Photo: Julia Lazarova

Between 50 and 60 private property auctions have culminated in a sale but only one such case was recorded last year, according to data provided by website targ.bg during a seminar organised by imoti.net.

“About a third of private auctions end with a deal,” targ.bg owner Georgi Palpourin said. “However, the number of such auctions is negligible given that, at any time, there are often more than 2000 sales ads posted by private bailiffs. The Ministry of Justice is the only source with information on how many actually end in a deal since it gets the transaction reports.”

“Private property auctions are still somewhat of an oddity in Bulgaria. Still, they are useful for people who want to save time and money as they can sell their property within two months. However, the success of the undertaking depends on setting the right asking price. Sellers often try to extract the amount they paid for a property bought before the crisis but experts insist that a deal at such terms is impossible. Motivation to clinch a deal is the highest among people experiencing financial difficulties, which most often means they cannot service their bank debts. Public auctions also take place when a real estate agency has been unable to sell the property,” Palpourin said.

Inability to access credit has so far been the main problem facing buyers at property auctions. However, about a month ago First Investment Bank introduced a mortgage loan designed for that purpose.

“We have so far extended 12 chance mortgage loans for the purchase of properties sold by bailiffs,” retail banking chief Milka Todorova said. However, the bank is required to work with the bailiff who has declared the property for sale. First Investment Bank has signed agreements with bailiffs in Sofia, Varna, Stara Zagora, Shoumen, Bourgas and Pleven.

Sofia Echo

Work on extending Sofia's metro underground railway system - Photo: Nadezhda Chipeva

About a third of property sales in Bulgaria in 2011 were motivated by people wanting to get out of their investments, according to a January 16 2012 report by local television station bTV.

The report, quoting a real estate agency study, said that property prices continued to fall in 2011, by nine per cent in Sofia and an average seven per cent countrywide.

However, the number of transactions was stable, according to the bTV report.

The number of transactions conducted in local currency the lev increased against those in euro, a reaction to speculation that the European Union’s common currency was headed for collapse, the report said.

More than half of those buying did so to meet their household need for accommodation, while most sellers – about a third – had put their properties on the market to get out of the investments, bTV quoted the agency as saying.

Repeating a refrain heard for several years, the agency said that the shape of the property market in Sofia in 2012 would be determined by the expansion of the public transport network as the metro railway is extended.

The agency said that it expected a 15 per cent increase in transactions in the residential areas of Nadezhda, Druzhba and Banishora, while completion of work on a metro extension would benefit the residential district of Lozenets.

Sofia Echo

Photo: Nadezhda Chipeva

Weighed down by heavy snow, Bulgaria woke up on January 27 2012 to closed roads, snow drifts of up to two metres and 121 villages without electricity.

The situation in Rousse remained severe, Bulgarian National Television said.

Efforts were being made to restore traffic access for lorries bound for Romania while at border crossings with Greece and Turkey, lorries were being held at parking bays.

States of emergency had been declared on January 26 in Svoge, Lovech, Ivanovo, Lisichevo, Batak, Velingrad and Popovo.

Emergency teams from electricity distribution companies and civil defence teams were working on restoring power supplies and clearing roads.

Sofia Airport had cancelled flights to Frankfurt and Bulgaria’s Black Sea city of Bourgas, according to Bulgarian National Television.

Overnight, snow in western Bulgaria had begun to stop but the situation remained difficult in the Danubian plain and in eastern Bulgaria.

A Code Orange weather warning was in force in Bourgas, Varna and Dobrich. Code Yellow was declared in the districts of Yambol, Sliven, Turgovishte, Rousse, Razgrad, Silistra and Shoumen.

Roads were closed in the Dobrich area, except for the road to Balchik. Most schools in Dobrich were closed for the day on January 27.

The Road Infrastructure Agency said on the morning of January 27 that the road between the town of Shoumen and the Black Sea city of Varna was closed. There were strong winds in Varna.

Roads in the Byala and Obzor areas on the route between Varna and Bourgas were closed.

In the areas worst-hit by snow, snowfalls were expected to end between 5pm and 7.30pm, making clearing-up operations easier.

Electricity distribution company CEZ told bTV said 22 settlements, all in the mountains, were without power. Road access was difficult but local authorities had promised that these roads would be opened by the end of the day to enable power restoration to go ahead, the company said.

Schools were closed in Gabrovo and Varna, bTV said.

Sofia Echo

Photo: Reuters

The world’s housing markets were on balance weaker during the year ending in the second quarter of 2011, according to the research house the Global Property Guide.

Housing markets were particularly weak in Europe and the United States, the research said.

Few European countries’ markets rose, most fell, and many worse-hit countries such as Ireland, Greece and Spain performed even worse this year than last year. The US figures were also disappointing, because of high unemployment.

Globally, more housing markets experienced price falls than rises. Only 13 out of 39 countries which have so far released data for the period saw house price increases during the year to end Q2 2011. Out of 26 countries with house price falls, 18 saw accelerated rates of decline.

The Global Property Guide said in a media statement that its statistical presentation uses price changes after inflation, “giving a more realistic picture than the more upbeat nominal figures usually preferred by real estate agents”.

Asia

Housing markets in some parts of Asia remain strong, despite government measures to cool price-rises, the statement said.

Hong Kong had the highest increase among all countries surveyed by the Global Property Guide, despite cooling measures implemented by the government. House prices were up 19.76 per cent over the year to end Q2 2011, after inflation, with a quarterly rise of 3.51 per cent.

The underlying dynamic has been Hong Kong’s very strong economic growth, with GDP up 5.1 per cent over a year earlier, and very low interest rates resulting from the Hong Kong dollar’s peg to the US dollar.

In Thailand, single-detached houses rose impressively by 7.75 per cent during the year to Q2 2011, after inflation, after last year’s fall of 4.83 per cent.

Thai house prices skyrocketed by 18.29 per cent during the second quarter.

“This rise probably resulted from the zero interest loan scheme launched by the Government Housing Bank (GHB), aimed at increasing home ownership among lower and middle class earners. However, it should be noted that the Thai house price database is dated and unrepresentative,” the statement said.

In Taiwan and Singapore, government curbs seem to have been effective, the study found.

House prices in Taiwan rose by only 6.43 per cent over the past 12 months, after a rise of 11.51 per cent the previous year. In Singapore, house prices rose by 5.27 per cent (after a massive rise of 34 per cent the previous year).

House prices in Japan (Tokyo) and China (Shanghai) are both weakening (falling by 0.52 per cent and 4.84 per cent year-on-year, respectively).

Americas

US house prices fell 9.05 per cent after inflation, a 5.93 per cent decline in nominal terms, in the second quarter from a year earlier, the largest decline since 2009, according to the Federal Finance Housing Agency (FHFA).

During the quarter, house prices dropped 2.33 per cent after inflation (a fall of 0.63 per cent in nominal terms).

US home values were pushed down by foreclosures, despite the lowest mortgage interest rates for more than half a century. The homes for sale inventory averaged 3.7 million during the second quarter, the highest since Q3 2010, according to the National Association of Realtors (NAR).

The key factor driving US foreclosures is the continued high unemployment rate. During the second quarter, unemployment in the US stood at 9.1 per cent.

Latin America’s housing markets seem vibrant, but the data is weak, the statement said.

In only a few Latin American countries are house-price statistics published. Brazil had the second largest reported house price rises in the world year-on-year to end Q2 2011. House prices in Brazil have enjoyed double-digit growth over the past two years, according to the FIPE-ZAP price index.

In Sao Paulo, advertised property prices rose by 19.50 per cent during the year to Q2 2011, with a rise of 5.17 per cent during the second quarter of 2011. Factors boosting Brazil’s real estate market include rapidly growing incomes and purchasing power, political and economic stability, an emerging middle class, and a growing population and availability of credit.

“We would expect other countries where reporting institutions have not yet published their house price data (Argentina and Colombia) to reflect this upward trend when their Q2 figures appear. We also believe house prices have risen in other fast-growing Latin American countries (Peru), where (in contrast) no house price statistics exist,” the statement said.

Photo: Nikolai Doichinov

In Europe

Prices of houses in Europe generally fell lower during the year to the second quarter of 2011. In fact, most European countries experienced faster rates of decline than last year.

The data can be grouped into several categories: a) faster declines this year than last, b) recoveries last year which have turned into declines, c) continued declines, but not as severe as last year, and d) actual recoveries (a small category).

Several European countries which saw house price falls last year performed even worse this year.

Ireland had the worst house price decline among all reporting countries in the survey over the twelve months to Q2 2011. House prices were down by 14.84 per cent year-on-year, an even worse decline than the 11.83 per cent fall the previous year.

European countries which experienced weaker performances than the previous year include Netherlands (-4.07 per cent), Slovak Republic (-6.49 per cent),Croatia (-6.55 per cent), Spain (-8.43 per cent) and Athens, Greece (-9.88 per cent) (all figures inflation-adjusted).

Some European countries which recovered last year, sunk back this year

In Latvia, standard type apartments in Riga fell by 5.4 per cent year-on-year, after a solid comeback since Q2 2010. Quarter-on-quarter, apartment prices were down by 3.8 per cent.

In the United Kingdom, average house prices were down by 5.33 per cent year-on-year, after rising 6.04 per cent the previous year. The housing market began rebounding as early as Q4 2009, but started falling again in the last quarter of 2010.

“The price-falls in the UK are interesting, because UK interest rates have been low and sterling has fallen, attracting foreign buyers,” the statement said.

In Sweden, house prices slid by 1.35 per cent over the year to end Q2 2011, probably due to the 85 per cent mortgage ceiling introduced last year.

In Portugal, house prices have been falling since Q3 2010, and during the year to Q2 2011, prices dropped by 5.67 per cent.

In Germany, apartment prices have been slowing since the first quarter of 2011. During the full year to Q2 2011, prices dipped by 0.65 per cent.

In Finland, house prices rose, but were up a mere 0.18 per cent year-on-year, down from 10.24 per cent growth over the same period last year.

Other European countries which saw price falls last year, have continued to perform poorly this year, but in their case the rate of decline has decelerated.

In Lithuania, apartment prices were down 4.29 per cent over the year to end Q2 2011, a significant improvement than last year’s fall of 15.7 per cent.

In Ukraine, apartment prices in Kyiv were down 8.44 per cent (in nominal terms) over the past 12 months, after plummeting by 17.15 per cent the previous year.

In Russia, prices in the secondary housing market were down 5.25 per cent in the year to Q2 2011, after dropping by 8.06 per cent the previous year.

In Turkey, house prices were down by 1.55 per cent from a year earlier, after last year’s fall of 3.53 per cent.

A few European countries have seen their housing markets recover, the statement said.

Norway led the small group of European countries which experienced house price increases, up by 5.93 per cent over the year to end Q2 2011. Norway’s housing market began to rebound in Q3 2009 and hasnot slowed, driven by low interest rates and strong economic growth (4.8 per cent over a year earlier).

Housing markets in Estonia (Tallinn), France and Iceland rose during the year to end Q2 2011 after suffering house price falls in the previous year. In Tallinn, house prices were up 4.94 per cent year-on-year, after last year’s fall of 0.66 per cent. In France (data is from FNAIM), prices of existing dwellings rose 4.65 per cent year-on-year, after a fall of 1.71 per cent the previous year. In Iceland, house prices rose slightly by 0.60 per cent year-on-year, after plunging by 9.04 per cent during the previous year.

After a decade-long decline during the 1990s, the housing market in Switzerland has been stable since 2000. During the year to Q2 2011, apartment prices rose by 2.19 per cent year-on-year, up from 0.92 per cent the previous year.

Bulgaria

For Bulgaria, the survey found that in terms of house price changes – inflation-adjusted – the year-on-year Q2 2011 result was -10.65 per cent, against -11.16 per cent in Q2 2010. The quarter-on-quarter result for Q2 2011 was -2.27 per cent. In nominal terms, the house price change in Bulgaria for Q2 2011 was -6.41 per cent, against -9.65 per cent in Q2 2010.
The quarter-on-quarter result for Q2 2011, in nominal terms, was -1.59 per cent.

In July, according to Raiffeisen Real Estate, prices of residential property in Bulgaria’s capital city Sofia dropped by 10.1 per cent in the second quarter of 2011 compared with the same period of the previous year.

On a quarterly basis, however, housing prices in Sofia increased by 3.6 per cent.

In Plovdiv, Bulgaria’s second-largest city, prices of residential properties sold in April-June declined by 2.6 per cent on the year, but edged up 0.2 per cent quarter-on-quarter.

In the Black Sea city of Varna, the country’s third-largest, the average housing prices fell by 6.9 per cent against the same period of 2010 and by 1.5 per cent in quarterly terms.

Also in July, the National Statistical Institute said that Bulgaria’s residential property prices declined by 6.4 per cent year-on-year in the second quarter of 2011.

In quarterly terms, housing prices decreased by 1.6 per cent in Q2 2011.

Twenty-three regional cities registered quarterly drops in prices, with Veliko Turnovo recording the most significant decline of 5.5 per cent, followed by Gabrovo with 5.4 per cent and Vidin and Plovdiv with 4.7 per cent each.

In Israel

According to the Global Property Guide, Israeli house prices were up 5.4 per cent year-on-year to Q2 2011, but the pace is slowing due to the steps taken by Bank of Israel. These include interest rate hikes (currently 3.25 per cent) and the new limit on prime interest based mortgages (33 per cent of the property’s value).

During the second quarter, Israeli house prices fell by 3.38 per cent, the steepest decline since the last quarter of 2008. Furthermore, the continued increase in the number of building starts, and steps taken by the finance ministry in real estate taxation, are expected to be reflected in house prices in the course of the coming year.

“House prices are still over-stretched in many countries, and developed world economies are still weak, so price-falls were to be expected,” says Matthew Montagu-Pollock, publisher of the Global Property Guide.

“Low interest rates will be positive for housing, but only if the underlying economies recover. And recovery will ultimately bring a sting in the tail, because higher inflation would eventually bring higher nominal interest rates, choking strong upward house price movements,” Montagu-Pollock said.

Sofia Echo

Photo: Tsvetelina Belutova

In Bulgarian politics, conventional wisdom is that if you want to know how many ethnic Turks live in Bulgaria, look at the most recent election results to see how many votes Ahmed Dogan’s Movement for Rights and Freedoms got.

Well, here’s a comparison. According to the results of Bulgaria’s 2011 census, there are 585 024 people in Bulgaria who described themselves as being of Turkish ethnicity. A comparison: Dogan’s party got 610 521 votes in the July 2009 parliamentary elections, according to official records.

Assuming a direct correlation between Turkish ethnicity and voting for the MRF, and even allowing for the fact that some people counted in the census must have been below voting age, that does show a difference of about 25 500, give or take a vote or two. That may suggest that the MRF is able to reach beyond its traditional constituency. Oh, and any of Dogan’s detractors by now would be mumbling slanderously about vote-buying, no doubt.

But let’s move on, because you started reading this because the headline suggested this story would be about the number of foreigners living in Bulgaria, and who cares about the arcane practices of Bulgarian politics. In fact, that MRF story was there to show that the tale told by Census 2011 is one that requires a touch of interpretation, a dab of guesswork and probably too, a pocket calculator.

It also requires you to be able to understand Bulgarian, the only language in which the results were posted on the website of the National Statistics Institute. But then again, the language of Bulgaria is Bulgarian, officially, and by the way, of this country’s population of 7 364 570 people, about 5.6 million gave Bulgarian as their mother tongue.

Photo: Georgi Kozhouharov

Minor arcana

Which means that about 1.7 million people in Bulgaria do not use Bulgarian as their mother tongue.

So how many speak English? I hear you cry. Wait a bit, I’ve been too busy reading small-print spreadsheets and tapping on a calculator to give that away just yet.

Of the non-Bulgarian speakers, the mother-tongue list is:
Turkish 604 246 (sorry to harp on this, but that means more people speak Turkish than declare themselves to be ethnic Turks, but we shall get back to that);
Romani 280 979;
Armenian 5567;
Hebrew 141;
Vlach 1815;
Russian 15 211;
Tatar 1367;
Arabic 1321;
Greek 3182;
Macedonian 1376;
Romanian 5454; and
Wait for it… “Other” 9946.

Major arcana

That was, I hope, an interesting digression, but really may only indicate the mother tongue of people holding Bulgarian passports, even though foreigners were counted in this year’s census.

To try to get to the number of English-speakers, it is necessary to go to the table of details about foreigners who were in Bulgaria at that golden point in February 2011. Remember that figures for nationalities do not count in diplomats, who by law were excluded from being tallied in the census.

There are, for the record, 36 723 foreigners in Bulgaria, or at least there were in February 2011. Of these, by the by, 16 292 are men and 20 431 women.

From European Union member states, there were 8444, with the United Kingdom making up the biggest share of the EU group, at 2605 (1504 men and 1101 women).

Greece follows at 1253 (914 men and 339 women), Germany at 848 (515 men and 333 women), Poland at 819 (274 men and 545 women), Italy at 456 (376 men and 80 women) and the Czech Republic at 372 (128 men, 244 women). As a matter of interest, 26th on the list was Luxembourg, at four (all men).

Of non-EU Europe, unsurprisingly perhaps, Russia is top of the list, at 11 991 (this time, women far outnumber men – 2518 men and 9473 women; if anyone knows why this is so, please write and tell me).

Further in this category, there are Ukraine (3064), Macedonia (1091), Moldova (893) and Serbia (569); like the EU states, others straggle along to make up a total of foreign residents from non-EU Europe of 18 413.

From Africa, there were 429 people at the time of the census. Egypt topped the list, at 62, followed by Algeria, 59, and Nigeria, 50. These figures make the number of my South African compatriots quite respectable; it seems I am one of 37, and we are close to evenly split between men and women, politically-correct lot that we are.

From Asia, Turkey had 2741 (2221 men, 520 women) – so presumably we can add that figure to the number of ethnic Turks to bump up the number of Turkish-speakers – followed by Armenia (1167), China (749), Syria (729), Iraq (506) and Vietnam (173). For those who track Turkey’s EU bid, please note that the census classified Turkey as an Asian country.

Говорите ли Aнглийски?

Clearly, the only way to try to establish the number of English-speakers is to add up the number of people recorded as having been from countries either officially English-speaking, effectively so or where English is in common usage or, to jazz this up a little, where they reasonably may be expected to speak English; and no rude chauvinistic comments please, about each other’s forms of English (The Sofia Echo lives in a world where “the colour of the pavement is grey” rather than the “color of the sidewalk is gray” but that’s just our choice).

So, we have, as noted, 2605 people from the UK. Add the United States (524), Canada (64), Ireland (78), India (123), South Africa (37), Australia (34), New Zealand (11), Nigeria (50), Malta (eight) and round up a bit for a few people from other former colonial spots, throw in a guesstimate of people from countries likely to have a least a rudimentary-to-working knowledge of English, and you get something like 3500 to 4000 people, and even that higher figure may be conservative. Remember that under “mother tongue” the total in the “Other” category was 9946.

To complicate matters, under the category “did not declare” is the figure 47 458. But then again, while not putting on the spreadsheet a separate category for the English language, there also was not one for German, Italian, Spanish or French.

And finally, of course, there seems to be no official figure anywhere for the number of people, Bulgarians or foreigners in Bulgaria, who have English as a second language. That would require, presumably, a stout pair of shoes, a clipboard, paper, a pencil, time and funding. And no doubt, someone would ask why it was worth knowing at all.

Population count

The population of Bulgaria as of February 2011 is 7 364 570 people, of whom a third live in the country’s three biggest cities, Sofia, Varna and Plovdiv, according to the official results of this year’s census.

The results were announced at a news conference on July 21 2011

Ethnic Bulgarians make up 84.8 per cent (5 664 624 people), ethnic Turkish Bulgarians 8.8 per cent (588 318 people) and Roma 4.9 per cent (325 343 people), according to the census.

Of the overall population, 51.3 per cent are women and 48.7 per cent men.

About 72.5 per cent of the population live in cities. Sofia, which along with Varna has seen a population increase since the 2001 census, has 1 291 591 residents.

Sofia has seen a population increase of 10.3 per cent and Varna 2.8 per cent. The districts of Veliko Turnovo and Bourgas also have seen increases in population.

The biggest decreases in population have been in Lovetch (17.1 per cent), Vidin (16.2 per cent), Silistra (15.1 per cent) Razgrad (13 per cent) and Pleven (12.2 per cent).

Bourgas is the fourth-largest district, with 415 817 people, followed by Stara Zagora (333 265) and Blagoevgrad (232 552).

Census officials said that there were 255 cities and towns, together home to 5 339 001 people (72.5 per cent) and 50 047 villages, together with 2 025 569 residents (27.5 per cent) while in 181 settlements, the census recorded no people.

Twenty-one per cent of settlements had up to 50 residents and 36 per cent had between 100 and 500.

From people’s declarations of their religious affiliations, census officials concluded that Orthodox Christians made up 76 per cent of the population, Muslims 10 per cent. Protestants 1.1 per cent and Roman Catholics 0.8 per cent.

Sofia Echo

The airline will service the destination four times a week, starting from September 14, with a stop-over in Bucharest. The company started flights to Romania’s capital Bucharest in January.

Qatar Airlines has already started selling tickets for the destination.

As part of its aggressive entry into Europe, the airline has already started flights to Brussels, Stuttgart, Budapest, Venice. The company will also start flights to Oslo in October.

Currently, the air carrier services more than 100 routes in Europe, the Middle East, Africa, Asia, North and South America.

By 2013, the airline plans to offer direct flights to more than 120 destinations globally and to have a fleet of more than 120 aircraft.

Photo: Nadezhda Chipeva

A new Bulgarian speed train is going to reach the Black Sea coast from Sofia in about 3.5 hours, Tomislav Donchev, European affairs minister said while on a visit to Pernik, Bulgarian media reported on June 24 2011.

This is the largest railway project – currently under negotiation – due to receive European funding. The modern infrastructure will allow trains to reach Bourgas from Sofia in 3.5 hours, reaching speeds of about 160km/h, the report said.

According to Donchev, the “negotiations for the funding of railroad projects and infrastructure are going very well,” Dnevnik reported.

Bulgaria’s national railway carrier BDZ is yet to obtain the 140 million leva loan from the Bulgarian Development Bank (BDB), which was expected to support it with funds until the extension of a larger credit facility from the World Bank, the company’s chief executive Pencho Popov said earlier this month.

BDZ’s total liabilities amount to more than 500 million leva.

BDZ owes 4.5 million leva to oil company Lukoil for diesel fuel purchases. The carrier has been given an extension to pay its debts by the end of the June but if it fails to settle the debt, Lukoil may decide to suspend fuel deliveries to the company. BDZ owes about nine million leva to local company Transimpex for locomotive repairs, media reports said.

Sofia Echo

Ryanair, the world’s favourite airline, today (4 August) announced that it will open a new twice-weekly service from London Stansted to Plovdiv in Bulgaria which will commence on 2 November with fares from £32.99 one way inclusive of taxes.

Ryanair celebrated this new routes by releasing 500,000 £8 seats for travel on Tuesdays, Wednesdays and Thursdays in September. These “all in” low fares will be available on over 500 of Ryanair’s European routes but must be booked on www.ryanair.com before midnight on Thursday, 5 Aug.

Ryanair’s Laura McCormack said:

“Ryanair is delighted to announce our first Bulgarian route from London Stansted to Plovdiv. This new service will operate twice-weekly on Tuesdays and Saturdays with fares from only £32.99 one way inclusive of taxes which will go on sale tomorrow on www.ryanair.com. Plovdiv is Bulgaria’s second largest city with a rich and varied history dating back 8000 years. Plovdiv makes a great city break destination and is also within easy access of the ski resorts of Bansko and

Only Ryanair sells Europe’s lowest fares with a no fuel surcharge guarantee. In addition to our lowest fares we also deliver Europe’s No1 on-time performance across over 1,100 routes. Passengers can book our £8 seats for travel on over 500 European destinations in September. These seats can only be booked until midnight on Thursday (5 August) and are sure to be snapped up fast so we urge passengers to book them on www.ryanair.com before they sell out. Fares to Plovdiv start from £32.99 one way inclusive of taxes.”

Mortgage loans for foreign nationals and Bulgarians working abroad are back on the Bulgarian banking market in response to reviving demand, banks and credit consultants said.

Tihomir Toshev, executive director of credit consultant Credit Center, said interest in this type of loans was zero at the time when the crisis was at its worst, forcing lenders to withdraw such offers.

Other consultants say that banks are imposing new requirements, such as targeting borrowers from specific nationalities and financing the purchases of a property whose construction the lender has backed.

UniCredit Bulbank said on July 13 2010 that it had launched mortgages for foreigners and Bulgarians working abroad, who could choose from among a list of 22 projects financed by the bank.

Source: Dnevnik.bg

Despite flying “in bulk” to more than 150 destinations throughout Europe, low-cost airline Ryanair is very picky in choosing which airports it uses. Among the list of conditions that must be met, the most important is that the use of the airport must come cheaply.

This is one of the main reasons why the largest no-frills airline in the world is yet to launch flights to Bulgaria. But all of that could change now that several municipalities in Plovdiv region – Hissarya, Assenovgrad and Rodopi – have joined forces to draw more tourists by exploiting the proximity of Plovdiv Airport.

In 2009, the Bulgarian Government completed work on a large passenger terminal in the country’s second-largest city, investing more than 40 million leva in the construction, which for now stands empty.

Until April, the only regular arrivals to Plovdiv were by Russian airline S7 out of Siberia, which will resume flights in September.

Cargo flights are out of the question because Plovdiv Airport has no cargo terminal, so the only option is to attract passenger flights by low-cost airlines, since the traditional carriers operate flights to the not-so-distant Sofia.

To draw the interest of big-name players like Ryanair, the Cabinet halved the fees for Plovdiv Airport starting May 1 until May 1 2012. The airport fee is thus half that charged by Sofia Airport and and the passenger processing fee is three times lower.

There is still no contract with the Irish low-cost carrier, but people familiar with the situation say that there is an unspoken competition to win Ryanair’s business. On May 26, the airline’s officials met representatives of all civilian airports in Bulgaria and a technical review of the Plovdiv Airport is said to have been scheduled.

ECCENTRIC: Chief executive of Ryanair Michael O’Leary poses for photographers during a news conference in Vienna in November 2007.

I want to fly

The three municipalities set up on May 20 a fund for the development of Plovdiv Airport.

“The goal of this non-profit organisation is to raise funds and help the creation of permanent flights to Plovdiv Airport, as well as advertise the municipalities,” the executive director of Plovdiv Airport Doichin Angelov said.

Plovdiv city hall is expected to join the initiative and 20 more municipalities are in talks to do the same. The fund’s decisions are taken by majority vote of its board, which includes all mayors, while Plovdiv Airport has been retained as a consultant.

The money would be raised from tourist taxes, which hotels have to pay to local authorities. Additionally, a small local tax would be levied on residents of municipalities that have joined the fund. For the three municipalities now on board, that would generate an estimated 56 000 leva a year.

“It is an opportunity for joint action if any given municipality cannot manage on its own,” the governor of Plovdiv region, Ivan Totev, said. “The fund is a mechanism to share risk, a practice common in the West, but not used a lot in Bulgaria,” he said.

The example that the local authorities in Plovdiv hope to emulate is that of Girona Airport in Catalonia, about 92km from Barcelona, which Ryanair picked as one of its destinations in 2000.

“After the creation of a similar fund by Catalonian municipalities, an airport that had no passengers managed to build a passenger flow of eight million people,” Totev said. “Such a practice can be used in other fields, Plovdiv Airport is just one separate case.”

The first step is to help attract airlines to use Plovdiv Airport, which is now underused, followed by the establishment of regular bus lines between individual municipalities and the airport.

After the local authorities announced their plans, the immediate follow-up question was whether the money would be treated as state aid. The fears are that the airline could be compensated under certain conditions, such as flights not being sold out.

“There can be no talk of state aid because the fund was not set up to help a particular airline,” Totev said.

The proposed solution is that airlines would sign separate contracts with Plovdiv Airport and the fund, the second one being optional and carrying certain obligations for both sides. “The airlines would be paid by the fund in return for advertising space on their websites, promoting [Bulgarian] municipalities and their tourist attractions,” Angelov said.

Like many other low-cost airlines, Ryanair flies mainly to regional or secondary airports that charge lower fees. Sometimes, these airports happen to be even closer to the central city areas than the main airports, as is the case with Belfast, Gothenburg and Rome.

Cheaper is better

Ryanair has the reputation of unscrupulously pursuing its agenda in all negotiations with airports, with the end goal being lower costs. It is no wonder that its chief executive Michael O’Leary is one of the least liked in the industry.

In the past, the airline has employed such tactics as pitting nearby airports against each other for its business and arm-twisting airports into agreeing to its terms. In April 2006, Ryanair surprised the management of Cardiff Airport by announcing an end to flights to Dublin. More recently, the airline said it would cease operations in Budapest and Prague starting with October 2010 because of the high fees.

This constant drive to minimise airport and ground personnel costs is the main reason for Ryanair’s ability to offer cheaper prices to its customers. As an example, by booking two months in advance, flying from London to Madrid would cost 35 euro with Ryanair, compared to about 150 euro using British Airways or Iberia.

The service offered for the lower price is also different – Ryanair passengers end up paying for extras like food, seat preference and luggage, as do customers of other low-cost airlines like easyJet and Wizz Air.

It is still unclear what destinations Ryanair would pick in Bulgaria and where those flights would be headed. But according to an Economy Ministry source, the expectation is that Plovdiv would be linked to five destinations and flights could be launched as early as September.

Kapital weekly, issue 22

About 600 British property owners have not paid their estate taxes in the Bulgarian resort town of Pamporovo for the past two years, Bulgarian news agency BTA said on July 1 2010.

According to Chepelare deputy mayor Georgi Pepelanov, the municipality has sent nearly 600 letters to debtors, addressed to the UK, in which the owners concerned are “kindly requested” to pay their taxes.

The municipality’s mailings cost 600 leva, as each letter costs about one lev, the report said.

Perhaps to defuse tension, Pepelanov said that the municipality is certain that this was not a deliberate evasion but merely a misunderstanding between the British owners and the companies managing their properties in Bulgaria.

However, the municipality is also owed a large sum from local hotels in the resort of Pamporovo.

According to the BTA, the sum owed by the British and the hotels amounts to 600 000 leva in total.

“Russians and Spanish nationals also have property here but they have paid taxes on time,” Pepelanov said.

So far, the municipality has only received about a third of the money owed to it by hotels in Pamporovo.

The Sofia Echo

One of Europe’s largest low-cost airlines, Ryanair, plans to start flying to and from Bulgaria’s second largest city of Plovdiv in September 2010, Bulgaria’s Deputy Economy and Tourism Minister Ivo Marinov was quoted as saying by Bulgarian-language media.

But to launch flights to Bulgaria, Ryanair asked for lower landing fees charged by the country’s airports, Marinov said during a discussion in Parliament on the topic of Bulgarian tourism. It was a demand that the Cabinet was now considering for the less-used Plovdiv airport, at least for a period of two years.

Plovdiv would be Ryanair’s first destination in Bulgaria.

Bulgarian-language Dnevnik daily also quoted Ivelina Grozdeva of the Bulgarian Hotel and Restaurant Association as saying that Ryanair should be allowed to also operate flights to Sofia, Bourgas and Varna.

The Sofia Echo

Bulgarian PM Borisov (standing) and Finance Minister Djankov during Friday's news conference during which they made staggering revelations that the country's budget deficit doubled in 2009. Photo by BGNES

Bulgaria’s 2009 budget deficit has doubled as a result of “hidden” contracts made by the Stanishev Cabinet, the Borisov government has announced.

Finance Minister Simeon Djankov stated that the state budgets for 2008 and 2009 will have to be revised and recalculated because of the contracts in question made by the previous government that the Ministers of Boyko Borisov were not made aware of when they took over in July 2009.

“We are going to revise voluntarily the budgets for 2008 and 2009, according to our best estimates at the current moment – unless there are more surprises, of course, that might be hidden somewhere else in the drawers of the various ministries. Thus, with the hidden contracts of the previous government that have recently emerged, our 2009 budget deficit almost doubles – from 1,9% to 3,7%,” Djankov declared at a joint news conference together with Prime Minister Boyko Borisov and Economy Minister Traicho Traikov.

Djankov emphasized the fact with the emergence of the “surprising” new deficit, Bulgaria no longer meets the Eurozone criteria as its budget deficit is over 3%.

Djankov and Borisov revealed that they had notified the EU institutions about the 2009 “hyper deficit”, as they call it, on Thursday afternoon.

“Unwillingly, our government has become part of the lies that our predecessors had been telling the EU institutions in Brussels. We have even lied involuntarily when we applied to the ERM II as well. We were telling the Eurozone we are ready without knowing that the previous government had laid this trap for us,” PM Borisov said.

“This doubling of the 2009 budget deficit means at least two things. First, it is very likely that now that our European partners know about these results, Bulgaria may face infringement procedures because it actually had a hyper-deficit in 2009. Every single time that the Bulgarian Socialist Party has been in power, Bulgaria has gotten into financial trouble. This happened after the Lukanov government, after the Videnov government, and now after the government of Sergey Stanishev,” Finance Minister Djankov stated.

He emphasized that the sanctions that Bulgaria might have to face on part of Brussels most likely would entail regular monitoring of the country’s finances, and respective reports every six months, which means that Bulgaria will not be able to apply to join the ERM II in 2010 as Djankov originally planned.

The Finance Minister pointed out that because of the unforeseen expenses the government will have to make under the “hidden” public procurement contracts, it will have to revise the adopted anti-crisis package of 60 measures by cutting state spending even further.

Sofia News Agency (novinite.com)

Bulgaria's center-right government has blamed their Socialist predecessors for the dashed hopes for entry into ERM II in 2010. Photo by BGNES

Bulgaria’s center-right government abandoned plans on Friday to apply to join the bloc’s exchange-rate mechanism, the so-called Eurozone waiting room, over a larger than expected 2009 deficit caused by unaccounted procurement deals, signed by the previous Socialist-led cabinet.

“It would be insolent to apply for ERM II and the eurozone given the high levels of the deficit”, Prime Minister Boyko Borisov told a news conference. “We have in fact lied to our (EU) colleagues about our readiness for the euro zone being unaware of this trap.”

Bulgaria’s Finance Minister Simeon Djankov told the same press conference that the country’s aspirations to join ERM II will not be rewarded this year.

“Bulgaria’s hidden budget deficit has ruined its dreams of joining the eurozone due to financially unaccounted procurement deals, which increased the 2009 gap to 3.7% of gross domestic product (GDP) from an initial 1.9%,” Minister Djankov said.

He announced that the budgets for 2008 and 2009 will be revised after annexes to a total of 150 contracts incurred losses to the budget worth BGN 2,15 M.

“We were expected to be a fiscal model for the other European countries together with Estonia, now I will feel only shame in Madrid ( at the meeting of the EU finance ministers next week) when I tell my colleagues what has happened,” Djankov fumed.

“Europe does not make a distinction between current and former governments. I represent Bulgaria and now it is a shame,” he added.

The finance minister stressed that the revision of the budgets from the last two years will not reflect on the budget for 2010 and the government will do its best to keep the budget deficit under 3% in line with the Maastricht criteria.

“This year, there is no risk for the fiscal stability, the currency board and the banking system thanks to our tight fiscal policy,” Djankov said.

Joining the exchange-rate mechanism was assigned top priority for this year by the new Bulgarian center-right government, which was the reason why it stuck to tight financial policy at the end of 2009 and delayed payments to businesses in a bid to keep low the budget deficit.

Minister Djankov, a World Bank economist, hoped to offset a possible reluctance to admit Bulgaria into the ERM, stemming from the global crisis, by garnishing the application with a targeted balanced 2010 budget, small 2009 deficit and laws overhauling the inefficient health-care and social-security systems.

Entry into the so-called Eurozone waiting room would have brought Bulgaria closer to the umbrella of the euro region and the protection of the European Central Bank and was conditional on whether the new government would succeed to restore Brussels trust and the budget deficit that the country has posted.

Countries must be members of ERM II for two years before they can formally join the eurozone.

Bulgaria so far believed that it could be ready for euro entry by 2013.

Sofia News Agency (novinite.com)

The Ryanair delegation is expected to arrive in Bulgaria on April 6 and will remain in the country until April 15.

“They will meet with the Transport Minister Alexander Tsvetkov and subsequently will travel to Plovdiv, where we are to finalise our potential agreement with them,” Angelov said in the statement.

Ryanair has been showing interest in Bulgaria for several years. But as airport taxes are poised to become three times cheaper than those at Sofia as of April 1, the reality for the line to be launched becomes ever more real.

A forum between the Plovdiv municipal administration and the Bulgarian-Catalan chamber of commerce BGCAT was held in Plovdiv on March 23.

Meanwhile, Sofia Airport said that Danish budget carrier Cimber Sterling will link Copenhagen and Sofia and flights will be conducted biweekly, on Thursdays and Sundays, Dnevnik reported. Currently there is no direct flight to the Danish capital. The flights will start on March 28.

Bulgaria Air used to fly Copenhagen, but the service was withdrawn in 2006.

The newest attraction at the resort is floodlights installed at the Snejanka 3 slope as well as the Stanata (The Wall), Pamporovo’s most demanding slope. The media statement also says the complex is equipped with a new dental and first aid medical centre, Medicus Alfa, which will operate 24-hours.

The resort currently has more than 19km of slopes, 95 per cent of which can be serviced by snow cannons if needed. A brand new six-seater lift has also been installed as well as a recreational park and an “extreme park” all within the premises.

Finally, the report’s authorities believe that with the inauguration of the new border crossing point between Bulgaria and Greece at Zlatograd, many people in northern Greece will visit the resort, thus boosting the local economy.

Greek tour operators have been invited to attend the official inauguration ceremony on December 19. Tourists are also expected to flock from Serbia, Macedonia and Montenegro after the visa regime for the aforementioned countries is officially dropped the same day.

The carrier is S7 Airlines, described in a report by Bulgarian news agency Focus as the second-largest airline in Russia after Aeroflot.

Flights will be once-weekly on Fridays.

The airline has several connecting flights to destinations in the Middle East, which could boost passenger flow to Plovdiv, Focus said.

An upgrade of Plovdiv Airport was completed in 2009 after an investment of about 40 million leva, but more funds will be required to revamp the airport completely.

The airport, frequently used by tourists headed for Pamporovo and other Rhodope destinations, is said to service about two million passengers a year.

The Greek farmers strike was scheduled to start at 11am on January 18 and the farmers duly sealed off the border, but only for lorries. According to Greek authorities, lorries queuing on the border would be allowed to trickle through between 3pm until 5pm. However, vehicles ferrying timber and dairy products would not be allowed to pass, Dnevnik said.

For the time being, the other three border crossing points between Bulgaria and Greece were operating normally, although it was uncertain for how long.

Bulgaria’s Interior Ministry and border police have warned Bulgarians not to travel to Greece unless “absolutely necessary”. Authorities say that any trips to Greece while the blockade is enforced are likely to result in “serious delays, traffic jams and substantial financial losses”.

Greek daily Kathimerini said that more farmers from Serres were expected to descend on the Promachonas crossing on the border with Bulgaria from January 18, and that wider protests could follow in coming days as farmers stepped up their demands. The blockades are expected to last at least five days.

We were having lunch a short falling distance from the beginner’s slopes in Pamporovo, while her husband and my wife were off further up Snezhanka peak, skiing on slopes appropriate to their respective degrees of skill.

The Irish couple was from a town just south of the Northern Irish border. For her husband, it was the latest of many visits he had made in the past 20 years. It was her fourth, and she and two of her small children were sharing a novice skiing class with me. She laughingly confessed it was not the first time that she was trying to learn to ski. This time was to prove no success either. She and the children did not turn up after lunch on day two, and after that I found myself by default in an individual class. Not a bad thing, although she and the little children had made good company for me; but we Africans need special attention in skiing classes, because we are just not used to this crunchy white stuff called snow.

Back to lunch, and back to the Irish. Of her husband, the tourist told me: “he just loves Bulgaria. And so do I”.

There were many accents like hers to be heard in Pamporovo in that week, cheering each other on down the slopes, keeping the bar people busy, and occasionally braving an attempt to haggle with Pamporovo’s taxi drivers.

All this past year I had followed with great interest the unfolding saga of Bulgaria’s tourist industry. The Sofia Echo takes the subject sufficiently seriously that we run a column on it every week. Of course, few Bulgarian newspapers of note had failed to record the reports published in foreign countries about tourism in Bulgaria.

Conventional wisdom has come down to a number of points. One is that Bulgaria’s tourism industry is ever-growing. Another is that a threat to it is that the country will not remain affordable, and related to this point is that the country will have to do a lot more than simply sell itself on the basis of being cheaper than other destinations. A further, and much-reported, issue has been that of “construction tourism” at seaside and winter resorts, with construction continuing during the respective high seasons, and alienating visitors.

Well yes, I had seen media reports of some controversy about construction continuing at Pamporovo, although during our daily commuting between our hotel and the slopes, I saw no evidence of it. Yes, Pamporovo is less “affordable” than it was when we first visited together four years ago.

Time for a few realities. The Irish tourist couple did not regard cost as any kind of factor. Before you rush to say that spending leva means nothing to wealthy Europeans, this is a couple composed of a husband who is a teacher, and a wife who broke off her career eight years ago to produce their three children – the youngest just 11 months ago.

What was it this couple enthused about? The atmosphere. The people – Bulgarians, themselves. As the tourist put it to me, “the hospitality, the warmth, the ability to have a good time, to put themselves out for us”.

I wish all the skeptics could have heard this conversation, including those who say that Bulgarians have learnt nothing about the service ethic.

Listening to her, I responded that the night before our conversation, I had seen BNT’s programme Dalekogled, which had featured an Irish expatriate saying that he had felt very much at home in the past four years here because, he believed, the Irish and Bulgarians had very much in common, at the level of the soul and in approach to life.

She agreed, and said she believed that was one of the reasons her husband had come back so often.

When I met him, I said to her husband that I was very glad to meet a “return tourist” because of concerns that people would come to the country only once, tick it off their list – or go home with bad word of mouth because of “construction tourism” or bad service – and never come back.

He laughed, his face red with the exertion of the slopes, and said he hoped to come back many, many times.

His wife did not feel in the least deprived by her continuing inadequacy at learning to ski.
“The apres-ski is the best thing, after all, isn’t it?”

The attractions of Pamporovo’s bars and restaurants were, it seems, one of the reasons that she and some of the other tourists removed themselves from the slopes at one stage or another. “Bulgarian wine is very good, but it goes down rather too easily. So I’m feeling a bit pale today. Still, I wish it were easier to get it in Ireland. The stuff they export really isn’t the best”.

I smiled when she asked me whether or not the country was in the European Union. Living every day with coverage of the issue of whether or not Bulgaria will deal adequately with major issues like judiciary reform and thus meet its January 2007 appointment, I found it refreshing to meet someone to whom it was not a real issue, and who had half an impression that Bulgaria already had achieved this Holy Grail of European respectability.

All around me foreign tourists, including one Western diplomat and his wife who were happily incognito, were having a good time, and it is correct to record my own impressions, those of someone who is now in his fourth year of living in Bulgaria. In a word: good. Rental of ski equipment, and the lessons, were not cheap but nor were they exorbitant. Service everywhere was decent. With the exception of New Year’s Day, machines cleaned the roads to keep them safe. There was much more signage in English (and in better English) than during my first visit four years ago.

And if I sound in a good mood, it is not that the people of Pamporovo slipped me a few leva to write something nice about them. It is because, with the very patient teaching and encouragement of a young lady called Biserka, and with a tumble or four, and a few stops to catch my breath, on New Year’s Day, I somehow made it down the green slope of Snezhanka. For a middle-aged African, that’s not bad, don’t you think? It’s enough to make me want to go back.

All Bulgarian – Greek border checkpoints, including the newly opened Zlatograd-Xanthi checkpoint, were operating normally on January 16, media reports said, after the previous day the Ilinden – Eksohi checkpoint was blockaded for 90 minutes.

People should avoid travelling to Greece, Bulgarian news agency Focus quoted deputy regional governor of Blagoevgrad Georgi Bahanov as saying after the meeting at Kulata border checkpoint with his counterpart deputy regional governor of Serres, Tomas Syambris, and a representative of the police Nikolas Rizos.

The Greek side offered an alternative route for drivers through Zlatarevo border checkpoint, Valandovo and Gevgeli.

Farmers have said that they would continue the protest for a further five days from January 18, but this depends on the outcome of negotiations. The farmers want to be paid 2009 subsidies that are in arrears, and have indicated that the strike could become indefinite until this happens.

Bulgaria said that bodies including the border police, Bulgarian Red Cross, emergency services and local authorities had been briefed on steps to take in the event of a sustained blockade and were co-ordinating their actions.

Bulgarian National Television (BNT) said that the January 16 meeting between the deputy governors of Blagoevgrad and Serres was held to discuss how to deal with traffic flow in the event of a further blockade.

Bulgaria was requesting clear rules on how traffic flow would work, not only for light vehicles but also for TIR lorries, BNT said.

Greek daily Kathimerini said that wider protests could follow in the days ahead as farmers stepped up their demands.

On January 15, about 120 tractors were used to close the national road near the Strymonas bridge in northern Greece. Motorists had to use a diversion which took them onto the old Thessaloniki-Kavala highway via Asprovalta. The same day, farmers from Kastoria also set up intermittent blocks on the road leading to the Albanian border.

Kathimerini said that more farmers from Serres were expected to descend on the Promachonas crossing on the border with Bulgaria from January 18.

On January 16, before the meeting between the Blagoevgrad and Serres officials started, Focus quoted Todor Georgiev, head of the regional customs office in Smolyan, as saying that Bulgarian motorists should check the situation before travelling to Greece.

This could be done at the Interior Ministry website, and people should check news websites as well, Georgiev said.

Bulgarian citizens travelling to Turkey were advised to use the Lesovo and Malko Tarnovo border checkpoints.

The alternatives to the Kapitan Andreevo – Kalotina border checkpoints are the crossings along the Bulgarian-Serbian border: Vrashka Chuka, Bregovo, Stezimirovtsi and Oltomantsi or to Romania via the Danube Bridge and to Macedonia via Gyueshevo crossing, Focus said.