the recommendations of Brussels.
